Stock Code: 600415 Stock Abbreviation: 小商品城
Zhejiang China Commodities City Group
Co., Ltd.2022 Annual Report
Important Note
I. The Board of Directors, the supervisory committee and the directors, supervisors andsenior management of the Company hereby warrant the truthfulness, accuracy andcompleteness of the contents of the Annual Report, guarantee that there are no falserepresentations, misleading statements or material omissions contained in thisAnnual Report, and are jointly and severally responsible for the liabilities of theCompany.
II. All directors of the Company were present at the board meeting.
III. Ernst & Young Hua Ming Certified Public Accountants (special general partnership)
has issued a standard unqualified audit opinion for the Company.
IV. ZHAO Wenge, Head of the Company, WANG Dong, Head in charge of accounting, andZHAO Difang, Head of the accounting department (Accounting Supervisor), declarethat they warrant the truthfulness, accuracy and completeness of the financial reportin the annual report.
V. The profit distribution plan for the reporting period or the plan for public reserve fundsinto share capital that was approved by the board of directorsBased on the total share capital on the registration date of profit distribution equity in 2022,cash dividends of RMB 0.65 (tax inclusive) will be distributed for every 10 shares. According tothe total share capital of the Company at the end of 2022, cash dividends of RMB356,594,821.44 (tax inclusive) will be distributed. In the event of changes in the total share capitalof the Company before the dividend distribution registration date, the scheme of allocation shallremain unchanged while the total profits distribution will be adjusted accordingly.
VI. Risk statement with forward-looking representations
√Applicable □Not applicable
The forward-looking representations involved in this Report such as future plans anddevelopment strategies do not constitute the Company’s substantial commitments to investors.Investors shall watch out for the investment risks.
VII. Is the Company’s cash occupied by its controlling shareholder or any of other
affiliates for non-operational purposes?No
VIII. Has the Company provided external guarantee in violation of the prescribed
decision-making procedures?No
IX. Whether more than half of the directors can not warrant the truthfulness, accuracy
and completeness of the annual report disclosed by the CompanyNoX. Reminder of major risks
The Company has described the risks that may exist in this Report in details. Please referto “Potential Risks” in “Section III Discussion and Analysis of Managers” of this Report.
XI. Others
□Applicable √Not applicable
Table of Contents
Section I. Definitions .......................................................................................................................... 5
Section II. Company Profile and Financial Highlights .................................................................... 6
Section III. Discussion and Analysis of Managers ......................................................................... 13
Section IV. Corporate Governance .................................................................................................. 49
Section V. Environmental and Social Responsibilities ................................................................. 75
Section VI. Significant Matters .......................................................................................................... 77
Section VII. Changes in Shares and Shareholders ........................................................................ 90
Section VIII. Preferred Shares .......................................................................................................... 100
Section IX. Bonds ............................................................................................................................. 101
Section X. Financial Report............................................................................................................ 110
| Documents for Inspection | Accounting statements with the signatures and stamps of the person incharge of the Company, person in charge of accounting and person in charge of the accounting body. |
| The original audit report with the seal of the accounting firm and the signature and seal of the certified public accountant | |
| The originals of all company documents and announcements publicly disclosed during the reporting period |
Section I. Definitions
I. DefinitionsFor the purpose of this Report, unless otherwise stated in the context, the following terms shallhave the following meanings:
| Definitions | ||
| SCO | means | Yiwu State-owned Capital Operation Co., Ltd. |
| MDG | means | Yiwu Market Development Group Co., Ltd. |
| CCCH | means | Yiwu China Commodities City Holdings Limited |
| Zhijie Yuangang | means | Zhejiang Zhijie Yuangang International Supply Chain Technology Co., Ltd. |
| CCCP | means | Yiwu China Commodities City Property Development Co., Ltd. |
| CCCF | means | Yiwu China Commodities City Financial Holdings Co., Ltd. |
| Huishang Micro-finance | means | Yiwu Huishang Micro-finance Co., Ltd. |
| Haicheng Company | means | Haicheng Yiwu China Commodities City Investment Development Co., Ltd. |
| Yiwu Shanglv | means | Yiwu Shanglv Investment Development Co., Ltd. |
| Chouzhou Financial Lease | means | Zhejiang Chouzhou Financial Lease Co., Ltd. |
| Yiwu Shangbo | means | Yiwu Shangbo Yuncang Enterprise Management Co., Ltd. |
| Handing Shangbo | means | Yiwu Handing Shangbo Real Estate Co., Ltd. |
| Huangyuan Shangbo | means | Yiwu Huangyuan Shangbo Property Co., Ltd. |
| The Company, the Listed Company or the Group | means | Zhejiang China Commodities City Group Co., Ltd. |
Section II. Company Profile and Financial Highlights
I. Company profile
| Chinese name | 浙江中国小商品城集团股份有限公司 |
| Chinese short name | 小商品城 |
| English name | Zhejiang China Commodities City Group Co.,Ltd |
| English short name | YIWU CCC |
| Legal representative | ZHAO Wenge |
II. Contact information
| Board Secretary | Securities Affairs Representative | |
| Name | XU Hang | RAO Yangjin |
| Address | Haiyang Business Building, No.105 Futian Road, Yiwu | Haiyang Business Building, No.105 Futian Road, Yiwu |
| Telephone | 0579-85182812 | 0579-85182812 |
| Fax | 0579-85197755 | 0579-85197755 |
| Hxu@cccgroup.com.cn | Hxu@cccgroup.com.cn |
III. Basic Information
| Registered address | Haiyang Business Building, No.105 Futian Road, Yiwu, Zhejiang Province |
| Office address | Haiyang Business Building, No.105 Futian Road, Yiwu, Zhejiang Province |
| Postal code at the office address | 322000 |
| Corporate website | www.cccgroup.com.cn |
| 600415@cccgroup.com.cn |
IV. Places for information disclosure and access to the annual report
| Media's names and websites selected by the Company for annual report disclosure | China Securities Journal, Shanghai Securities News and Securities Times |
| Stock exchange website selected by the Company for annual report disclosure | www.sse.com.cn |
| Place for access to the Company’s annual report | Securities Department of the Company |
V. Stock profile
| Stock profile | ||||
| Type of stock | Exchange | Stock short name | Stock code | Stock short name before change |
| A share | Shanghai Stock Exchange | 小商品城 | 600415 | Nil |
VI. Other relevant information
| CPAs engaged by the Company (domestic) | Name | Ernst & Young Hua Ming Certified Public Accountants (special general partnership) |
| Office address | 16 th Floor, Ernst & Young Building, Oriental Plaza, 1 Chang'an Street, Dongcheng District, Beijing, China | |
| Name of the Signing Certified Public Accountants | YIN Guowei, HUANG Zhigang |
VII. Major accounting data and financial indicators in the past three years(i) Major accounting data
Unit: RMB
| Major accounting data | 2022 | 2021 | YoY change (%) | 2020 |
| Operating revenue | 7,619,693,742.60 | 6,033,842,972.95 | 26.28 | 3,725,686,100.39 |
| Net profits attributable to shareholders of the Listed Company | 1,104,719,091.71 | 1,334,095,906.95 | -17.19 | 926,626,706.42 |
| Net profit attributable to shareholders of the Listed Company after deducting non-recurring profits and losses . | 1,765,087,553.23 | 1,221,808,001.15 | 44.47 | 517,246,267.88 |
| Net cash flow from operating activities | 1,400,090,713.77 | 2,033,082,507.76 | -31.13 | 828,788,261.95 |
| At the end of 2022 | At the end of 2021 | YoY change (%) | At the end of 2020 | |
| Net assets attributable to shareholders of the Listed Company | 15,262,290,780.57 | 14,610,845,868.33 | 4.46 | 13,558,228,377.08 |
| Total assets | 32,111,004,317.38 | 31,014,635,513.35 | 3.54 | 28,750,127,146.86 |
(ii) Major financial indicators
| Major financial indicators | 2022 | 2021 | YoY change (%) | 2020 |
| Basic EPS (RMB) | 0.20 | 0.25 | -20.00 | 0.17 |
| Diluted EPS (RMB) | 0.20 | 0.25 | -20.00 | 0.17 |
| Basic EPS after deducting non-recurring profits and losses (RMB/share) | 0.32 | 0.22 | 45.45 | 0.10 |
| Weighted average ROE (%) | 7.30 | 9.38 | Down 2.08 ppt | 6.88 |
| Weighted average ROE after deducting non-recurring profits and losses (%) | 11.67 | 8.59 | Up 3.08 ppt | 3.84 |
Explanation of main accounting data and financial indicators of the Company in the previousthree years at the end of the report period
√Applicable □Not applicable
1. The Company’s operating revenue increased by RMB 1.586 billion YoY, mainly due to theincrease in the sales of goods during the current period.
2. The net profit attributable to shareholders of the listed Company decreased by RMB 229
million compared with the same period of the previous year, mainly due to the implementationof the rent reduction policy, which resulted in a decrease of RMB 840 million in operating
gross profit, the increase of RMB 407 million in investment income and the decrease of RMB281 million in income tax expenses compared with the same period of the previous year.
3. The net profit attributable to shareholders of the listed Company after deduction of non-recurring profits and losses increased by RMB 543 million compared with the same periodof the previous year, mainly due to the decrease of RMB 229 million in net profits attributableto shareholders of the listed Company and the increase of RMB 773 million in non-recurringprofits and losses compared with the same period of the previous year.
4. The net flow generated by operating activities decreased by RMB 633 million compared withthe same period of the previous year, mainly due to the decrease of RMB 916 million YoY inthe net cash received after deduction of payment for sales of goods and provision of serviceand the increase of RMB 319 million YoY in the tax refund received.
VIII. Differences in accounting data between foreign and Chinese accounting standards(i) Differences between the net profit and net assets attributable to shareholders of theCompany disclosed in accordance with international accounting standards andChina accounting standards in the financial report
□Applicable √Not applicable
(ii) Differences between the net profit and net assets attributable to shareholders of theCompany disclosed in accordance with overseas accounting standards and Chinaaccounting standards in the financial report
□Applicable √Not applicable
(iii) Explanation of differences between domestic and overseas accounting standards
□Applicable √Not applicable
IX. Key financial indicators by quarter in 2022
Unit: RMB
| 1st Quarter January to March | 2nd Quarter April to June | 3rd Quarter July to September | 4th Quarter October to December | |
| Operating revenue | 1,597,965,861.91 | 2,609,061,754.55 | 2,113,429,925.63 | 1,299,236,200.51 |
| Net profits attributable to shareholders of the Listed Company | 672,246,046.23 | 549,959,932.58 | 397,670,847.78 | -515,157,734.88 |
| Net profit attributable to shareholders of the Listed Company after deducting non-recurring profits and losses | 656,190,767.01 | 525,525,039.63 | 379,914,236.83 | 203,457,509.76 |
| Net cash flow from operating activities | -658,351,559.97 | -8,235,773.65 | 329,304,785.87 | 1,737,373,261.52 |
Explanation of difference between quarterly data and disclosed data in regular reports
□Applicable √Not applicable
X. Non-recurring items and amounts thereof
√Applicable □Not applicable
Unit: RMB
| Non-recurring items | Amount for 2022 | Remark (if applicable) | Amount for 2021 | Amount for 2020 |
| Profits or losses from the disposal of non-current assets | -1,130,587.34 | -561,416.89 | 383,206,932.21 | |
| Government grants that are recognized in the current profit or loss, excluding the government grants that are closely related to the normal operation of the Company and are provided in a fixed amount or quantity continuously according to the national polices and certain standards | 38,802,436.81 | Please refer to details of other income and government grants accounted for profit or loss for the current period | 23,559,898.01 | 18,655,980.14 |
| Cash occupation fees charged from non-financial enterprises that are recognized in the current profit or loss | 52,315,023.80 | Cash occupation fee for receiving financial aid | 107,299,598.45 | 124,744,826.38 |
| Gain arising from investment costs for acquisition of subsidiaries, associates and joint ventures by the corporation being less than its share of fair value of identifiable net assets of the investees on acquisition | - | - | 31,308,053.80 | |
| Profits or losses from changes in fair value of held-for-trading financial assets, derivative financial assets, financial liabilities held for trading and derivative financial liabilities, and investment income from the disposal of held-for-trading financial assets, derivative financial assets, financial liabilities held for trading, derivative financial liabilities and other debt instruments, except for effective hedging during the ordinary course of business | 166,489.60 | Mainly due to profits or losses arising from the change in fair value | 7,298,587.58 | -32,578,800.48 |
| Profits and losses arising from external entrusted loans | 79,561.64 | - | 11,786,857.07 | |
| Net income from other non-operating activities | 3,244,125.63 | 3,504,923.76 | -4,107,200.75 | |
| Other profit and loss items that meet the definition of non-recurring profit and loss | -975,086,670.50 | Mainly due to the implementation of the rent reduction policy | 1,604,200.49 | 688,953.43 |
| Less: effect of income tax | -223,084,975.36 | 28,698,936.71 | 122,917,029.51 | |
| Effect of minority interest (after-tax) | 1,843,816.52 | 1,718,948.89 | 1,408,133.75 | |
| Total | -660,368,461.52 | 112,287,905.80 | 409,380,438.54 |
Explanations shall be made for the non-recurring items identified by the Company according to the Explanatory Announcement No. 1 on InformationDisclosure by Companies Publicly Offering Securities – Non-recurring Items, and for the Company identifying the non-recurring items enumerated inthe Explanatory Announcement No. 1 on Information Disclosure by Companies Publicly Offering Securities – Non-recurring Items as recurring items.
□Applicable √Not applicable
XI. Items measured at fair value
√Applicable □Not applicable
Unit: RMB10,000
| Item | Opening balance | Closing balance | Changes for the current period | Amount of impact on current profits . |
| Held-for-trading financial assets | 7,537.51 | 6,233.10 | -1,304.41 | -12.71 |
| Other equity instruments investment | 64,218.80 | 49,920.08 | -14,298.72 | 1,254.27 |
| Other non-current financial assets | 152,481.93 | 150,030.76 | -2,451.17 | 2,765.87 |
| Total | 224,238.24 | 206,183.94 | -18,054.30 | 4,007.43 |
XII. Others
□Applicable √Not applicable
Section III. Discussion and Analysis of Managers
I. Discussion and analysis of operationIn 2022, the 20th National Congress of the Communist Party of China was successfully held,the "14th Five-Year Plan" entered a critical stage of implementation, and Yiwu Market celebratedits 40th anniversary. Under the guidance of "Yiwu's development experience" and thedevelopment strategy of "prospering businesses to build counties (cities)", Yiwu Market haswritten a legendary story in the history of China's economic development. It has experienced sixrelocations, twelve expansions, and five generations of transition. The form of the market rangesfrom regional trading, to buying and selling national products, and then to buying and sellingglobal products: the first generation of road market; the second generation of stall market; thethird generation of scaffolding market; the fourth generation of indoor market; the fifth generationof international trade city. Today's Yiwu Market brings together more than 2.1 million kinds ofcommodities in 26 categories. Here, "there is something you can't think of but nothing you can'tbuy." With more than 10,000 new products launched every day, Yiwu Market exports the quality,brand, and standard of small commodities to the world, and has become the "leader of ChinaChic" and "supplying place of hot styles". See Yiwu for global small commodities. The smallcommodity index has become a barometer of global small commodity trade.In 2022, Yiwu City achieved import and export of RMB 478.80 billion, an increase of 22.7%YoY. Among them, exports were RMB 431.64 billion, an increase of 18.0% YoY; imports wereRMB 47.16 billion, an increase of 93.5% YoY. Market procurement trade mode is still the mainforce to promote the growth of Yiwu's export share. Regionally, Southeast Asia, the Middle Eastand Latin America continue to occupy a relatively high market share in trade with Yiwu, and thecountries along the “Belt and Road” and in the “RCEP” region continued to bring opportunitiesto the Yiwu Market.During the reporting period, in the face of geopolitical conflicts and other impacts andchallenges, the Company anchored the strategic goal of "building a first-class international tradecomprehensive service provider", under the framework of a unified national market, promotedbusiness development as a whole, and broke through physical constraints of traditional businesswith digital reform, sped up the construction of a real economic ecology centered on the marketand a digital economic ecology centered on the Chinagoods platform.
(1) Physical market ecology
1. Overall situation of the market
In 2022, the Company's core competitiveness in the market was steadily improved. Duringthe reporting period, the Company took multiple measures to drive market operators to upgradefrom the era of information trade to the era of digital trade. The occupancy rate of market spaceremained above 98%, and the turnover was RMB 202.09 billion, an increase of 8.3% YoY,showing strong resilience and vitality.
(1) Second District East New Energy Product Market
In 2022, the Company took advantage of the Yiwu Market's product system, customergroups, trade services and new energy application product trade to create the first professionalmarket for new energy product display and trading in China—Second District East new energyproduct market. During the reporting period, the Second District East market completed part ofthe investment promotion work, and collected a total of RMB 856 million in admissionqualification fees and business space usage fees. At present, the Second District East markethas officially opened. A series of digital application scenarios have been implanted in the SecondDistrict East to build a digital market system. The digital market is based on the most cutting-edge digital trade concept, combined with the characteristics of Yiwu Market, to build an excellentexperience scene. Through cloud computing and trade Internet as information technologysupport, intelligent integrated management system is used for unified management and control,and the high availability of market intelligent operation is improved. Through the construction
and output of AI capabilities such as natural language theory, computer vision, machine learningand intelligent voice, it helps market participants (purchasers, business operators, etc.) toconnect with the market, to realize the application of industrial digital achievements in off-linemarkets.
(2) Overseas market
During the reporting period, Dubai Yiwu China Commodities City (hereinafter referred to asDubai Market) opened for business. It takes a 15-minute drive from Maktoum Airport and JebelAli Port, one of the largest ports in the Middle East, to the Dubai Market, effectively radiating theconsumer market of nearly 1 billion people around (the Middle East, North Africa, Europe, etc.).The Dubai Market is the first overseas submarket in the Company's "global strategy", and it isalso one of the important measures for the Company to integrate into the new developmentpattern of domestic and international dual circulation. Dubai is the "Gateway to the Middle East"and the largest trade distribution center for Made-in-Yiwu commodities in the Middle East. TheDubai Market is connected to the Yiwu Market. Through the gradual synchronization of products,it solves the pain points such as high procurement costs for some overseas buyers going to Yiwu,weak online display experience, and low online communication efficiency. Through commoditysales exhibition, bonded warehousing, transshipment, and others, the market can promotebilateral trade and industrial investment between China and UAE and its neighboring countries,and strive to be a win-win cooperation model of the "Belt and Road" Initiative.
(3) Comprehensive bonded zone
In 2022, Yiwu Comprehensive Bonded Zone insisted on digital reform to speed updevelopment, and through measures such as precise project investment promotion, refinedoperation management, innovative business expansion and other measures, achieved importvolume will over RMB 20 billion, ranking first among the newly approved comprehensive bondedzones in 2020-2022. Yiwu Comprehensive Bonded Zone launched the zone operationmanagement system of "e Zongbao", completed the construction of the station operationassistance system, customs digital large screen display system and other functional platforms;achieving the annual value of imported bulk commodities over RMB 10 billion, promoting theimplementation of the new model of "Yiwu-Xinjiang-Europe Cargo Train + comprehensivebonded zone + sea-rail combined transport", and radiating the surrounding manufacturingindustry through the "linkage between district and port"; achieving cross-border parcels out ofthe area over 25.1 million, and introducing 50 cross-border e-commerce platforms. The trend ofindustrial agglomeration was prominent, and the function of cross-border e-commerce goods
source gathering center gradually emerged. Copying and promoting "cross-border e-commerceretail import return center warehouse mode", Yiwu Comprehensive Bonded Zone broke throughthe last "kilometer" of cross-border e-commerce returns; introducing "bank + guarantee" mode,developing and implementing separate customs duty payment guarantee products.
2. Self-operated trade
During the reporting period, the Company entered the upstream and downstream of markettrade through self-operated trade, gave full play to the Company's platform and brandadvantages, linked trade with the market and fed back the market, forming a situation of virtuousand orderly cycle, with a trade revenue nearly RMB 5 billion.
3. Hotel, exhibition and advertisement
In 2022, the hotel sector achieved a revenue of RMB 180 million, bursting with vitality inadversity, with a growth of 41.43% YoY. During the reporting period, the hotel business line wasdeeply integrated with the chinagoods platform to optimize the full-link experience, develop aunified member marketing platform, build a private domain traffic pool, further promote theunified development and operation of members, and realize the traffic scale effect; it wasintegrated into the Company's market database, and the hotel community module constructionand product launch were completed.
In 2022, the exhibition and advertising sector achieve a revenue of nearly RMB 80 million,showing resilience in adversity. During the reporting period, the exhibition segment completedthe shareholding reform and continued to promote capitalization operations. The digitalization ofexhibitions was steadily advancing. Focused on the online layout of the four self-organizedexhibitions of Hardware Fair, Yiwu Fair, Forest Expo, and Cultural Tourism Fair, core digitalapplications such as digital marketing, online exhibitions, and smart exhibition halls were built,and traditional exhibition business was transformed into new digital business model.
4. Rent relief
During the reporting period, the Company reduced or exempted about RMB 1 billion in rentfor small and micro enterprises or individual industrial and commercial households. In order tofully promote the resumption of work and production of small, medium and micro enterprises andindividual industrial and commercial households, the Company reduced or exempted the rent for6 months in 2022 to the owners of the right to use the house (business space) that is a smalland micro enterprise or individual industrial and commercial household, and effectively assumedthe social responsibility of state-owned enterprises. These measures effectively reduced theoperating costs of individual industrial and commercial households, small, medium and micro
enterprises, unleashed economic vitality, helped small, medium and micro enterprises tostrengthen their confidence and overcome difficulties together, promoted the continuedprosperity of the market, and protected market entities, employment, and people's livelihood.
(2) Digital trade ecology
1. Chinagoods platform
During the report period, the chinagoods platform, driven by the integration of trade data,met the demands of supply and demand in production, exhibition and trading, warehousing andlogistics, financial credit, market management and other links, and built an open and integrateddigital trade comprehensive service platform, which is the core carrier for the Company to realizetrade digitalization.In 2022, the chinagoods platform achieved GMV of RMB 35.676 billion for the whole year,an increase of 112% YoY.
2. Industrial digitization
In 2022, the Company's industrial digitalization process was accelerated. The digital freetrade application of small commodities won the "Best APP" of Zhejiang digital reform in 2022.The registered purchasers of chinagoods platform exceeded 3.32 million, and more than 2,500foreign trade companies were linked. In view of the characteristics of scattered orders, LCLdeclaration, and no-ticket tax exemption in market procurement trade, combined with the "cargounitizer system", one-click "documentary procurement", "digital cargo examination", "loading and
shipping" and "smart customs declaration" can be realized with chinagoods Caigoubao. Theorder sheet, packing list, customs declaration form and foreign exchange settlement form areconnected in series to form a unique closed-loop information of market procurement trademethods; chinagoods platform logistics, overseas warehouses, supply chain financial servicesand other functions form a closed loop of logistics; licenses of the Company for payment,factoring, local and foreign currency exchange, and products such as Huokuanbao amdJiehuibao are used to form a closed loop of payment flow and capital flow. "Three FlowConvergence" simplifies trade links, improves trade efficiency, and helps Chinese smallcommodities go overseas.
3. Payment link was constantly improved
During the reporting period, the Company successfully completed the delivery of paymentlicenses, the adjustment of the new organizational structure has been filed with the regulatoryauthorities, and the new management team effectively carried out various tasks. On May 24,2022, the Company officially launched the promotion and construction of the e-CNY in theInternational Trade City. By building an e-CNY experience area in the market, launching “millione-CNY red envelopes” activity, etc., combined with the means of "online promotion and offlineguidance", the Company integrated chinagoods platform, the import and export company, themarket operation company and other sectors to jointly promote e-CNY, and provided 97.3% ofthe market tenants with e-CNY payment collection services. A total of 60,000 e-CNY walletswere opened, and the cumulative number of transactions was about 21,900, and the cumulativetransaction amount exceeded RMB 799 million. The Company obtained the qualification forcross-border RMB business, opened up the "Yiwupay" cross-border RMB payment channel, andcompleted the first cross-border RMB payment transaction between Yiwu and Saudi Arabia.From August 2022, the Company upgraded the Kuaijietong brand to create a new brand imageof "YiwuPay". According to the research and analysis of target users, corporate strategy, YiwuMarket and industry environment, brand positioning, core value extraction, VIS visual systemconstruction, system optimization and upgrading and other related brand work have beencompleted in an orderly manner. YiwuPay can support cross-border collections in 16 mainstreamcurrencies around the world. At present, it has reached cooperation with more than 400 banksaround the world, and its business covers more than 100 countries and regions, providing acompliant, safe and efficient integration for market trade payment solutions, using payment toempower the digital economy, improve the global digital trade service ecosystem, and help theCompany's industrial digital development.
4. Digital and intelligent development of contract fulfillment services
During the reporting period, the Company achieved phased results in cooperation projectswith COSCO SHIPPING and GLP, and established a joint venture company Zhijie Yuangang.The joint venture company leverages the resource advantages of all parties to create a third-party delivery platform for digital cross-border logistics, integrating into the Company's existingbusiness system, and connecting the upstream and downstream links of small commodity trade,improves the ecology of grouping people, shipping ecology, warehousing ecology, and financialservice ecology, etc., changes the "scattered" supply-demand relationship of various participantsin traditional foreign trade, and improves trade efficiency. The Company carries out businesscooperation extension with the joint venture company in the front-end warehousing link andback-end payment link of the performance of the contract, realizes LCL and export in Yiwu forglobal goods, improves the level of trade facilitation, forms a new market development drivingforce in the Yiwu area, and promotes the continuous prosperity of the Yiwu Market.In the future, the development of contract fulfillment will first be full link integration, followedby the rapid development of digital and intelligent performance services. The value of full-linkcollaboration contract fulfillment service system will become more and more prominent, anddigital intelligent construction is the key to improve the level of full-link collaboration. On the onehand, the joint venture empowers the development of Yiwu's foreign trade, enhances the vitalityof market subjects, provides stable shipping capacity and efficient storage resources in Chinaand abroad for Yiwu's foreign trade industry, and stabilizes the cross-border trade of smallcommodities. On the other hand, various trade services, including trade implementation, areconnected and integrated by the joint venture company through digital links to enlarge the overallservice functions, so as to reduce trade costs and improve trade facilitation.
II. Description of the industry of the Company during the reporting period
(1) Industry policies
1. National policies
General Secretary Xi Jinping pointed out in the article "Continuously Strengthening,Optimizing and Expanding China’s Digital Economy" published in the second issue of QiuShimagazine in 2022 that the digital economy can promote the rapid flow of various resourceelements and accelerate the integration of various market entities, help market entitiesreconstruct their organizational models, achieve cross-border development, break theconstraints of time and space, extend the industrial chain, and smooth domestic and foreigneconomic cycles.
On February 27, 2023, the Central Committee of the Communist Party of China and theState Council issued the "Overall Layout Plan for the Construction of Digital China", pointing outthat the construction of digital China is an important engine for promoting Chinese-stylemodernization in the digital age and a strong support for building new national competitiveadvantages.
On March 10, 2023, the first session of the 14th National People's Congress held its thirdplenary meeting, and voted to pass the decision on the institutional reform plan of the StateCouncil. China established National Data Bureau, and the newly established National DataBureau is responsible for coordinating and promoting the construction of data basic system,coordinating the integration, sharing, development and utilization of data resources, andpromoting the planning and construction of digital China, digital economy and digital society. Itis managed by the National Development and Reform Commission. The establishment ofNational Data Bureau demonstrates the important position of the construction of digital Chinaand the data resource system in the future national development strategy, and it is also a signalthat the construction of digital China is accelerating and reaching a new level.
2. Local policies
On February 1, 2023, the Yiwu Municipal Government Work Report stated that "we shouldfully release the enthusiasm, initiative, and creativity of 900,000 powerful market entities. It isnecessary to firmly and resolutely support, develop and prosper the market, seize the"commanding heights" in the small commodity division system, grasp the "right to speak", andlead the global trade fashion. "
Yiwu International Trade City has been in the forefront of the national comprehensive marketfor many years in terms of market turnover, and has formed the support of industrial clusters inthe field of small commodity circulation. As of 2022, the operating area of Yiwu Market reached
6.4 million square meters, with 75,000 physical stores, serving 2.1 million small, medium andmicro enterprises upstream and downstream. The Company provides market management,commodity sales and self-operated trade, chinagoods online platform, hotel and exhibitionservices around the Yiwu Market. Yiwu Market is an important platform connecting the domesticand international trade supply chains, and is at the key node of the global small commoditysupply chain. It plays an important role in smoothing the internal circulation, improving theexternal circulation, and serving the new pattern of "dual circulation". Yiwu is the leader anddemonstration center of market procurement trade in China, and has maintained high-speedgrowth for 7 years in a row, with a compound annual growth rate over 30%, which has effectivelyunlocked the validity of the market subject and further improved the convenience level of trade.
(2) Industry situation
1. 1039 market trade model
In the future, in China's consumption industry, the transformation and improvement of supplychain link are important industry opportunities. China's consumer industry has developed
relatively well on the TO C side, while the circulation mode in the TO B field is still relativelyprimitive in general. Digital transformation and industrial interconnection transformation will bringgreater room for efficiency improvement.
The Company focuses on its main business, continuously promotes the upgrade of onlineand offline markets, and is expected to lead the upgrading and transformation of the industrialInternet in the field of daily consumption and on the 1039 track. The first is the iteration of the1039 market trade model, which has been continuously upgraded to reduce the merchant'sexport declaration process, speed up the approval process, and improve export efficiency. Thesecond is the Company's 1039 platform, which relies on the resources of tens of thousands ofphysical stores in Yiwu Trade City to realize B2B industrial interconnection, speed up theefficiency of information circulation in the circulation link, and accumulate data to achieve qualityand efficiency. The third is the construction of a series of contract fulfillment facilities such asYiwu International Digital Logistics Market. The investment in these logistics facilities is expectedto further improve the contract fulfillment efficiency of merchants in Yiwu Market, and formsynergy with chinagoods and other businesses to continue to reduce the cost of daily consumergoods going overseas and continuously strengthen China's competitiveness in daily consumergoods market.
2. Yiwu-Xinjiang-Europe Cargo Train
2023 is the 10th anniversary of the release of the "Belt and Road" initiative. In 2014, the first"Yiwu-Xinjiang-Europe Cargo Train" of China-Europe Railway Express was opened. At present,the "Yiwu-Xinjiang-Europe Cargo Train" of China-Europe Railway Express has opened a total of19 lines, covering 51 countries and regions and reaching 160 cities. It operates 2,269 trainsannually, a 7-fold increase from 2015. The annual transportation volume exceeded RMB 40billion, a 4-fold increase from 2015. It has become the "Golden Ribbon" of the "Belt and Road"initiative and Sino-Euro communication.
Based on the import and export of small commodities in Yiwu, "Yiwu-Xinjiang-Europe CargoTrain" develops the upstream and downstream of the logistics industry chain, drives theupgrading of surrounding industries, fully integrates with the development of the digital economy,and brings extensive development room for the Company's offline market, logistics contractfulfillment, import trade, online chinagoods platform, and payment business.
III. Description of the business of the Company during the reporting period
According to the definitions in the Guidelines for Industry Classification of Listed Companies(revised in 2012) released by the CSRC, the Company is engaged in “Business Service” (L72)and “Lease and Business Service” (L).
(I) Main businesses
The Company is engaged in market development and operation and supporting services,providing online trading platform and services, online trading market development and operation,etc., belonging to the comprehensive industry category.
(II) Operating model
1. Market operation
Market operation business is mainly operated and managed by the Company'ssubordinate market branches. The main business income of the market operation segment ismainly the income from the use of shops. The Company adopts a shop rental model, that is,the ownership of the shops belongs to the Company, and market traders only have the right touse the shop within the contract period. The Company and market traders sign a contract toclearly stipulate the use period, usage fee and business purpose of the shops. The merchant
shall not change the agreed business purpose, and shall not sublet without the Company’sconsent. Generally, the payment methods of usage fee are one-time payment or installmentpayment according to the contract terms. Currently the markets of which the Company isresponsible for operation include Dsitricts 1 to 5 of the International Trade City, ImportingMarket, First District East Expansion Market, Huangyuan Market and International ProductionGoods Market.
2. Online trading platform
Relying on the Company's market resources of 75,000 off-line shops, Yiwu Market officialwebsite “chinagoods” platform (www.chinagoods.com, referred to as "chinagoods platform")provides service for 2.1 million micro, small, and medium enterprises in the upper reaches of theindustry chain. With trade data integration as the core driver, it meets the needs of both supplyand demand parties in manufacturing, display transactions, warehousing and logistics, financialcredit, market management and other links to achieve effective and accurate allocation of marketresources, and build a true, open, and integrated digital trade comprehensive service platform.
IV. Analysis of core competencies during the reporting period
√Applicable □Not applicable
(I) First-mover advantages
At the start of China’s reform and opening-up, Yiwu took the lead in establishing thecommodities market. During the recent forty years, the market has been upgraded five times andexpanded ten times and has been among the top comprehensive national markets with thehighest turnover, pointing to its remarkable first-mover advantages. As the largest commoditiesdistribution center in the world, the Yiwu commodities market provides more than 2.1 millionproducts, which fall in 26 categories and supports one-stop purchase. The market boastsenormous resources and huge business flow, goods flow, cash flow and information flow.
(II) Brand advantages
“Yiwu China Commodities City” is the first market identified by the SAIC as a well-knowntrademark among the national commodities trading markets. The Company has taken multiplemeasures to give play to the brand of “Yiwu China Commodities City” and is committed toimproving its influence and leading role in the industry. Its brand advantages and influence havekept enhancing.
(III) Auxiliary services advantages
The People’s Government of Yiwu has been providing policy support for the developmentof the market for years, and the auxiliary industries are developing rapidly in Yiwu.
1. Convenient logistics system
Yiwu has perfect commerce and trade auxiliary facilities and advantageous logisticsservice. The logistics network has full coverage in Yiwu. A large number of large-sizedinternational and domestic express delivery and logistics companies have regional distributioncenters in Yiwu, and a world-oriented goods transport and distribution network has beenestablished. Yiwu has been listed among the “commerce and trade-oriented national logisticshubs” by the National Development and Reform Commission and the Ministry of Transport.According to the report on operation of the postal industry in 2022 released by the State PostBureau, the express delivery business volume of Yiwu ranked second in China in 2022.
2. Industry support
During the recent years, thanks to the Yiwu China Commodities City, the Yiwu-centeredmanufacturing industry cluster has been developing fast, an commodities industrial belt that iscentered in Yiwu and covers Jinhua, Lishui, Quzhou, Hangzhou, Jiaxing, Taihu, Shaoxing,Ningbo, Wenzhou and Taizhou with an area of nearly 10,000 km
has been established, and abenign mechanism under which the Yiwu wholesales market and the peripheral industrycluster develop together has been formed.
3. Support from exhibition service
The major international trade exhibitions held by the Company’s exhibition businessdivision such as China Yiwu International Commodities Fair, China Yiwu International ForestProducts Fair, China Yiwu International Imported Commodities Fair and China Yiwu Hardwareand Electrical Expo support and cultivate vertical exhibition in multiple industries such asstationery and textiles, have developed multiple professional and international exhibitionbrands, and are important national platforms for the China Commodities City to lead industrydevelopment, develop the city economy and maintain the clusters of traders and commodities.
(IV) Advantages of diversified businesses
The Company has strengthened its presence in the related industries, made efforts onfinancial investment, kept developing the exhibition business, created a new e-commercemodel, developed the hotel business and also run international trade, modern logistics,advertising information, shopping and tourism businesses. It has created a group structure andprofit-making model of shared and interactive development of market resources.
(V) Management advantages
In terms of personnel, management and technology, excellent operation and managementability is one of the core competences of the Company as a professional market operatingcompany. The Company has developed a series of perfect management systems for marketoperation and management, accumulated rich experience in operation and management, andhas cultivated a professional management team with reasonable knowledge and expertisestructures and strategic development insights.(VI) Advantages of online and offline platform integrationThe Company’s international trade city is the global leading commodity market. TheCompany’s official Yiwu CCC website, chinagoods platform, relying on the Company’s 75,000off-line shops, through integration of online and offline services, serves 2.1 million small, mediumand micro enterprises in the upper reaches of the industry chain. With trade data integration asthe core driver, it meets the needs of both supply and demand parties in manufacturing, displaytransactions, warehousing and logistics, financial credit, market management and other links.
(VII) Advantages of international logistics
The Company's Zhijie Yuangang international logistics business, establishes a logisticsplatform to replace the multi-layer freight forwarder system, thus shortening the level of freightforwarder distribution, and improving logistics efficiency. In contrast, the traditional foreign tradefreight forwarders are divided into multiple levels, the logistics and transportation services arenot standardized, and the service prices vary widely and are usually not the lowest price.V. Operating status during the reporting periodDuring the reporting period, the main operating status of the Company are as follows:
(i) Analysis of main business
1. Analysis of changes in related accounting subjects of income statement and cash
flow statement
Unit: RMB
| Item | Amount in the current report period | Amount in the same report period of the previous year | YoY change (%) |
| Operating revenue | 7,619,693,742.60 | 6,033,842,972.95 | 26.28 |
| Operating cost | 6,452,909,829.96 | 4,027,543,138.56 | 60.22 |
| Sales expenses | 197,679,981.09 | 204,745,974.57 | -3.45 |
| Administrative expenses | 529,466,270.71 | 453,543,427.80 | 16.74 |
| Financial expenses | 149,148,889.80 | 179,911,613.70 | -17.10 |
| R&D expenses | 17,377,161.88 | 10,308,801.84 | 68.57 |
| Net cash flow from operating activities | 1,400,090,713.77 | 2,033,082,507.76 | -31.13 |
| Net cash flow from investing activities | -2,362,698,917.70 | 1,650,766,978.93 | -243.13 |
| Net cash flow from financing activities | -1,057,216,958.11 | -1,701,935,200.78 | NA |
Reasons for the change in operating cost: the Company’s operating cost increased by 60.22%YoY, mainly due to the increase in the sales of goods during the current period.Reasons for change in R&D expenses: the Company's R&D expenses increased 68.57% YoY,mainly due to the increase in expensed R&D investment during the current period.Reasons for changes in net cash flow from operating activities: mainly due to a year-on-yeardecrease of RMB 916 million in net cash received and paid for sales of goods and provision oflabor services in the current period, and a year-on-year increase of RMB 319 million yuan in taxrefunds received.Reasons for the change in net cash flow from investment activities: mainly due to a year-on-yearincrease of RMB 1.598 billion in net investment outflows in the current period, a year-on-yearincrease of RMB 2.072 billion in cash paid for the purchase and construction of long-term assetssuch as fixed assets, and a year-on-year increase of RMB 313 million in cash paid for acquiringsubsidiaries.Explanation for the change in the net cash flow from financing activities: mainly due to andecrease of RMB 670 million YoY in the net inflow of financing in the current period.Details of material changes to the business types, the components or sources of profits of theCompany in this reporting period
□Applicable √Not applicable
2. Revenue and cost analysis
√Applicable □Not applicable
In 2022, the Company's operating revenue was RMB 7.620 billion, an increase of RMB1.586billion YoY, and the Company's operating cost was RMB 6.453 billion, an increase of 2.425 billionYoY.
(1). Main business by industry
Unit: RMB10,000
| Main business by industry | ||||||
| By industry | Operating revenue | Operating cost | Gross profit margin (%) | Change in operating revenue YoY (%) | Change in operating cost YoY (%) | Change in gross profit margin YoY (%) |
| Market operation | 169,702.11 | 96,207.40 | 43.31 | -29.19 | 10.95 | Down 20.51 ppt |
| Sales of goods | 494,929.78 | 493,522.41 | 0.28 | 90.85 | 90.79 | Up 0.03 ppt |
| Hotel service | 18,026.31 | 15,422.06 | 14.45 | 41.43 | 15.30 | Up 19.40 ppt |
| Exhibition and advertising | 7,997.62 | 6,255.16 | 21.79 | -33.10 | -49.13 | Up 24.65 ppt |
| Other services | 42,022.21 | 22,162.70 | 47.26 | 20.30 | 38.27 | Down 6.86 ppt |
| Sub-total | 732,678.03 | 633,569.73 | 13.53 | 31.16 | 63.68 | Down 17.18 ppt |
Description of main business by industry
1. Revenue and cost of product sales increased by 90.85% and 90.79% YoY respectively, mainlydue to the large year-on-year increase in commodity sales in the current period.
2. The hotel service revenue increased by 41.43% YoY, mainly due to the year-on-year increasein hotel occupancy rate.
3. Revenues and costs of exhibition and advertisement decreased by 33.10% and 49.13% YoYrespectively, mainly due to the year-on-year decrease in the number of exhibitions undertaken.
4. The costs of other services increased by 31.16% YoY, mainly due to the increase in shippingagency costs due to the increase in business volume of Huanqiu Yida in the current period.
(2). Table of production and sales analysis
□Applicable √Not applicable
(3). The performance of major purchase contracts and major sales contracts
□Applicable √Not applicable
(4). Cost Analysis Table
Unit: RMB10,000
| Situation by industry | |||||||
| By industry | Cost components | Amount in the current period | Proportion in the total cost in the current period (%) | Amount in the same period of prior year | Proportion in the total cost in the prior corresponding period (%) | Percentage change of amount in the current period compared with the prior corresponding period (%) | Situation Description of |
| Market operation | Depreciation and amortization | 43,737.99 | 6.90 | 46,031.98 | 11.89 | -4.98 | |
| Market operation | Wages and benefits | 7,693.99 | 1.21 | 22,111.44 | 5.71 | -65.20 | Mainly due to the outsourcing of basic property services such as security for the markets, which resulted in the decrease in direct employment |
| Market operation | Other costs | 44,775.42 | 7.07 | 18,570.54 | 4.80 | 141.11 | Mainly due to the outsourcing of basic property services such as security for the markets |
| Sales of goods | Cost of product sales | 493,522.41 | 77.90 | 258,667.18 | 66.82 | 90.79 | Mainly due to the increase in product sales |
| Hotel service | Depreciation and amortization | 3,730.53 | 0.59 | 2,432.99 | 0.63 | 53.33 | |
| Hotel service | Cost of food and beverage raw materials | 5,539.34 | 0.87 | 4,356.83 | 1.13 | 27.14 | |
| Hotel service | Wages and benefits | 3,154.74 | 0.50 | 4,216.87 | 1.09 | -25.19 | |
| Hotel service | Material and fuel consumption | 1,116.72 | 0.18 | 759.03 | 0.20 | 47.12 | |
| Hotel service | Other costs | 1,880.73 | 0.30 | 1,610.40 | 0.41 | 16.79 | |
| Exhibition and advertising | Depreciation and amortization | 1,456.27 | 0.23 | 4,167.15 | 1.08 | -65.05 | |
| Exhibition and advertising | Exhibition and advertising cost | 4,486.46 | 0.71 | 6,311.12 | 1.63 | -28.91 | |
| Exhibition and advertising | Other costs | 312.43 | 0.05 | 1,817.79 | 0.47 | -82.81 | |
| Other services | Property management cost | 3,239.75 | 0.51 | 2,318.52 | 0.60 | 39.73 | |
| Other services | Network transformation and service | 5,881.42 | 0.93 | 7,542.35 | 1.95 | -22.02 | |
| Other services | Other costs | 13,041.53 | 2.05 | 6,167.27 | 1.59 | 111.46 | Mainly due to the increase in shipping agency costs |
| Total | 633,569.73 | 100.00 | 387,081.46 | 100.00 | 63.68 |
Explanation on cost analysis and other informationNil
(5). Changes in consolidation scope due to the changes in main subsidiaries' shareownership during the report period
□Applicable √Not applicable
(6). Major changes or adjustment in the Company's business, products or services
□Applicable √Not applicable
(7). Main sales customers and suppliers
A. Main sales customers of the Company
□Applicable √Not applicable
Case in which the sales to a single customer accounted for over 50% of the total sales, newcustomers were added to the list of top 5 customers or the Company relied heavily on a fewcustomers during the report period
□Applicable √Not applicable
B. Main suppliers of the Company
□Applicable √Not applicable
Case in which the purchase amount for a single supplier accounted for over 50% of the totalpurchase amount, new suppliers were added to the list of top 5 suppliers or the Companyrelied heavily on a few suppliers during the report period
□Applicable √Not applicable
Other statementsNil
3. Costs
√Applicable □Not applicable
Unit: RMB10,000
| Item | 2022 | 2021 | YoY change amount | Change / % | Explanation on changes |
| Sales expenses | 19,768.00 | 20,474.60 | -706.60 | -3.45 | |
| Administrative expenses | 52,946.63 | 45,354.34 | 7,592.29 | 16.74 | |
| R&D expenses | 1,737.72 | 1,030.88 | 706.84 | 68.57 | Due to the increase in expensed R&D investment |
| Financial expenses | 14,914.89 | 17,991.16 | -3,076.27 | -17.10 | |
| Income tax expenses | 4,620.57 | 32,752.52 | -28,131.95 | -85.89 | Due to the decrease in taxable income |
Unit: RMB10,000
| Item | 2022 | 2021 | YoY change amount | Change / % |
| Staff expenses and work clothes | 31,721.94 | 32,636.89 | -914.95 | -2.80 |
| Advertising expenses | 3,174.30 | 4,564.90 | -1,390.60 | -30.46 |
| Security and insurance costs | 3,384.43 | 3,830.60 | -446.17 | -11.65 |
| R&D expenses | 1,737.72 | 1,030.88 | 706.84 | 68.57 |
| Depreciation and amortization | 11,406.51 | 3,869.35 | 7,537.16 | 194.79 |
| Promotion and investment promotion | 9,221.94 | 12,124.46 | -2,902.52 | -23.94 |
| Intermediary expenses | 1,913.78 | 2,348.08 | -434.30 | -18.50 |
| Office expenses | 1,411.89 | 1,761.61 | -349.72 | -19.85 |
| Water, electricity and fuel consumption | 695.33 | 135.19 | 560.14 | 414.34 |
| Start-up fee | 4,089.58 | - | 4,089.58 | - |
| Other expenses | 5,694.93 | 4,557.86 | 1,137.07 | 24.95 |
| Subtotal of management, R&D and sales expenses | 74,452.35 | 66,859.82 | 7,592.53 | 11.36 |
1. The reason for the year-on-year increase in depreciation and amortization: mainly due toYindu Yayue Hotel’s being put into operation and the year-on-year increase in depreciation andamortization of the newly added warehouse and logistics park project land in northeast of Yiwuduring the current period.
4. R&D Investment
(1).Table of R&D investment status
√Applicable □Not applicable
Unit: RMB10,000
| Expended R&D investment in this period | 1,737.72 |
| Capitalized R&D investment in this period | 3,192.12 |
| Total R&D investment | 4,929.84 |
| Total R&D investment as a percentage of operating income (%) | 0.65 |
| Proportion of capitalization of R&D investment (%) | 64.75 |
(2).Table of R&D personnel status
√Applicable □Not applicable
| Number of R&D personnel | 182 |
| Number of R&D personnel as a percentage of the Company’s total personnel number (%) | 5.64 |
| Education level of R&D personnel | |
| Education level | People at this education level |
| Doctor's degree | 3 |
| Master's degree | 6 |
| Bachelor's degree | 126 |
| College graduates | 46 |
| High school graduate and below | 1 |
| Age of R&D personnel | |
| Age range | People in this age range |
| Below 30 (30 excluded) | 72 |
| 30-40 (30 included, 40 excluded) | 96 |
| 40-50 (40 included, 50 excluded) | 14 |
(3).Reasons for change
□Applicable √Not applicable
(4).Reasons for major changes in the composition of the R&D personnel and theirinfluence on the Company's future development
□Applicable √Not applicable
5. Cash flow
√Applicable □Not applicable
Unit: RMB10,000
| Item | 2022 | 2021 | YoY change |
| Net cash flow (used)/generated from operating activities | 140,009.07 | 203,308.25 | -63,299.18 |
| Net cash flow (used)/generated from investing activities | -236,269.89 | 165,076.70 | -401,346.59 |
| Net cash flow (used)/generated from financing activities | -105,721.70 | -170,193.52 | 64,471.82 |
| (Decrease)/increase in cash and cash equivalents | -202,526.74 | 197,382.55 | -399,909.29 |
1. The net cash flow from operating activities in 2022 decreased by RMB 633 million YoY. Mainlydue to a year-on-year decrease of RMB 916 million in net cash received and paid for sales ofgoods and provision of labor services in the current period, and a year-on-year increase of RMB319 million yuan in tax refunds received.
2. The net cash flow from investment activities in 2022 decreased by RMB 4.013 billion YoY.Mainly due to a year-on-year increase of RMB 1.598 billion in net investment outflows in thecurrent period, a year-on-year increase of RMB 2.072 billion in cash paid for the purchase andconstruction of long-term assets such as fixed assets, and a year-on-year increase of RMB 313million in cash paid for acquiring subsidiaries.
3. The net cash flow from financing activities in 2022 increased by RMB 645 million YoY. Mainlydue to an decrease of RMB 670 million YoY in the net inflow of financing during the currentperiod.
(ii) Material changes to profits caused by non-main businesses
□Applicable √Not applicable
(iii) Analysis of assets and liabilities
√Applicable □Not applicable
1. Assets and liabilities
Unit: RMB10,000
| Item | Amount at the end of the current period | % of total assets at the end of the current period | Closing balance in the prior corresponding period | Closing balance as a percentage of total assets in the prior corresponding period (%) | Percentage change of the closing balance of the current period compared with the prior corresponding period (%) | Reasons for change |
| Total assets | 3,211,100.43 | 100.00 | 3,101,463.55 | 100.00 | 3.54 | |
| Cash and cash equivalents | 199,129.90 | 6.20 | 483,146.84 | 15.58 | -58.78 | |
| Held-for-trading financial assets | 6,233.10 | 0.19 | 7,537.51 | 0.24 | -17.31 | |
| Accounts receivable | 21,075.07 | 0.66 | 18,523.75 | 0.60 | 13.77 | |
| Prepayments | 60,605.70 | 1.89 | 87,516.77 | 2.82 | -30.75 | Mainly due to the decrease in advance payment |
| Other receivables | 41,939.81 | 1.31 | 135,592.43 | 4.37 | -69.07 | Mainly due to recovering of financial assistance during the current period |
| Inventory | 133,035.12 | 4.14 | 132,740.26 | 4.28 | 0.22 | |
| Other current assets | 63,421.00 | 1.98 | 24,866.22 | 0.80 | 155.05 | Mainly due to the newly added payment business reserve fund during the current period |
| Debt investments | 4,807.96 | 0.15 | - | - | NA | |
| Long-term receivables | 27,829.96 | 0.87 | 22,230.74 | 0.72 | 25.19 | |
| Long-term equity investment | 603,347.29 | 18.79 | 577,245.52 | 18.61 | 4.52 | |
| Other equity instruments investment | 49,920.08 | 1.55 | 64,218.80 | 2.07 | -22.27 | |
| Other non-current financial assets | 150,030.76 | 4.67 | 152,481.93 | 4.92 | -1.61 | |
| Property investment | 285,164.32 | 8.88 | 297,393.64 | 9.59 | -4.11 | |
| Fixed assets | 522,088.28 | 16.26 | 507,859.09 | 16.37 | 2.80 | |
| Construction in progress | 286,006.48 | 8.91 | 109,057.80 | 3.52 | 162.25 | Mainly due to the payment for construction projects such as comprehensive protection zones |
| Right-of-use assets | 21,770.29 | 0.68 | 22,534.71 | 0.73 | -3.39 | |
| Intangible assets | 646,184.97 | 20.12 | 404,356.46 | 13.04 | 59.81 | Mainly due to land purchase during the current period |
| Development expenses | 466.10 | 0.01 | 635.98 | 0.02 | -26.71 | |
| Goodwill | 28,491.64 | 0.89 | - | - | - | |
| Long-term prepaid | 30,692.60 | 0.96 | 18,818.44 | 0.61 | 63.10 | Mainly due to the completion and transfer-in of Yindu Yayue during the current period |
| expenses | ||||||
| Deferred income tax assets | 15,034.68 | 0.47 | 13,573.70 | 0.44 | 10.76 | |
| Other non-current assets | 13,825.33 | 0.43 | 21,132.96 | 0.68 | -34.58 | Mainly due to the transfer-out of the prepaid equity transfer consideration |
| Total liabilities | 1,682,990.80 | 52.41 | 1,638,379.34 | 52.83 | 2.72 | |
| Short-term borrowings | 105,928.74 | 3.30 | 94,273.61 | 3.04 | 12.36 | |
| Accounts payable | 119,131.44 | 3.71 | 49,336.04 | 1.59 | 141.47 | Mainly due to the increase in payables for the market and supporting projects |
| Advances from customers | 88,599.33 | 2.76 | 15,356.63 | 0.50 | 476.95 | Mainly due to the new payment received in advance from merchants during the current period |
| Contract liabilities | 399,103.80 | 12.43 | 405,841.92 | 13.09 | -1.66 | |
| Payroll payable | 18,313.53 | 0.57 | 24,396.48 | 0.79 | -24.93 | |
| Tax payable | 21,499.84 | 0.67 | 55,949.65 | 1.80 | -61.57 | Mainly due to the decrease in corporate income tax payable |
| Other payables | 132,559.61 | 4.13 | 190,874.28 | 6.15 | -30.55 | Mainly due to the increase of investment allocation to be confirmed |
| Non-current liabilities due within one year | 8,685.23 | 0.27 | 366,424.19 | 11.81 | -97.63 | Mainly due to repayment of bonds due within one year |
| Other current liabilities | 347,390.70 | 10.82 | 308,138.48 | 9.94 | 12.74 | |
| Long-term borrowings | 40,450.00 | 1.26 | 77,125.00 | 2.49 | -47.55 | Mainly due to early repayment of long-term loans |
| Bonds payable | 349,741.68 | 10.90 | - | - | N/A | Mainly due to the new issuance of medium-term notes and corporate bonds during the current period |
| Lease liabilities | 20,662.37 | 0.64 | 20,594.27 | 0.66 | 0.33 | |
| Estimated liabilities | 11,062.03 | 0.34 | 11,062.03 | 0.36 | - | |
| Deferred income | 10,358.21 | 0.32 | 7,817.01 | 0.25 | 32.51 | Mainly due to receiving the start-work reward of the Comprehensive Bonded Zone |
| Deferred income tax liabilities | 9,504.27 | 0.31 | 11,189.75 | 0.36 | -15.06 |
Other statementsNil
2. Overseas assets
√Applicable □Not applicable
(1) Scale of assets
Among them: offshore assets was RMB 520 million, accounting for 1.62% of the total assets.
(2) Explanation one the high proportion of offshore assets
□Applicable √Not applicable
3. Encumbrances on major assets as of the end of the reporting period
√Applicable □Not applicable
Unit: RMB
| Item | 2022 | 2021 |
| Cash and cash equivalents | 10,098,029.66 | 60.78 |
| Long-term equity investment | 102,918,559.00 | 102,918,559.00 |
| Other non-current financial assets | 621,447,424.37 | 636,870,392.09 |
| Other current assets | 367,484,914.87 | - |
| Total | 1,101,948,927.90 | 739,789,011.87 |
Note 1. As of December 31, 2022, bank deposits with a book value of RMB 60.97(December 31, 2021: RMB 60.78) were restricted for ownership or use rights due to being assecurity deposits for obtaining commercial housing mortgage loan. As of December 31, 2022,bank deposits with a book value of RMB 7,220,000.00 (December 31, 2021: RMB 0.00) wereused as a performance guarantee for civil air defense projects under construction. As ofDecember 31, 2022, bank deposits with a book value of RMB 2,877,968.69 (December 31, 2021:
RMB 0.00) were used as fast payment business risk deposits with restricted ownership or userights.
2. As of December 31, 2022, long-term equity investments with a book value of RMB102,918,559.00 (December 31, 2021: RMB 102,918,559.00) and other non-current assets ofRMB 621,447,424.37 (December 31, 2021: RMB 636,870,392.09) were frozen by ShanghaiMunicipal Public Security Bureau.
3. As of December 31, 2022, the payment business reserve fund with a book value of RMB367,484,914.87 was established by the Company in accordance with the "AdministrativeMeasures for Payment Services of Non-financial Institutions" and "Measures for the Custody ofCustomer Reserve Funds of Payment Institutions" Bank special deposit account. The scope offunds stored and received by the Company through the customer reserve account includes:
funds received from bank card acquiring business, third-party payment convenience servicebusiness, credit card repayment business, credit payment settlement business, and other partof the Company's business.
4. Other statements
□Applicable √Not applicable
(iv) Analysis of business information of industry
√Applicable □Not applicable
For details, please refer to "II. The situation of the industry of the Company" in this section
(v) Analysis of investments
Overview of external equity investment
√Applicable □Not applicable
At the end of December 2022, the external investment amounted to RMB 8,095,312,300(including RMB 62,331,000 for financial assets held for trading, RMB 6,033,472,900 for long-term equity investment, RMB 499,200,800 for investment in other equity instruments, RMB1,500,307,600 for other non-current financial assets), a increase of RMB 80,474,700 or 1.00%,from RMB 8,014,837,600 (including RMB 75,375,100 for financial assets held for trading, RMB5,772,455,200 for long-term equity investment, RMB 642,188,000 for investment in other equityinstruments, RMB 1,524,819,300 for other non-current financial assets) at the end of theprevious year. The main changes were as follows:
I. Trading financial assets during the reporting period decreased by RMB 13.0441 millionfrom the end of the previous year, mainly due to the increase in bank wealth management ofRMB 13.6794 million, the sale of part of the equity of Orient International Venture Co., Ltd. andthe decrease of RMB 26.7235 million from fair value changes.
II. Long-term equity investment during the reporting period increased by RMB 261.0177million from the end of the previous year, mainly due to:
1. The net increase of RMB 138,260,500 in investment cost. The investment principalincreased by RMB 168.9705 million, including: RMB 150 million for Zhejiang Zhijie YuangangInternational Supply Chain Technology Co., Ltd., 18.1455 million for JEBEL ALI FREE ZONETRADER MARKET DEVELOPMENT AND OPERATION FZCO, RMB 625,000 for ZhejiangYixinou Supply Chain Management Co., Ltd., and RMB 200,000 for Yiwu Heimahui EnterpriseService Co., Ltd.; recovered investment principal of RMB 30.71 million, of which RMB 24.5million was recovered from Hangzhou Binjiang Shangbo Real Estate Development Co., Ltd. andRMB 6.21 million from Yiwu Huishang Microfinance Co., Ltd.
2. A net increase of RMB 122,757,200 was recorded in the accrued income by equitymethod. Among it, the investment income and other equity changes accrued during the reportingperiod were RMB 1,000.1689 million; the dividends received were RMB 877.4117 million,including RMB 580.8656 million from Rongshang Real Estate, RMB 194.4768 million fromChuangcheng Real Estate, RMB 88.2 million from Pujiang Lvgu, and RMB 13.8693 million fromHangzhou Binjiang Shangbo Real Estate Development Co., Ltd.
III. During the reporting period, the investment in other equity instruments decreased byRMB 142.9872 million from the end of the previous year, due to the change in fair value ofShenwan Hongyuan Group Co., Ltd. during the reporting period.
IV. During the reporting period, other non-current financial assets decreased by RMB
24.5117 million from the end of the previous year, mainly due to the addition of RMB 60 millionfor Suzhou Xiangzhong Venture Capital Partnership (Limited Partnership) and the recovery ofinvestment funds of RMB 59.2535 million from Nantong Zijing Huatong Equity InvestmentPartnership (Limited Partnership) and other enterprises, RMB 23.8819 million for the disposal ofYiwu Shanfeng Investment Partnership, and RMB -1.3763 million from changes in the fair valueof other non-current financial assets.
1. Major equity investments
√Applicable □Not applicable
Unit: RMB10,000
| Invested company name | Main business | Whether the target is mainly engaged in investment business | Investment method | Investment amount | Shareholding Scale | Whether to consolidate | Statement subject (if applicable) | Source of funds | Partner Remarks (if applicable) | Investment period (if any) | Progress as of balance sheet date | Estimated earnings (if any) | Impact on current profit and loss | Whether involved in litigation | Disclosure date (if any) | Disclosure index (if any) |
| Zhejiang Xunchi Digital Technology Co., Ltd. | Value-added Telecom Services | No | Acquisition | 44,430.00 | 100% | Yes | NA | Self-owned Fund sources | NA | NA | Acquisition completed | 682.22 | No | Jun 25, 2022 Dec 04, 2021 | Nil | |
| Zhejiang Zhijie Yuangang International Supply Chain Technology Co., Ltd. | International cargo transportation agency by sea; International cargo transportation agency by air; International cargo transportation agency by land; Domestic cargo transportation agency, etc. | No | Newly established | 15,000.00 | 27% | No | Long-term equity investment | Self-owned Fund sources | COSCO SHIPPING Logistics Supply Chain Co., Ltd., ProLogis Investment (Shanghai) Co., Ltd. | NA | Contribution of capital completed | -443.66 | No | Aug 24, 2022 | Nil | |
| Suzhou Xiangzhong Venture Capital Partnership (Limited Partnership) | Venture capital (limited to investment in unlisted enterprises); Equity investment | Yes | Others | 6,000.00 | 12.37% | No | Other non-current financial assets | Self-owned Fund sources | Taicang Weizhong Investment Management Co., Ltd., etc. | NA | Cumulative contribution of capital RMB 100 million | 697.30 | No | Feb 10, 2021 Nov 19, 2020 Nov 18, 2020 | Nil |
| Jebel Ali Free Zone Trader Market Development and Operation FZCO | Lease and management of proprietary properties; and lease and management of the properties owned by others | No | Others | 1,814.55 | 30% | No | Long-term equity investment | Self-owned Fund sources | Jebel Ali Free Zone FZE | NA | Cumulative contribution of capital RMB 91.6483 million | -2,508.37 | No | Aug 23, 2019 | Nil | |
| Total | / | / | / | 67,244.55 | / | / | / | / | / | / | / | / | -1,572.51 | / | / | / |
2. Major non-equity investments
√Applicable □Not applicable
Unit: RMB10,000
| Item | Project amount | Progress | Investment during current period Amount | Cumulative actual investment amount . |
| The Yiwu Comprehensive Bonded Zone Project | 624,250.00 | International Trade Digitalization Industry Project in the Comprehensive Bonded Zone: The project has been basically completed, and the initial inspection of the completion has been completed. Comprehensive Bonded Zone bonded processing park project: 95% of the overall project of the north project of Zone A has been completed, and the main structure of the south project of area A has been completed. The new import market project in the Comprehensive Bonded Zone: the general contracting construction in the south area, the bidding of the landscape project has been completed, and 70% of the overall project has been completed in the north area. | 149,648.20 | 290,570.05 |
| Logistics Park S2 | 108,000.00 | 40% of the main structure has been completed, with partial structure completed. | 23,533.90 | 23,533.90 |
| Logistics Park S3 | 132,000.00 | 55% of the main structure is completed, with partial structure completed. | 30,400.05 | 30,400.05 |
| Yiwu Digital Trade Industrial Park | 39,579.00 | The curtain walls below the 12th floor of the main building and the podium have been basically completed. | 9,807.99 | 15,815.07 |
| Yiwu International Digital Logistics Market | 113,600.00 | About 80% of the foundation works have been completed, among which the construction of hole piles has been completed, and the main structure of the first floor of the comprehensive building has been completed. | 11,602.24 | 11,602.24 |
3. Financial assets measured with fair value
√Applicable □Not applicable
Unit: RMB10,000
| Category of assets | Opening balance | Current fair value Profit and loss from changes | Cumulative fair value changes included in equity | Current provision for impairment | Current purchase amount | Sale/redemption amount in current period | Other changes | Closing balance |
| Held-for-trading financial assets | 7,537.51 | -388.62 | - | - | 1,358.84 | 2,238.50 | -36.13 | 6,233.10 |
| Other equity instruments investment | 64,218.80 | - | -4,081.85 | - | - | - | -1,360.61 | 49,920.08 |
| Other non-current financial assets | 152,481.93 | -137.63 | - | - | 6,000.00 | 2,600.00 | -5,713.54 | 150,030.76 |
| Total | 224,238.24 | -526.25 | -4,081.85 | - | 7,358.84 | 4,838.50 | -7,110.28 | 206,183.94 |
Securities investment
√Applicable □Not applicable
Unit: RMB10,000
| Securities | Security code | Security abbreviation | Initial investment cost | Source of funds | Opening book value | Profit and loss from changes in fair value in the current period | Cumulative fair value changes included in equity | Current purchase amount | Sales amount in current period | Profit and loss from investment in current period | Closing book value | Accounting item |
| Stocks | / | New shares | 0.15 | Self-owned funds | 0.15 | - | - | 6.90 | 7.05 | 4.77 | - | Held-for-trading financial assets |
| Stocks | 000166 | Shenwan Hongyuan | 55,362.54 | Self-owned funds | 64,218.80 | - | -4,081.85 | - | - | 1,254.27 | 49,920.08 | Other equity instruments investment |
| Stocks | 600278 | Oriental Venture | 5,000.00 | Self-owned funds | 5,037.36 | -440.74 | - | - | 2,231.46 | 224.20 | 2,365.16 | Held-for-trading financial assets |
| Stocks | 833979 | Tiantu Investment | 15,519.21 | Self-owned funds | 4,788.21 | -14.24 | - | - | - | - | 4,773.97 | Other non-current financial assets |
| Total | / | / | 75,881.90 | / | 74,044.52 | -454.98 | -4,081.85 | 6.90 | 2,238.51 | 1,483.24 | 57,059.21 | / |
PE investment
√Applicable □Not applicable
The book value of private equity fund investment at the end of the reporting period was RMB 1,242,537,400, a decrease of RMB 20,792,400 fromRMB 1,263,329,800 at the end of the previous year, mainly due to the addition of RMB 60 million for Suzhou Xiangzhong Venture Capital Partnership(Limited Partnership) in this period, and the recovery of investment funds of RMB 59,253,500 from Nantong Zijing Huatong Equity Investment (LimitedPartnership) and other enterprises, and RMB 23,882,000 from the disposal of Yiwu Shanfeng Investment Partnership, and RMB 2,343,100 fromchanges in fair value.
Derivatives investment
□Applicable √Not applicable
4. Specific progress of major asset restructurings during the report period
□Applicable √Not applicable
(vi) Major sales of assets and equity
□Applicable √Not applicable
(vii) Analysis of major subsidiaries and associates
√Applicable □Not applicable
Unit: RMB10,000
| company name | Business | Registered capital | Total assets | Net assets | Net profits |
| Yiwu China Commodities City Financial Holdings Co., Ltd. | Enterprise free capital investment, asset management, investment consulting services, investment management services | 400,000.00 | 277,988.36 | 262,334.19 | 9,992.71 |
| Haicheng Yiwu China Commodities City Investment Development Co., Ltd. | Industry investment, investment management, property service, market development and operation, market auxiliary service, real estate development, sale and lease, design, production and agency of domestic advertising, and operation and management of parking garages | 60,000.00 | 202,183.91 | -94,839.74 | -8,909.95 |
| Yiwu Shangbo (former name: Yiwu Shangbo Real Estate Co., Ltd.) | Enterprise management; property management, etc. | 30,000.00 | 83,451.20 | 32,388.29 | -2,011.02 |
| Yiwu Commodities City Gonglian Property Co., Ltd. | Real estate development and sale | 20,000.00 | 16,041.83 | 15,775.03 | -94.38 |
| Kuaijietong Payment Service Co., Ltd. | Internet payment service | 18,000.00 | 56,350.88 | 13,616.08 | 1,000.95 |
| Yiwu Xingchen Enterprise Management Co., Ltd. (former name: Yiwu China Commodities City Payment Network Technology Co., Ltd.) | R&D of computer and multimedia software | 15,000.00 | 12,085.47 | 12,058.39 | -23.40 |
| Yiwu China Commodities City Import and Export Co., Ltd. | Domestic trade and international trade | 10,000.00 | 87,816.70 | 5,775.63 | 3,291.02 |
| Yiwu China Commodities City Big Data Co., Ltd. | Internet data services; professional design services; intelligent control system integration; computer information technology development, technical consulting, technical services, technology transfer, etc. | 10,000.00 | 36,817.66 | 12,293.54 | 110.22 |
| Yiwu China Commodities City Supply Chain Management Co., Ltd. | Supply chain management service | 10,000.00 | 20,426.92 | 6,809.85 | 842.41 |
| Zhejiang Yiwugou E-commerce Co., Ltd. | Computer software, multimedia technologies, computer network and application, and wholesale & retail | 10,000.00 | 14,796.68 | 10,353.29 | 1,206.88 |
| Yiwu China Commodities City Property Development Co., Ltd. | Real estate development and sale | 500,000.00 | 1,795,280.05 | 618,851.71 | 43,105.17 |
| Yiwu Hongyi Equity Investment Fund Partnership (limited partnership) | Investment management, equity investment, asset management and investment consulting | 200,100.00 | 189,307.30 | 189,217.42 | 10,670.77 |
| Zhejiang Chouzhou Financial Lease Co., Ltd. | Financial lease service, and transfer of financial lease assets | 100,000.00 | 1,682,685.53 | 188,155.98 | 24,301.81 |
| Yiwu Shanglv Investment Development Co., Ltd. | Industry investment, investment management, property service, operation and management of parking garages, business marketing planning, operation and management consulting, and operation and management of shopping malls | 80,000.00 | 135,614.42 | 84,156.82 | 2,618.68 |
| Pujiang Lvgu Property Co., Ltd. | Real estate development and sale | 70,000.00 | 122,095.85 | 76,449.22 | 2,642.70 |
| Zhejiang Zhijie Yuangang International Supply Chain Technology Co., Ltd. | International cargo transportation agency by sea; international cargo transportation agency by air; international cargo transportation agency by land; domestic cargo transportation agency; domestic shipping agency; general cargo warehousing services, etc. | 55,556.00 | 46,032.53 | 43,669.03 | -1,330.97 |
| Yiwu Rongshang Real Estate Co., Ltd. | Real estate development and sale | 10,204.08 | 13,547.12 | 13,398.14 | 87,577.34 |
| Yiwu Chuangcheng Real Estate Co., Ltd. | Real estate development and sale | 8,333.33 | 47,540.47 | 11,853.87 | 56,192.82 |
| Yiwu Guoshen Shangbo Property Co., Ltd. | Real estate development, sale and lease; real estate brokerage service, interior decoration service; and landscaping service | 4,081.63 | 1,254,543.18 | 15,457.16 | 10,525.21 |
(viii) Structured entities controlled by the Company
□Applicable √Not applicable
VI. Discussion and Analysis of the Company's Future Development(i) Industry Pattern and Trends
√Applicable □Not applicable
From a macro perspective, the world economy is expected to stabilize and recover, theglobal supply chain is still resilient, and the digital economy and digital trade will lead futuredevelopment. As the initial organizational form of the digital economy, the platform model is ahallmark feature of the current competition in the digital economy. Jumping out of thetraditional model and innovating the trading platform is an important starting point for theinternationalization and intelligentization of the small commodity market. Through big datamining, algorithm and computing power, the digital platform can efficiently organize resourceelements, force production companies and trading companies to upgrade, accurately connectwith the market, reduce trade costs for both parties, and form a sustainable buyer-supplierinteraction relationship. By building a new digital platform, the Company creates andconsolidates the market's position as an order center, settlement center, exhibition center, andR&D center, expands the brand and physical positions of logistics centers and informationcenters, and promotes domestic-international dual cycles. It is the current goal of Yiwu Marketto make a good plan for platform construction, build Yiwu's business service system centeredon the platform, build the world's small commodity trading ecosystem, and build the wholechain of information and financial support from research and development of new products toinventory clearance.
The Company's sixth-generation market, with the new import market as the core symbol,realizes the integration of "export, import and re-export"; online and offline integration, "cloud-network-terminal" digital linkage; promotes standards and design to enter the market, andmoves towards the high end of the value chain; integrates "market + manufacturing",strengthen support for industrial belts and industrial digitalization.(ii) Development strategies of the Company
√Applicable □Not applicable
At the Fifth China-Africa Entrepreneurs Conference, General Secretary Xi Jinping calledYiwu the world "Capital of Small Commodities", pointing out the direction for the developmentof the market and the Company. As the builder and service provider of Yiwu Market, theCompany shoulders the historical mission of building the world's "Small Commodity Capital"with high quality and high level. The Company puts forward the development strategy of“taking the market as the main business, taking the digital as the link, taking the platform as thesupport, building an international trade comprehensive service provider”.
With the goal of building the world's "Small Commodity Capital" with high quality and highstandards, focusing on the main market business, promoting various resource elements to
concentrate in the main business, opening up all links of the domestic and foreign trade supplychain through vigorously developing digital trade, and continuously enhancing and upgradingthe core competitiveness to empower the small commodity industry chain and ecosystem,promoting the transformation of the physical market into a global trade service platform forsmall, medium and micro enterprises, and the transformation of the Company from a marketmanager to a comprehensive trade service provider.(iii) Business plan
√Applicable □Not applicable
2023 is the 30th anniversary of the Company, which is of great significance.In the past 30 years, generations of employees of company the have overcome difficultiesand forged ahead, creating leading enterprises in the field of commerce and trade in the country;batches of entrepreneurs have continued to struggle with their original intentions, and haveachieved the world's largest small commodity wholesale market. Over the past 30 years, theemployees of company have unswervingly created a new world. Today, 30 years later, theemployees of company are standing at a new starting point. The Company encourages all cadresand employees to concentrate, boost their energy, and forge ahead in unity, so as to promotevarious tasks to a new level!
1. Overall business objectives
Business plan goals of 2023: based on 2019 performance, operating revenue growth rateshall be not less than 180%; earnings per share shall be not less than RMB 0.25; the above twoindicators are not less than 75% of those of the Company's benchmarking enterprise or averageof the industry; main business income accounts for not less than 90% of operating income; GMVof chinagoods platform, which is the innovative business of the Company, shall be not less thanRMB 50 billion.
2. Promoting market digital reform
(1) Promoting digital reform of the market and innovatively developing the digital market
Promote the digitalization of all elements of the "people, goods, and market" market in anintegrated manner, build a new market trade scene with online and offline integration, and “cloud,internet, and terminall” linkage, and build a digital market model in the east of the second districtof the International Trade City.
(2) Improve the digitization of "people"
Fully tap the value of buyers' data, attract accurate customer groups through digitalmanagement tools, empower business customers' business growth and value upgrades, andprovide full life cycle services for business customers and full life cycle management for buyers.
(3) Improve the digitalization of "goods"
Create a "good goods in a package" digital supply chain system to support the growth ofdomestic trade, foreign trade, and e-commerce.
(4) Improve the digitization of the "market"
Build two application scenarios of digital service and digital operation and maintenance,realize intelligent market service, market operation, and property management, multi-spancollaboration, efficient connection, and data fusion in diversified trade scenarios, and provide the"Yiwu Solution" for the transformation of traditional commodity trading markets.
3. Promoting trade digitalization reform
(1) Promoting the reform of trade digitalization and iteratively upgrading the digital tradeecology
Accelerate the promotion of digitalization to lead the reconstruction of the supply chainsystem, and accelerate the formation of a full-link contract fulfillment service closed loopthrough the digitization of information flow, goods flow, and payment flow in all links of trade,so as to reduce costs and increase efficiency of small, medium and micro trade entities andempower them.
(2) Upgrading chinagoods platform
Focusing on the promotion and application of the core product Caigoubao and the qualityimprovement and expansion of the Caigoubao industrial belt, expand functions such as digitalmarketing, traffic empowerment, and order matching, and improve the one-stop digital tradeservice of "customs, exchange and tax, transportation, warehousing and financing" to help theupgrade of market procurement trade to better facilitate the free and convenient participation ofsmall, medium and micro entities in international trade.
(3) Strengthening digital settlement empowerment
Build and improve the "Yiwu Pay" brand, take advantage of the integration of third-partypayment licenses and market trade scenarios, continue to expand the scale of domesticpayment and cross-border RMB payment business, actively apply for cross-border foreignexchange qualifications, and form a closed loop of capital flow and information flow for masstrade of small commodities. Explore e-CNY payment for cross-border trade, cooperate withmajor banks to pilot digital renminbi cross-border payment applications, create a benchmarkfor digital renminbi domestic and overseas, online and offline full-scenario applications, andexpand digital logistics channels.
(4) Building an international logistics network system
It is necessary to deepen cooperation with COSCO SHIPPING and ProLogis, andstrengthen the operation of the joint venture Zhijie Yuangang. Build an international logisticsnetwork system and use the international logistics market as a platform to ensure the stabilityof the international trade supply chain of small, medium and micro enterprises. Improve theintelligence level of the logistics supply chain, apply advanced digital supply chain technology,independently develop order, transportation, and warehouse management systems, andrealize intelligent collaboration of cross-border supply chain resources. Build a digital cross-border logistics service platform, and build a digital international logistics consignment systemthat connects the whole China and the world.
(5) Expending overseas network
Accelerate the digital construction of Yiwu overseas warehouses, comprehensively innovatethe operation mode of traditional overseas warehouses, build a digital and intelligent operationmanagement platform for overseas warehouses, establish standardized, scenario-based, andautomated operation scenarios, and improve the coverage and facilitation of international tradecontract fulfillment services, to provide strong support for the global circulation of goods made inChina. It is necessary to increase the layout of overseas projects in key trading countries andregions such as the Middle East, Africa, and RCEP countries for the Yiwu Market, so as to realizethe advancement of the Yiwu Market and drive Yiwu's products to go overseas on their owninitiative.
(iv) Potential risks
√Applicable □Not applicable
1. Market operation risk. Large-sized shopping malls, hypermarkets, warehouse stores ande-commerce platforms are strong competitors in the commodities trading market. Large-sizedshopping malls offer products of reliable quality and well-known brands; hypermarkets orwarehouse stores supply diversified products at low prices; e-commerce platforms provide newtrading means and facilitate consumers. Purchasers or consumers may also choose to makeprocurement or consumption via e-commerce platforms for convenience. Therefore, theCompany may compete with other forms of business. In addition, affected by the risingspecialized market, robust development of the industry market and rapid development of thecentral and western regions, the Company may also face competition from other similarspecialized markets.
2. Risk from insufficient reserve of talents. With the acceleration of market transformationand the expansion of the Company’s business, and with the expansion of experiencedinternational trade, warehousing and logistics, supply chain, overseas development, informationdata, industrial investment, and business operations, the Company may face the risk ofinsufficient reserves of professional talents and compound talents.
3. External uncertainty. International political conflicts have caused increased uncertainty ininternational trade, and the development of global market trade is more complicated and severe
than before; new technologies are accelerating to breed new opportunities, and new trademodels and new formats are constantly emerging.
(v) Others
□Applicable √Not applicable
VII. The Company failed to disclose and explain the reasons in accordance with thestandards due to special reasons such as non-applicable standards or state secretsand trade secrets.
□Applicable √Not applicable
Section IV. Corporate Governance
I. Description of corporate governance
√Applicable □Not applicable
During the reporting period, in strict accordance with the Company Law of the People'sRepublic of China, the Securities Law of the People's Republic of China, the Code ofGovernance for Listed Companies and the relevant laws and regulations of China SecuritiesRegulatory Commission and Shanghai Stock Exchange, the Company has continuouslyestablished and improved relevant systems, endeavoured to improve the corporategovernance structure, and conduct standardized and lawful operation. There is no differencebetween the actual status of the Company's legal person governance structure and thenormative documents related to the governance of the listed company.(I) Shareholders and general meetings of shareholdersThe Company convenes and holds a general meeting of shareholders in strict accordancewith the Rules of Procedure for the General Meeting of Shareholders of Listed Companies toensure that all shareholders of the Company fully exercise their rights, especially those of smalland medium shareholders. In peacetime, the Company earnestly receives visits and calls fromshareholders to ensure the shareholders’ rights to know, participate and vote on major companyissues, so that shareholders can truly enjoy equal rights.(II) Controlling shareholders and the listed companyThe controlling shareholder of the Company exercised the rights of investors through thegeneral meeting of shareholders in accordance with the law, and did not directly or indirectlyintervene in the Company's decision-making and business activities beyond the general meetingof shareholders. The Company has achieved the five independences of personnel, assets,finances, institutions and businesses. The Company's board of directors, board of supervisorsand internal institutions can operate independently. The controlling shareholder of the Companycan strictly abide by the promise made to the Company to avoid horizontal competition. Whenthe Company has connected transactions with its controlling shareholders, it strictly follows therelevant laws and regulations to ensure that the connected transactions are fair, just andequitable.
(III) Directors and Board of Directors
The Company selects directors in strict accordance with the procedures stipulated in the"Articles of Association", and convenes and holds board meetings in strict accordance with the"Code of Corporate Governance for Listed Companies". All directors of the Company canconscientiously attend the board of directors and shareholders' meetings, actively participate intraining, and conscientiously perform their duties as directors. The three independent directorscan conscientiously perform the duties and obligations entrusted by laws, regulations and theCompany's articles of association, express independent opinions and suggestions on important
matters of the Company, and effectively protect the legitimate rights and interests ofshareholders.(IV) Supervisors and Board of SupervisorsDuring the reporting period, the Company held eight meetings of Board of Supervisorsmeetings, and the convening and holding procedures of the previous meetings complied withrelevant laws and regulations. Company supervisors can earnestly perform their duties,supervise major company matters, supervise the legality and compliance of the Company'sdirectors and senior managers in performing their duties, safeguarding the legitimate rights andinterests of the Company and shareholders.(V) Information disclosure and investor relationship managementThe Company disclosed relevant information in a true, accurate, complete and timelymanner in accordance with the "Administrative Measures for Information Disclosure of ListedCompanies". Investors can learn about the Company's situation through media publicity andtelephone consultation. In addition to completing mandatory regular reports and disclosure oftemporary announcements, the Company proactively conducts compliant and voluntaryinformation disclosure, allowing investors to have a continuous understanding of the businessconditions they care about, and truly protecting shareholders' right to know.
Whether there are major differences between the corporate governance and the requirementsof the law, administrative laws and regulations, and relevant regulations of the China SecuritiesRegulatory Commission; if there are major differences, the reasons should be explained.
□Applicable √Not applicable
II. Specific measures for ensuring the independency of the Company's controllingshareholder and actual controller in company assets, personnel, finance,organization, business and others, and solutions taken after they influenced theindependency of the Company, the progress thereof and follow-up work plan
□Applicable √Not applicable
Cases in which the Company's controlling shareholder, actual controller and other unitscontrolled by them conduct business as same as or similar to that of the Company, theinfluence on the Company due to major changes in horizontal competitors or horizontalcompetition, measures taken, progress thereof and follow-up solution plan
□Applicable √Not applicable
III. General meeting of shareholders
| Session of meeting | Date | Designated website on which the resolution is published | Date of disclosure of the resolution | Resolution of the meeting |
| Resolution of the first provisional general meeting of shareholders in 2022 | Mar 10, 2022 | www.sse.com.cn | Mar 11, 2022 | See the resolution notice for details |
| 2021 Annual General Meeting of Shareholders | April 13, 2022 | www.sse.com.cn | April 14, 2022 | See the resolution notice for details |
| The second provisional general meeting of shareholders in 2022 | Nov 8, 2022 | www.sse.com.cn | Nov 9, 2022 | See the resolution notice for details |
| The third provisional general meeting of shareholders in 2022 | Nov 29, 2022 | www.sse.com.cn | Nov 30, 2022 | See the resolution notice for details |
The preferred shareholders whose voting rights had been restituted requested to anprovisional general meeting of shareholders
□Applicable √Not applicable
Statement on shareholders’ meetings
√Applicable □Not applicable
1. The 2022 First Provisional General Meeting of Shareholders deliberated and adopted the“Proposal on By-election of Supervisors”.The 2021 Annual General Meeting of Shareholders deliberated and adopted “2021 Boardof Directors Work Report”, “2021 Board of Supervisors Work Report”, “2021 Annual Report andSummary”, “2021 Final Accounts Report”, “2022 Financial Budget Report”, and “2021 ProfitDistribution Plan”, “Proposal on the Proposed Issuance of Various Debt Financing Instrumentsin the Coming 12 Months”.
3. The second provisional general meeting of shareholders in 2022 reviewed and approvedthe "Proposal on the Re-appointment of Accounting Firm", the "Proposal on the Election of Non-Independent Directors", the "Proposal on the Election of Independent Directors", and the"Proposal on the Election of Supervisors".
4. The third provisional general meeting of shareholders in 2022 reviewed and approved the"Proposal on Reducing and Exempting Rents for Small and Micro Enterprises or IndividualIndustrial and Commercial Households".
IV. Directors, supervisors and senior management(i) Changes in shareholding and remuneration of current and resigned directors, supervisors and senior executives during the reportingperiod
√Applicable □Not applicable
Unit: Ten Thousand Shares
| Name | Position (Note) | SEX | AGE | Start date of tenure | Term end date | Number of shares held at the beginning of the year | Number of shares held at the end of the year | The amount of stock increase or decrease during the year | Reasons for change | Total pre-tax remuneration received from the Company during the reporting period (RMB ten thousand) | Remuneration received from related parties of the Company |
| ZHAO Wenge | Board chairman | Male | 56 | September 27, 2018 | 34 | 34 | 49.2 | No | |||
| WANG Dong | Vice Chairman General manager | Male | 50 | March 8, 2019 | 30 | 30 | 49.2 | No | |||
| LI Chengqun | Director | Male | 51 | May 12, 2014 | 0 | 0 | 0 | Yes | |||
| ZHANG Lang | Director | Male | 49 | November 8, 2022 | 0 | 0 | 0 | Yes | |||
| WANG Chunming | Director | Male | 59 | August 27, 2019 | November 8, 2022 | 0 | 0 | 0 | Yes | ||
| XU Hang | Director Board Secretary | Male | 49 | December 12, 2017 | 30 | 30 | 41.82 | No | |||
| ZHANG Leping | Director | Male | 43 | November 8, 2022 | 0 | 0 | 0 | Yes | |||
| GU Zhixu | Director | Male | 35 | December 10, 2020 | November 8, 2022 | 0 | 0 | 0 | Yes |
| MA Shuzhong | Independent director | Male | 55 | August 27, 2019 | 0 | 0 | 7.2 | No | |||
| HONG Jianqiao | Independent director | Male | 57 | May 22, 2020 | 0 | 0 | 7.2 | No | |||
| LUO Jinming | Independent director | Male | 55 | April 9, 2021 | 0 | 0 | 7.2 | No | |||
| JIN Xiaojia | Chairman of the Supervisory Board | Male | 35 | December 16, 2016 | 0 | 0 | 0 | Yes | |||
| WANG Jinjian | Supervisor | Male | 50 | October 26, 2020 | 0 | 0 | 0 | Yes | |||
| WU Menghua | Supervisor | Female | 32 | March 10, 2022 | 0 | 0 | 0 | Yes | |||
| WANG Gaiying | Supervisor | Female | 43 | October 26, 2020 | February 22, 2022 | 0 | 0 | 0 | Yes | ||
| FANG Min | Employee supervisor | Male | 38 | December 8, 2020 | 0 | 0 | 27.85 | No | |||
| JIN Yongsheng | Employee supervisor | Male | 45 | December 8, 2020 | 0 | 0 | 17.51 | No | |||
| HUANG Haiyang | Vice general manager | Male | 33 | June 21, 2022 | 0 | 0 | 24.395 | No | |||
| ZHANG Qizhen | Vice general manager | Male | 55 | July 7, 2017 | 30 | 30 | 41.82 | No | |||
| SHOU Shengdi | Vice general manager | Male | 49 | November 4, 2021 | 0 | 0 | 6.67 | No | |||
| LI Xiaobao | Vice general manager | Male | 46 | June 21, 2022 | 0 | 0 | 24.395 | No | |||
| GONG Chenghao | Vice general manager | Male | 43 | September 29, 2021 | 20 | 20 | 41.82 | No | |||
| YANG Yang | Vice general manager | Male | 40 | September 29, 2021 | 20 | 20 | 41.82 | No | |||
| HUANG Xiaoying | Vice general manager | Female | 40 | March 9, 2023 | 0 | 0 | 0 | No |
| ZHAO Difang | Financial Manager | Female | 50 | May 12, 2014 | 35.01 | 35.01 | 41.82 | No | |||
| WU Xiubin | Vice general manager | Male | 52 | July 17, 2020 | June 21, 2022 | 30 | 0 | -30 | Equity Incentive Repurchase and Cancellation | 17.425 | No |
| JIN Gengzhong | Vice general manager | Male | 53 | September 18, 2020 | September 6, 2022 | 30 | 0 | -30 | Equity Incentive Repurchase and Cancellation | 17.425 | No |
| ZHU Yi | Vice general manager | Male | 43 | November 4, 2021 | November 8, 2022 | 0 | 0 | 0 | No | ||
| Total | / | / | / | / | / | 259.01 | 199.01 | -60 | / | 464.77 | / |
| Name | Main working experience |
| ZHAO Wenge | He used to be Vice Chairman and General Manager of the Company, and is currently Secretary of the Party Committee and Chairman of the Company. |
| WANG Dong | He used to be a member and deputy director of the Party Committee of Yiwu SASAO, and deputy director (concurrently) of the management committee of the State-owned Assets Operation Center, and is currently the deputy secretary of the Company’s party committee, vice chairman and general manager. |
| LI Chengqun | He used to be the deputy party secretary, vice chairman and general manager of Yiwu Small Commodity City Evergrande Development Co., Ltd., and is currently the party secretary, chairman and company director of Yiwu Market Development Group Co., Ltd. |
| ZHANG Lang | He used to be the party secretary, vice chairman and general manager of Yiwu International Land Port Group Co., Ltd., and is currently the deputy secretary, vice chairman, general manager and company director of Yiwu Market Development Group Co., Ltd. |
| WANG Chunming | He used to be a director of the Company, and his term expired on November 8, 2022, and has not held any other positions in the Company since then. |
| XU Hang | He used to be general manager of the Company's securities legal affairs department, and representative of securities affairs of the Company's, and is currently a director and the secretary of the board of the Company. |
| ZHANG Leping | He used to be the general manager of Hangtou Equity Investment Fund Management (Hangzhou) Co., Ltd., and is currently the deputy general manager and director of Zhejiang Zhecai Capital Management Co., Ltd. |
| GU Zhixu | He used to be a director of the Company, and his term expired on November 8, 2022, and has not held any other positions in the Company since then. |
| MA Shuzhong | He is currently the dean of the China Digital Trade Research Institute of Zhejiang University and concurrently serves as an independent director of the Company. |
| HONG Jianqiao | He is currently the dean of the Accounting Department of the School of Management, Fudan University, and concurrently serves as an independent director of the Company. |
| LUO Jinming | He's now a professor of Zhejiang University, and an independent director of the Company and Silan Microelectronics Co., Ltd. |
| JIN Xiaojia | He used to be the accounting director of the Finance Department of Yiwu Communications Investment and Construction Group, and is currently a supervisor and chairman of the supervisory committee of the Company. |
| WANG Jinjian | He used to be the deputy general manager of Yiwu China Commodities City Property Development Co., Ltd., and is currently the general manager and company supervisor of Yiwu China Commodities City Property Development Co., Ltd. |
| WU Menghua | She used to be a supervisor of Yiwu Market Development Group Co., Ltd., concurrently a supervisor of Yiwu State-owned Capital Operation Co., Ltd. and a supervisor of Yiwu Industrial Investment Development Group Co., Ltd., and currently serves as a supervisor of the Company. |
| WANG Gaiying | She used to be a supervisor of the Company, and resigned as a supervisor of the Company on February 22, 2022, and has not held any other positions in the Company since then. |
| FANG Min | He used to be a business commissioner of the Company’s human resources department (party construction office), and currently serves as deputy general manager of the Company’s human resources department (party construction office) and employee supervisor of the Company. |
| JIN Yongsheng | He used to be the business assistant of the Company's supervision and audit department, the accounting supervisor of the finance department of the Company's Ocean Hotel, and the internal audit supervisor of the Company's legal audit department. He is currently the financial director of Xingfu Lake International Conference Center and the Company's employee supervisor. |
| HUANG Haiyang | He used to be a member of the party committee and deputy general manager of Yiwu Urban Investment and Construction Group Co., Ltd., and is currently a member of the party committee and deputy general manager of Zhejiang China Commodities City Group Co., Ltd. |
| ZHANG Qizhen | He used to be the general manager and marketing director of the Company's marketing department, and is currently a member of the party committee and deputy general manager of the Company. |
| SHOU Shengdi | He used to be a member of the Party Committee of Zhejiang Yiwu Municipal Bureau of Foreign Trade and Economic Cooperation, a member of the Party Committee and Deputy Director of Zhejiang Yiwu City Commerce Bureau, and is currently a member of the party committee and deputy general manager of the Company. |
| LI Xiaobao | He used to be a member of the party committee and deputy general manager of Yiwu Urban Investment and Construction Group Co., Ltd., and is currently a member of the party committee and deputy general manager of Zhejiang China Commodities City Group Co., Ltd. |
| GONG Chenghao | He used to be the general manager of Yiwu China Commodities City Information Technology Co., Ltd., and the general manager of Yiwu China Commodities City Supply Chain Management Co., Ltd., and is currently a member of the party committee and deputy general manager of the Company. |
| YANG Yang | He used to be the general manager of Zhejiang Yiwu China Commodities City Imported Commodity Market Branch, the general manager of Zhejiang Yiwu China Commodities City Import and Export Co., Ltd., and is currently a deputy general manager of the Company. |
| HUANG Xiaoying | She used to be the director of the Supervision Office of the People's Government of Fotang Town, the secretary of the Disciplinary Committee, and a member of the Party Committee. He is currently a member of the Party Committee and Deputy General Manager of the Company. |
| ZHAO Difang | She used to be the general manager of the Company's financial department and is currently the head of the Company's finance. |
| WU Xiubin | He used to be a member of the Party Committee and a deputy general manager of the Company, and resigned as a deputy general manager of the Company on June 21, 2022, and has not held other positions in the Company since then. |
| JIN Gengzhong | He used to be a member of the Party Committee and a deputy general manager of the Company, and resigned as a deputy general manager of the Company on September 6, 2022, and has not held other positions in the Company since then. |
| ZHU Yi | He used to be a member of the Party Committee and a deputy general manager of the Company, the term of which expired on November 8, 2022, and has not held other positions in the Company since then. |
Statement on other matters
√Applicable □Not applicable
1. The remuneration received by some of the Company's directors and executives is the pre-paid remuneration for 2022, and the actual remunerationwill be determined after the completion of relevant assessments and the implementation of relevant procedures.
2. Mr Fang Min, and Mr Jin Yongsheng are the employee representative supervisors, and the remuneration listed in the table is the totalremuneration received after the annual appraisal based on the position in the Company.
(ii) Appointments of current and resigned directors, supervisors and senior executivesduring the reporting period
1. Position in shareholder units
√Applicable □Not applicable
| Name of incumbent | Name of shareholder unit | Positions held in shareholder units | Start date of tenure | Term end date |
| ZHAO Wenge | Yiwu China Commodities City Holdings Limited | Chairman, general manager | 2019 | |
| WANG Dong | Yiwu China Commodities City Holdings Limited | Director | 2021 | |
| LI Chengqun | Yiwu Market Development Group Co., Ltd. | Board chairman | 2014 | |
| ZHANG Lang | Yiwu Market Development Group Co., Ltd. | Vice Chairman and General Manager | 2022 | |
| ZHANG Leping | Zhejiang Zhecai Capital Management Co., Ltd. | Vice general manager | 2022 | |
| JIN Xiaojia | Yiwu State-owned Assets and State-owned Enterprise Development Service Center | Assigned full-time supervisor | ||
| WU Menghua | Yiwu State-owned Assets and State-owned Enterprise Development Service Center | Assigned full-time supervisor | ||
| WANG Gaiying | Yiwu State-owned Assets and State-owned Enterprise Development Service Center | Assigned full-time supervisor | ||
| Description of the position in the shareholder unit | Nil | |||
2. Serving in other units
√Applicable □Not applicable
| Name of incumbent | Names of other units | Positions held in other units | Start date of tenure | Term end date |
| XU Hang | Yiwu China Commodities City Investment Management Co., Ltd. | Director | March 2017 | |
| HONG Jianqiao | Shanghai Laiyifen Co., Ltd. | Independent director | ||
| HONG Jianqiao | Shanghai Huafon Microfiber Technology Co., Ltd. | Independent director | ||
| LUO Jinming | Hangxiao Steel Structure Co., Ltd. | Independent director | ||
| LUO Jinming | Riyue Heavy Industries Co., Ltd. | Independent director | ||
| LUO Jinming | Ningbo Qiancheng Furniture Co., Ltd. | Independent director | ||
| LUO Jinming | Wanyuan Ecology Co., Ltd. | Independent director | ||
| WANG Jinjian | Yiwu China Commodities City Property Development Co., Ltd. | Chairman, general manager | January 2019 |
| Description of employment in other units | Nil |
(iii) Remuneration of directors, supervisors and senior management personnel
√Applicable □Not applicable
| Decision-making procedures for the remuneration of directors, supervisors and senior executives | The remuneration of the Company’s remunerated directors, supervisors and senior executives shall be reviewed by the remuneration and appraisal committee of the Company’s board of directors and submitted to the board of directors for review and approval. The remuneration of directors and supervisors shall also be submitted to the general meeting of shareholders for review and approval. |
| The basis for determining the remuneration of directors, supervisors and senior managers | The remuneration of independent directors is determined in accordance with the Independent Director Allowance System. The Independent Director Allowance System is deliberated and formulated by the board of directors and approved by the general meeting shareholders. The remuneration of the Company’s directors, supervisors and senior management shall be reviewed and determined by the Board of Directors’ Compensation and Appraisal Committee in conjunction with the assessment opinions and results of the state-owned regulatory authority, and submitted to the board of directors for deliberation. |
| Actual payment of remuneration for directors, supervisors and senior management | The relevant assessment for 2022 has not yet been completed, and the actual payment will be determined after the assessment is completed and the relevant procedures are performed. |
| The total remuneration actually received by all directors, supervisors and senior management at the end of the reporting period | The actual payment of remuneration will be determined after completing the assessment and performing the relevant procedures. The salary currently paid is the pre-paid salary for 2022, totaling RMB 4,431,700 before tax. |
(iv) Changes in directors, supervisors and senior officers of the Company
√Applicable □Not applicable
| Name | Title | Change | Reasons for change |
| ZHANG Lang | Director | Election | Election |
| ZHANG Leping | Director | Election | Election |
| WANG Chunming | Director | Leaving office | Term expired |
| GU Zhixu | Director | Leaving office | Term expired |
| WU Menghua | Supervisor | Election | Election |
| WANG Gaiying | Supervisor | Leaving office | Resigned as supervisor in accordance with organizational arrangement |
| HUANG Haiyang | Vice general manager | Hiring | Hired by the Board of Directors |
| LI Xiaobao | Vice general manager | Hiring | Hired by the Board of Directors |
| HUANG Xiaoying | Vice general manager | Hiring | Hired by the Board of Directors |
| WU Xiubin | Vice general manager | Leaving office | Due to job adjustments, he resigned from deputy general manager. |
| JIN Gengzhong | Vice general manager | Leaving office | Due to job adjustments, he resigned from deputy general manager. |
| ZHU Yi | Vice general manager | Leaving office | Term expired |
(v) Explanation of punishments by securities regulatory agencies in the past three years
□Applicable √Not applicable
(vi) Others
□Applicable √Not applicable
V. Description of the meetings of the Board of Directors held during the reporting period
| Session of meeting | Date | Resolution of the meeting |
| 44th meeting of 8th Board of Directors | February 22, 2022 | Reviewed and approved 1. "Proposal on Convening the First Provisional General Meeting of Shareholders in 2022" |
| 45th meeting of 8th Board of Directors | March 20, 2022 | Reviewed and approved 1. "2021 Annual Work Report of the Board of Directors" 2. "2021 Annual Report" 3. "2021 Annual Financial Final Account Report" 4. "2022 Financial Budget Report" 5. "Profit Distribution Plan for 2021" 6. "Proposal on Determining Audit Fees of Accounting Firm in 2021" 7. "2021 Internal Control Evaluation Report" 8. "Sustainable Development Report for 2021" 9. "Proposal on Applying for Credit Granting from Relevant Financial Institutions" 10. Proposal on Issuing Debt Instruments within the Coming 12 Months 11. "Proposal on Convening the 2021 Annual General Meeting of Shareholders" 12. "2021 Internal Control Audit Report" 13. "2021 Annual Work Report of Independent Directors" 14. "Report on Duty Performance of the Audit Committee of the Board of Directors in 2021" |
| 46th meeting of 8th Board of Directors | March 28, 2022 | Reviewed and approved 1. "Proposal on Investing in the Construction of Cross-Border E-commerce Logistics Park" 2. "Proposal on Participating in Land Bidding" 3. "Proposal on Authorizing the Chairman to Use Idle Funds to Entrust Financial Management" |
| 47th meeting of 8th Board of Directors | April 14, 2022 | Reviewed and approved 1. "First Quarter Report for 2022" |
| 48th meeting of 8th | April 27, | Reviewed and approved |
| Board of Directors | 2022 | 1. "Proposal on Investing in the Construction of the First Phase Project of Yiwu International Digital Logistics Market" 2. "Proposal on Participating in Land Bidding" |
| 49th meeting of 8th Board of Directors | June 21, 2022 | Reviewed and approved 1. "Proposal on Appointment of Deputy General Manager" |
| 50th meeting of 8th Board of Directors | June 27, 2022 | Reviewed and approved 1. "Proposal on the Establishment of Wholly-Owned Subsidiaries by Foreign Investment" |
| 51st meeting of 8th Board of Directors | July 19, 2022 | Reviewed and approved 1. "Proposal on Adjusting the Repurchase Price of Restricted Stocks and Repurchase and Cancellation of Some Restricted Stocks" 2. "Proposal on Participating in Land Bidding" |
| 52nd meeting of 8th Board of Directors | August 16, 2022 | Reviewed and approved 1. "2022 Semi-Annual Report and Summary" |
| 53rd meeting of 8th Board of Directors | August 23, 2022 | Reviewed and approved 1. "Proposal on the Establishment of Foreign Investing Subsidiaries" |
| 54th meeting of 8th Board of Directors | September 28, 2022 | Reviewed and approved 1. "Proposal on Applying for Credit Granting from Relevant Financial Institutions" |
| 55th meeting of 8th Board of Directors | October 19, 2022 | Reviewed and approved 1. "Third Quarter Report for 2022" 2. "Proposal on General Election of the Board of Directors" 3. "Proposal on Renewing the Engagement of Accounting Firms" 4. "Proposal on Convening the Second Provisional General Meeting of Shareholders in 2022" |
| 1st meeting of 9th Board of Directors | November 8, 2022 | Reviewed and approved 1. "Proposal on Election of Chairman and Vice Chairman of the Ninth Board of Directors" 2. "Proposal on the Election of Members of Special Committees of the Ninth Board of Directors" 3. "Proposal on the Appointment of the General Manager of the Company" 4. "Proposal on the Appointment of the Company's Deputy General Manager, Secretary of the Board of Directors and Person in Charge of Finance" 5. "Proposal on Appointment of Securities Affairs Representative" 6. "Proposal on Authorization of the Board of Directors to the Management Team Headed by the Chairman" |
| 2nd meeting of 9th Board of Directors | November 11, 2022 | Reviewed and approved 1. "Proposal on Rent Reduction and Exemption for Small and Micro Enterprises or Individual Industrial and Commercial Households" |
| 2. "Proposal on Convening the Third Provisional General Meeting of Shareholders in 2022" | ||
| 3rd meeting of 9th Board of Directors | November 22, 2022 | Reviewed and approved 1. "Proposal on Entrusted Management of Project Construction and Related Transactions" 2. "Proposal on Cancellation of Huishang Investment Management Branch of the Company" |
| 4th meeting of 9th Board of Directors | December 5, 2022 | Reviewed and approved 1. "Proposal on Changing the Registered Capital and Amending the Articles of Association" |
| 5th meeting of 9th Board of Directors | December 15, 2022 | Reviewed and approved 1. "Proposal on Formulating the Management System for External Financial Assistance" 2. "Proposal on Providing External Entrusted Loans" |
| 6th meeting of 9th Board of Directors | December 28, 2022 | Reviewed and approved 1. "Proposal on the Achievement of the Unlocking Conditions for the First Unlocking Period of Part of the First Grant of the 2020 Restricted Stock Incentive Plan" 2. "Proposal on the 2021 annual remuneration of some directors of the Company" 3. "Proposal on the 2021 annual remuneration of the Company's senior management" 4. "Proposal on Convening the First Provisional General Meeting of Shareholders in 2023" |
VI. Duties performed by directors(i) Meetings of Board of Directors and Shareholders attended by Directors
| Director Name | Independent director or not | Participation in meetings of Board of Directors | Participation in General meeting of shareholders | |||||
| Number of board meetings this year | Number of attendances in person | Number of participations by communication | Number of delegates attended | Absence Frequency | Failure to attend the meeting in person twice in a row or not | The number of shareholders attending the general meeting | ||
| ZHAO Wenge | No | 18 | 18 | 15 | 0 | 0 | No | 3 |
| WANG Dong | No | 18 | 18 | 15 | 0 | 0 | No | 4 |
| LI Chengqun | No | 18 | 18 | 15 | 0 | 0 | No | 2 |
| ZHANG Lang | No | 6 | 6 | 5 | 0 | 0 | No | 2 |
| WANG Chunming | No | 12 | 12 | 10 | 0 | 0 | No | 0 |
| XU Hang | No | 18 | 18 | 15 | 0 | 0 | No | 4 |
| ZHANG Leping | No | 6 | 6 | 5 | 0 | 0 | No | 1 |
| GU Zhixu | No | 12 | 11 | 10 | 1 | 0 | No | 0 |
| MA Shuzhong | Yes | 18 | 18 | 15 | 0 | 0 | No | 1 |
| HONG Jianqiao | Yes | 18 | 16 | 15 | 2 | 0 | No | 0 |
| LUO Jinming | Yes | 18 | 18 | 15 | 0 | 0 | No | 1 |
Explanation of not attending the board meeting in person for two consecutive times
□Applicable √Not applicable
| Number of meetings of the Board of Directors held during the year | 18 |
| Including: the number of on-site meetings | 3 |
| Number of meetings held by communication | 15 |
| Number of meetings held on site combined with communication methods | 0 |
(ii) Objections raised by directors on company-related matters
□Applicable √Not applicable
(iii) Others
□Applicable √Not applicable
VII. Committees under the Board of Directors
√Applicable □Not applicable
(1).Members of Committees under the Board of Directors
| Category of committees | Member name |
| Audit committee | HONG Jianqiao MA Shuzhong ZHANG Lang |
| Nomination Committee | MA Shuzhong LUO Jinming XU Hang |
| Compensation and Appraisal Committee | LUO Jinming HONG Jianqiao LI Chengqun |
| Strategy Committee | ZHAO Wenge WANG Dong MA Shuzhong |
(2).8 meetings were held by these committees during the report period
| Date | Contents of the meeting | Important comments and suggestions | Other things on duty fulfillment |
| March 3, 2022 | The 15th meeting of the Audit Committee of the 8th Board of Directors reviewed and approved the "2021 Integrated Audit Plan" | Approved the 2021 Integrated Audit Plan | |
| March 20, 2022 | The 16th meeting of the Audit Committee of the 8th Board of Directors reviewed and approved the "2021 Annual Financial Report", "2021 Annual Internal Control Evaluation Report", "2021 Annual Internal Control Audit Report", and "2021 Annual Duty Performance Report of the Audit Committee" | Approved the 2021 financial report, the 2021 internal control evaluation report, the 2021 internal control audit report, and the audit committee's 2021 performance report | |
| June 20, 2022 | The 8th Meeting of the Nomination Committee of the 8th Board of Directors reviewed and approved the "Proposal on Nominating Deputy General Managers" | Agreed to nominate Mr. HUANG Haiyang and Mr. LI Xiaobao as candidates for deputy general manager | |
| August 16, 2022 | The 17th Meeting of the Audit Committee of the Eighth Session of the Board of Directors reviewed and approved the "2022 Semi-Annual Internal Control Audit Work Report" | Approved the 2021 Semi-annual Internal Control Audit Work Report | |
| October 17, 2022 | The 9th Meeting of the Nomination Committee of the Eighth Board of Directors reviewed and approved the "Proposal on the General Election of the Board of Directors" | Approved the general election of the board of directors, and nominate Mr. Zhao Wenge, Mr. Wang Dong, Mr. Li Chengqun, Mr. ZHANG Lang and Mr. Xu Hang as non-independent director candidates for the |
| Company's ninth board of directors, and nominate Mr. Ma Shuzhong, Mr. Hong Jianqiao and Mr. Luo Jinming as the Company's Candidates for independent directors of the Ninth Board of Directors, among whom Mr. Hong Jianqiao is an accounting professional | |||
| October 17, 2022 | The 18th meeting of the Audit Committee of the 8th Board of Directors reviewed and approved the "Proposal on Renewing the Engagement of Accounting Firms" | Approved the proposal on further appointment of the accounting firm | |
| November 07, 2022 | The first meeting of the Nomination Committee of the Ninth Board of Directors reviewed and approved the "Proposal on Nominating the Company's General Manager", "The Proposal on Nominating the Company's Deputy General Manager, Secretary of the Board of Directors and Person in Charge of Finance" | Agreed to nominate Mr. Wang Dong as candidate for general manager; agree to nominate Mr. HUANG Haiyang, Mr. ZHANG Qizhen, Mr. Shou Shengdi, Mr. LI Xiaobao, Mr. Gong Chenghao, and Mr. Yang Yang as candidates for deputy general manager, and Mr. Xu Hang as candidate for the Company's board secretary , Ms. Zhao Difang is the candidate for the Company's financial director | |
| December 28, 2022 | The first meeting of the Remuneration and Appraisal Committee of the Ninth Board of Directors deliberated and approved the "Proposal on the Conditions for Unlocking of the First Granted Part in the First Unlocking Period of the Restricted Stock Incentive Plan", "About the 2021 Annual Proposal on Salary Cashing", "Proposal on the 2021 Annual Salary Cashing of the Company's Senior Management" | Agreed to award part of the achievement of unlocking conditions during the first unlocking period for the first time; agreed to honor the 2021 annual remuneration of some directors and executives |
(3).The specifics of objection
□Applicable √Not applicable
VIII. Explanation of the Company risk that the board of supervisors founds
□Applicable √Not applicable
The Board of Supervisors has no objection to the supervision matters during the reportingperiod.
IX. Employees of the parent company and major subsidiaries(i) Employees
| Number of employees in the parent company | 1,754 |
| Number of employees in major subsidiaries | 1,475 |
| Total number of employees | 3,229 |
| Number of retired employees for whom the parent company and major subsidiaries have to bear expenses | |
| Professional composition | |
| Professional composition category | Professional composition |
| Production staff | 498 |
| Salesperson | 102 |
| Technical staff | 1,905 |
| Financial officer | 94 |
| Administration staff | 416 |
| Security personnel | 198 |
| Vehicle management staff | 16 |
| Total | 3,229 |
| Education level | |
| Education level category | Quantity (person) |
| Postgraduate | 113 |
| Bachelor's degree | 1,530 |
| College graduates | 840 |
| High school | 326 |
| Junior high school and below | 420 |
| Total | 3,229 |
(ii) Salary policy
√Applicable □Not applicable
I. Principles of remuneration system
(1) Combination of duties, powers, responsibilities, and benefits;
(2) It shall be fair internally and competitive externally;
(3) Distribution according to work, priority to efficiency, fairness and sustainabledevelopment;
(4) Adoption of the distribution form of "salary determined by post, grade determined byability, and award determined by performance" to reasonably widen the income gap.
2. Basis of salary system
Position importance, performance contribution, ability, work attitude and spirit ofcooperation.
(1) As far as the overall level is concerned, the Company determines the remunerationbased on the current economic benefits and sustainable development.
(2) The Company's salary system includes two different types.
a. The annual salary system is applicable to managers and deputy managers of theCompany's headquarters, as well as members of the management team of branches andsubsidiaries;b. The structured wage system is applicable to employees who have signed labor contractsfor two years and above. Including grassroots management personnel, functional departmentpersonnel, engineering management personnel, logistics management personnel andequipment maintenance personnel.
(3) The remuneration of specially hired staff, staff waiting for duty, retired staff and timingpiecework staff shall be stipulated separately.
(4) The Company's employee income generally includes four parts: job skill wages, bonuses,benefits, and allowances.
(iii) Training program
√Applicable □Not applicable
According to the different training organizations, the Company's employee training can bedivided into: OJT training, company internal training, expatriate training and online training.
1. OJT (On the Job Training) The training of ordinary employees and new employees byleaders of various departments, experienced or skilled employees belongs to OJT training,including the Company's administrative management series training, business managementseries training, engineering technology series training, and security logistics series training.
2. Enterprise internal training. According to the Company's training needs, the Companyorganizes internal trainers or invites external training institutions to tailor training courses for theCompany, allowing employees to receive systematic training, including corporate culture,company organizational structure and rules and regulations, industry status and prospects, andprofessional ethics, etiquette, code of conduct, language, computer skills, etc.
3. Expatriate training In accordance with the needs of the Company's business developmentand job skills, the Company organizes personnel in specific positions to go out to participate inthe training of training institutions, including financial securities series training, human resourcemanagement training, and enterprise management series training.
4. Network training It is an online training for employees through the application ofinformation technology and Internet technology, and different training content is set for differentpositions, so that training and learning are independent and personalized, and the use ofresources is maximized.
(iv) Labor outsourcing
√Applicable □Not applicable
| Total number of working hours of labor outsourcing | 2501.5 months |
| Total remuneration paid for labor outsourcing | 14.3055 million yuan |
X. Plan for profit distribution or capital reserve into stock capital(i) Formulation, implementation or adjustment of cash dividend policy
√Applicable □Not applicable
According to the China Securities Regulatory Commission's Notice on FurtherImplementation of Cash Dividends by Listed Companies (ZJF [2012] 37) and Zhejiang SecuritiesRegulatory Bureau Notice on Forwarding and Further Implementation of Listed Companies'Cash Dividends (ZZJSSZ [2012] 138) Regulations, the Company held the 24th meeting of thesixth board of directors on August 15, 2012, and reviewed and approved the Proposal onAmending the Articles of Association, which revised the Company’s profit distribution policy andadjustment decision-making mechanism. The second provisional general meeting ofshareholders held on September 3, 2012 was deliberated and approved. In order to furtherimplement the new requirements of the China Securities Regulatory Commission's Guidelinesfor the Supervision of Listed Companies No. 3-Cash Dividend Distribution of Listed Companies(November 30, 2013) and the Guidelines for Cash Dividend Distribution of Listed Companies ofthe Shanghai Stock Exchange, the forty-fourth meeting of the sixth board of directors of theCompany held on April 17, 2014 reviewed and approved the Proposal on Amending the ProfitDistribution Clauses in the Articles of Association of the Company. The Company further clarifiedthe basic principles, distribution forms, specific policies, decision-making mechanisms andprocedures of the Company's profit distribution, which were reviewed and approved by the 2013Annual General Meeting of Shareholders held on May 12, 2014. The nineteenth meeting of theseventh board of directors of the Company held on December 25, 2015 reviewed and approvedthe Plan of Zhejiang China Commodities City Group Co., Ltd. on Shareholder Dividend ReturnPlan.
The Company's 2021 annual general meeting of shareholders held on April 13, 2022reviewed and approved the Company's profit distribution plan for 2021. In 2021, based on thetotal share capital of 5,491,274,176 shares, a cash dividend of RMB 0.73 (including tax) will bedistributed for every 10 shares. A total of RMB 400,863,014.85 was allocated. The Company'sboard of directors published the Announcement on the Implementation of the Distribution ofRights and Interests in 2021 on the website of the Shanghai Stock Exchange and the ChinaSecurities Journal, Shanghai Securities News and Securities Times on June 1, 2022. The profitshave been distributed before June 10, 2022. The decision-making procedures related to theCompany's profit distribution comply with the provisions of the Articles of Association. TheCompany listens to the opinions and demands of small and medium shareholders, and the profitdistribution is based on factors such as the Company's industry characteristics, developmentstage and profitability level, and capital needs. It takes into account the requirements forinvestors to share the results of the Company's development and growth and obtain reasonableinvestment returns.
(ii) Special explanation of cash dividend policy
√Applicable □Not applicable
| Whether it complies with the provisions of the Company's articles of association or the requirements of the resolution of the general meeting of shareholders | √ Y □ N |
| Whether the dividend standard and ratio are clear and clear | √ Y □ N |
| Whether the relevant decision-making procedures and mechanisms are complete | √ Y □ N |
| Whether the independent directors performed their duties and played their due role | √ Y □ N |
| Whether minority shareholders have the opportunity to fully express their opinions and demands, and whether their legitimate rights and interests have been fully protected | √ Y □ N |
(iii) During the reporting period, if the parent company is profitable and the profitavailable for distribution to shareholders is positive, but does not propose a plan forthe distribution of cash profits, the Company shall disclose in details the reason, theapplication and using plan of the undistributed profits.
□Applicable √Not applicable
(iv) Profit distribution and conversion of capital reserves into share capital during thereporting period
√Applicable □Not applicable
Unit: RMB
| Number of bonus shares for every 10 shares | 0 |
| Dividend payout for every 10 shares (tax inclusive) | 0.65 |
| Number of shares converted from the capitalization of capital reserve for every 10 shares | 0 |
| Cash dividend amount (tax included) | 356,594,821.44 |
| Net profit attributable to common shareholders of listed companies in the annual consolidated statements of dividends | 1,104,719,091.71 |
| Percentage of net profit attributable to common shareholders of listed companies in the consolidated statements (%) | 32.28 |
| The circumstance when repurchase of shares in cash is included in cash dividends | 0 |
| Total dividend amount (tax included) | 356,594,821.44 |
| The ratio of the total dividend amount to the net profit attributable to ordinary shareholders of the listed company in the consolidated statement (%) | 32.28 |
XI. Incentive stock option plans, employee stock ownership plans and other employeeincentives granted by the Company and the impact thereof(i) Relevant incentive matters have been disclosed in the temporary announcement and
there is no progress or change in subsequent implementation.
√Applicable □Not applicable
| Overview of the matter | Query website |
| On October 23, 2020, the twenty-third meeting of the eighth session of the Company's board of directors passed the Proposal on the Company's 2020 Restricted Stock Incentive Plan (Draft) and Its Summary, Proposal on the Measures for the Evaluation and Management of the Implementation of the Company's 2020 Restricted Stock Incentive Plan, Proposal on Requesting the General Meeting of Shareholders to Authorize the Board of Directors to Handle Issues Related to Equity Incentives. The independent directors of the Company issued relevant independent opinions. On October 23, 2020, the sixth meeting of the eighth board of supervisors of the Company deliberated and approved the Proposal on the Company's 2020 Restricted Stock Incentive Plan (Draft) and its Summary, The Proposal on the Implementation Evaluation and Management Measures for the Company's 2020 Restricted Stock Incentive Plan, Proposal on Verification of the List of Incentive Objects of the Company's 2020 Restricted Stock Incentive Plan. The board of supervisors issued relevant verification opinions. Independent financial consultants, lawyers and other intermediary agencies issued corresponding opinions. | For details, please refer to the Company's announcement on the website of the Shanghai Stock Exchange (www.sse.com.cn) on October 24, 2020. |
| On November 18, 2020, it received the Approval for Approving Zhejiang China Commodities City Group Co., Ltd. to implement the 2020 restricted stock incentive plan issued by the State-owned Assets Supervision and Administration Office of the People's Government of Yiwu City, forwarded by Yiwu China Commodities City Holdings Ltd. (Yiwu SASAOF〔2020〕51). | For details, please refer to the Company's announcement on the website of the Shanghai Stock Exchange (www.sse.com.cn) on November 20, 2020. |
| From November 20, 2020 to November 29, 2020, the list of incentive objects and positions of the 2020 restricted stock incentive plan were internally publicized. Within the time limit of the publicity, the board of supervisors of the Company did not receive any objection from any organization or individual or bad feedback, without feedback record. On November 30, 2020, the Board of Supervisors of the Company issued the Examination Opinions and Public Statement of the Board of Supervisors on the List of Incentive Objects of the Company's 2020 Restricted Stock Incentive Plan. | For details, please refer to the Company's announcement on the website of the Shanghai Stock Exchange (www.sse.com.cn) on December 1, 2020. |
| On December 10, 2020, the Company's 2020 Fifth Provisional General Meeting of Shareholders deliberated and approved the “Proposal on the ‘Company's 2020 Restricted Stock Incentive Plan (Draft)’ and Summary”, the “Proposal on the “Measures of Assessment and Management of Implementation of ‘Company’s 2020 Restricted Stock Incentive Plan’”, and the “Proposal on Requesting the General Meeting of Shareholders to Authorize the Board of Directors to Deal with Equity Incentive Related Matters”, and disclosed the “Self-examination Report on the Trades of Company’s Stocks by Insiders of Company’s 2020 Restricted Stock Incentive Plan”. | For details, please refer to the Company's announcement on the website of the Shanghai Stock Exchange (www.sse.com.cn) on December 11, 2020. |
| On December 11, 2020, the twenty-sixth meeting of the eighth session of the Company's board of directors passed the Proposal on Granting Restricted Shares to Incentive Objects for the First Time. The independent directors of the Company issued relevant independent opinions. On December 11, 2020, the seventh meeting of the Company's eighth board of supervisors passed the Proposal on Granting Restricted Stocks to Incentive Objects for the First Time. The Board of Supervisors issued the Verification Opinions of the Board of Supervisors on Matters Related to the First Grant of the Company's 2020 Restricted Stock Incentive Plan. Independent financial consultants, lawyers and other intermediary agencies issued corresponding opinions. | For details, please refer to the Company's announcement on the website of the Shanghai Stock Exchange (www.sse.com.cn) on December 12, 2020. |
| On January 15, 2021, the Company received the Securities Change Registration Certificate issued by the Shanghai Branch of China Securities Depository and Clearing Co., Ltd., and the Company completed the registration of the first grant of restricted stocks to incentive objects. | For details, please refer to the Company's announcement on the website of the Shanghai Stock Exchange (www.sse.com.cn) on January 19, 2021. |
| On August 9, 2021, the 35th meeting of the eighth board of directors of the Company passed the "Proposal on Reserved Granting Restricted Stocks to Incentive Objects", "On Adjusting the Repurchase Price of Restricted Stocks and Repurchasing and Cancelling Some Restricted Stocks" 's proposal". The independent directors of the Company issued relevant independent opinions. On August 9, 2021, the ninth meeting of the eighth Boarder of Supervisors of the Company passed the "Proposal on Reserved Granting Restricted Stocks to Incentive Objects", "Proposal on Adjusting the Repurchase Price of Restricted Stocks and Repurchasing and Cancelling Some Restricted Stocks" ". The Board of Supervisors issued the Verification Opinions of the Board of Supervisors on Matters Related to the Company's Reserved Grant of the Restricted Stock Incentive Plan in 2020. | For details, please refer to the Company's announcement on the website of the Shanghai Stock Exchange (www.sse.com.cn) on August 11, 2021. |
| On November 4, 2021, the Company received the Securities Change Registration Certificate issued by the Shanghai Branch of China Securities Depository and Clearing Co., Ltd., and the Company completed the registration of the reserved grant of restricted stocks to incentive objects. | For details, see the Company's announcement on the website of the Shanghai Stock Exchange (www.sse.com.cn) on November 6, 2021. |
| On November 17, 2021, the Company applied to China Securities Depository and Clearing Co., Ltd. Shanghai Branch for repurchase and cancellation of restricted stocks that have been granted but not yet lifted by some resigned employees. On November 30, 2021, the Company received the "Securities Change Registration Certificate" issued by China Securities Depository and Clearing Co., Ltd. Shanghai Branch, and the Company has completed the registration of the restricted stock repurchase and cancellation. | For details, see the Company's announcement on the website of the Shanghai Stock Exchange (www.sse.com.cn) on November 26, 2021. |
| On July 19, 2022, the fifty-first meeting of the eighth board of directors of the Company reviewed and approved the "Proposal on Adjusting the Repurchase Price of Restricted Stocks and the Repurchase and Cancellation of Some Restricted Stocks", and the independent directors of the Company issued a statement on this Independent opinion expressing consent. On July 19, 2022, the 14th meeting of the 8th Supervisory Committee of the Company passed the "Proposal on Adjusting the Repurchase Price of Restricted Shares and Repurchasing and Cancelling Some Restricted Shares". | For details, see the Company's announcement on the website of the Shanghai Stock Exchange (www.sse.com.cn) on July 20, 2022. |
| On October 18, 2022, the Company applied to China Securities Depository and Clearing Co., Ltd. Shanghai Branch for repurchase and cancellation of restricted stocks that have been granted but not yet lifted by some resigned employees. On October 21, 2022, the Company received the "Securities Change Registration Certificate" issued by China Securities Depository and Clearing Co., Ltd. Shanghai Branch, and the Company has completed the registration of the restricted stock repurchase and cancellation. | For details, see the Company's announcement on the website of the Shanghai Stock Exchange (www.sse.com.cn) on October 19, 2022. |
| On December 28, 2022, the sixth meeting of the ninth session of the board of directors of the Company passed the "Proposal on the achievements of the first part of the 2020 Restricted Stock Incentive Plan to grant part of the first unlocking period to unlock the selling restrictions". The independent directors of the Company have issued independent opinions expressing agreement. On December 28, 2022, the second meeting of the Company's ninth board of supervisors passed the "Proposal on the Achievement of the First Unlocking Period of the First Unlocking Period of the First Grant of the 2020 Restricted Stock Incentive Plan". The Board of Supervisors issued the "Verification Opinion on the Achievement of the Unlocking Conditions for the First Unlocking Period of the Part of the First Grant of the 2020 Restricted Stock Incentive Plan". | For details, see the Company's announcement on the website of the Shanghai Stock Exchange (www.sse.com.cn) on July 20, 2022. |
(ii) Incentives that have not been disclosed in the temporary announcements or had
further progressesIncentive stock option
□Applicable √Not applicable
Other statements
□Applicable √Not applicable
Employee stock ownership plans
□Applicable √Not applicable
Other incentives
□Applicable √Not applicable
(iii) Equity incentives granted to directors and senior executives during the reporting
period
□Applicable √Not applicable
(iv) The evaluation mechanism for senior managers during the reporting period, as wellas the establishment and implementation of incentive mechanisms
√Applicable □Not applicable
The salary appraisal of the senior management personnel is completed and determinedaccording to the performance appraisal method of the head of the enterprise and theCompany's operation and related appraisal indicators, then the salary determination iscompleted.XII. Construction and implementation of internal control system during the reportingperiod
√Applicable □Not applicable
For details, please refer to the "2022 Internal Control Evaluation Report" disclosed by theCompany on the website of the Shanghai Stock Exchange.
Explanation of major deficiencies in internal control during the reporting period
□Applicable √Not applicable
XIII. Management and control of subsidiaries during the reporting period
√Applicable □Not applicable
For details, please refer to the "2022 Internal Control Evaluation Report" disclosed by theCompany on the website of the Shanghai Stock Exchange.
XIV. Explanation of the internal control audit report
√Applicable □Not applicable
The Company hired Ernst & Young Hua Ming Certified Public Accountants (special generalpartnership) to audit the effectiveness of the Company's internal control in its 2022 financialstatements. The accounting firm has issued a standard unqualified internal control audit report.It is believed that the Company maintained effective internal control of financial reporting in allmajor aspects in accordance with the Basic Standards for Corporate Internal Control and relatedregulations on December 31, 2022. Please refer to the website of Shanghai Stock Exchange(www.sse.com.cn) for details of the "Internal Control Audit Report".Disclosure of internal control audit report: YesOpinion type of internal control audit report: standard unqualified opinion
XV. Self-examination and rectification of the Listed Company's governance specialactionsIn the Listed Company's governance special actions, after self-examination, the Companyfound that the Company's articles of association did not specify that when the shareholders'general meeting elects directors and supervisors, it should implement the cumulative votingsystem. The Company held the third provisional general meeting of shareholders in 2021 onNovember 4, 2021. With the special resolution of the general meeting of shareholders, therelevant content of Article 84 of the Company's articles of association, i.e., "When the generalmeeting of shareholders votes on the election of directors and supervisors, the cumulative votingsystem may be implemented in accordance with the provisions of the Articles of Association orthe resolutions of the shareholders' general meeting" was revised to "When the general meetingof shareholders votes on the election of two or more directors and supervisors, the cumulativevoting system shall be implemented in accordance with the provisions of the Articles ofAssociation or the resolutions of the general meeting of shareholders.” For details, please referto the "Announcement on Amending the Articles of Association" (L 2021-048) disclosed onOctober 19, 2021 and the "Announcement on Resolutions of the Third Provisional GeneralMeeting in 2021" disclosed on November 5, 2021 ( L 2021-054).
XVI. Others
□Applicable √Not applicable
Section V. Environmental and Social ResponsibilitiesI. Environmental issues
| Whether to establish relevant mechanisms for environmental protection | No |
| Investment in environmental protection funds during the reporting period (unit: ten thousand yuan) | NA |
(i) Description of the environmental protection status of the Company and its mainsubsidiaries that are key pollutant discharging units announced by the environmentalprotection authorities
□Applicable √Not applicable
(ii) Description of the environmental protection status of the companies other than thekey pollutant discharging units
□Applicable √Not applicable
(iii) Relevant information that is conducive to protecting ecology, preventing pollution,and fulfilling environmental responsibilities
□Applicable √Not applicable
(iv) Measures taken to reduce their carbon emissions during the reporting period and theeffect
| Whether to take carbon reduction measures | Yes |
| Reduction of carbon dioxide equivalent emissions (unit: tons) | 17,600 |
| Types of carbon reduction measures (such as using clean energy to generate electricity, using carbon reduction technologies in the production process, developing and producing new products that help reduce carbon emissions, etc.) | clean energy power generation |
Specific instructions
□Applicable √Not applicable
II. Social responsibility(i) Whether to disclose social responsibility report, sustainable development report or
ESG report separately
√Applicable □Not applicable
For details, please refer to the "2022 ESG Report" disclosed by the Company on the website ofthe Shanghai Stock Exchange.
(ii) Social responsibility
□Applicable √Not applicable
Specific instructions
□Applicable √Not applicable
III. Status of consolidation and expansion of the results of poverty alleviation, ruralrevitalization and other specific work
□Applicable √Not applicable
Specific instructions
□Applicable √Not applicable
Section VI. Significant MattersI. Fulfillment of commitments(i) Commitments made by the actual controller, shareholders, affiliates and acquirer ofthe Company, the Company itself and other related parties during the reportingperiod or as of the reporting period
□Applicable √Not applicable
(ii) If there is a profit forecast for the Company’s assets or projects, and the reportingperiod is still in the profit forecast period, the Company will explain whether theassets or projects have reached the original profit forecast and the reason
□Reached □Not reached √Not applicable
(iii) Completion of performance commitments and its impact on the impairment testof goodwill
□Applicable √Not applicable
II. Non-operating capital occupation by controlling shareholders and other relatedparties during the reporting period
□Applicable √Not applicable
III. Illegal guarantees
□Applicable √Not applicable
IV. The Company's explanation on the ‘non-standard opinion audit report’ of theaccounting firm
□Applicable √Not applicable
V. The Company's analysis and explanation on the reasons and effects of changes inaccounting policies, accounting estimates or corrections of major accounting errors(i) The Company's analysis and explanation on the reasons and effects of changes in
accounting policies and accounting estimates
□Applicable √Not applicable
(ii) The Company's analysis and explanation on the reasons and effects of majoraccounting errors correction
□Applicable √Not applicable
(iii) Communication with the former accounting firm
□Applicable √Not applicable
(iv) Other statements
□Applicable √Not applicable
VI. Engagement and termination of engagement of accounting firm
Unit: RMB10,000
| Now engaging | |
| Name of the engaged domestic accounting firm | Ernst & Young Hua Ming Certified Public Accountants (special general partnership) |
| Remuneration of the engaged domestic accounting firm | 200 |
| Audit period of the engaged domestic accounting firm | 15 |
| Name | Remuneration | |
| Internal control auditing accounting firm | Ernst & Young Hua Ming Certified Public Accountants (special general partnership) | 55 |
Statement on the engagement or termination of engagement of accounting firm
√Applicable □Not applicable
After deliberation at the 55th meeting of the eighth Board of Directors of the Company heldon October 19, 2022, and the Company’s second provisional general meeting of shareholdersin 2022 held on November 8, 2022, the Proposal on Renewing the Appointment of theAccounting Firm was passed, and agreed to continue Appoint Ernst & Young Hua Ming CertifiedPublic Accountants (Special General Partnership) as the Company's 2022 financial and internalcontrol audit agency. For details, please refer to the Announcement on Renewing theAppointment of Accounting Firms (L2022-055) issued by the Company on the Shanghai StockExchange website www.sse.com.cn on October 20, 2022, and the Announcement onResolutions of the Second Provisional General Meeting of Shareholders in 2022 (L2022-059)issued by the Company on the Shanghai Stock Exchange website www.sse.com.cn onNovember 9, 2022.
Statement on replacing the accounting firm during the audit
□Applicable √Not applicable
VII. Situations at risk of delisting(i) Reasons for the delisting risk warning
□Applicable √Not applicable
(ii) The Company's proposed response measures
□Applicable √Not applicable
(iii) Termination of listing and reasons
□Applicable √Not applicable
VIII. Matters relating to bankruptcy and reorganization
□Applicable √Not applicable
IX. Material litigations and arbitrations
√There are material litigations or arbitrations in current reporting period □No material litigations or arbitrations in current reporting period
(i) Litigations and arbitrations have been disclosed in the temporary announcements and have had no further progresses
□Applicable √Not applicable
(ii) Litigations and arbitrations that have not been disclosed in the temporary announcements or have had further progresses
√Applicable □Not applicable
Unit: RMB10,000
| During the reporting period: | |||||||||
| Plaintiff (claimant) | Defendant (respondent) | Party Bearing Joint Liabilities | Litigation or arbitration | Basic information of litigation (arbitration) | Value involved in litigation (arbitration) | Does the litigation (arbitration) cause estimated liabilities and the amount thereof | Status of litigation (arbitration) | Results of litigation (arbitration) and effect thereof | Enforcement of judgment (award) |
| Zhenjiang Hongda Real Estate Co., Ltd., Zhenjiang Hongda Yiwu Small Commodity Market Management Co., Ltd. | The Company | Nil | Litigation | Second instance of unfair competition dispute [(2022) SMZ No. 362] | 812.00 | No | Judgment has been made | Dismissed the appeal and upheld the original verdict | Won but not enforced |
| Sun Lijun, Tu Lixin | Bafang Construction Group Co., Ltd., the Company, the first branch of the International Trade | Nil | Litigation | Construction project subcontract dispute case [(2022) Z 0782 | 546.98 | No | Judgment has been made | The claims of plaintiffs Sun Lijun and Tu Lixin were | Closed |
| City | MSQD No. 3081] | dismissed. | |||||||
| China Cinda Asset Management Co., Ltd. Zhejiang Branch | Zhejiang Yiwu China Small Commodity City Trading Co., Ltd., the Company | Nil | Litigation | Dispute over License of Credit [(2021) Z 07 MC No. 230] | 10,939.76 | Yes, 11,062.03 | Hearing has been held. Undecided | ||
| Ying Jianhua | The Company, third party Shenzhen Pengrun Construction Group Co., Ltd. | Nil | Litigation | Dispute over construction contract [(2022) Z 0782 M C No. 8315] | 836.31 | No | Hearing has been held. Undecided | ||
| Ningxia Shenghong Construction Engineering Co., Ltd. | Shizuishan Shengyuze Asset Management Co., Ltd., Yiwu China Commodities City Supply Chain Management Co., Ltd., the Company | Nil | Litigation | Dispute over construction contract [(2022) N 0202 M C No. 4273] | 430.69 | No | Hearing has been held. Undecided | ||
| The Company | Zhejiang Yiwu Chuanglian Market Investment and Management Co., Ltd., Hebei Jiangcheng Real Estate Development Co., Ltd., Handan Zheshang Yiwu China Commodities Wholesale City Co., Ltd. | Nil | Litigation | Dispute over unfair competitions [(2021) Z 0782 MC No.6367] | 485.00 | No | No hearings have not been held |
(iii) Other statements
√Applicable □Not applicable
In March 2018, the Company and Yiwu China Commodities City (the Company’s former holding subsidiary, present participating company, inwhich the Company holds 35.8% of shares) was sued by Bank of China Co., Ltd. Yiwu Branch (hereinafter referred to as “Bank of China Yiwu Branch”)due to dispute over a letter of credit” in the Jinhua Intermediate People’s Court of Zhejiang Province (hereinafter referred to as “Jinhua IntermediateCourt”). For details, see the “Announcement on Litigation Involved in the Company and Its Holding Subsidiaries" (L 2018-008) disclosed by the Companyon March 2, 2018. Later, the claims were dismissed by Jinhua Intermediate Court
On May 18, 2018, Bank of China Yiwu Branch transferred all the rights of the principal and interest, compound interest, liquidated damages,compensation and other claims under the letter of credit involved to China Cinda Asset Management Co., Ltd. Zhejiang Branch (hereinafter referred toas "Cinda Assets").
On June 25, 2021, Cinda Assets again filed a civil lawsuit with the Jinhua Intermediate People's Court on the dispute over the letter of credit. Fordetails, see the “Announcement on the Progress of Litigation Involved in the Company and its Subsidiaries” (Lin 2021-036) disclosed by the Companyon July 21, 2021.
As of the end of the reporting period, the court hearing for the case was held but no judgment was made.
X. Information of the listed company and its directors, supervisors, senior management,controlling shareholder, and actual controller suspected of violations of laws andregulations, penalties and rectification
□Applicable √Not applicable
XI. Credit standing of the Company and its controlling shareholder and actual controller
√Applicable □Not applicable
There was no outstanding court judgment or overdue debt of a large amount involving theCompany or its controlling shareholder or actual controller during the reporting period.
XII. Material related-party transactions(i) Related-party transactions relating to regular corporate operation
1、 Matters that have been disclosed in the temporary announcements and had nofurther progresses or changes
□Applicable √Not applicable
2、 Matters that have been disclosed in the temporary announcements but had furtherprogresses or changes
√Applicable □Not applicable
The third meeting of the Company's ninth Board of Directors reviewed and approved the"Proposal on Entrusted Management of Project Construction and Related Transactions", andagreed that the Company's wholly-owned subsidiaries Yiwu Shangbo and Yiwu Shangbo DigitalIntelligence Enterprise Management Co., Ltd. and the controlling shareholder Mall Holdingsrespectively signed the "Contract on Entrusted Management of Engineering Projects" withShangbo Yungu a wholly-owned subsidiary of the Company's controlling shareholder CCCH.For details, please refer to the "Announcement on Entrusted Management of ProjectConstruction and Related Transactions" (L 2022-073) disclosed by the Company on the websiteof the Shanghai Stock Exchange (www.sse.com.cn) on November 23, 2022.
As of the end of the reporting period, the project was under construction.
3、 Matters that have not been disclosed in the temporary announcements
√Applicable □Not applicable
Unit: RMB
| Related counterparty | Relationship | Type of related-party transaction | Contents of related-party transaction | Pricing principle | Price of related-party transaction | Amount of related-party transaction | Percentage in the amount of similar transactions (%) | Settlement method | Market PRICE | Reasons for the large difference between the price of the transaction and reference market price |
| Yiwu China Commodities City Property Service Co., Ltd. | Subsidiary of controlling shareholder | Acceptance of labor service | Property service fee and greening maintenance fee | Market price | 184,739,755.70 | 184,739,755.70 | 78.08 | Account transfer | 184,739,755.70 | |
| Yiwu Security Service Co., Ltd. | Subsidiaries of controlling shareholder parent company | Acceptance of labor service | Exhibition security service fee | Market price | 28,188,230.28 | 28,188,230.28 | 11.91 | Account transfer | 28,188,230.28 | |
| CCCH | Controlling shareholders | Lease | Warehouses | Market price | 15,015,618.37 | 15,015,618.37 | 6.35 | Account transfer | 15,015,618.37 | |
| Yiwu China Commodities City Property Service Co., Ltd. | Subsidiary of controlling shareholder | Sales of goods | Sales of goods | Market price | 2,175,245.60 | 2,175,245.60 | 0.92 | Account transfer | 2,175,245.60 | |
| Yiwu Agriculture Development Co., Ltd. | Subsidiaries of controlling shareholder parent company | Buying goods | Commodity purchase | Market price | 2,042,604.35 | 2,042,604.35 | 0.86 | Account transfer | 2,042,604.35 |
| CCCP | Subsidiary of controlling shareholder | Lease | Office space | Market price | 1,126,617.29 | 1,126,617.29 | 0.48 | Account transfer | 1,126,617.29 | |
| Yiwu Shangbo Yungu Enterprise Management Co., Ltd. | Subsidiary of controlling shareholder | Providing services | Construction fee | Market price | 1,100,800.00 | 1,100,800.00 | 0.47 | Account transfer | 1,100,800.00 | |
| Yourworld International Conference Center, subordinated to Yiwu Market Development Group | Branches of the controlling shareholder parent company | Acceptance of labor service | Laundering fees | Market price | 1,054,026.05 | 1,054,026.05 | 0.45 | Account transfer | 1,054,026.05 | |
| Yiwu Market Development Service Center Co., Ltd. | Subsidiaries of controlling shareholder parent company | Lease | Parking lot | Market price | 516,288.99 | 516,288.99 | 0.22 | Account transfer | 516,288.99 | |
| Yourworld International Conference Center, subordinated to Yiwu Market Development Group | Branches of the controlling shareholder parent company | Other inflow | Entrusted management fees and license fees | Negotiated price | 514,979.27 | 514,979.27 | 0.22 | Account transfer | 514,979.27 | |
| Yiwu China Commodities City Property Service Co., Ltd. | Subsidiary of controlling shareholder | Lease | Office space | Market price | 122,445.99 | 122,445.99 | 0.04 | Account transfer | 122,445.99 | |
| Total | / | / | 236,596,611.89 | 100 | / | / | / | |||
| Return of large-value goods sales | ||||||||||
| Illustration on related-party transactions | Yiwu China Small Commodity City Property Service Co., Ltd. obtained the market property service and greening maintenance contract by participating in public bidding. | |||||||||
(ii) Related transactions in the acquisition or sale of assets or equity
1. Matters that have been disclosed in the temporary announcements and had nofurther progresses or changes
□Applicable √Not applicable
2. Matters that have been disclosed in the temporary announcements but had furtherprogresses or changes
□Applicable √Not applicable
3. Matters that have not been disclosed in the temporary announcements
□Applicable √Not applicable
4. If any agreement on the operating results is involved, the achievement of operatingresults during the reporting period shall be disclosed
□Applicable √Not applicable
(iii) Related-party transactions arising from joint external investment
1. Matters that have been disclosed in the temporary announcements and had no
further progresses or changes
□Applicable √Not applicable
2. Matters that have been disclosed in the temporary announcements but had furtherprogresses or changes
□Applicable √Not applicable
3. Matters that have not been disclosed in the temporary announcements
□Applicable √Not applicable
(iv) Related-party credits and debts
1. Matters that have been disclosed in the temporary announcements and had nofurther progresses or changes
□Applicable √Not applicable
2. Matters that have been disclosed in the temporary announcements but had further
progresses or changes
□Applicable √Not applicable
3. Matters that have not been disclosed in the temporary announcements
□Applicable √Not applicable
(v) Financial business between the Company and the associated financial companies,the Company's holding financial company and the related parties
□Applicable √Not applicable
(vi) Others
□Applicable √Not applicable
XIII. Material contracts and performance thereof(i) Trusteeship, contracting and leases
1. Hosting
□Applicable √Not applicable
2. Contracting
□Applicable √Not applicable
3. Renting
□Applicable √Not applicable
(ii) Guarantees
√Applicable □Not applicable
Unit: RMB10,000
| External guarantees provided by the Company (excluding those provided for the subsidiaries) | |||||||||||||||
| Guarantor | Relationship between the guarantor and the Listed Company | The guaranteed | Amount of guarantee | Date of guarantee (signing date of the agreement) | Guarantee Starting date | Guarantee Maturity date | Type of guarantee | Collateral (if any) | Is the guarantee fulfilled in full | Is the guarantee overdue | Overdue amount of the guarantee | Counter guarantees | Is it a related-party guarantee | Related Relationship | |
| The Company | The Company itself | Yiwu Shanglv | 9,479.93 | Dec 16, 2015 | Jul 1, 2015 | Dec 15, 2026 | Joint and several liability guarantee | Nil | No | No | NA | SCO provided a counter-guarantee | Yes | Joint venture | |
| Hangzhou Shangbo Nanxing | Wholly-owned subsidiary | House purchaser | 484.63 | Joint and several liability guarantee | Nil | No | No | NA | No | ||||||
| Amount of guarantees made during the reporting period (excluding the guarantees provided for subsidiaries) | -5,898.85 | ||||||||||||||
| Balance of guarantees at the end of the reporting period (A) (excluding the guarantees provided for subsidiaries) | 9,964.56 | ||||||||||||||
| The guarantee of the Company and its subsidiaries to the subsidiaries | |||||||||||||||
| Amount of guarantees provided for subsidiaries during the reporting period | - | ||||||||||||||
| Balance of guarantees provided for subsidiaries at the end of the reporting period (B) | - | ||||||||||||||
| Total guarantees provided by the Company (including those provided for the subsidiaries) | |
| Total amount of guarantees (A+B) | 9,964.56 |
| Ratio of the total amount of guarantees to the Company’s net assets (%) | 0.65 |
| Among them: | |
| Amount of guarantees provided for shareholders, actual controller and their related parties (C) | - |
| Amount of guarantees provided directly or indirectly for the debtors whose debt-to-asset ratio exceed 70% (D) | - |
| Portion of total amount of guarantees in excess of 50% of net assets (E) | - |
| Total (C+D+E) | - |
| Statement on the joint and several liability that may be assumed due to outstanding guarantees | N/A |
| Statement on guarantees | 1. According to the resolution of the 15th Meeting of the 7th Board of Directors on July 1, 2015, the Group applied for a RMB 750 million loan with Agricultural Bank of China Yiwu Branch for Yiwu Shanglv and provided guarantees in accordance with the shareholding ratio. The guarantee method was joint liability guarantee, the highest guarantee amount was RMB 367.5 million and the guarantee term was11 years. As of December 31, 2022, Yiwu Shanglv actually borrowed RMB 193,468,056.42 (December 31, 2021: 296,505,577.63) from banks in total. According to the agreement of the guarantee contract, it assumed the guarantee liability of RMB 94,799,347.65 (December 31, 2021: RMB 145,287,733.04) for the Agricultural Bank of China Yiwu Branch. SCO provided a counter-guarantee for this guarantee. 2. According to relevant regulations, before the purchaser of the commercial housing sold by the Group has obtained the property certificate, the Group shall provide the purchaser with a bank mortgage guarantee. As of December 31, 2022, the unsettled guarantee amount was RMB 4,846,333.64 (December 31, 2021: RMB 5,063,333.60). Those guarantees would be released after the issuance of the property ownership certificates and are thus little likely to incur losses. Therefore, the management believed that it was not necessary to make provision for the guarantees. |
(iii) Entrust the management of the cash assets of others
1. Entrusted financial management
(1) The totality of entrusted financial management
□Applicable √Not applicable
Other information
□Applicable √Not applicable
(2) Individual entrusted financial management
□Applicable √Not applicable
Other information
□Applicable √Not applicable
(3) Entrusted financial management impairment provision
□Applicable √Not applicable
2. Entrusted Loan
(1) Total entrusted loan
√Applicable □Not applicable
Unit: RMB10,000
| Type | Source of funds | Amount | Unexpired balance | Overdue unrecovered amount |
| Entrusted Loans | Self-owned funds | 4,800 | 4,800 | - |
Zhejiang Yiwugou E-Commerce Co., Ltd., an indirect controlled subsidiary of the Company,provided an entrusted loan of RMB 48 million to Yixia Chengdu International Trade City Co., Ltd.with its own funds for a period of 2 years in order to improve the efficiency of capital use. Fordetails, please refer to the "Announcement on Providing Entrusted Loans to External Parties" (L2022-079) disclosed on the website of the Shanghai Stock Exchange.
Other information
□Applicable √Not applicable
(2) Single Entrusted Loan
√Applicable □Not applicable
Unit: RMB10,000
| trustee | Type of entrusted loan | Entrusted loan amount | Entrusted loan start date | Entrusted loan termination date | Fund sources Source | Annualized rate of return | Actual recovery | Statutory procedures | Entrusted loan program | Amount of provision for impairment (if any) |
| Yiwu Branch of Agricultural Bank of China Co., Ltd. | Bank entrusted loans | 4,800 | Dec 20, 2022 | Dec 19, 2024 | Self-owned funds | 5.5% | Yes | NA |
Other information
□Applicable √Not applicable
(3) Entrusted loan impairment provision
□Applicable √Not applicable
3. Other information
□Applicable √Not applicable
(iv) Other material contracts
√Applicable □Not applicable
| No | Name of contract | Contracting party | Contract price (RMB 10,000) |
| 1 | Yiwu International Digital Logistics Market (Yiwu Northeast Warehouse) Project Phase I Construction Contract | Zhejiang Dadongwu Group Construction Co., Ltd. | 70,651.77 |
The 48th meeting of the 8th board of directors of the Company reviewed and approved the"Proposal on Investing in the Construction of the Yiwu International Digital Logistics MarketPhase I Project". For details, please refer to the Company's website of the Shanghai StockExchange (www.sse.com .cn) disclosed the "Announcement on Investing in the Construction ofYiwu International Digital Logistics Market Phase I Project" (L 2022-027).
XIV. Explanation on other major events that have a significant impact on investors' value
judgments and investment decisions
□Applicable √Not applicable
Section VII. Changes in Shares and ShareholdersI. Changes in equity(i) Exhibition of changes in shares
1. Exhibition of changes in shares
Unit: Ten Thousand Shares
| Before this change | Increase or decrease in the current period (+, -) | After this change | |||||||
| QTY | Proportion (%) | New shares issued | Bonus shares | Shares converted from capital reserve | Others | Sub-total | QTY | Proportion (%) | |
| I. Restricted shares | 4,806 | 0.88 | 0 | 0 | 0 | -520 | -520 | 4,286 | 0.78 |
| 1. Shares held by other domestic capitals | 4,806 | 0.88 | 0 | 0 | 0 | -520 | -520 | 4,286 | 0.78 |
| shares held by domestic natural persons | 4,806 | 0.88 | 0 | 0 | 0 | -520 | -520 | 4,286 | 0.78 |
| II. Unrestricted shares | 544,321.4176 | 99.12 | 0 | 0 | 0 | 0 | 0 | 544,321.4176 | 99.22 |
| 1. RMB-denominated common shares | 544,321.4176 | 99.12 | 0 | 0 | 0 | 0 | 0 | 544,321.4176 | 99.22 |
| III. Total number of shares | 549,127.4176 | 100 | 0 | 0 | 0 | -520 | -520 | 548,607.4176 | 100 |
2. Description of changes in shares
√Applicable □Not applicable
On October 21, 2022, because some incentive objects no longer met the incentiveconditions, the Company repurchased and cancelled 5,200,000 shares of restricted shares.
3. The impact of changes in shares on financial indicators such as earnings per shareand net assets per share in the most recent year and the most recent period (if any)
□Applicable √Not applicable
4. Other matters the Company deems it necessary to disclose or required by the
securities regulatory authority to be disclosed
□Applicable √Not applicable
(ii) Changes in non-tradable shares
√Applicable □Not applicable
Unit: 10,000 shares
| Shareholder | Number of restricted shares at the beginning of the year | Number of restricted shares released during the year | Number of increased restricted shares during the year | Number of restricted shares at the end of the year | Reasons for restriction on trade | Release date |
| 386 incentive objects for first-time grand of the restricted stock incentive plan in 2020 | 4,572 | 0 | 0 | 4,060 | Restricted stock incentives | The lock-up period is 24 months, 36 months and 48 months from the date when the registration of the reserved grant is completed. |
| 31 incentive objects for reserved grant of restricted stock incentive plan in 2020 | 234 | 0 | 0 | 226 | Restricted stock incentives | The lock-up period is 24 months, 36 months and 48 months from the date when the registration of the reserved grant is completed. |
| Total | 4,806 | 0 | 0 | 4,286 | / | / |
Note: During the reporting period, 45 incentive objects no longer met the incentive conditionsdue to transfer, resignation and other reasons, and the restricted stocks held by them wererepurchased and canceled by the Company. As of the end of the reporting period, there were372 surviving incentive objects, holding a total of 42.86 million restricted shares.II. Securities issuance and listing(i) Securities issuance as of the reporting period
√Applicable □Not applicable
Unit: 10,000 shares, Currency: RMB
| Stocks and derivatives of securities | Issue date | Issuing price (or interest rate) | Issuing number | Listing date | Number of approved listing transactions | Transaction termination date |
| Common stock class | ||||||
| A share | January | RMB 2.94 | 4,670 | January 15, | 4,670 | |
| 15, 2021 | /share | 2021 | ||||
| A share | November 4, 2021 | RMB 2.39 / share | 234 | November 4, 2021 | 234 | |
| Bonds (including corporate bonds, corporate bonds, and non-financial corporate debt financing instruments) | ||||||
| 22 YIWU CCC 01 | August 30, 2022 | 2.88% | 800 | September 8, 2022 | 800 | September 1, 2025 |
| 22 YIWU CCC 02 | September 20, 2022 | 2.88% | 700 | September 27, 2022 | 700 | September 22, 2025 |
Notes on the issuance of securities as of the reporting period (for bonds with different interestrates during the duration, please specify separately):
√Applicable □Not applicable
Approved by the document "ZJXK [2022] No. 1792" issued by the China Securities RegulatoryCommission, the Company publicly issued corporate bonds of RMB 800,000,000 on September1, 2022, with a face value of RMB 100 and a coupon rate of 2.88%. It was listed and traded onthe Shanghai Stock Exchange on September 8, 2022. The abbreviation of the bond is 22 YIWUCCC 01 and the bond code is 137740.In accordance with the document ZJXK [2022] No. 1792 issued by the China SecuritiesRegulatory Commission, the Company publicly issued corporate bonds of RMB 700,000,000 onSeptember 22, 2022. The face value of the current bonds is RMB 100, and the coupon rate is
2.88%. It was listed and traded on the Shanghai Stock Exchange on September 27, 2022. Theabbreviation of the bond is 22 YIWU CCC 02 and the bond code is 137815.
(ii) Changes in the total number of shares of the Company, the shareholder structure,
and changes in the Company's assets and liabilities structure
□Applicable √Not applicable
(iii) Existing internal employee shares
□Applicable √Not applicable
III. Shareholders and actual controllers(i) Total number of shareholders
| Number of common shareholders as of the end of the reporting period | 201,353 |
| The total number of common shareholders (households) at the end of the previous month before the disclosure of the annual report | 174,068 |
(ii) Shareholdings of the top 10 shareholders and top 10 holders of tradable shares (or
shareholders not subject to trading restrictions)
Unit: share
| Shares held by top 10 shareholders | |||||||
| Shareholder (full name) | Change during the reporting period | Number of shares held at the end of the reporting period | Proportion (%) | Number of non-tradable shares held | Pledge, mark or freezing | Ownership of shareholder | |
| Status of shares | QTY | ||||||
| Yiwu China Commodities City Holdings Limited | 0 | 3,038,179,392 | 55.38 | 0 | Nil | 0 | State-owned legal person |
| Zhejiang Zhecai Capital Management Co., Ltd. | 0 | 147,466,528 | 2.69 | 0 | Nil | 0 | State-owned legal person |
| Hong Kong Central Clearing Company Limited | -2,155,460 | 61,754,865 | 1.13 | 0 | Unk | 0 | Others |
| Dacheng Fund－Agricultural Bank of China－Dacheng China Securities Financial Assets Management Scheme | 0 | 27,672,800 | 0.50 | 0 | Unk | 0 | Unk |
| GF Fund－Agricultural Bank of China－GF China Securities Financial Assets Management Scheme | 0 | 27,672,800 | 0.50 | 0 | Unk | 0 | Unk |
| Southern Asset Management－Agricultural Bank of China－Southern China Securities Financial Assets Management Scheme | 0 | 27,672,800 | 0.50 | 0 | Unk | 0 | Unk |
| Zhong Ou AMC－Agricultural Bank of China－Zhong Ou China Securities Financial Assets Management Scheme | -4,378,100 | 23,294,700 | 0.42 | 0 | Unk | 0 | Unk |
| E Fund－Agricultural Bank of China－E Fund China Securities Financial Assets Management Scheme | -4,662,700 | 23,010,100 | 0.42 | 0 | Unk | 0 | Unk |
| Agricultural Bank of China Co., Ltd. - China Securities 500 Trading Open-end Index Securities Investment Fund | 7,538,800 | 22,592,110 | 0.41 | 0 | Unk | 0 | Unk |
| Yinhua Fund－Agricultural Bank of China－Yinhua China Securities Financial Assets Management Scheme | -4,401,818 | 19,395,127 | 0.35 | 0 | Unk | 0 | Unk |
| Shares held by top 10 holders of tradable shares | |||||||
| Shareholder | Number of tradable shares held | Type and quantity of shares | |||||
| Type | QTY | ||||||
| Yiwu China Commodities City Holdings Limited | 3,038,179,392 | RMB-denominated common share | 3,038,179,392 | ||||
| Zhejiang Zhecai Capital Management Co., Ltd. | 147,466,528 | RMB-denominated common share | 147,466,528 | ||||
| Hong Kong Central Clearing Company Limited | 61,754,865 | RMB-denominated common share | 61,754,865 | ||||
| Dacheng Fund－Agricultural Bank of China－Dacheng China Securities Financial Assets Management Scheme | 27,672,800 | RMB-denominated common share | 27,672,800 | ||||
| GF Fund－Agricultural Bank of China－GF China Securities Financial Assets Management Scheme | 27,672,800 | RMB-denominated common share | 27,672,800 | ||||
| Southern Asset Management－Agricultural Bank of China－Southern China Securities Financial Assets Management Scheme | 27,672,800 | RMB-denominated common share | 27,672,800 | ||||
| Zhong Ou AMC－Agricultural Bank of China－Zhong Ou China Securities Financial Assets Management Scheme | 23,294,700 | RMB-denominated common share | 23,294,700 |
| E Fund－Agricultural Bank of China－E Fund China Securities Financial Assets Management Scheme | 23,010,100 | RMB-denominated common share | 23,010,100 |
| Agricultural Bank of China Co., Ltd. - China Securities 500 Trading Open-end Index Securities Investment Fund | 22,592,110 | RMB-denominated common share | 22,592,110 |
| Yinhua Fund－Agricultural Bank of China－Yinhua China Securities Financial Assets Management Scheme | 19,395,127 | RMB-denominated common share | 19,395,127 |
| Explanation on the relationship or concerted action between the above shareholders | Zhejiang Provincial Finance Development Co., Ltd., controlling shareholder of Zhejiang Zhecai Capital Management Co., Ltd., holds 9.44% of the shares of Yiwu State-owned Capital Operation Co., Ltd., the controlling shareholder of Yiwu China Commodities City Holding Limited, the controlling shareholder of Yiwu Market Development Group Co., Ltd. | ||
| Explanation on the preferred shareholders whose voting rights had been restituted and the quantity of shares held thereby | Nil | ||
Number of shares held by the top 10 shareholders subject to trading restrictions and thetrading restrictions
□Applicable √Not applicable
(iii) Strategic investors or general legal persons became the top 10 shareholders due tothe placement of new shares.
□Applicable √Not applicable
IV. Controlling shareholder and actual controller(i) Controlling shareholder1 Legal person
√Applicable □Not applicable
| Name | Yiwu China Commodities City Holdings Limited |
| The person in charge or legal representative of the unit | ZHAO Wenge |
| Date of establishment | October 29, 2019 |
| Main business | State-owned shareholding platform |
| Shareholdings of other domestic and overseas listed companies that hold or participate in shares during the reporting period | Nil |
| Other statements | Nil |
2 Natural person
□Applicable √Not applicable
3 Special statement that the Company does not have a controlling shareholder
□Applicable √Not applicable
4 Explanation on Changes in Controlling Shareholders During the Reporting Period
□Applicable √Not applicable
5 Block diagram of the property rights and control relationship between the Companyand the controlling shareholder
√Applicable □Not applicable
(ii) The actual controller1 Legal person
√Applicable □Not applicable
| Name | State-owned Assets Supervision and Administration Office of the People’s Government of Yiwu |
| The person in charge or legal representative of the unit | Wang Chenggang |
| Date of establishment | March 26, 2009 |
| Main business | State-owned capital management and state-owned equity management |
| Shareholdings of other domestic and overseas listed companies | Nil |
55.38%
| that hold or participate in shares during the reporting period | |
| Other statements | Nil |
2 Natural person
□Applicable √Not applicable
3 Special explanation that the Company does not have an actual controller
□Applicable √Not applicable
4 Explanation on changes in the Company's control during the reporting period
□Applicable √Not applicable
5 Block diagram of the property rights and control relationship between the Company
and the actual controller
√Applicable □Not applicable
6 The actual controller controls the Company through trust or other asset managementmethods.
□Applicable √Not applicable
(iii) Other introductions of controlling shareholders and actual controllers
□Applicable √Not applicable
V. The controlling shareholder or the largest shareholder of the Company and itspersons acting in concert have accumulatively pledged shares that account for morethan 80% of the Company's shares held by them
□Applicable √Not applicable
VI. Other corporate shareholders holding more than 10% of the shares
□Applicable √Not applicable
VII. Description of share restriction reduction
□Applicable √Not applicable
VIII. The specifics of implementation of share repurchase during the reporting period
□Applicable √Not applicable
Section VIII. Preferred Shares
□Applicable √Not applicable
Section IX. BondsI. Corporate bonds, corporate bonds and non-financial corporate debt financing
instruments
√Applicable □Not applicable
(i) Corporate bonds
□Applicable √Not applicable
(ii) Corporate bonds
√Applicable □Not applicable
1. Basic information on corporate bonds
Unit: RMB 100 million
| Name of bond | Abbreviation | Code | Issue date | Value date | Maturity date | Outstanding amount | Interest rate (%) | Method of principal repayment and interest payment | Trading venue | Whether there is a risk of terminating the transaction in the stock market |
| Zhejiang China Commodities City Group Co., Ltd. publicly issued corporate bonds to professional investors in 2022 (Issue 1) | 22 YIWU CCC 01 | 137740 | September 1, 2022 | September 1, 2022 | September 1, 2025 | 8 | 2.88 | Simple interest is calculated, the interest payment frequency is annual, and the principal is repaid once due. | Shanghai Stock Exchange | No |
| Zhejiang China Commodities City Group Co., Ltd. publicly issued corporate bonds to professional | 22 YIWU CCC 02 | 137815 | September 22, 2022 | September 22, 2022 | September 22, 2025 | 7 | 2.88 | Simple interest is calculated, the interest payment frequency is annual, and the principal is | Shanghai Stock Exchange | No |
| investors in 2022 (Issue 2) | repaid once due. |
The Company's measures to deal with the risk of bond termination
□Applicable √Not applicable
Bonds overdue
□Applicable √Not applicable
Bond interest payment during the reporting period
√Applicable □Not applicable
| Name of bond | Description of interest payment |
| Publicly offered corporate bond 2019 of Zhejiang China Commodities City Group Co., Ltd (Phase I) | On June 1, 2022, the Company paid all the holders of "19 YIWU CCC 01" the interest from June 05, 2021 to June 05, 2022 on time. |
| Publicly offered corporate bond 2019 of Zhejiang China Commodities City Group Co., Ltd (Phase II) | On September 23, 2022, the Company paid interest to all "19 YIWU CCC 02" holders on time from September 27, 2021 to September 24, 2022. |
2. Issuer or investor option clause, investor protection clause trigger and enforcement
□Applicable √Not applicable
3. Intermediaries providing services for bond issuance and duration business
| Intermediary name | Office address | Name of the Signing Certified Public Accountants | Contact person | Contact number |
| CITIC Securities Co., Ltd. | CITIC Securities Building, No. 48 Liangmaqiao Road, Chaoyang District, Beijing | HAN Dan, LU Yibin | ZHANG Yifan | 18758102095 |
Changes to the above intermediaries
□Applicable √Not applicable
4. Use of raised funds at the end of the reporting period
√Applicable □Not applicable
Unit: RMB 100 million
| Name of bond | Total amount of funds raised | Amount used | Amount unused | Operation of the special account for raised funds (if any) | Rectification of illegal use of raised funds (if any) | Whether it is consistent with the purpose, use plan and other agreements promised in the prospectus |
| Zhejiang China | 8 | 8 | - | Nil | Nil | No |
| Commodities City Group Co., Ltd. publicly issued corporate bonds to professional investors in 2022 (Issue 1) | ||||||
| Zhejiang China Commodities City Group Co., Ltd. publicly issued corporate bonds to professional investors in 2022 (Issue 2) | 7 | 7 | - | Nil | Nil | No |
The progress and operational benefits of raised funds used for construction projects
□Applicable √Not applicable
Explanation on changing the use of the above-mentioned bonds raised during the reportingperiod
□Applicable √Not applicable
Other statements
□Applicable √Not applicable
5. Adjustment in credit rating results
□Applicable √Not applicable
Other statements
√Applicable □Not applicable
Shanghai Brilliance Credit Rating & Investors Service Co., Ltd. issued the Credit RatingSurveillance Report on Zhejiang China Commodities City Group Co., Ltd. and Bonds PubliclyIssued by It [Brilliance Surveillance (2022) 00023] on May 20, 2022. The Company had an issuerrating of AAA with stable outlook, and the bonds had a rating of AAA.Shanghai New Century Credit Rating Investment Service Co., Ltd. issued the "ZhejiangChina Commodities City Group Co., Ltd. Credit Rating Report" [New Century Enterprise Review(2022) 020228] on June 28, 2022. The Company's main credit rating is AAA. The rating outlookis stable.
6. The implementation and changes of guarantees, debt repayment plans and other debt
repayment protection measures during the reporting period and their impacts
□Applicable √Not applicable
7. Other statement on corporate bonds
□Applicable √Not applicable
(iii) Non-financial corporate debt financing instruments in the inter-bank bond market
√Applicable □Not applicable
1. Non-financial corporate debt financing instruments
Unit: RMB 100 million
| Name of bond | Abbreviation | Code | Issue date | Value date | Maturity date | Outstanding amount | Interest rate (%) | Method of principal repayment and interest payment | Trading venue | Investor appropriate arrangements (if any) | Trade mechanism | Whether there is a risk of terminating the transaction in the stock market |
| Zhejiang China Commodities City Group Co., Ltd.’s 2022 MTN (Issue 1) | 22 Zhejiang Yiwu CCC MTN001 | 102280347 | Feb-22-2022 to Feb-23-2022 | Feb 24, 2022 | Feb 24, 2025 | 10 | 3.29 | Annual interest payment, principal repayment at maturity | Interbank market | Nil | No | |
| Zhejiang China Commodities City Group Co., Ltd.’s 2022 MTN (Issue 2) | 22 Zhejiang Yiwu CCC MTN002 | 102280660 | Mar-25-2022 to Mar-28-2022 | Mar 29, 2022 | Mar 29, 2025 | 5 | 3.57 | Annual interest payment, principal repayment at maturity | Interbank market | Nil | No | |
| Zhejiang China Commodities City Group Co., Ltd.'s 2022 MTN (Issue 3) | 22 Zhejiang Yiwu CCC MTN003 | 102281584 | Jul 18, 2022 to Jul 19, 2022 | Jul 20, 2022 | Jul 20, 2025 | 5 | 3.00 | Annual interest payment, principal repayment at maturity | Interbank market | Nil | No | |
| Zhejiang China Commodities City Group Co., Ltd.’s | 22 Zhejiang Yiwu CCC SCP005 | 012283271 | Sep 19, 2022 to Sep | Sep 21, 2022 | May 19, 2023 | 10 | 2.09 | One-time repayment of principal and | Interbank market | Nil | No |
| 2022 Super Short-term Financing Bonds (Issue 5) | 20, 2022 | interest at maturity. | ||||||||||
| Zhejiang China Commodities City Group Co., Ltd.’s 2022 Super Short-term Financing Bonds (Issue 6) | 22 Zhejiang Yiwu CCC SCP006 | 012283708 | Oct 24, 2022 to Oct 25, 2022 | Oct 26, 2022 | Jun 23, 2023 | 10 | 2.30 | One-time repayment of principal and interest at maturity. | Interbank market | Nil | No | |
| Zhejiang China Commodities City Group Co., Ltd.’s 2022 Super Short-term Financing Bonds (Issue 7) | 22 Zhejiang Yiwu CCC SCP007 | 012284013 | Nov 18, 2022 to Nov 21, 2022 | November 22, 2022 | Mar 22, 2023 | 10 | 3.00 | One-time repayment of principal and interest at maturity. | Interbank market | Nil | No |
The Company's measures to deal with the risk of bond termination
□Applicable √Not applicable
Bonds overdue
□Applicable √Not applicable
Bond interest payment during the reporting period
√Applicable □Not applicable
| Name of bond | Description of interest payment |
| Zhejiang China Commodities City Group Co., Ltd.’s 2019 MTN (Issue 1) | On July 14, 2022, the Company paid the interest to the holders of "19 Zhejiang Yiwu CCC MTN001" for the period from July 15, 2021 to July 15, 2022 on time. |
| Zhejiang China Commodities City Group Co., Ltd.’s 2019 MTN (Issue 2) | On October 20, 2022, the Company paid the interest to the holders of "19 Zhejiang Yiwu CCC MTN002" for the period from October 21, 2021 to October 21, 2022 on time. |
| Zhejiang China Commodities City Group Co., Ltd.’s 2021 Super Short-term Financing Bonds (Issue 8) | On July 21, 2022, the Company paid interest to the holders of "21 Zhejiang Yiwu CCC SCP008" on time for the period from October 27, 2021 to July 22, 2022. |
| Zhejiang China Commodities City Group Co., Ltd.’s 2021 Super Short-term Financing Bonds (Issue 9) | On August 11, 2022, the Company paid interest to the holders of "21 Zhejiang Yiwu CCC SCP009" on time for the period from November 15, 2021 to August 12, 2022. |
| Zhejiang China Commodities City Group Co., Ltd.’s 2021 Super Short-term Financing Bonds (Issue 10) | On August 25, 2022, the Company paid interest to the holders of "21 Zhejiang Yiwu CCC SCP010" on time for the period from November 30, 2021 to August 26, 2022. |
| Zhejiang China Commodities City Group Co., Ltd.’s 2022 Super Short-term Financing Bonds (Issue 1) | On July 28, 2022, the Company paid interest to the holders of "22 Zhejiang Yiwu CCC SCP001" on time for the period from June 29, 2022 to July 29, 2022. |
| Zhejiang China Commodities City Group Co., Ltd.’s 2022 Super Short-term Financing Bonds (Issue 2) | On September 23, 2022, the Company paid interest to the holders of "22 Zhejiang Yiwu CCC SCP002" on time for the period from July 27, 2022 to September 26, 2022. |
| Zhejiang China Commodities City Group Co., Ltd.’s 2022 Super Short-term Financing Bonds (Issue 3) | On October 27, 2022, the Company paid interest to the holders of "22 Zhejiang Yiwu CCC SCP003" on time for the period from August 10, 2022 to October 28, 2022. |
| Zhejiang China Commodities City Group Co., Ltd.’s 2022 Super Short-term Financing Bonds (Issue 4) | On November 22, 2022, the Company paid interest to the holders of "22 Zhejiang Yiwu CCC SCP004" on time for the period from August 24, 2022 to November 23, 2022. |
2. Issuer or investor option clause, investor protection clause trigger and enforcement
□Applicable √Not applicable
3. Intermediaries providing services for bond issuance and duration business
| Intermediary name | Office address | Name of the Signing Certified Public Accountants | Contact person | Contact number |
| Industrial and Commercial Bank of China Limited | No. 55 Fuxingmennei Street, Xicheng District, Beijing | Wu Weijun, Zeng Hao | Wang Siyuan | 010-81013642 |
| China Construction Bank Corporation | No. 25 Jinrong Street, Xicheng District, Beijing | Jiang Changzheng, Tian Zhiyong, Feng Suoteng | ZHANG Rui | 010-67596044 |
| Shanghai Pudong Development Bank Co., Ltd. | 8th Floor, Shanghai Pudong Development Bank Building, No. 29 Bailian Jingluo, Pudong New Area, Shanghai | SHI Haiyun, DOU Youming | Zhao Guangzhi | 021-31886343 |
| Bank of Beijing Co., Ltd. | No. C14, Financial Street, Xicheng District, Beijing | Xu Xuming, Shi Yuxuan | Chen Xi | 010-66225593 |
| Agricultural Bank of China Limited | No. 69 Jianguomen Inner Street, Dongcheng District, Beijing | Shi Jian, HUANG Aizhou | An Liwei | 010-85109045 |
| Bank of Hangzhou Co., Ltd. | No. 46 Qingchun Road, Hangzhou City, Zhejiang Province | Zhou ZHANG, Tong Yongjing | Dai Ruinan | 0571-85119872 |
| Industrial Bank Co., Ltd. | Industrial Bank Building, No. 398 Jiangbin Middle Avenue, Taijiang District, Fuzhou City, Fujian Province | Chen Sijie, Wu Zhongming | Jiang Zhongjin | 0571-87037999 |
| Bank of Ningbo Co., Ltd. | No. 345, Ningdong Road, Yinzhou District, Ningbo City, Zhejiang Province | Hu Liang, Gu Ying | Xu Hong | 0574-83050395 |
| China Securities Co., Ltd. | No. 188 Chaonei Street, Dongcheng District, Beijing | Han Dan, Yan Jing | Zhou Xinnan | 010-85156322 |
Changes to the above intermediaries
□Applicable √Not applicable
4. Use of raised funds at the end of the reporting period
√Applicable □Not applicable
Unit: RMB 100 million
| Name of bond | Total amount of funds | Amount used | Amount unused | Operation of the special account | Rectification of illegal use of raised funds | Whether it is consistent with the |
| raised | for raised funds (if any) | (if any) | purpose, use plan and other agreements promised in the prospectus | |||
| Zhejiang China Commodities City Group Co., Ltd.’s 2022 MTN (Issue 1) | 10 | 10 | - | Nil | Nil | No |
| Zhejiang China Commodities City Group Co., Ltd.’s 2022 MTN (Issue 2) | 5 | 5 | - | Nil | Nil | No |
| Zhejiang China Commodities City Group Co., Ltd.'s 2022 MTN (Issue 3) | 5 | 5 | - | Nil | Nil | No |
| Zhejiang China Commodities City Group Co., Ltd.’s 2022 Super Short-term Financing Bonds (Issue 5) | 10 | 10 | - | Nil | Nil | No |
| Zhejiang China Commodities City Group Co., Ltd.’s 2022 Super Short-term Financing Bonds (Issue 6) | 10 | 10 | - | Nil | Nil | No |
| Zhejiang China Commodities City Group Co., Ltd.’s 2022 Super Short-term Financing Bonds (Issue 7) | 10 | 10 | - | Nil | Nil | No |
The progress and operational benefits of raised funds used for construction projects
□Applicable √Not applicable
Explanation on changing the use of the above-mentioned bonds raised during the reportingperiod
□Applicable √Not applicable
Other statements
□Applicable √Not applicable
5. Adjustment in credit rating results
□Applicable √Not applicable
Other statements
√Applicable □Not applicable
Shanghai Brilliance Credit Rating & Investors Service Co., Ltd. issued the Credit RatingSurveillance Report on Zhejiang China Commodities City Group Co., Ltd. and Bonds PubliclyIssued by It [Brilliance Surveillance (2022) 00023] on May 20, 2022. The Company had an issuerrating of AAA with stable outlook, and the bonds had a rating of AAA.Shanghai New Century Credit Rating Investment Service Co., Ltd. issued the "ZhejiangChina Commodities City Group Co., Ltd. Credit Rating Report" [New Century Enterprise Review(2022) 020228] on June 22, 2022. The Company's main credit rating is AAA. The rating outlookis stable.
6. The implementation and changes of guarantees, debt repayment plans and other debt
repayment protection measures during the reporting period and their impacts
□Applicable √Not applicable
7. Explanation on other situations relevant to non-financial corporate debt financing
instruments
□Applicable √Not applicable
(iv) During the reporting period, the Company's loss in the scope of consolidated
statements exceeded 10% of its net assets as of the the end of the previous year.
□Applicable √Not applicable
(v) Interest-bearing debts other than bonds overdue at the end of the reporting period
□Applicable √Not applicable
(vi) Influence of violations of laws and regulations, the Company's Articles of Association,information disclosure affairs management system and the stipulations or commitmentsin the bond prospectus during the reporting period on the rights and interests of bondinvestors
□Applicable √Not applicable
(vii) The Company's accounting data and financial indicators for the past 2 years asof the end of the reporting period
√Applicable □Not applicable
Unit: RMB10,000
| Major indicator | 2022 | 2021 | Increase/decrease in the current period as compared to the prior corresponding period (%) | Reasons for change |
| Net profits attributable to shareholders of the Listed Company with non-recurring items excluded | 176,508.76 | 122,180.80 | 44.47 | Mainly due to the decrease of RMB 229 million YoY in the net profit attributable to shareholders of the listed company million, and the increase of RMB 773 million YoY in non-recurring profits and losses. |
| Current ratio | 42.33% | 58.91% | Down 16.58 ppt | |
| Quick ratio | 31.61% | 50.12% | Down 18.51 ppt | |
| Debt-to-asset ratio (%) | 52.41 | 52.83 | Down 0.42 ppt | |
| EBITDA to total debt ratio | 0.29 | 0.32 | -9.38 | |
| Interest coverage ratio | 5.09 | 5.85 | -12.99 | |
| Cash interest protection multiple | 6.60 | 7.19 | -8.15 | |
| EBITDA-to-interest coverage ratio | 7.80 | 7.99 | -2.42 | |
| Loan repayment rate (%) | 100 | 100 | - | |
| Interest payment rate (%) | 100 | 100 | - |
II. Convertible corporate bonds
□Applicable √Not applicable
Section X. Financial ReportI. Auditor’s report
√Applicable □Not applicable
All the shareholders of Zhejiang China Commodities City Group Co., Ltd.
1. Audit opinion
We have audited the financial statements of Zhejiang China Commodities City GroupCo., Ltd., including Consolidated & Corporate Balance Sheets as of December 31, 2022,Consolidated & Corporate Income Statements, Consolidated & Corporate Cash FlowStatements, Consolidated & Corporate Statements of Changes in Owner’s Equity for 2022and Notes to the Financial Statements.We believe that the attached financial statements were prepared according toAccounting Standards for Zhejiang China Commodities City Group Co., Ltd. in all materialaspects as a fair reflection of the consolidated and parent company’s financial status ofZhejiang China Commodities City Group Co., Ltd. on the December 31, 2022 and theoperation outcomes and cash flows of the Company for 2022.
2. Basis of audit opinion
We conducted our audit in accordance with the Auditing Standards for Chinese CertifiedPublic Accountants. The section “CPAs’ Responsibility for Audit of Financial Statements” in theaudit report further describes on our responsibilities under these standards. In accordance withthe CPA Code of Ethics in China, we are independent of Zhejiang China Commodities City GroupCo., Ltd. and have performed other responsibilities in respect of professional ethics.We believe that the audit evidence we have acquired is sufficient and effective, providing a reasonable basis for our opinion.
3. Key audit matters
Key audit matters are matters that we believe are the most important matters for theaudit of the financial statements for 2018 based on professional judgment. The response tosuch matters is based on the background of auditing the financial statements as a wholeand forming an audit opinion. We do not express independent opinions on such matters.This was also the background for our description for how every matter below was respondedin the audit.
We have fulfilled the responsibilities described in the "Certified Accountants'Responsibilities for the Audit of Financial Statements" section of this report, including thoserelated to these key audit matters. Correspondingly, our audit work included theimplementation of audit procedures designed to deal with the assessed risk of materialmisstatement in the financial statements. The results of our audit procedures, including theprocedures performed in response to the following key audit matters, provide a basis for theexpression of the audit opinion in the financial statements as a whole.
| Key audit matters: | Audit response to the matter: |
| Impairment of non-goodwill long-term assets with certain useful life | |
| As of December 31, 2022, the book value of the non-goodwill assets with certain useful life in the Group’s market and supporting hotels, exhibition halls and commercial buildings, such as the corresponding property, plant and equipment, investment real estate, land use rights, construction in progress, right-of-use assets and long-term deferred expenses(hereinafter collectively referred to as "long-term assets") totaled RMB 17,919.07 million, accounting for 56% of the total book value of the consolidated assets of the Group. When identifying whether the above-mentioned long-term assets have any indications of impairment, and when carrying out impairment tests on the long-term assets with indications of impairment, the recoverable amount of the asset or asset group needs to be reviewed, the Group needs to review the recoverable amount of the asset or asset group. This requires the management to use major judgments and estimates to determine the estimated future sales income, gross profit, operating costs, the disposal value forecast and discount rate at the end of the useful life of the relevant assets and other key assumptions when predicting the present value of future cash flows.The evaluation process is complicated, so we identify them as key audit matters. Relevant information has been disclosed in Note V. 43 and Notes VII. 20, 21, 22, 25, 26 and 29 to the financial statements. | During the audit process, our procedures for assessing the impairment of non-goodwill long-term assets with a useful life include: 1. Based on our understanding of the business of the Company and its subsidiaries and the provisions of the Accounting Standards for Business Enterprises, evaluate the management's identification of each asset group and its judgment on the signs of impairment of each asset group; 2. With the assistance of internal valuation experts, we assessed the reasonableness of the major assumptions and evaluation methods used by the Group management, like discount rates; 3. We assessed the reasonableness of key assumptions such as estimated sales income, gross profit, operating costs, and disposal value predictions at the end of the useful life of related assets in the future years, and checked basic data on the present value of expected future cash flows with relevant supporting evidence. 4. We compared and analyzed the actual performance of the current year with the predicted performance of the previous year; 5. We checked the adequacy and completeness of the relevant disclosures of the Group in the notes to the financial statements. |
| Recognition of revenue from sales of goods | |
| The operating income of the Group mainly comes from the sales of commodities, the use of shops and supporting services for operation, hotel accommodation and catering services, leasing business, etc., among which the revenue from commodity sales accounts for a relatively high proportion. In 2022, the operating income of the Group was RMB 7,619.69 million, of which the revenue from sales of goods was RMB 5,164.81 million, accounting for 68% of the operating income. The Group recognizes incomes when it has fulfilled its performance obligations in the contract, that is, the customer has acquired the control over the relevant goods or services. Since revenue is one of the key performance indicators of the Group, there may be an inherent risk that the management of the Group may achieve specific goals or expectations through inappropriate revenue recognition. We identified the revenue recognition of the Group's merchandise sales business as a key audit matter. For related information, please refer to Note V.38 and Note VII.61 to the Financial Statements. | For the recognition of revenue from sales of goods, our audit procedures mainly include: 1. We have understood and evaluated the design effectiveness of key controls in the management process related to sales of goods business revenue, and tested its operational effectiveness; 2. We select a sample to check the sales contract, identify the terms and conditions of the contract related to the transfer of control of the sold goods, and evaluate whether the timing of the revenue recognition of your group complies with the requirements of the Accounting Standards for Business Enterprises; 3. We obtained and carried out detailed testing by means of sampling, and reviewed supporting documents related to revenue recognition, including orders, receipt records, logistics documents, bank receipts, invoices, and import and export data of the electronic port data system, etc.; 4. According to the characteristics and nature of customer transactions, we select samples to confirm the amount of sales revenue and the balance of receivables to customers; 5. We analyzed fluctuations in revenue, cost, and gross profit, and compared them with the gross profit margin of companies in the same industry to evaluate the rationality of changes in revenue-related indicators; 6. We conducted background checks and visits to important customers in the sales of goods; 7. We used a sampling method to check the sales revenue confirmed before and after the balance sheet date to supporting documents such as customer receipts to assess whether the sales revenue is recognized in the appropriate period; and 5. We checked the adequacy and completeness of the relevant disclosures of the Group in the notes to the financial statements. |
4. Other information
Zhejiang China Commodities City Group Co., Ltd.’s management is responsible for otherinformation. Such information includes the information covered by the annual report, but thefinancial statements and the audit report provided by us are excluded.
Our audit opinion released in the financial statements do not cover other information andwe do not release any form of assurance conclusion on other information.
Our responsibility is to read other information in conjunction with our audit of the financialstatements. During the process, we consider whether there is a material inconsistency orother material misstatement in the financial statements with the knowledge acquired by usduring the audit process.
Based on the work we have performed, if we determine that there is a materialmisstatement of other information, we should report the fact. We have nothing to report inthis aspect.
5. Responsibility of management and governance for financial statements
The management is responsible for preparing financial statements in accordance withthe provisions of the Accounting Standards for Business Enterprises to achieve fairreflection, and designing, implementing and maintaining necessary internal controlsto prevent these financial statements from material misstatement arising from fraud or error.
During preparing the financial statements, the management is responsible for assessingthe sustainability management capabilities of Zhejiang China Commodities City Group Co.,Ltd., disclosing, as applicable, going-concern-related matters and applying the going-concern assumption unless the management plans to liquidate Zhejiang China CommoditiesCity Group Co., Ltd. and discontinue operations or has no other realistic choices.
The governance is responsible for supervising the financial reporting process ofZhejiang China Commodities City Group Co., Ltd.
6. Certified Public Accountants’ responsibility for audit of financial statements
Our goal is to obtainreasonable assurance about whether the financial statements are free from material misstatement caused by fraud or error andexpress an opinion on these financial statements based on our audits. The reasonableassurance is a guarantee at a high level, but there is no guarantee that an audit performedin accordance with the auditing standards will always identify existing material misstatement.Misstatements may be caused by fraud or error. Misstatement is generally considered to bematerial if it is reasonably expected that the misstatement, alone or aggregated, may affectthe financial decision made by the users of the financial statements based on the financialstatements.
We applied professional judgment and professional skepticism during conducting auditwork in accordance with the Auditing Standards for CPA while performing following works:
（1） (1) Identifying and evaluating the risk of material misstatements of financial
statements for fraud or error designing and implementing audit procedures todeal with these risks and obtaining adequate and appropriate audit evidence asa basis for release of our audit opinion. As fraud may involve collusion, forgery,willful omission, misrepresentation or override of internal control, the risk of notdiscovering a material misstatement due to fraud is higher than the risk of notdiscovering a material misstatement resulting from an error.
（2） Understanding the internal control related to the audit in order to design the
appropriate audit procedures.
（3） Evaluating the appropriateness of the accounting policies selected by
management level and the reasonableness of accounting estimates and relateddisclosures.
（4） Concluding the appropriateness of management level’s use of the going concern
assumption while drawing a conclusion as to whether there is any materialuncertainty about the issues or circumstances that may cause major doubts
about the ability of the Zhejiang China Commodities City Group Co., Ltd. tocontinue as a going concern on basis of the audit evidence acquired. If weconclude that there is a significant uncertainty, the auditing standards require usto remind user of the statements of the relevant disclosures in the financialstatements in the audit report. If the disclosures are inadequate, we shouldrelease an unqualified opinion. Our conclusion is based on the informationavailable by the date of the audit report. However, future events or circumstancesmay result in Zhejiang China Commodities City Group Co., Ltd. being unable tocontinue as a going concern.
（5） Evaluating the overall presentation, structure and content (including disclosure)
of the financial statements as well as whether the financial statements are a fairreflection of the related transactions and matters.
(6) Obtaining adequate and appropriate audit evidence on the financial information
of the entities or business activities in Zhejiang China Commodities City GroupCo., Ltd. to express an opinion on the financial statements. We are responsiblefor directing, supervising and implementing the Group’s audit and assume fullresponsibility for the audit opinion.We have communicated with the governance on the matters such as the scope andtiming of audit and major audit findings, including the notable defects of internal controlidentified in our audit.We also provided a statement to the governance that we had complied with theprofessional ethics requirements related to independence, and communicated with thegovernance all relationships and other matters that may be reasonably believed to affect ourindependence, and related preventive measures (if applicable) .In the matters communicated with the governance, we determined which matters shouldbe the most important to the audit of the financial statements of the current period, andshould constitute the key audit matters accordingly. We described such matters in the auditreport, unless laws and regulations had prohibited public disclosure of these matters, or inrare cases, we determined that such matters should not be communicated in the audit reportif the negative consequences of communicating a matter in the audit report are reasonablyexpected to outweigh the public interests.
| Ernst & Young Hua Ming Certified Public Accountants (special general partnership) | Chinese CPA: YIN Guowei (Project Partner) |
| Chinese CPA: Huang Zhigang | |
| Beijing, China | April 10, 2023 |
II. Financial statements
Consolidated Balance SheetDecember 31, 2022Prepared by: Zhejiang China Commodities City Group Co., Ltd.
Unit: RMB
| Item | Note | December 31, 2022 | December 31, 2021 |
| Current assets: | |||
| Cash and cash equivalents | 1,991,298,971.30 | 4,831,468,386.25 | |
| Held-for-trading financial assets | 62,331,000.66 | 75,375,083.20 | |
| Accounts receivable | 210,750,725.36 | 185,237,530.89 | |
| Prepayments | 606,057,048.25 | 875,167,709.48 | |
| Other receivables | 419,398,092.62 | 1,355,924,282.96 | |
| In which: interest receivable | - | 92,249,275.44 | |
| Inventory | 1,330,351,243.87 | 1,327,402,567.99 | |
| Other current assets | 634,209,950.69 | 248,662,219.40 | |
| Total current assets | 5,254,397,032.75 | 8,899,237,780.17 | |
| Non-current assets: | |||
| Debt investments | 48,079,561.64 | - | |
| Long-term receivables | 278,299,600.73 | 222,307,363.40 | |
| Long-term equity investment | 6,033,472,919.92 | 5,772,455,242.84 | |
| Other equity instruments investment | 499,200,803.85 | 642,187,968.77 | |
| Other non-current financial assets | 1,500,307,562.13 | 1,524,819,255.41 | |
| Property investment | 2,851,643,180.42 | 2,973,936,400.46 | |
| Fixed assets | 5,220,882,784.47 | 5,078,590,929.75 | |
| Construction in progress | 2,860,064,818.36 | 1,090,577,963.27 | |
| Right-of-use assets | 217,702,910.81 | 225,347,077.14 | |
| Intangible assets | 6,461,849,690.36 | 4,043,564,662.35 | |
| Development expenses | 4,660,995.87 | 6,359,814.02 | |
| Goodwill | 284,916,367.87 | - | |
| Long-term prepaid expenses | 306,925,970.89 | 188,184,376.43 | |
| Deferred income tax assets | 150,346,801.31 | 135,737,028.89 | |
| Other non-current assets | 138,253,316.00 | 211,329,650.45 | |
| Total non-current assets | 26,856,607,284.63 | 22,115,397,733.18 | |
| Total assets | 32,111,004,317.38 | 31,014,635,513.35 | |
| Current liabilities: | |||
| Short-term borrowings | 1,059,287,361.11 | 942,736,046.04 | |
| Accounts payable | 1,191,314,404.15 | 493,360,429.02 | |
| Advances from customers | 885,993,269.48 | 153,566,311.13 | |
| Contract liabilities | 3,991,038,021.56 | 4,058,419,224.84 | |
| Payroll payable | 183,135,314.51 | 243,964,755.38 | |
| Tax payable | 214,998,424.41 | 559,496,547.34 | |
| Other payables | 1,325,596,105.43 | 1,908,742,835.15 | |
| Non-current liabilities due within one year | 86,852,293.01 | 3,664,241,923.08 | |
| Other current liabilities | 3,473,907,027.00 | 3,081,384,800.50 | |
| Total current liabilities | 12,412,122,220.66 | 15,105,912,872.48 | |
| Non-current liabilities: | |||
| Long-term borrowings | 404,500,000.00 | 771,250,000.00 | |
| Bonds payable | 3,497,416,819.75 | - | |
| Lease liabilities | 206,623,735.97 | 205,942,673.93 | |
| Estimated liabilities | 110,620,306.10 | 110,620,306.10 | |
| Deferred income | 103,582,129.94 | 78,170,103.62 | |
| Deferred income tax liabilities | 95,042,722.31 | 111,897,463.42 | |
| Total non-current liabilities | 4,417,785,714.07 | 1,277,880,547.07 | |
| Total liabilities | 16,829,907,934.73 | 16,383,793,419.55 | |
| Owners’ equity (or shareholders’ equity) | |||
| Paid-in capital (share capital) | 5,486,074,176.00 | 5,491,274,176.00 | |
| Capital reserve | 1,651,146,033.96 | 1,631,509,114.96 | |
| Less: treasury stocks | 119,483,675.00 | 137,494,800.00 | |
| Other comprehensive income | -24,008,473.60 | 60,850,735.02 | |
| Surplus reserve | 1,616,083,136.73 | 1,505,209,795.50 | |
| General risk reserve | 1,038,991.13 | - | |
| Undistributed profits | 6,651,440,591.35 | 6,059,496,846.85 | |
| Total equity attributable to owners (shareholders) of the parent company | 15,262,290,780.57 | 14,610,845,868.33 | |
| Minority interest | 18,805,602.08 | 19,996,225.47 | |
| Total owners’ equity (or shareholders’ equity) | 15,281,096,382.65 | 14,630,842,093.80 | |
| Total liabilities and owners’ equity (or shareholders’ equity) | 32,111,004,317.38 | 31,014,635,513.35 | |
Legal Representative: Zhao Wenge, Person in Charge of Finance: Wang Dong, Head of FinanceDepartment: Zhao Difang
Balance Sheet of Parent Company
December 31, 2022Prepared by: Zhejiang China Commodities City Group Co., Ltd.
Unit: RMB
| Item | Note | December 31, 2022 | December 31, 2021 |
| Current assets: | |||
| Cash and cash equivalents | 1,439,042,451.56 | 4,327,117,133.34 | |
| Held-for-trading financial assets | - | 1,484.70 | |
| Accounts receivable | 22,032,390.71 | 23,629,682.69 | |
| Prepayments | 11,055,123.31 | 11,213,809.02 | |
| Other receivables | 329,607,469.39 | 1,207,086,885.99 | |
| In which: interest receivable | - | 92,249,275.44 | |
| Inventory | 4,599,032.34 | 7,308,939.20 | |
| Other current assets | 3,650,862,939.52 | 3,282,706,248.36 | |
| Total current assets | 5,457,199,406.83 | 8,859,064,183.30 | |
| Non-current assets: | |||
| Long-term receivables | 36,763,731.53 | 41,668,837.64 | |
| Long-term equity investment | 9,210,422,313.34 | 8,246,000,020.80 | |
| Other equity instruments investment | 499,200,803.85 | 642,187,968.77 | |
| Other non-current financial assets | 142,053,056.97 | 179,632,207.32 | |
| Property investment | 2,803,007,146.68 | 2,533,374,736.14 | |
| Fixed assets | 4,122,738,826.73 | 4,333,691,395.01 | |
| Construction in progress | 2,318,993,733.00 | 936,297,029.41 | |
| Right-of-use assets | 109,853,155.63 | 118,591,035.63 | |
| Intangible assets | 5,872,460,683.86 | 3,878,208,204.47 | |
| Long-term prepaid expenses | 275,795,256.99 | 165,720,500.56 | |
| Deferred income tax assets | 137,378,229.19 | 122,565,730.38 | |
| Other non-current assets | - | 65,607,343.55 | |
| Total non-current assets | 25,528,666,937.77 | 21,263,545,009.68 | |
| Total assets | 30,985,866,344.60 | 30,122,609,192.98 | |
| Current liabilities: | |||
| Short-term borrowings | 1,059,287,361.11 | 942,736,046.04 | |
| Accounts payable | 822,773,769.51 | 349,268,967.90 | |
| Advances from customers | 861,860,467.12 | 104,805,243.57 | |
| Contract liabilities | 3,032,044,768.16 | 3,029,673,931.75 | |
| Payroll payable | 139,946,321.85 | 203,724,767.47 | |
| Tax payable | 188,723,169.42 | 527,641,861.33 | |
| Other payables | 1,075,413,151.71 | 1,596,947,195.91 | |
| Non-current liabilities due within one year | 64,688,676.55 | 3,656,595,072.25 | |
| Other current liabilities | 3,726,398,088.04 | 3,452,451,678.36 | |
| Total current liabilities | 10,971,135,773.47 | 13,863,844,764.58 | |
| Non-current liabilities: | |||
| Long-term borrowings | 404,500,000.00 | 771,250,000.00 | |
| Bonds payable | 3,497,416,819.75 | - | |
| Lease liabilities | 110,999,791.68 | 113,367,062.05 | |
| Estimated liabilities | 110,620,306.10 | 110,620,306.10 | |
| Deferred income | 103,582,129.94 | 78,170,103.62 | |
| Deferred income tax liabilities | 13,046,676.14 | 43,870,176.87 | |
| Total non-current liabilities | 4,240,165,723.61 | 1,117,277,648.64 | |
| Total liabilities | 15,211,301,497.08 | 14,981,122,413.22 | |
| Owners’ equity (or shareholders’ equity) | |||
| Paid-in capital (share capital) | 5,486,074,176.00 | 5,491,274,176.00 | |
| Capital reserve | 1,885,778,197.50 | 1,866,141,278.50 | |
| Less: treasury stocks | 119,483,675.00 | 137,494,800.00 | |
| Other comprehensive income | -40,818,470.36 | 66,421,903.33 | |
| Surplus reserve | 1,616,029,660.90 | 1,505,156,319.67 | |
| Undistributed profits | 6,946,984,958.48 | 6,349,987,902.26 | |
| Total owners’ equity (or shareholders’ equity) | 15,774,564,847.52 | 15,141,486,779.76 | |
| Total liabilities and owners’ equity (or shareholders’ equity) | 30,985,866,344.60 | 30,122,609,192.98 | |
Legal Representative: Zhao Wenge, Person in Charge of Finance: Wang Dong, Head of FinanceDepartment: Zhao Difang
Consolidated Income StatementJanuary-December 2022
Unit: RMB
| Item | Note | 2022 | 2021 |
| I. Gross revenue | 7,619,693,742.60 | 6,033,842,972.95 | |
| In which: operating revenue | 7,619,693,742.60 | 6,033,842,972.95 | |
| II. Gross cost | 7,545,489,637.45 | 5,037,812,165.29 | |
| In which: Operating cost | 6,452,909,829.96 | 4,027,543,138.56 | |
| Taxes and surcharges | 198,907,504.01 | 161,759,208.82 | |
| Sales expenses | 197,679,981.09 | 204,745,974.57 | |
| Administrative expenses | 529,466,270.71 | 453,543,427.80 | |
| R&D expenses | 17,377,161.88 | 10,308,801.84 | |
| Financial expenses | 149,148,889.80 | 179,911,613.70 | |
| In which: interest expenses | 280,924,664.39 | 341,313,765.39 | |
| Interest income | 132,216,250.44 | 177,964,682.68 | |
| Plus: other income | 38,802,684.45 | 23,556,948.01 | |
| Investment income (loss is indicated by “-”) | 1,041,524,864.25 | 634,227,991.02 | |
| In which: income from investment in associates and joint ventures | 996,108,417.69 | 599,180,325.58 | |
| Changes in fair value (loss is indicated by “-”) | -5,262,476.59 | 7,231,321.84 | |
| Credit impairment loss (loss is indicated by “-”) | -1,815,004.95 | -7,299,694.67 | |
| Income from disposal of assets (loss is indicated by “-”) | -941,780.66 | 76,006.41 | |
| III. Operating profit (loss is indicated by “-”) | 1,146,512,391.65 | 1,653,823,380.27 | |
| Plus: income from non-operating activities | 7,499,270.88 | 5,766,372.46 | |
| Less: expenses from non-operating activities | 4,204,829.93 | 2,895,928.76 | |
| IV. Profits before tax (loss is indicated by “-”) | 1,149,806,832.60 | 1,656,693,823.97 | |
| Less: income tax | 46,205,700.39 | 327,525,237.95 | |
| V. Net profits (net loss is indicated by “-”) | 1,103,601,132.21 | 1,329,168,586.02 | |
| (I) Categorized by continuity of operation | |||
| Net profits from continuing operation (net loss is indicated by “-”) | 1,103,601,132.21 | 1,329,168,586.02 | |
| (II) Categorized by ownership | |||
| 1. Net profits attributable to shareholders of the parent company (net loss is indicated by “-”) | 1,104,719,091.71 | 1,334,095,906.95 | |
| 2. Minority interest(net loss is indicated by “-”) | -1,117,959.50 | -4,927,320.93 | |
| VI. Other comprehensive income, net of tax | -84,931,872.51 | -17,256,380.07 | |
| (I) Other comprehensive income attributable to owners of the parent company, net of tax | -84,859,208.62 | -17,298,926.31 | |
| 1. Other comprehensive income that cannot be reclassified as profits or loss | -107,240,373.69 | -15,051,280.51 | |
| (3) Changes in fair value of investments in other equity instruments | -107,240,373.69 | -15,051,280.51 | |
| 2 . Other comprehensive income that will be reclassified as profits or loss | 22,381,165.07 | -2,247,645.80 | |
| (1) Other comprehensive income that can be transferred into profit and loss under equity method | 4,060,531.46 | - | |
| (6) Difference arising from the translation of foreign currency financial statements | 18,320,633.61 | -2,247,645.80 | |
| (II) After -tax net of other comprehensive income attributable to minority shareholders | -72,663.89 | 42,546.24 | |
| VII. Total comprehensive income | 1,018,669,259.70 | 1,311,912,205.95 | |
| (I) Total comprehensive income attributable to owners of the parent company | 1,019,859,883.09 | 1,316,796,980.64 | |
| (II) Total comprehensive income attributable to minority shareholders | -1,190,623.39 | -4,884,774.69 | |
| VIII. Earnings per share: | |||
| (I) Basic earnings per share | 0.20 | 0.25 | |
| (II) Diluted earnings per share | 0.20 | 0.25 | |
For merger of the enterprises under common control during the current period, net profits ofthe merged party prior to the merger were RMB 0, and net profits of the merged party duringthe previous period were RMB 0.Legal Representative: Zhao Wenge, Person in Charge of Finance: Wang Dong, Head ofFinance Department: Zhao Difang
Income Statement of Parent Company
January-December 2022
Unit: RMB
| Item | Note | 2022 | 2021 |
| I. Operating revenue | 1,941,582,561.02 | 2,922,125,402.93 | |
| Less: Operating cost | 937,173,155.53 | 1,062,881,897.31 | |
| Taxes and surcharges | 165,751,730.61 | 132,198,523.20 | |
| Sales expenses | 198,120,081.31 | 158,004,638.76 | |
| Administrative expenses | 269,059,168.76 | 239,151,835.56 | |
| Financial expenses | 168,088,031.70 | 175,493,659.20 | |
| In which: interest expenses | 281,287,879.72 | 341,313,765.39 | |
| Interest income | 122,678,523.33 | 177,964,682.68 | |
| Plus: other income | 13,079,397.88 | 13,716,900.72 | |
| Investment income (loss is indicated by “-”) | 948,235,020.44 | 598,320,996.73 | |
| In which: income from investment in associates and joint ventures | 932,395,547.67 | 544,982,046.87 | |
| Changes in fair value (loss is indicated by “-”) | -31,735,150.35 | -83,904,126.09 | |
| Credit impairment loss (loss is indicated by “-”) | -288,497.31 | -989,960.58 | |
| Income from disposal of assets (loss is indicated by “-”) | 1,019,351.95 | -32,610.97 | |
| II. Operating profits (loss is indicated by “-”) | 1,133,700,515.72 | 1,681,506,048.71 | |
| Plus: income from non-operating activities | 6,488,569.32 | 5,508,893.78 | |
| Less: expenses from non-operating activities | 3,650,112.77 | 3,187,712.27 | |
| III. Profits before tax (loss is indicated by “-”) | 1,136,538,972.27 | 1,683,827,230.22 | |
| Less: income tax | 27,805,559.97 | 274,307,361.05 | |
| IV. Net profits (net loss is indicated by “-”) | 1,108,733,412.30 | 1,409,519,869.17 | |
| (I) Categorized by continuity of operation(net loss is indicated by “-”) | 1,108,733,412.30 | 1,409,519,869.17 | |
| V. Other comprehensive income, net of tax | -107,240,373.69 | -15,051,280.51 | |
| (I) Other comprehensive income that cannot be reclassified as profit or loss | -107,240,373.69 | -15,051,280.51 | |
| 3. Changes in fair value of investments in other equity instruments | -107,240,373.69 | -15,051,280.51 | |
| VI. Total comprehensive income | 1,001,493,038.61 | 1,394,468,588.66 |
Legal Representative: Zhao Wenge, Person in Charge of Finance: Wang Dong, Head of FinanceDepartment: Zhao Difang
Consolidated Cash Flow Statement
January-December 2022
Unit: RMB
| Item | Note | 2022 | 2021 |
| I. Cash flow from operating activities: | |||
| Cash received from sale of goods and rendering of services | 8,663,117,389.69 | 8,099,404,766.59 | |
| Cash received for taxes and surcharges refunded | 319,401,723.98 | - | |
| Other cash receipts relating to operating activities | 434,715,976.74 | 525,408,330.58 | |
| Sub-total of cash inflow from operating activities | 9,417,235,090.41 | 8,624,813,097.17 | |
| Cash paid for goods and services | 6,134,704,401.79 | 4,655,490,266.98 | |
| Cash paid to and on behalf of employees | 522,242,510.47 | 551,082,829.16 | |
| Payments of taxes | 804,862,955.73 | 786,973,453.98 | |
| Other cash payments relating to operating activities | 555,334,508.65 | 598,184,039.29 | |
| Sub-total of cash outflow from operating activities | 8,017,144,376.64 | 6,591,730,589.41 | |
| Net cash flow from operating activities | 1,400,090,713.77 | 2,033,082,507.76 | |
| II. Cash flow from investing activities: | |||
| Cash received from recovery of investment | 990,875,547.75 | 6,124,327,288.57 | |
| Cash received from investment income | 162,065,398.30 | 325,898,607.79 | |
| Net cash received from disposal of property, plant and equipment, intangible assets and other long-term assets | 13,483,158.58 | 44,446,864.25 | |
| Other cash receipts relating to investing activities | 1,259,208,113.00 | 3,746,899,831.00 | |
| Sub-total of cash inflow from investing activities | 2,425,632,217.63 | 10,241,572,591.61 | |
| Cash paid to acquire and construct fixed assets, intangible assets and other long-term assets | 4,114,901,826.31 | 2,042,626,824.44 | |
| Cash paid to acquire investments | 319,039,459.91 | 4,915,716,783.24 | |
| Net cash paid by acquiring subsidiaries and other business units | 312,616,964.11 | - | |
| Other cash paid related to investing activities | 41,772,885.00 | 1,632,462,005.00 | |
| Sub-total of cash outflow from investing activities | 4,788,331,135.33 | 8,590,805,612.68 | |
| Net cash flow from investing activities | -2,362,698,917.70 | 1,650,766,978.93 | |
| III. Cash flow from financing activities: | |||
| Cash received for investment taking | - | 13,992,600.00 | |
| Including: cash received by subsidiaries from absorbing minority shareholders' investment | - | 8,400,000.00 | |
| Cash received from borrowings | 14,419,431,088.06 | 12,319,250,000.00 | |
| Sub-total of cash inflow from financing activities | 14,419,431,088.06 | 12,333,242,600.00 | |
| Cash paid for debts repayment | 14,774,484,040.95 | 13,344,000,000.00 | |
| Cash paid for distribution of dividends or profits or payment of interest | 652,035,197.63 | 650,819,017.71 | |
| Other cash paid related to financing activities | 50,128,807.59 | 40,358,783.07 | |
| Sub-total of cash outflow from financing activities | 15,476,648,046.17 | 14,035,177,800.78 | |
| Net cash flow from financing activities | -1,057,216,958.11 | -1,701,935,200.78 | |
| IV. Effect of foreign exchange rate changes on cash and cash equivalents | -5,442,221.79 | -8,088,832.07 | |
| V. Net increase in cash and cash equivalents | -2,025,267,383.83 | 1,973,825,453.84 | |
| Plus: opening balance of cash and cash equivalents | 4,006,468,325.47 | 2,032,642,871.63 | |
| VI. Closing balance of cash and cash equivalents | 1,981,200,941.64 | 4,006,468,325.47 |
Legal Representative: Zhao Wenge, Person in Charge of Finance: Wang Dong, Head ofFinance Department: Zhao Difang
Cash Flow Statement of Parent Company
January-December 2022
Unit: RMB
| Item | Note | 2022 | 2021 |
| I. Cash flow from operating activities: | |||
| Cash received from sale of goods and rendering of services | 2,757,913,722.02 | 3,748,589,385.84 | |
| Cash received for taxes and surcharges refunded | 248,723,587.20 | - | |
| Other cash receipts relating to operating activities | 223,084,596.77 | 349,377,861.57 | |
| Sub-total of cash inflow from operating activities | 3,229,721,905.99 | 4,097,967,247.41 | |
| Cash paid for goods and services | 562,286,375.43 | 571,281,536.76 | |
| Cash paid to and on behalf of employees | 281,130,313.54 | 353,270,873.06 | |
| Payments of taxes | 710,961,271.08 | 691,067,319.78 | |
| Other cash payments relating to operating activities | 403,432,298.40 | 674,684,402.42 | |
| Sub-total of cash outflow from operating activities | 1,957,810,258.45 | 2,290,304,132.02 | |
| Net cash flow from operating activities | 1,271,911,647.54 | 1,807,663,115.39 | |
| II. Cash flow from investing activities: | |||
| Cash received from recovery of investment | 1,095,641,009.05 | 6,200,000,000.00 | |
| Cash received from investment income | 128,261,072.18 | 327,497,449.71 | |
| Net cash received from disposal of property, plant and equipment, intangible assets and other long-term assets | 4,820,113.40 | 42,475,671.66 | |
| Net cash received from disposal of subsidiaries and other business units | 9,380,000.00 | - | |
| Other cash receipts relating to investing activities | 1,221,892,831.00 | 3,746,899,831.00 | |
| Sub-total of cash inflow from investing activities | 2,459,995,025.63 | 10,316,872,952.37 | |
| Cash paid to acquire and construct fixed assets, intangible assets and other long-term assets | 3,579,149,669.56 | 1,973,252,137.98 | |
| Cash paid to acquire investments | 1,214,422,943.13 | 5,193,070,000.00 | |
| Other cash paid related to investing activities | - | 1,632,462,005.00 | |
| Sub-total of cash outflow from investing activities | 4,793,572,612.69 | 8,798,784,142.98 | |
| Net cash flow from investing activities | -2,333,577,587.06 | 1,518,088,809.39 | |
| III. Cash flow from financing activities: | |||
| Cash received for investment taking | - | 5,592,600.00 | |
| Cash received from borrowings | 14,419,431,088.06 | 12,319,250,000.00 | |
| Sub-total of cash inflow from financing activities | 14,419,431,088.06 | 12,324,842,600.00 | |
| Cash paid for debts repayment | 14,774,484,040.95 | 13,344,000,000.00 | |
| Cash paid for distribution of dividends or profits or payment of interest | 652,035,197.63 | 650,819,017.71 | |
| Other cash paid related to financing activities | 26,540,591.93 | 14,525,871.43 | |
| Sub-total of cash outflow from financing activities | 15,453,059,830.51 | 14,009,344,889.14 | |
| Net cash flow from financing activities | -1,033,628,742.45 | -1,684,502,289.14 | |
| IV. Effect of foreign exchange rate changes on cash and cash equivalents | - | - | |
| V. Net increase in cash and cash equivalents | -2,095,294,681.97 | 1,641,249,635.64 | |
| Plus: opening balance of cash and cash equivalents | 3,527,117,072.56 | 1,885,867,436.92 | |
| VI. Closing balance of cash and cash equivalents | 1,431,822,390.59 | 3,527,117,072.56 |
Legal Representative: Zhao Wenge, Person in Charge of Finance: Wang Dong, Head of FinanceDepartment: Zhao Difang
Statement of Changes in Consolidated Owners’ Equity
January-December 2022
Unit: RMB
| Item | 2022 | |||||||||
| Equity attributable to owners of the parent company | Minority interest | Total owners’ equity | ||||||||
| Paid-in capital (share capital) | Capital reserve | Less: treasury stocks | Other comprehensive income | Surplus reserve | General risk reserve | Undistributed profits | Sub-total | |||
| I. Balance at the end of previous year | 5,491,274,176.00 | 1,631,509,114.96 | 137,494,800.00 | 60,850,735.02 | 1,505,209,795.50 | - | 6,059,496,846.85 | 14,610,845,868.33 | 19,996,225.47 | 14,630,842,093.80 |
| II. Opening balance of the current year | 5,491,274,176.00 | 1,631,509,114.96 | 137,494,800.00 | 60,850,735.02 | 1,505,209,795.50 | - | 6,059,496,846.85 | 14,610,845,868.33 | 19,996,225.47 | 14,630,842,093.80 |
| III. YoY change (decrease is indicated by “-”) | -5,200,000.00 | 19,636,919.00 | -18,011,125.00 | -84,859,208.62 | 110,873,341.23 | 1,038,991.13 | 591,943,744.50 | 651,444,912.24 | -1,190,623.39 | 650,254,288.85 |
| (I) Total comprehensive income | - | - | - | -84,859,208.62 | - | - | 1,104,719,091.71 | 1,019,859,883.09 | -1,190,623.39 | 1,018,669,259.70 |
| (II)Owners’ contribution to and reduction in capital | -5,200,000.00 | 19,636,919.00 | -18,011,125.00 | - | - | - | - | 32,448,044.00 | - | 32,448,044.00 |
| 3. Amount of share-based payment into owner’s equity | -5,200,000.00 | 19,636,919.00 | -18,011,125.00 | - | - | - | - | 32,448,044.00 | - | 32,448,044.00 |
| (III) Profits distribution | - | - | - | - | 110,873,341.23 | 1,038,991.13 | -512,775,347.21 | -400,863,014.85 | - | -400,863,014.85 |
| 1．Withdrawal of surplus reserve | - | - | - | - | 110,873,341.23 | - | -110,873,341.23 | - | - | - |
| 2. Withdrawal of provision for general risks | - | - | - | - | - | 1,038,991.13 | -1,038,991.13 | - | - | - |
| 3．Distribution to owners (or shareholders) | - | - | - | - | - | - | -400,863,014.85 | -400,863,014.85 | - | -400,863,014.85 |
| IV. Closing balance of the current period | 5,486,074,176.00 | 1,651,146,033.96 | 119,483,675.00 | -24,008,473.60 | 1,616,083,136.73 | 1,038,991.13 | 6,651,440,591.35 | 15,262,290,780.57 | 18,805,602.08 | 15,281,096,382.65 |
| Item | 2021 | ||||||||
| Equity attributable to owners of the parent company | Minority interest | Total owners’ equity | |||||||
| Paid-in capital (share capital) | Capital reserve | Less: treasury stocks | Other comprehensive income | Surplus reserve | Undistributed profits | Sub-total | |||
| I. Balance at the end of previous year | 5,489,914,176.00 | 1,594,906,524.67 | 137,298,000.00 | 78,149,661.33 | 1,364,257,808.58 | 5,168,298,206.50 | 13,558,228,377.08 | 16,481,000.16 | 13,574,709,377.24 |
| II. Opening balance of the current year | 5,489,914,176.00 | 1,594,906,524.67 | 137,298,000.00 | 78,149,661.33 | 1,364,257,808.58 | 5,168,298,206.50 | 13,558,228,377.08 | 16,481,000.16 | 13,574,709,377.24 |
| III. YoY change (decrease is indicated by “-”) | 1,360,000.00 | 36,602,590.29 | 196,800.00 | -17,298,926.31 | 140,951,986.92 | 891,198,640.35 | 1,052,617,491.25 | 3,515,225.31 | 1,056,132,716.56 |
| (I) Total comprehensive income | - | - | - | -17,298,926.31 | - | 1,334,095,906.95 | 1,316,796,980.64 | -4,884,774.69 | 1,311,912,205.95 |
| (II)Owners’ contribution to and reduction in capital | 1,360,000.00 | 32,884,763.28 | 196,800.00 | - | - | - | 34,047,963.28 | 8,400,000.00 | 42,447,963.28 |
| 1．Common shares contributed by owners | 1,360,000.00 | 1,351,400.00 | 196,800.00 | - | - | - | 2,514,600.00 | 8,400,000.00 | 10,914,600.00 |
| 3. Amount of share-based payment into owner’s equity | - | 31,533,363.28 | - | - | - | - | 31,533,363.28 | - | 31,533,363.28 |
| (III) Profits distribution | - | - | - | - | 140,951,986.92 | -442,897,266.60 | -301,945,279.68 | - | -301,945,279.68 |
| 1．Withdrawal of surplus reserve | - | - | - | - | 140,951,986.92 | -140,951,986.92 | - | - | - |
| 3．Distribution to owners (or shareholders) | - | - | - | - | - | -301,945,279.68 | -301,945,279.68 | - | -301,945,279.68 |
| (VI) Others | - | 3,717,827.01 | - | - | - | - | 3,717,827.01 | - | 3,717,827.01 |
| IV. Closing balance of the current period | 5,491,274,176.00 | 1,631,509,114.96 | 137,494,800.00 | 60,850,735.02 | 1,505,209,795.50 | 6,059,496,846.85 | 14,610,845,868.33 | 19,996,225.47 | 14,630,842,093.80 |
Legal Representative: Zhao Wenge, Person in Charge of Finance: Wang Dong, Head of Finance Department: Zhao Difang
Statement of Changes in Owners’ Equity of Parent Company
January-December 2022
Unit: RMB
| Item | 2022 | ||||||
| Paid-in capital (share capital) | Capital reserve | Less: treasury stocks | Other comprehensive income | Surplus reserve | Undistributed profits | Total owners’ equity | |
| I. Balance at the end of previous year | 5,491,274,176.00 | 1,866,141,278.50 | 137,494,800.00 | 66,421,903.33 | 1,505,156,319.67 | 6,349,987,902.26 | 15,141,486,779.76 |
| II. Opening balance of the current year | 5,491,274,176.00 | 1,866,141,278.50 | 137,494,800.00 | 66,421,903.33 | 1,505,156,319.67 | 6,349,987,902.26 | 15,141,486,779.76 |
| III. YoY change (decrease is indicated by “-”) | -5,200,000.00 | 19,636,919.00 | -18,011,125.00 | -107,240,373.69 | 110,873,341.23 | 596,997,056.22 | 633,078,067.76 |
| (I) Total comprehensive income | -107,240,373.69 | 1,108,733,412.30 | 1,001,493,038.61 | ||||
| (II)Owners’ contribution to and reduction in capital | -5,200,000.00 | 19,636,919.00 | -18,011,125.00 | 32,448,044.00 | |||
| 3. Amount of share-based payment into owner’s equity | -5,200,000.00 | 19,636,919.00 | -18,011,125.00 | 32,448,044.00 | |||
| 4．Others | - | - | - | ||||
| (III) Profits distribution | 110,873,341.23 | -511,736,356.08 | -400,863,014.85 | ||||
| 1．Withdrawal of surplus reserve | 110,873,341.23 | -110,873,341.23 | |||||
| 2. Distribution to owner (or shareholders) | -400,863,014.85 | -400,863,014.85 | |||||
| IV. Closing balance of the current period | 5,486,074,176.00 | 1,885,778,197.50 | 119,483,675.00 | -40,818,470.36 | 1,616,029,660.90 | 6,946,984,958.48 | 15,774,564,847.52 |
| Item | 2021 | ||||||
| Paid-in capital (share capital) | Capital reserve | Less: treasury stocks | Other comprehensive income | Surplus reserve | Undistributed profits | Total owners’ equity | |
| I. Balance at the end of previous year | 5,489,914,176.00 | 1,833,256,515.22 | 137,298,000.00 | 81,473,183.84 | 1,364,204,332.75 | 5,383,365,299.69 | 14,014,915,507.50 |
| II. Opening balance of the current year | 5,489,914,176.00 | 1,833,256,515.22 | 137,298,000.00 | 81,473,183.84 | 1,364,204,332.75 | 5,383,365,299.69 | 14,014,915,507.50 |
| III. YoY change (decrease is indicated by “-”) | 1,360,000.00 | 32,884,763.28 | 196,800.00 | -15,051,280.51 | 140,951,986.92 | 966,622,602.57 | 1,126,571,272.26 |
| (I) Total comprehensive income | - | - | - | -15,051,280.51 | - | 1,409,519,869.17 | 1,394,468,588.66 |
| (II)Owners’ contribution to and reduction in capital | 1,360,000.00 | 32,884,763.28 | 196,800.00 | - | - | - | 34,047,963.28 |
| 1．Common shares contributed by owners | 1,360,000.00 | 1,351,400.00 | 196,800.00 | - | - | - | 2,514,600.00 |
| 3. Amount of share-based payment into owner’s equity | - | 31,533,363.28 | - | - | - | - | 31,533,363.28 |
| (III) Profits distribution | - | - | - | - | 140,951,986.92 | -442,897,266.60 | -301,945,279.68 |
| 1．Withdrawal of surplus reserve | - | - | - | - | 140,951,986.92 | -140,951,986.92 | - |
| 2. Distribution to owner (or shareholders) | - | - | - | - | - | -301,945,279.68 | -301,945,279.68 |
| IV. Closing balance of the current period | 5,491,274,176.00 | 1,866,141,278.50 | 137,494,800.00 | 66,421,903.33 | 1,505,156,319.67 | 6,349,987,902.26 | 15,141,486,779.76 |
Legal Representative: Zhao Wenge, Person in Charge of Finance: Wang Dong, Head of Finance Department: Zhao Difang
III. Basic information of the Company
1. Company profile
√Applicable □Not applicable
Zhejiang China Commodities City Group Co., Ltd. (the “Company”) is a company limitedby share and was incorporated on Dec 28, 1993 in Zhejiang Province of the People’s Republicof China. The RMB-denominated common A shares issued by the Company got listed onShanghai Stock Exchange on May 9, 2002. The Company is headquartered at No.105 FutianRoad, Yiwu City, Zhejiang Province.The Group’s main business activities: market development and operation and supportingservices, sales of commodities, provision of online trading platforms and services,development and management of online trading market, etc., in the category of comprehensiveservices.
The parent company of the Group is Yiwu China Commodities City Holdings Limited(hereinafter referred to as “CCCH”) and the final controller of the Group is the State-ownedAssets Supervision and Administration Office of the People’s Government of Yiwu.
These financial statements were approved for release by the Company's board ofdirectors on April 10, 2023. According to the Company's articles of association, these financialstatements are to be submitted to the general meeting of shareholders for deliberation.
2. Consolidation scope of financial statements
√Applicable □Not applicable
The consolidation of financial statements is determined on the basis of control. For thechanges in the reporting period, please refer to Note VIII. Changes in consolidation scope
IV. Basis of preparation of financial statements
1. Basis of preparation
The financial statements of the Company were prepared on a going-concern basis.
The financial statements were prepared in accordance with the Accounting Standards forEnterprises-Basic Standards and the specific accounting standards, application guidelines,interpretations and other related regulations promulgated and amended thereafter (collectivelyreferred to as “Accounting Standards”).
The financial statements were all prepared based on the valuation principle of historicalcost, except for certain financial instruments. In case of assets impairment, correspondingprovision was made in accordance with relevant provisions.
2. Going concern
√Applicable □Not applicable
The Company prepared financial statements on the basis of continuous operation.
On December 31, 2022, after deducting the contract liabilities/advance receipts that theGroup will use services/commodities to settle revenue to be recognized in the future, and theprepaid accounts that the Group will receive in the future for goods/services, the Group'scurrent liabilities exceeded current assets by RMB 2,886,750,945.12. The Board of Directors ofthe Company comprehensively considered the following sources of funds available to theGroup: 1. The Group’s expected net cash inflow from operating activities within the next 12months; 2. As of December 31, 2022, the Group’s unused bank credit line of was RMB4,745,500,000.00, of which RMB 650,000,000.00 needed to be renewed within the next 12months. The board of directors of the Company is convinced that the available credit line canbe re-approved when it expires based on past experience and good reputation; 3. In view ofthe credit history of the Group, other available financing channels from banks and otherfinancial institutions; 4. , The Group's controlling shareholder CCCH has promised to continueto provide sufficient financial support in the foreseeable future.
After evaluation, the board of directors of the Company believed that the Group hassufficient resources to continue operations in the foreseeable future period of not less than 12
months from the end of the reporting period. Therefore, the Board of Directors of the Companycontinued to prepare the Group's 2022 annual financial statements on a going concern basis.
V. Important Accounting Policies and Accounting EstimatesReminders on specific accounting policies and accounting estimates:
√Applicable □Not applicable
The Group has formulated specific accounting policies and accounting estimates based onthe characteristics of actual production and operation, which are mainly reflected in the baddebt provisions for receivables, inventory valuation methods, depreciation of fixed assets,amortization of intangible assets, income recognition and measurement, recognition ofproperty investments and fixed assets, and service life and residual value of fixed assets.
1. Statement of compliance with the Accounting Standards
The financial statements prepared by the Group comply with the requirements of theAccounting Standards, and truly and completely reflect the Company’s financial conditions,operating results, changes in shareholders’ equity, cash flows and other related information.
2. Accounting period
The fiscal year of the Group starts from January 1 until December 31 of each calendaryear.
3. Operating cycle
√Applicable □Not applicable
The business cycle of the Company is relatively short, and 12 months are used as thestandard for defining the liquidity of assets and liabilities.
4. Functional currency
The Company’s functional currency is RMB. The Group uses RMB as its functionalcurrency and in the preparation of financial statements. Unless specifically stated, all amountsare expressed in RMB.
The subsidiaries, joint ventures and associates of the Group determine their functionalcurrencies at their own discretion based on the main economic environments in their places ofbusinesses and convert all amounts into RMB while preparing financial statements.
5. Accounting methods for merger of the enterprises under common control and merger
of the enterprises not under common control
√Applicable □Not applicable
The mergers of enterprises are divided into the mergers of the enterprises under commoncontrol and mergers of the enterprises not under common control.
Mergers of the enterprises under common control
Merger of the enterprises under common control refers to the merger of the enterprisesthat are under ultimate control of the same party or parties before and after the merger and thecontrol is not temporary.
The assets and liabilities acquired by the merging party in a merger of the enterprisesunder common control (including the goodwill formed through the acquisition of the mergedparty by the ultimate controller) are accounted according to the book value thereof in theultimate controller’s financial statements on the date of merger. For the difference between thebook value of the net assets obtained by the merging party and the book value of theconsideration paid for the merger (or the total nominal value of the shares issued), the sharecapital premium in the capital reserve shall be adjusted; if the share capital premium is notsufficient to absorb the difference, the retained earnings shall be adjusted.
Mergers of the enterprises not under common control
Merger of the enterprises not under common control refers to the merger of theenterprises that are not under ultimate control of the same party or parties before and after themerger.
The acquiree’s identifiable assets, liabilities and contingent liabilities obtained from themerger of the enterprises not under common control are measured at their fair values on thedate of acquisition. If the sum of the fair value of the consideration paid for the merger (or fairvalue of the equity securities issued) and the fair value of the acquiree’s equity held before thedate of acquisition is higher than the share in the fair value of the acquiree’s identifiable netassets acquired from the merger, the difference between them is recognized as goodwill,which will be subsequently measured by the cost less accumulated impairment loss. If the sumof the fair value of the consideration paid for the merger (or fair value of the equity securitiesissued) and the fair value of the acquiree’s equity held before the date of acquisition is lowerthan the share in the fair value of the acquiree’s identifiable net assets acquired from themerger, the measurement of the fair value of the acquiree’s identifiable assets, liabilities andcontingent liabilities, the fair value of the consideration paid for the merger (or fair value of theequity securities issued) and the fair value of the acquiree’s equity held before the date ofacquisition will be reviewed, and if the sum of the fair value of the consideration paid for themerger (or fair value of the equity securities issued) and the fair value of the acquiree’s equityheld before the date of acquisition is still lower than the share in the fair value of the acquiree’sidentifiable net assets acquired from the merger after such review, the difference will berecognized in the profit or loss for the current period.
For mergers of the enterprises not under common control that are executed throughmultiple transactions, the long-term equity investment of the acquiree before the date ofacquisition shall be re-measured based on the fair value thereof on the date of acquisition andany difference between the fair value and book value thereof shall be recognized in the profitor loss for the current period; other comprehensive income from the long-term equityinvestment of the acquiree before the date of acquisition under the equity method shall beaccounted on the same basis as that for the direct disposal of related assets or liabilities by theinvestee, and other changes in shareholders’ equity than net profits or losses, othercomprehensive income and profit distribution shall be recognized in the profit or loss for theperiod where the date of acquisition falls.
6. Preparation method of consolidated financial statements
√Applicable □Not applicable
The financial statements to be consolidated is determined on the basis of control,including those of the Company and all of its subsidiaries. Subsidiaries refer to the entitiescontrolled by the Company (including the severable parts of enterprises and invested entities,and the structured entities controlled by the Company).
In the preparation of consolidated financial statements, the subsidiaries adopt the sameaccounting year and accounting policies as those adopted by the Company. Assets, liabilities,equity, income, expenses and cash flows generated from all deals between companies withinthe Group are fully offset at the time of merger.
If the amount of loss for the current period attributable to the minority shareholders of asubsidiary exceeds the minority shareholders’ share in the opening balance of shareholders’equity in the subsidiary, the excess will still be recognized against minority interest.
For a subsidiary acquired through a business merger not under the same control, theoperating results and cash flows of the acquiree will be included in the consolidated financialstatements from the day when the Group acquires control, until the control of the Groupceases. In the preparation of consolidated financial statements, adjustments will be made tothe financial statements of the subsidiary based on the fair value of its identifiable assets,liabilities or contingent liabilities determined on the date of acquisition.
For a subsidiary acquired through a business merger under the same control, theoperating results and cash flows of merged party will be included in the consolidated financialstatements since the beginning of the current period of the merger. In the preparation of
consolidated financial statements, adjustments will be made to the related items in its previousfinancial statements as if the reporting entity formed after the merger has been existing as fromthe ultimate controller starts to exercise control.In case of any change to one or more elements of the control due to the changes inrelated facts and circumstances, the Group will re-evaluate whether to control the investee.Without loss of control, changes in minority shareholders' equity are regarded as equitytransactions.
7. Classification of joint arrangements and accounting treatment of joint operations
√Applicable □Not applicable
Joint arrangements are divided into joint operations and joint ventures. Joint operationrefers to a joint arrangement in which the parties thereto enjoy the assets relating to sucharrangement and assume the liabilities relating to such arrangement. Joint venture refers to ajoint arrangement in which the parties thereto only enjoy rights to the net assets in thisarrangement.Each party to a joint arrangement recognizes the following items relating to its share in thejoint operation: assets held individually by it and assets held jointly based on its share;liabilities assumed individually by it and liabilities assumed jointly based on its share; revenuefrom the sale of its share in the output of the joint operation; revenue from the sale of theoutput of the joint operation based on its share; expenses incurred individually by it andexpenses incurred by the joint operation based on its share.
8. Criteria for the identification of cash and cash equivalents
Cash refers to the Group’s cash on hand and deposits that can be used for payment atany time; cash equivalent refers to the investment held by the Group with a short term, strongliquidity, easy to convert into cash with a known amount, and with low risk of value changes.
9. Foreign currency transactions and translation of foreign currency financial
statements
√Applicable □Not applicable
For foreign currency transactions, the Group will translate the foreign currency amountsinto its functional currency amounts.
In the initial recognition of a foreign currency transaction, the foreign currency amount istranslated to a functional currency amount according to the spot exchange rate on the date oftransaction. On the balance sheet date, the foreign currency monetary items are translatedaccording to the spot exchange rate on the balance sheet date. The translation differencebetween settlement and monetary items is recognized in the profit or loss for the currentperiod, except for the difference arising from the special foreign currency borrowing relating tothe acquisition and construction of the assets qualified for capitalization, which will be treatedbased on the principles for the capitalization of borrowing expenses. The foreign currency non-monetary items measured by historical cost are also translated according to the spot exchangerate on the date of transaction, without changing the functional currency amounts thereof. Theforeign currency non-monetary items measured by fair value are translated according to thespot exchange rate on the fair value determination date and the difference arising therefrom isrecognized in the profit or loss or other comprehensive income for the current period based onthe nature of the items.
The Group translates the functional currency of its foreign business into RMB whilepreparing the financial statements. The assets and liabilities items in the balance sheet aretranslated according to the spot exchange rate on the balance sheet date, the shareholders’equity items are translated according to the spot exchange rate at the occurrence of the itemsexcept for “undistributed profits”; revenue and expenses items in the income statement aretranslated according to the average exchange rate during the period in which the transactionhappens (conversion shall be at the spot rate on the date of the transaction, unless exchangerate fluctuations make such conversion inappropriate). The translation differences of foreigncurrency statements arising from the above translations are recognized as other
comprehensive income. For the disposal of foreign business, other comprehensive incomerelating to the foreign business is recognized in the profit or loss of the disposal for the currentperiod and is calculated pro rata for partial disposal.Foreign currency cash flows and cash flows of overseas subsidiaries are converted usingthe average exchange rate for the period in which the cash flows occur (unless exchange ratefluctuations make the exchange rate inappropriate, the spot exchange rate on the day the cashflows occur) is used for conversion. The amount of impact of the changes in exchange rate oncash is separately stated in the cash flow statement as an adjustment item.
10. Financial instruments
√Applicable □Not applicable
Financial instruments refer to the contracts which form financial assets of an enterpriseand form financial liabilities or equity instruments of other entities.Recognition and de-recognition of financial instrumentsThe Group recognizes a financial asset or financial liability at the time of becoming a partyto a financial instrument contract.
The Group will derecognize a financial asset (or a part of the financial asset or a part of agroup of similar financial assets), i.e. writing off the asset from its account and balance sheet,if:
(1) the right to collect cash flow from the financial asset has expired;
(2) The right to collect cash flows of financial assets has been transferred, or the obligationto pay the collected cash flows in full and in time to a third party under the “handoveragreement” has been undertaken; and (a) all risks and rewards in the ownership of thefinancial assets have been substantially transferred, or (b) almost all risks and rewards in theownership of the financial asset have been neither transferred nor retained, but control of thefinancial asset has been waived.
If a financial liability has been fulfilled, revoked or expired, it will be derecognized. If anexisting financial liability is replaced by the same creditor with another financial liability undersubstantially different terms or the terms of the existing liability are substantially modified inwhole, the existing liability will be derecognized and the new liability will be recognized, and thedifference will be recognized in the profit or loss for the current period.
For the transactions of financial assets in regular ways, the recognition and de-recognitionthereof will be conducted based on the accounting on the transaction date. Transactions offinancial assets in regular ways refer to the collection or delivery of financial assets within thetime limit prescribed by laws and regulation or prevailing practices in accordance with thecontract terms. The transaction date refers to the date when the Group promises to buy or sellthe financial assets.
Classification and measurement of financial assets
Based on the Group’s business model for the management of financial assets and thefeatures of the contractual cash flow of financial assets, the Group’s financial assets areclassified at initial recognition into the financial assets that are measured by fair value and ofwhich the changes in fair value are recognized in the profit or loss for the current period, thefinancial assets measured by amortized cost and the financial assets that are measured by fairvalue and of which the changes in fair value are recognized in other comprehensive income.
If a financial asset is measured by fair value at initial recognition, but the accountsreceivable or notes receivable from the sale of goods or rendering of service do not includesignificant financing components or the financing components with a term no longer than oneyear are not considered, the initial measurement will be made based on the transaction price.
For the financial assets that are measured by fair value and of which the changes in fairvalue are recognized in the profit or loss for the current period, the related transaction fees willbe directly recognized in the profit or loss for the current period; the related transaction fees ofother financial assets will be recognized in the initially recognized amounts thereof.
The subsequent measurement of financial assets depends on the classification thereof:
Investment in debt instruments measured by amortized cost
A financial asset is classified into those measured by amortized cost, if the businessmodel for the management of the asset is for the purpose of collecting contractual cash flow;
and the terms of the contract of the asset stipulate that the cash flow generated on the specificdate is only the repayment of principal and the payment of interest on the outstanding principal.The interest income of such financial assets is recognized with the effective interest method,and the profits or losses from the de-recognition, modification or impairment thereof are allrecognized in the profit or loss for the current period.Investment in the equity instruments that are measured by fair value and of whichthe changes in fair value are recognized in other comprehensive income
The Group has irrevocably chosen to designate some non-trading equity instrumentinvestments as the financial assets that are measured by fair value and of which the changesin fair value are recognized in other comprehensive income. Only the related dividend income(except for the dividend income expressly acting as a recovery of investment cost) isrecognized in the profit or loss for the current period, while the subsequent changes in fairvalue are recognized in other comprehensive income, and no provision is required forimpairment. When the financial assets are derecognized, the accumulated profits or lossespreviously recognized in other comprehensive income will be moved out of othercomprehensive income and recognized in retained earnings.Financial assets that are measured by fair value and of which the changes in fairvalue are recognized in the profit or loss for the current periodThe financial assets other than the above financial assets measured by amortized costand the above financial assets that are measured by fair value and of which the changes in fairvalue are recognized in other comprehensive income are classified as the financial assets thatare measured by fair value and of which the changes in fair value are recognized in the profitor loss for the current period. Those financial assets are subsequently measured by fair valueand all changes in the fair value thereof are recognized in the profit or loss for the currentperiod.
Classification and measurement of financial liabilities
The Group’s financial liabilities are classified at initial recognition into the financial liabilitiesthat are measured by fair value and of which the changes in fair value are recognized in theprofit or loss for the current period and other financial assets. For the financial liabilities that aremeasured by fair value and of which the changes in fair value are recognized in the profit orloss for the current period, the related transaction fees are recognized directly in the profit orloss for the current period, while the related transaction fees of other financial liabilities arerecognized in the initially recognized amounts thereof.
The subsequent measurement of financial liabilities depends on the classification thereof:
Financial liabilities that are measured by fair value and of which the changes in fairvalue are recognized in the profit or loss for the current period
The financial liabilities that are measured by fair value and of which the changes in fairvalue are recognized in the profit or loss for the current period include financial liabilities heldfor trading (including the derivative instruments as financial liabilities) and the liabilities that aredesignated at initial recognition as the financial liabilities that are measured by fair value and ofwhich the changes in fair value are recognized in the profit or loss for the current period. Thefinancial liabilities held for trading (including the derivative instruments as financial liabilities)are subsequently measured by fair value and all changes in the fair value are recognized in theprofit or loss for the current period.
Other financial liabilities
Those financial liabilities are subsequently measured by amortized cost with the effectiveinterest method.
Impairment of financial instruments
The Group has treated and recognized the impairment of the financial assets measured byamortized cost based on the expected credit loss.
For receivables that do not contain significant financing components, the Group measuresthe loss provision based on the amount of expected credit loss equivalent to the entire durationunder a simplified measurement method,
For the financial assets not measured with the simplified method, the Group evaluates oneach balance sheet date whether their credit risks have increased significantly since the initialrecognition. If the credit risk of a financial asset has not increased significantly since the initialrecognition, the asset is in the first stage and the Group will make provision for loss based on
the amount of expected credit loss within the coming 12 months and calculate interest incomebased on the book balance and effective interest rate; if the credit risk has increasedsignificantly since the initial recognition, but credit has not been impaired, the asset is in thesecond stage and the Group will make provision for loss equivalent to the amount of expectedcredit loss during the entire term and calculate interest income based on the book balance andeffective interest rate; if credit has been impaired after the initial recognition, the asset is in thethird stage and the Group will make provision for loss equivalent to the amount of expectedcredit loss during the entire term and calculate interest income based on the amortized costand effective interest rate.The Group evaluates the expected credit losses of financial instruments on the individualand group bases. It evaluates the expected credit loss of accounts receivable by taking intoaccount the credit risk characteristics of different clients and based on the account aging-based asset groups.
For the disclosure of the Group’s criteria for a significant increase in credit risk, definitionof the assets whose credit has been impaired and assumptions for the measurement ofexpected credit loss, please refer to Notes X. 2.The factors reflected in the Group's method of measuring expected credit losses offinancial instruments include: unbiased probability-weighted average amount determined byevaluating a series of possible outcomes; time value of money; no unnecessary additional costor effort on the balance sheet date Reasonable and evidence-based information that is readilyavailable about past events, current conditions and forecasts of future economic conditions.When the Group no longer reasonably expects that it can recover the contractual cashflow of a financial asset in whole or in part, it will directly write down the book balance of theasset.
11. Notes receivable
Determination and accounting treatment of the expected credit loss of notes receivable
□Applicable √Not applicable
12. Accounts receivable
Determination and accounting treatment of the expected credit loss of accountsreceivable
√Applicable □Not applicable
Please refer to Notes X. Risks Associated with Financial Instruments
13. Accounts receivable financing
□Applicable √Not applicable
14. Other receivables
Determination and accounting treatment of the expected credit loss of other receivables
√Applicable □Not applicable
Please refer to Notes X. Risks Associated with Financial Instruments
15. Inventory
√Applicable □Not applicable
Inventory includes raw materials, work-in-progress materials, finished goods, real estatedevelopment costs and real estate development products.
Inventory is initially measured by cost. The costs of inventory except development costsand development products include the procurement cost, processing cost and other costs. Theactual costs of items out of inventory are determined with the weighted average method. Work-in-progress materials include low-value consumables and packages, which are amortized withthe one-off amortization method.
Development costs refer to the properties that have not been completed and aredeveloped for the purpose of being sold. Development products refer to the properties thathave been completed and are ready for sale. The actual costs of real estate developmentcosts and development products include the land acquisition cost, expenditures onconstruction and installation works, capitalized interest and other direct and indirectdevelopment expenses. The use right of the land for development purpose at the developmentof a project is amortized and recognized as the development cost of the project based on thesite area of the development product, and the development cost will be changed over todevelopment product after being completed.If the public auxiliary facilities are completed earlier than the related development product,the facilities will be allocated to and recognized in the development cost of relateddevelopment project based on the floor space of the project after final accounting of thefacilities upon completion; if the public auxiliary facilities are completed later than the relateddevelopment product, they will be recognized in the development cost of related developmentproject based on the predicted cost of the public auxiliary facilities.Hotel, catering and fresh goods inventories are subject to onsite inventory, while otherinventories are subject to perpetual inventory.On the balance sheet date, inventory is measured by cost and net realizable value,whichever is lower. If the cost is higher than the net realizable value, provision will be made forinventory depreciation, which will be recognized in the profit or loss for the current period. Netrealizable value is the estimated selling price of inventory less the cost estimated to occur as ofcompletion, estimated sales expenses and related taxes. In principle, provisions for inventorydepreciation shall be made for inventory items individually. For the inventory with a largequantity and a low unit price, inventory depreciation provision will be made based on theGroups of items.
16. Contract assets
(1). Determination and criteria for contract assets
□Applicable √Not applicable
(2). Determination and accounting treatment of the expected credit loss of contract
assets
□Applicable √Not applicable
17. Held-for-sale assets
□Applicable √Not applicable
18. Debt investments
(1). Determination and accounting treatment of the expected credit loss of debt
investments
√Applicable □Not applicable
Please refer to Notes X. Risks Associated with Financial Instruments
19. Other debt investments
(1). Determination and accounting treatment of the expected credit loss of other debt
investments
□Applicable √Not applicable
20. Long-term receivables
(1). Determination and accounting treatment of the expected credit loss of long-term
receivables
√Applicable □Not applicable
Please refer to Notes X. Risks Associated with Financial Instruments
21. Long-term equity investment
√Applicable □Not applicable
Long-term equity investment includes equity investment in subsidiaries, joint ventures andassociates.Long-term equity investment is initially measured by the initial investment cost at the timeof being acquired. For a long-term equity investment acquired through a business mergerunder the same control, the initial investment cost is the share of the book value of the mergedparty’s owner’s equity acquired on the merger date in the ultimate controlling party’sconsolidated financial statements; The difference between the initial investment cost and thebook value of the merger consideration is adjusted to the capital reserve (if it is insufficient tooffset, the retained earnings will be offset); other comprehensive income before the mergerdate is accounted for on the same basis as that for the investee’s direct disposal of relatedassets or liabilities when disposing of the investment. The shareholders’ equity recognized bythe investee due to the changes in shareholders’ equity other than net profit and loss, othercomprehensive income, and profit distribution is transferred to the current profit and loss whenthe investment is disposed of; those that are still long-term equity investments after disposalare carried forward in proportion, and those that are converted into financial instruments afterdisposal are carried forward in full. For a long-term equity investment acquired through abusiness merger not under the same control, the merger cost shall be used as the initialinvestment cost (for the business merger not under the same control realized step by step in apackage deal, the sum of the book value and the new investment cost on the acquisition dateis used as the initial investment cost). The merger cost includes the sum of fair values of theassets paid, the liabilities incurred or assumed, and the equity securities issued by theacquirer; the other comprehensive income held prior to the acquisition date that is recognizedfor accounting under the equity method is accounted for on the same basis as that for theinvestee’s direct disposal of related assets or liabilities when disposing of the investment. Theshareholders’ equity recognized by the investee due to the changes in shareholders’ equityother than net profit and loss, other comprehensive income, and profit distribution is transferredto the current profit and loss when the investment is disposed of; those that are still long-termequity investments after disposal are carried forward in proportion, and those that areconverted into financial instruments after disposal are carried forward in full. The initialinvestment costs of the long-term equity investment acquired other than through merger aredetermined with the following methods: if an investment is acquired through the payment ofcash, its initial investment cost consists of the purchase price actually paid and the expenses,taxes and other necessary expenses directly relating to the acquisition of the investment; and ifan investment is acquired through the offering of equity securities, its initial investment cost isthe fair value of the equity securities offered.For the accounting of the long-term equity investment through which the Company canexercise control over the investees, the Company adopts the cost method in individual financialstatements. Control refers to the power over an investee, with which the investor enjoysvariable return by participating in the investee’s related activities and is able to exercise itspower over the investee to affect the amount of return.
In the cost method, the long-term equity investment is measured by initial investment cost.If the investment is added or recovered, the cost of long-term equity investment will beadjusted. The cash dividend or profit declared by the investees to be distributed is recognizedas the investment income for the current period.
If the Group has joint control over or significant influence on the investee, the long-termequity investment will be measured with the equity method. Joint control refers to joint controlover an arrangement in accordance with related agreements, and decisions on the activitiesrelating to the arrangement shall be made only after the parties sharing the control reach anagreement. Significant influence refers to the power over the decision-making on the financialaffairs and business policies of the investee, but the investor does not have control or jointcontrol with others over the formulation of those policies.
In the equity method, if the initial investment cost of long-term equity investment is higherthan the share enjoyed by the Group in the fair value of the investee’s identifiable net assets atinvestment, the excess will be recognized in the initial investment cost of the long-term equityinvestment; if the initial investment cost of long-term equity investment is lower than the shareenjoyed by the Group in the fair value of the investee’s identifiable net assets at investment,the difference will be recognized in the profit or loss for the current period and the cost of thelong-term equity investment will be adjusted simultaneously.In the equity method, after long-term equity investment is acquired, the investment profitsor losses and other comprehensive income shall be recognized and the book value of the long-term equity investment shall be adjusted based on the share in the net profits or losses andother comprehensive income realized by the investees to be enjoyed or assumed. The share inthe investee’s net profits or losses to be enjoyed shall be determined based on the fair value ofthe investee’ s identifiable assets at the acquisition of investment, according to the Group’saccounting policies and accounting periods and after net profits of the investee are adjustedwith the portion of profits or losses from the internal transactions with its associates and jointventures that is attributable to the investor based on the share to be enjoyed by it (but if theloss from internal transactions falls in the assets impairment loss, it shall be recognized in full)offset, except for the invested and sold assets that constitute businesses. The book value oflong-term equity investment shall be reduced according to the share to be enjoyed by it in theprofits or cash dividend declared by the investees to be distributed. For an investee’s netlosses recognized by the Group, the book value of the long-term equity investment and otherlong-term equity that substantially constitute net investment in the investee shall be writtendown to zero at maximum, except for the extra losses for which the Group is liable. For theinvestee’s other changes in shareholders’ equity other than net profits or losses, othercomprehensive income and profit distribution, the book value of the long-term equityinvestment will be adjusted and the changes will be recognized in the shareholders’ equity.
For the disposal of long-term equity investment, the difference between the book value oflong-term equity investment and the proceeds actually received from the disposal thereof isrecognized in the profits or loss for the current period. For the long-term equity investmentmeasured with the equity method, if the equity method is terminated due to the disposal, theoriginal related other comprehensive income measured with the equity method will beaccounted on the same basis as that for the direct disposal of related assets or liabilities by theinvestees, and the shareholders’ equity recognized due to the investees’ other changes inshareholders’ equity than net profits or losses, other comprehensive income and profitdistribution will be recognized in the profits or loss for the current period in full; if the equitymethod is still adopted, the original related other comprehensive income measured with theequity method will be accounted on the same basis as that for the direct disposal of relatedassets or liabilities by the investees and recognized in the profits or loss for the current periodpro rata, and the shareholders’ equity recognized due to the investees’ other changes inshareholders’ equity than net profits or losses, other comprehensive income and profitdistribution will be recognized in the profit or loss for the current period pro rata.
22. Property investment
(1). In cost measurement model:
Depreciation or amortization methods
A property investment is a real estate property held with the intention of earning rents or ofcapital appreciation or both, including land use rights that have been leased, land use rightsthat are held and ready to be transferred after appreciation, and buildings that have beenleased.
Property investments are initially measured by cost. The subsequent expenses relating toan property investment will be recognized in the cost of the property investment if theeconomic benefits relating to the asset are very likely to flow in and the cost thereof can bemeasured reliably. Otherwise, they will be recognized in the profit or loss for the current periodat the time of being incurred.
The Group subsequently measures its property investments with the cost model. Thedepreciation/amortization of property investments is calculated on a straight line basis. The
service life, estimated net residual value and annual depreciation rate of property investmentsare as follows:
| Category | Service life | Estimated net residual value | Annual depreciation rate |
| Buildings and structures | 20-30 years | 4% | 3.2%-4.8% |
| Land use right | 40-50 years | - | 1.4%-2.5% |
23. Fixed assets
(1). Recognition requirements
√Applicable □Not applicable
A fixed asset will be recognized only if the economic benefits relating thereto are verylikely to flow into the Group and its cost can be measured reliably. If meeting the aboverecognition requirement, the subsequent expenses relating to a fixed asset will be recognizedin the cost of the fixed asset, and the book value of the replaced part will be deleted; otherwise,the subsequent expenses will be recognized in the profit or loss for the current period at thetime of being incurred.Fixed assets are initially measured by cost. The costs of purchasing a fixed asset includethe purchase price, related taxes and other expenses that are incurred before the fixed asset ismade to the predetermined ready-for-use status and are directly attributable to the asset.The Group reviews and makes adjustment to, if necessary, the service life, estimatedresidual value and depreciation method of its fixed assets at least at the end of each year.
(2). Depreciation methods
√Applicable □Not applicable
| Category | Depreciation methods | Depreciation period (number of years) | Residual value rate | Annual depreciation rate |
| Buildings and structures | Straight-line method | 10-40 | 4% | 2.4%-9.6% |
| General equipment | Straight-line method | 5-10 | 4% | 9.6%-19.2% |
| Transportation equipment | Straight-line method | 6 | 4% | 16.0% |
(3). Identification basis, pricing and depreciation method of the fixed assets under
financial lease
√Applicable □Not applicable
The depreciation method for the fixed assets under financial lease are the same as that forproprietary fixed assets. If it can be reasonably determined that the ownership of a leasedasset will be acquired upon expiry of the lease term, the depreciation will be based on itsservice life; if it cannot be reasonably determined that the ownership of a leased asset can beacquired upon expiry of the lease term, the depreciation will be based on the lease term or theservice life of the asset, whichever is shorter.
24. Construction in progress
√Applicable □Not applicable
The cost of construction in progress is determined based on the actual expenses,including the necessary expenses on the works incurred during the construction, the borrowingcosts incurred before the works reach the predetermined ready-for-use status that shall becapitalized and other related expenses.
The construction in progress will be recognized as fixed assets, property investment andlong-term prepaid expenses when reaching the predetermined ready-for-use status.
25. Borrowing costs
√Applicable □Not applicable
Borrowing costs refer to the interests incurred by the Group for its borrowings and otherrelated costs, including interest, amortization of discounts or premiums, ancillary costs andexchange difference arising from foreign currency borrowings.
Borrowing costs that are directly attributable to the acquisition, construction or productionof the assets qualified for capitalization shall be capitalized, and other borrowing costs shall berecognized in the profit or loss for the current period. The assets qualified for capitalizationrefer to the fixed assets, property investment, inventory and other assets that can reach thepredetermined ready-for-use or sale status only after a quite long time of acquisition,construction or production.
Borrowing costs can start to be capitalized only if they meet the following requirementssimultaneously:
(1) the expenses on assets have been incurred;
(2) the borrowing costs have been incurred;
(3) The purchase, construction or production activities necessary to make the asset reachthe intended usable or saleable status have started.
The borrowing costs for the assets qualified for capitalization shall cease being capitalizedwhen the assets reach the predetermined ready-for-use or sale status after the acquisition,construction or production. The borrowing costs incurred subsequently will be recognized inthe profit or loss for the current period.
During capitalization, the amount of interest to be capitalized during each accountingperiod is determined as follows:
For special borrowings, the amount of interest to be capitalized is the interest expensesactually incurred during the current period less the temporary deposits interest income orinvestment income.
(2) For occupied general borrowings, it is calculated and determined based on theweighted average of asset expenditures of the accumulated asset expenditure exceeding theportion of special borrowings multiplied by the weighted average interest rate of the occupiedgeneral borrowings.
If an asset qualified for capitalization is interrupted abnormally for more than three monthsduring its acquisition, construction or production except due to the necessary procedures for itto reach the predetermined ready-for-use or sale status, the capitalization of its borrowingcosts will be suspended. The borrowing costs incurred during the interruption will berecognized as expenses and in the profit or loss for the current period until the acquisition,construction or production of the asset is resumed.
26. Biological assets
□Applicable √Not applicable
27. Oil and gas assets
□Applicable √Not applicable
28. Right-of-use assets
√Applicable □Not applicable
The Group's right-of-use asset classes mainly include buildings and lands.
On the commencement date of the lease term, the Group recognizes its right to use theleased asset during the lease term as a right-of-use asset, which is initially measured at cost.Costs of right-of-use assets include: the initial measurement amount of the liabilities of thelease; The amount of the lease payment paid on or before the commencement date of thelease term, where there is a lease incentive, shall be deducted from the amount of the leaseincentive already enjoyed; Initial direct costs incurred by lessee; Costs expected to be incurredby the Lessee to disassemble and remove the leased asset, restore the leased asset to thesite, or restore the leased asset to the state agreed upon in the lease terms. If the Group re-
measures lease liabilities in accordance with the relevant provisions of the lease standards, thebook value of the right-of-use asset shall be adjusted accordingly. The Group subsequentlyshall adopt the straight-line method for the depreciation of the usufruct assets. Where theownership of the leased asset can be reasonably determined at the end of the lease term, theGroup shall take depreciation during the remaining useful life of the leased asset. Where it isnot reasonably certain that ownership of the leased asset will be acquired at the end of thelease term, the Group shall make depreciation within the shorter period of the lease term or theremaining useful life of the leased asset.
29. Intangible assets
(1). Measurement method, service life and impairment test
√Applicable □Not applicable
Intangible assets will be recognized only if the economic benefits relating thereto are verylikely to flow into the Group and the costs thereof can be measured reliably, and will be initiallymeasured by cost. However, the intangible assets acquired from the merger of the enterprisesnot under common control will be individually recognized so long as the fair values thereof canbe measured reliably, and will be measured by fair value.The service life of an intangible asset is determined based on the term during which it canbring economic benefits to the Group. If the term during which an intangible asset can bringeconomic benefits to the Group is unforeseeable, it will be deemed as an intangible asset withuncertain service life.The service life of intangible assets is as follows:
| Category | Service life |
| Land use right | 40-50 years |
| Software and software copyright | 10 years |
The land use rights acquired by the Group are generally accounted as intangible assets.The buildings constructed by the Group itself, the related land use rights and buildings areaccounted as intangible assets and fixed assets respectively. The price paid for the land andbuildings purchased externally shall be allocated between the land use rights and buildings. If itis hard to reasonably allocate the price, the price in full will be treated as fixed assets.
The intangible assets with finite service life shall be amortized with the straight-linemethod during their service life. The Group reviews and makes adjustment to, if necessary, theservice life and amortization method of its intangible assets with finite service life at least at theend of each year.
(2). Accounting policies for internal R&D expenses
√Applicable □Not applicable
The Group divides expenditures for internal R & D projects into research expenditures anddevelopment expenditures. Research expenses are recognized in the profit or loss for thecurrent period at the time of being incurred. Development expenditures can be capitalized onlywhen all of the following conditions are met at the same time, that is, it is technically feasible tocomplete the intangible asset to make them usable or saleable; there is an intention tocomplete the intangible asset and use or sell it; the way for intangible assets to generateeconomic benefits, including the ability to prove that there are markets for the productsgenerated by the intangible assets or the intangible assets themselves. Intangible assets thatwill be used internally can prove their usefulness; there are sufficient technology, financialresources and other resource supports to complete the development of the intangible assetand ability to use or sell the intangible asset; the expenditure attributable to the development ofsuch intangible asset can be reliably measured. Development expenditures that do not satisfythe above conditions are included in the current profits and losses when incurred.
30. Impairment of long-term assets
√Applicable □Not applicable
The Group determines the impairment of the assets other than inventory, deferred incometax and financial assets with the following methods.
On the balance sheet date, the Group judges whether there is any sign of possibleimpairment of assets. If there is any sign of impairment, the Group will estimate its recoverableamount and conduct an impairment test; Uncertain intangible assets and intangible assets notyet ready for use shall be tested for impairment at least at the end of each year, no matterwhether there is any sign of impairment.The recoverable value of an asset is determined based on the fair value of the asset lessthe disposal expenses or the present value of the expected future cash flows of the asset,whichever is higher. The Group estimates the recoverable value of each asset. For an assetwhose recoverable value is hard to be estimated, the Group estimates the recoverable value ofthe assets group which the asset belongs to. An assets group is identified based on whetherthe main cash inflows from the Group are independent from the cash inflows from other assetsor assets groups.When the recoverable value of an asset or assets group is lower than its book value, theGroup will write down its book value to the recoverable value and the amount written down willbe recognized in the profit or loss for the current period; meanwhile, it will make provision forthe impairment thereof.In terms of goodwill impairment tests, the book value of the goodwill formed in thebusiness merger shall be allocated to the relevant asset group under a reasonable methodfrom the date of acquisition; if it is difficult to allocate to the relevant asset group, it shall beallocated to the relevant combination of asset groups. The relevant asset group or asset groupcombination is an asset group or asset group combination that can benefit from the synergisticeffect of a business combination, and is not larger than the reporting segment determined bythe Group.
When an impairment test on a related asset group or combination of asset groups thatcontains goodwill is made, if there are indications of impairment for an asset group orcombination of asset groups related to goodwill, the asset group or combination of assetgroups that does not contain goodwill shall be tested for impairment first, to calculate therecoverable amount and recognize the corresponding impairment loss. Then, an impairmenttest is conducted on the asset group or asset group combination containing goodwill tocompare its book value with the recoverable amount. If the recoverable amount is lower thanthe book value, the impairment loss amount will be first offset and apportion to the book valueof goodwill in the asset group or asset group combination. Then the book value of other assetsshall be offset proportionally according to the proportion of the book value of other assetsexcept goodwill in the asset group or asset group combination.
The above assets impairment loss will not be reversed during the subsequent accountingperiods.
31. Long-term prepaid expenses
√Applicable □Not applicable
Long-term prepaid expenses are amortized with the straight-line method and theamortization periods are as follows:
| Category | Amortization period |
| Architectural ornaments of buildings | 3-5 years |
| Advertising facilities | 3-5 years |
32. Contract liabilities
(1). Recognition of contract liabilities
√Applicable □Not applicable
The Group presents contractual assets or contractual liabilities in the balance sheet basedon the relationship between performance obligations and customers’ payments. The Groupoffsets the contractual assets and contractual liabilities under the same contract as a netamount.A contractual liability refers to an obligation to transfer goods or services to a customer forthe consideration received or receivable from the customer, such as the amount received bythe enterprise before the transfer of committed goods or services.
33. Employee compensations
(1). Accounting treatment of short-term compensations
√Applicable □Not applicable
The short-term compensations actually incurred during the accounting period when theemployees provide service for the Group are recognized as liabilities and are recognized in theprofit or loss for the current period or costs of related assets.
(2). Accounting treatment of post-employment benefits
√Applicable □Not applicable
The employees of the Group participate in the endowment insurance and unemploymentinsurance managed by the local government, as well as the enterprise annuity, and thecorresponding expenditures are included in the relevant asset cost or current profit and losswhen incurred.
(3). Accounting treatment of severance benefits
√Applicable □Not applicable
Where the Group provides severance benefits to its employees, the employeecompensation liabilities arising from the severance benefits will be recognized, and the amountwill be recognized in the profit or loss for the current period on the earlier date below: the datewhen the Group cannot unilaterally withdraw the severance benefits provided as a result of theemployment termination plan or downsizing proposal; or the date when the Group recognizesthe costs or expenses relating to the reorganization involving the payment of severancebenefits.
(4). Accounting treatment of other long-term employee benefits
□Applicable √Not applicable
34. Lease liabilities
√Applicable □Not applicable
At the commencement date of the lease period, the Group recognizes the present value ofthe outstanding lease payments as a lease liability, except for short term and low value leases.Lease payments include fixed payments and substantial fixed payments after deduction oflease incentives, variable lease payments depending on indexes or ratios, payments expectedto be made based on security balances, and also include the exercise price of the purchaseoption or payments to exercise the option to terminate the lease, provided that the Group isreasonably certain that the option will be exercised or that the lease period reflects that theGroup will exercise the option to terminate the lease.
In calculating the present value of the lease payments, the Group uses the leaseembedded interest rate as the discount rate; If the inherent interest rate of the lease cannot bedetermined, the lessee's incremental borrowing rate shall be used as the discount rate. TheGroup calculates the interest expense of the lease liability in each period of the lease term in
accordance with the fixed cyclical interest rate and records it into the current profit and loss,except as otherwise stipulated in the cost of the relevant assets. The variable lease paymentnot included in the measurement of lease liabilities shall be recorded into the profit and loss ofthe current period when it actually occurs, except for those included in the cost of relatedassets as otherwise stipulated.After the commencement date of the lease term, the Group increases the book amount ofthe lease liability when recognizing interest, and decreases the carrying amount of the leaseliability when paying the lease payment. When the actual fixed payment amount changes, theexpected payable amount of the guarantee residual value changes, the index or ratio used todetermine the lease payment amount changes, the evaluation result of the purchase option,the lease renewal option or the termination option or the actual exercise situation changes, theGroup will re-measure the lease liabilities according to the current value of the changed leasepayment amount, and adjust the book value of the right-of-use assets accordingly.
35. Estimated liabilities
√Applicable □Not applicable
Except for the contingent considerations and contingent liabilities assumed in the mergersof enterprises not under common control, an obligation relating to contingent matters will berecognized by the Group as estimated liabilities if meeting the following requirementssimultaneously:
(1) The obligation is a current obligation assumed by the Group;
(2) The performance of the obligation may result in the outflow of economic benefits fromthe Group;
(3) The amount of the obligation can be measured reliably.
Estimated liabilities are initially measured based on the best estimate of the expensesrequired for the performance of related current obligations, and the risks, uncertainties andtime value of money relating to the contingent matters are also factored in. The book value ofestimated liabilities is reviewed on each balance sheet date. If any conclusive evidenceindicates that the book value cannot reflect the current best estimate, the book value will beadjusted based on the current best estimate.
36. Share-based payment
√Applicable □Not applicable
Share-based payment is divided into equity-settled share-based payment and cash-settledshare-based payment. An equity-settled share-based payment refers to a deal in which theGroup uses shares or other equity instruments as the consideration for settlement to obtainservices.
The equity-settled share-based payment in exchange for services provided by employeesshall be measured at the fair value of the equity instruments granted to employees. If it can beexercised immediately after the grant, it shall be included in the relevant costs or expenses atfair value on the grant date, and the capital reserve shall be increased accordingly; if it cannotbe exercised until the service within the waiting period has been completed or the specifiedperformance conditions have been satisfied on each balance sheet date during the waitingperiod, the Group will, based on the best estimate of the number of exercisable equityinstruments, include the services acquired in the current period, as relevant costs or expensesbased on the fair value on the grant date, and increase the capital reserve accordingly .
None of cost or expense shall be recognized for a share payment that cannot beexercised due to failure to meet non-market conditions and/or service period conditions. Wheremarket conditions or non-exercising conditions are stipulated in the share-based paymentagreement, regardless of whether the market conditions or non-exercising conditions aresatisfied, it shall be deemed as exercisable as long as all other performance conditions and/orservice period conditions have been satisfied.
If the equity-settled share payment is canceled, it will be treated as an acceleratedexercise on the cancellation day, and the unrecognized amount shall be recognizedimmediately. If an employee or other party has option to satisfy the non-exercising conditionsbut fails to satisfy within the waiting period, it shall be treated as cancellation of equity-settledshare-based payment. However, if a new equity instrument is granted and if it is determinedthat the new equity instrument granted is used to replace the canceled equity instrument on thegrant date of the new equity instrument, the replacement equity instruments granted in thesame way shall be treated in the same way as that for the modification of the terms andconditions for the original equity instrument.
37. Preferred shares, perpetual bonds and other financial instruments
□Applicable √Not applicable
38. Revenue
(1). Accounting policies for the recognition and measurement of revenue
√Applicable □Not applicable
The Group recognizes incomes when it has fulfilled its performance obligations in thecontract, that is, the customer has acquired the control over the relevant goods or services.The acquisition of the control over related goods or services means the ability to control theuse of the goods or the provision of the service and obtain almost all of the economic benefitsfrom them.Commodity sales contractsCommodity sales contracts between the Group and customers usually only includeperformance obligations for the transferred commodities. The Group generally recognizesincomes on the basis of comprehensive consideration of the following factors, at the time whenthe customer obtains control of the relevant products: the acquisition of the current right toreceive payment for the commodities, the transfer of the major risks and rewards in theownership of the commodities, the transfer of the legal ownership of the commodities, thetransfer of the physical assets of the commodities, and the acceptance of the commodities bythe customer.Service contractsThe service contracts between the Group and its customers usually include performanceobligations such as the provision of the use of shops in the Commodity City and its operatingsupporting services, the provision of hotel accommodation services and hotel cateringservices, and the provision of fixed-term paid funding services to related parties outside theGroup.The use of shops in the Commodity City and its supporting servicesSince customers obtain and consume the economic benefits brought about by the Group’sperformance at the time of the performance by the Group, the Group regards them as aperformance obligation to be fulfilled within a certain period of time and recognizes an incomebased on the performance progress, except that the performance progress cannot bereasonably determined. Under the output method, the Group determines the performanceprogress of the provision of the use of shops in the Commodity City and the supportingservices for its operation based on the number of using days of the shops When theperformance progress cannot be reasonably determined, if the cost incurred by the Group isexpected to be compensated, the income shall be recognized according to the amount of thecost incurred until the performance progress can be reasonably determined.Hotel accommodation businessSince customers obtain and consume the economic benefits brought about by the Group’sperformance at the time of the performance by the Group, the Group regards them as aperformance obligation to be fulfilled within a certain period of time and recognizes an incomebased on the performance progress, except that the performance progress cannot bereasonably determined. In accordance with the output method, the Group determines theperformance progress of hotel accommodation services based on the number of stayingdays. . When the performance progress cannot be reasonably determined, if the cost incurredby the Group is expected to be compensated, the income shall be recognized according to theamount of the cost incurred until the performance progress can be reasonably determined.Hotel catering businessFor individual performance obligations in the provision of hotel catering services, theGroup prices hotel catering services separately, and uses the completion of hotel cateringservices as the point of income recognition.Fixed -time paid funding servicesSince customers obtain and consume the economic benefits brought about by the Group’sperformance at the time of the performance by the Group, the Group regards them as aperformance obligation to be fulfilled within a certain period of time and recognizes an incomebased on the performance progress, except that the performance progress cannot bereasonably determined. Under the output method, the Group determines the performanceprogress of the services for the fixed-term paid funding services based on the number of usingdays of funds. When the performance progress cannot be reasonably determined, if the cost
incurred by the Group is expected to be compensated, the income shall be recognizedaccording to the amount of the cost incurred until the performance progress can be reasonablydetermined.
(2). Differences in the revenue recognition policies for the same business under differentbusiness models
□Applicable √Not applicable
39. Contract cost
√Applicable □Not applicable
The Group's assets related to contract costs include contract acquisition costs andcontract performance costs. According to their liquidity, they are presented in inventory, othercurrent assets and other non-current assets respectively.If the incremental cost incurred by the Group to acquire a contract is expected to berecoverable, it is recognized as an asset as the contract acquisition cost, unless theamortization period of the asset does not exceed one year.If the cost incurred by the Group for the performance of the contract does not apply to thescope of the relevant standards such as inventory, fixed assets or intangible assets, and meetsthe following conditions at the same time, it is recognized as an asset as the cost of contractperformance:
(1) The cost is directly related to a current or expected contract, including direct labor,direct materials, manufacturing expenses (or similar expenses), costs clearly borne by thecustomer, and other costs incurred only because of the contract;
(2) The cost increases the resources that the enterprise will use to fulfill the contractobligations in the future;
(3) The cost is expected to be recoverable.
The Group amortizes the assets related to contract costs on the same basis as therevenue recognition related to the assets, and includes them in the current profit and loss.
For assets related to contract costs, if the book value is higher than the differencebetween the following two items, the Group will make provision for impairment for the excesspart and recognize it as asset impairment loss:
(1) The remaining consideration that the enterprise expects to obtain due to the transfer ofgoods or services related to the asset;
(2) Estimated costs to be incurred for the transfer of the relevant goods or services.
40. Government grants
√Applicable □Not applicable
A government grant is recognized when it can meet the requirements and can bereceived. If a government grant falls in monetary assets, it will be measured by the amountreceived or receivable. If a government grant does not fall in monetary assets, it will bemeasured by fair value. If the fair value of a grant cannot be determined reliably, it will bemeasured by its nominal amount.
A government grant prescribed by government documents to be used to acquire orconstruct or otherwise form long-term assets will be deemed as an asset-related governmentgrant; if no government documents have express provisions, the grants that are used toacquire or construct or otherwise form long-term assets will be deemed as asset-relatedgovernment grants and others as income-related government grants.
The income-related government grants that are used to compensate for the related costs,expenses or losses during the subsequent periods are recognized as deferred income and willbe recognized in the profit or loss or against the related costs for the period when the relatedcosts, expenses or losses are recognized. The income-related government grants used tocompensate for the related costs, expenses or losses that have been incurred are directlyrecognized in the profit or loss or against the related costs for the current period.
The asset-related government grants shall be used to offset the book value of relatedassets; or recognized as deferred income, and included in profit and loss in stages under a
reasonable and systematic method during the useful life of the related assets (but governmentgrants measured at a nominal amount shall be directly included in the current profit and loss); ifthe relevant asset is sold, transferred, scrapped or damaged before the end of its useful life,the balance of the undistributed deferred income shall be transferred to the current profit andloss when the asset is disposal.If the finance allocates the discounted funds to the loan bank, and the loan bank providesthe Group with a loan at a policy-oriented preferential interest rate, the Group takes the actualloan amount received as the book value of the loan, and the loan principal and the policy Thepreferential interest rate calculates the relevant borrowing costs.
41. Deferred income tax assets and deferred income tax liabilities
√Applicable □Not applicable
The Group recognizes deferred income tax with the balance sheet liability method basedon the temporary difference between the book value of assets and liabilities on the balancesheet date and the tax base and that between the book value of the items that have not beenrecognized as assets and liabilities but whose tax base can be determined according to the taxlaw and the tax base thereof.All taxable temporary differences will be recognized as deferred income tax liabilities,unless:
(1) The taxable temporary difference is generated in the following types of transactions:
the initial recognition of goodwill, or the initial recognition of assets or liabilities generated in atransaction with the following characteristics: the transaction is not a business merger, andneither affecting accounting profits, nor impacting taxable incomes or deductible losses.
(2) For taxable temporary differences related to investments in subsidiaries, joint venturesand associated enterprises, the time for the reversal of the temporary differences can becontrolled and the temporary differences may not be reversed in the foreseeable future.
For the deductible temporary differences and the deductible losses and tax deductionsthat can be carried forward to the subsequent years, the Group recognizes the deferredincome tax assets arising therefrom within the limit of the future taxable income that is verylikely to be obtained and used to be offset against the deductible temporary differences,deductible losses and tax deductions, unless:
(1) The deductible temporary differences are generated in the following transactions: Thetransaction is not a business combination, and when the occurrence of the transaction affectsneither accounting profits nor taxable income or deductible losses.
(2) For deductible temporary differences related to investments in subsidiaries, jointventures and associates, if all of the following conditions are satisfied simultaneously, thecorresponding deferred income tax assets are recognized: the temporary differences are likelyto be reversed in the foreseeable future, and it is likely to obtain taxable income that can beused to offset the deductible temporary differences in the future.
The Group measures, on the balance sheet date, the deferred income tax assets andliabilities based on the applicable tax rate for the period when the assets are expected to berecovered or the liabilities are expected to be paid off, in accordance with the tax law, whichwill also reflect the impact of the way of the expected recovery of assets or repayment ofliabilities on the income tax on the balance sheet date.
The Group reviews the book value of deferred income tax assets on the balance sheetdate. If it is very likely to be unable to acquire adequate taxable income to be offset against thebenefits of deferred income tax assets in the future, the book value of deferred income taxassets will be written down. On the balance sheet date, the Group re-evaluates theunrecognized deferred income tax assets and recognizes the same to the extent that it is verylikely to acquire adequate taxable income to reverse all or part of the deferred income taxassets.
If all the following requirements are met, deferred income tax assets and liabilities will bepresented in net amount after offsetting: the Group has the legal right to settle the currentincome tax assets and liabilities in net amount; the deferred income tax assets and liabilitiesare related to the income tax levied by an identical tax authority on an identical taxpayer, or arerelated to the income tax levied by an identical tax authority on different taxpayers, but during
each important period when the deferred income tax assets and liabilities are reversed, theinvolved taxpayers intend to settle the current income tax assets and liabilities in net amount oracquire assets or pay off debts simultaneously.
42. Lease
(1). Accounting treatment of operating lease
□Applicable √Not applicable
(2). Accounting treatment of financial lease
□Applicable √Not applicable
(3). Determination and accounting treatment of leases under the new lease standards
√Applicable □Not applicable
On the commencement date of the contract, the Group evaluates whether the contract is alease or an inclusive lease if a party in the contract cedes the right to control the use of one ormore identified assets for a certain period in exchange for consideration.As a tenantSee Note V. 28 and Note V. 34 for the general accounting treatment of the Group as alessee.Short-term leases and leases of low-value assetsThe Group regards leases with a lease term shorter than 12 months and excludingpurchase options as short-term leases on the commencement date of the lease term; leaseswith a value not exceeding RMB 40,000 when a single leased asset is a brand-new asset isidentified as a low-value asset lease. If the Group subleases or expects to sublease the leasedassets, the original lease is not recognized as a low-value asset lease. The Group chooses notto recognize right-of-use assets and lease liabilities for short-term leases and leases of low-value assets. In each period of the lease term, it is included in the relevant asset cost orcurrent profit and loss on a straight-line basis.As a lessorThe lease that transfers virtually all the risks and rewards related to the ownership of theleased asset on the lease commencement date is a finance lease, and other leases areoperating leases.
The Group as the lessor to operating leases
Rental income from operating leases is recognised in profit or loss on a straight-line basisover each period of the lease term, and variable lease payments not included in lease receiptsare included in profit or loss for the current period when actually incurred. The capitalized initialdirect expenses shall be amortized on the same basis recognized with the rental income duringthe lease period, and shall be included in the current profit and loss in installments.
43. Other important accounting policies and accounting estimates
√Applicable □Not applicable
Distribution of profits
The Company’s cash dividend is recognized as liabilities after approval by theshareholders’ meeting.
Measurement of fair value
The Group measures the fair values of equity instruments investments on each balancesheet date. Fair value refers to the price received from the sale of an asset or paid for thetransfer of a liability by a market player in the orderly transactions on the measurement date.
For the assets and liabilities which are measured or disclosed by fair value in the financialstatements, the levels of fair value are determined based on the lowest-level input of importantsignificance for the overall measurement of fair values: Level 1 input is the unadjusted offerprice for an identical asset or liability that can be obtained in an active market on themeasurement date; Level 2 inputs are the inputs that are directly or indirectly observable forrelated assets or liabilities other than Level 1 inputs; Level 3 inputs are the inputs that areobservable for related assets or liabilities.
On each balance date, the Group re-evaluates the assets and liabilities that arerecognized in the financial statements and keep being measured by fair value so as todetermine whether to change the measurement levels of fair value.
Significant accounting judgments and estimatesIn the preparation of financial statements, the management need to make judgments,estimates and assumptions, which will affect the presented amounts and disclosure ofrevenue, expenses, assets and liabilities and the disclosure of contingent liabilities on thebalance sheet date. However, the uncertainties of these assumptions and estimates maycause material adjustment to the book value of the assets or liabilities that will be affected inthe future.
JudgmentsWhen applying the Group’s accounting policies, the management have made the followingjudgments which have had significant influence on the amounts recognized in the financialstatements:
Operating lease—as the lessorThe Group has signed lease contracts for the property investments. The Group thinks thataccording to the terms of the lease contracts, the Group retains all major risks andcompensations on the titles of those real estate properties and thus handles them as operatingleases.Partition between property investments and fixed assetsThe Group classifies the buildings and structures leased out other than for the mainbusinesses such as market and hotel services as well as the auxiliary land use rights thereofas property investments, including but not limited to the auxiliary banking and catering outletsfor market operation and the auxiliary service outlets for hotels. Other buildings and structuresleased out are classified as fixed assets.Judgments on assets acquisition and mergers of enterprisesWhen determining whether an acquisition transaction constitutes a merger, the Groupassesses various factors, including whether the acquiree constitutes a business, in accordancewith the Accounting Standards for Enterprises No. 20 – Merger of Enterprises. A businessrefers to a group of some production and operation activities or assets and liabilities within anenterprise, which has the input, processing and output abilities and whose costs and expensesor revenue can be calculated independently, but an asset or a group of assets or liabilities canbe deemed as a business so long as it has the input and processing processes. The Groupmakes comprehensive judgments by combining the asset acquired and the processingprocess.
Business modelThe classification of financial assets at initial recognition depends on the Group’s businessmodel for the management of financial assets. When judging the business model, the Groupfactors in the enterprise evaluation, the way of reporting financial assets performance to keymanagement personnel, the risks affecting the performance of financial assets, the way ofmanaging financial assets and the way of related business management personnel obtainingremunerations. When assessing whether to aim at the collection of contractual cash flow, theGroup needs to analyze the reasons, time, frequency and value for sale of the financial assetsto be sold before the expiry dates thereof.
Characteristics of contractual cash flowThe classification of financial assets at initial recognition depends on the characteristics ofthe contractual cash flow of the financial assets. For the judgment on whether the contractualcash flow is the repayment of principal and the payment of interest on outstanding principal,including the evaluation of the adjustment to the time value of money, it should be judgedwhether it is significantly different from the benchmark cash flow; for the financial assets withthe early repayment characteristic, it should be judged whether the fair value of the earlyrepayment characteristic is extremely low.
Uncertainties of estimatesThe key assumptions on the balance sheet date for the future and other key sources ofthe uncertainties of estimates are shown below, which may cause significant adjustments tothe book values of assets and liabilities during the future accounting periods.Impairment of financial instrumentsThe Group evaluates the impairment of financial instruments with the expected credit lossmodel. To apply the model, the Group needs to make significant judgments and estimates andtake into account all reasonable and evidenced information, including forward-looking
information. When making these judgments and estimates, the Group infers the expectedchanges in the debtors’ credit risks based on their historical repayment data, in combinationwith the economic policies, macroeconomic indicators and industry risks. Different estimatesmay affect the provisions for impairment and the provision that has been made for impairmentmay not necessarily be equal to the actual amount of impairment loss in the future.Net realizable value of property inventoryThe Group’s property inventory is measured by cost or net realizable value, whichever islower. For the calculation of net realizable value, assumptions and estimates should be used. Ifthe management adjust the estimated price and the costs and expenses to be incurred untilthe completion, it will affect the estimate of the net realizable value of the inventory and thedifference will affect the provision for inventory depreciation.Impairment of non-current assets other than financial assets (excluding goodwill)The Group determines, on the balance sheet date, whether the non-current assets otherthan financial assets have a sign of being impaired. For a non-current asset other thanfinancial asset, if it is indicated that its book value cannot be recovered, an impairment test willbe made. When the book value of an asset or a group of assets is higher than its recoverablevalue, i.e. fair value less the disposal expenses or the present value of expected future cashflow, whichever is higher, the asset or group has been impaired. For the fair value less thedisposal expenses, the Group refers to the agreed selling price or observable market price ofthe similar asset in a fair transaction, less the cost increase directly attributable to the disposalof the asset. When predicting the present value of future cash flows, the management mustestimate the expected future cash flows of the asset or group of assets and select anappropriate discount rate. When identifying a group of assets, the management considerwhether the smallest identifiable group of assets can generate income and cash flowsindependently from other departments or units, or the income and cash inflows generatedthereby are mostly independent from other departments or units, and also take into accountthe way of managing or monitoring production and operating activities and the way of makingdecisions on the continued use or disposal of the asset.Goodwill impairmentThe Group tests goodwill for impairment at least annually. This requires estimating thepresent value of the future cash flows of the asset group or combination of asset groups towhich the goodwill is allocated. When estimating the present value of future cash flows, theGroup needs to estimate the cash flows generated by future asset groups or combinations ofasset groups, and at the same time select an appropriate discount rate to determine thepresent value of future cash flows.
Fair value of unlisted equity investmentValuation of the unlisted equity investment is the expected future cash flows discounted atthe current discount rate of other financial instruments with similar contract terms and riskcharacteristics. This requires the Group to estimate the expected future cash flows, credit risk,volatility and discount rate, which brings uncertainties.Development expensesWhen determining the amount of capitalization, management must make assumptions onthe expected future cash flow, the applicable discount rate, and the expected benefit period ofthe asset.
Deferred income tax assetsTo the extent that it is very likely for the Group to have enough taxable income to be offsetagainst the deductible losses, the Group shall recognize deferred income tax assets inconnection with the outstanding deductible losses. This requires the management to use lots ofjudgments to estimate the acquisition time and amount of the taxable income to be acquired inthe future to determine the amount of deferred income tax assets to be recognized, inconsideration of the tax payment planning strategy.Lessee incremental borrowing interest rateFor leases where the interest rate implicit in the lease cannot be determined, the Groupuses the lessee's incremental borrowing rate as the discount rate to calculate the present valueof the lease payments. When determining the incremental borrowing rate, the Group takes theobservable interest rate as the reference basis for determining the incremental borrowing rateaccording to the economic environment it is in. On this basis, the Group adjusts the reference
interest rate according to its own situation, the underlying asset situation, the lease term, theamount of lease liabilities and other specific conditions of the lease business to obtain theapplicable incremental borrowing rate.
44. Changes in important accounting policies and accounting estimates
(1). Changes in important accounting policies
□Applicable √Not applicable
(2). Changes in important accounting estimates
□Applicable √Not applicable
(3). From 2022, the first implementation of new accounting standards or standardinterpretations would involve adjustments to the financial statements at thebeginning of the first implementation year
□Applicable √Not applicable
45. Others
□Applicable √Not applicable
VI. Taxes
1. Major taxes and tax rates
Major taxes and tax rates
√Applicable □Not applicable
| Tax | Base of taxation | Rate |
| VAT | Sale of goods or rendering of taxable service | The Company is a general taxpayer. The taxable income is calculated at 13%, 9% and 6% tax rates as output tax, and the value-added tax is calculated and paid on the basis of the difference after deduction of the input tax allowed to be deducted in the current period. In addition, for the sale of the self-developed old real estate projects (the contract start date indicated in the “Construction Project Construction Permit” is before April 30, 2016) and the lease of the real estate acquired before April 30, 2016, the simplified tax calculation method shall apply at the rate of 5%. |
| Urban maintenance and construction tax | Indirect tax actually paid | 5% or 7% |
| Corporate income tax | Domestic enterprises should pay 25% of the taxable income for corporate income tax; European Huajie Development Co., Ltd. is registered in Prague, Czech Republic, so it is subject to the corporate income tax rate of 19%; Yiwu China Commodities City (Hong Kong) International Trade Co., Ltd. is registered in Hong Kong Special Administrative Region, so it is subject to the Hong Kong income tax rate, 16.50%; BETTER SILK ROAD FZE is registered in Dubai, so it is free from corporate income tax. | |
| Land appreciation tax | Ratio of appreciation value to deductible items | Four-bracket progressive tax rate (30%～60%) |
| Real estate tax | If the tax is levied according to price, the amount is 1.2% of the balance of the original value of the property after a 30% deduction; if the tax is levied according to rental, the amount is 12% of the rental income. | 1.2% or 12% |
| Education surcharge | Indirect tax actually paid | 3% |
| Local education surcharge | Indirect tax actually paid | 2% |
| Cultural undertaking development fee | Advertising turnover | 3% |
Disclosure of taxpayers subject to different income tax rates
√Applicable □Not applicable
| Taxpayer | Income tax rate (%) |
| Yiwu China Commodities City (Spain) Co., Ltd. | 25.00 |
| European Huajie Investment Development Co., Ltd. | 19.00 |
| Yiwu China Commodities City (Hong Kong) International Trade Co., Ltd. | 16.50 |
| Yiwu China Commodities City (Germany) Co., Ltd. | 15.00 |
| BETTER SILK ROAD FZE | 0 |
2. Tax preference
√Applicable □Not applicable
According to the Announcement on the Filing of High-tech Enterprises recognized byZhejiang Provincial Accreditation Agency in 2022 issued by the Office of the National High-techEnterprise Accreditation Management Leading Group, Yiwu China Small Commodities City BigData Co., Ltd. has been listed in the filing list of high-tech enterprises recognized by ZhejiangProvincial Accreditation Agency in 2022 and passed the recognition of high-tech enterprises.The Certificate number is GR202233004297, date of issue: December 24, 2022, valid period:
three years. From January 1, 2022 to December 31, 2024, Yiwu China Commodities City BigData Co., Ltd. was subject to a reduced corporate income tax rate of 15%.
3. Others
□Applicable √Not applicable
VII. Notes to items in consolidated financial statements
1. Cash and cash equivalents
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Cash on hand | 220,471.11 | 154,264.94 |
| Bank deposits | 1,990,327,169.17 | 4,831,258,722.95 |
| Other cash and cash equivalents | 751,331.02 | 55,398.36 |
| Total | 1,991,298,971.30 | 4,831,468,386.25 |
| In which: amount deposited abroad | 76,203,839.82 | 38,554,320.18 |
Other statements
For the cash and cash equivalents which are restricted in use, please refer to Notes VII.81Assets with Restricted Title or Right of Use.
Interest income of demand deposits is accrued based on the demand deposit rates ofbanks. The term of short-term time deposits ranges from three months to half a year anddepends on the Group’s cash demand, and the interest income thereof is accrued based onthe corresponding time deposit rates of banks.
2. Held-for-trading financial assets
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Financial assets that are measured by fair value and of which the changes in fair value are recognized in the profit or loss for the current period | 62,331,000.66 | 75,375,083.20 |
| Among them: | ||
| Bank financing products | 38,679,435.66 | 25,000,000.00 |
| Equity instrument investment | 23,651,565.00 | 50,375,083.20 |
| Total | 62,331,000.66 | 75,375,083.20 |
Other notes:
□Applicable √Not applicable
3. Derivative financial assets
□Applicable √Not applicable
4. Notes receivable
(1). Categorized presentation of notes receivable
□Applicable √Not applicable
(2). Notes receivable having been pledged by the Company as of the close of thereporting period
□Applicable √Not applicable
(3). Notes receivable having been endorsed or discounted by the Company as of theclose of the reporting period and having not been due as of the balance sheet date
□Applicable √Not applicable
(4). Notes turned into accounts receivable due to the drawers’ non-performance at the
close of the reporting period
□Applicable √Not applicable
(5). Categorized disclosure based on the bad debt provision method
□Applicable √Not applicable
Accounts receivable for which bad debt provision is made individually:
□Applicable √Not applicable
Explanation for making bad debt provision for accounts receivable by group:
□Applicable √Not applicable
If the bad debt provision is made according to the general model of expected credit loss,please refer to the disclosure of other receivables:
□Applicable √Not applicable
(6). Provisions for bad debts
□Applicable √Not applicable
(7). Notes receivable actually written off during the current period
□Applicable √Not applicable
Other statements
□Applicable √Not applicable
5. Accounts receivable
(1). Disclosure based on account age
√Applicable □Not applicable
Unit: RMB
| Account age | Closing book balance |
| Within 1 year | |
| In which: sub-items | |
| Within 1 year | 211,121,943.94 |
| Within 1 year | 211,121,943.94 |
| 1 to 2 years | 8,026,629.17 |
| 2 to 3 years | 100,234.00 |
| Over 3 years | - |
| Total | 219,248,807.11 |
(2). Categorized disclosure based on the bad debt provision method
√Applicable □Not applicable
Unit: RMB
| Category | Closing balance | Opening balance | ||||||||
| Book balance | Bad debt provision | Book value | Book balance | Bad debt provision | Book value | |||||
| Amount | Proportion (%) | Amount | Provision ratio (%) | Amount | Proportion (%) | Amount | Provision ratio (%) | |||
| Accounts receivable for which bad debt provision is made individually | 6,261,907.10 | 2.86 | 6,261,907.10 | 100.00 | - | 97,219,393.59 | 50.71 | 6,261,907.10 | 6.44 | 90,957,486.49 |
| Among them: | ||||||||||
| Lease receivables | 6,261,907.10 | 2.86 | 6,261,907.10 | 100.00 | - | 6,261,907.10 | 3.27 | 6,261,907.10 | 100.00 | - |
| Trade receivables | - | - | - | - | - | 90,957,486.49 | 47.44 | - | - | 90,957,486.49 |
| Accounts receivable for which bad debt provision is made by group | 212,986,900.01 | 97.14 | 2,236,174.65 | 1.05 | 210,750,725.36 | 94,491,809.69 | 49.29 | 211,765.29 | 0.22 | 94,280,044.40 |
| Among them: | ||||||||||
| Accounts receivable for which the bad debts are provided by combination of credit risk characteristics | 212,986,900.01 | 97.14 | 2,236,174.65 | 1.05 | 210,750,725.36 | 94,491,809.69 | 49.29 | 211,765.29 | 0.22 | 94,280,044.40 |
| Total | 219,248,807.11 | / | 8,498,081.75 | / | 210,750,725.36 | 191,711,203.28 | / | 6,473,672.39 | / | 185,237,530.89 |
Accounts receivable for which bad debt provision is made individually:
√Applicable □Not applicable
Unit: RMB
| Name | Closing balance | |||
| Book balance | Bad debt provision | Provision ratio (%) | Reason for provision | |
| Lease receivables | 6,261,907.10 | 6,261,907.10 | 100.00 | Due to deterioration of operating conditions, expected not to be recovered |
| Total | 6,261,907.10 | 6,261,907.10 | 100.00 | / |
Explanation for making bad debt provision for accounts receivable individually:
□Applicable √Not applicable
Explanation for making bad debt provision for accounts receivable by group:
□Applicable √Not applicable
If the bad debt provision is made according to the general model of expected credit loss,please refer to the disclosure of other receivables:
√Applicable □Not applicable
| Account age | End of December 2022 | ||
| Estimated book balance in default | Expected credit loss rate (%) | Expected credit loss in whole duration | |
| Within 1 year | 211,121,943.94 | 0.99 | 2,096,697.81 |
| 1 - 2 years | 1,764,722.07 | 6.99 | 123,286.17 |
| 2 -3 years | 100,234.00 | 16.15 | 16,190.67 |
| Over 3 years | - | 100.00 | - |
| Total | 212,986,900.01 | 2,236,174.65 |
(3). Provisions for bad debts
√Applicable □Not applicable
Unit: RMB
| Category | Opening balance | Amount of change during the current period | Closing balance | |
| Provision | Recovery or reversal | |||
| Bad debt provision for accounts receivable | 6,473,672.39 | 2,439,030.53 | 414,621.17 | 8,498,081.75 |
| Total | 6,473,672.39 | 2,439,030.53 | 414,621.17 | 8,498,081.75 |
In which the recovered or reversed amount is important:
□Applicable √Not applicable
(4). Accounts receivable actually written off during the current period
□Applicable √Not applicable
(5). Accounts receivable from the five debtors with the highest closing balance
√Applicable □Not applicable
Unit: RMB
| Debtor | Closing balance | Proportion in the total closing balance of accounts receivable (%) | Closing balance of bad debt provision |
| Total balance of the accounts receivable with the top five entities | 24,183,149.50 | 11.03 | 240,168.10 |
| Total | 24,183,149.50 | 11.03 | 240,168.10 |
Other statementsNil
(6). Accounts receivable derecognized due to transfer of financial assets
□Applicable √Not applicable
(7). Amounts of assets and liabilities formed by the transfer of accounts receivable and
continuing involvement
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
6. Accounts receivable financing
□Applicable √Not applicable
7. Prepayments
(1). Presentation of prepayment by age
√Applicable □Not applicable
Unit: RMB
| Account age | Closing balance | Opening balance | ||
| Amount | Proportion (%) | Amount | Proportion (%) | |
| Within 1 year | 600,114,288.07 | 99.02 | 868,252,359.56 | 99.21 |
| 1 to 2 years | 5,252,760.18 | 0.87 | 6,212,572.92 | 0.71 |
| 2 to 3 years | 240,000.00 | 0.04 | 602,777.00 | 0.07 |
| Over 3 years | 450,000.00 | 0.07 | 100,000.00 | 0.01 |
| Total | 606,057,048.25 | 100 | 875,167,709.48 | 100 |
Explanation for failure to settle the prepayments with an account age longer than one year andin important amounts:
Nil
(2). Prepayments to the five suppliers with the highest closing balance
√Applicable □Not applicable
| Debtor | Closing balance | Proportion in total closing balance of prepayments (%) |
| Binzhou Yellow River Oasis Agricultural Development Co., Ltd. | 58,030,560.00 | 9.57 |
| OPERADORA Y PROCESADORA DE PRODUCTOS MARINOS OMARSA S.A. | 46,604,703.62 | 7.69 |
| CAMAR-EXPO S.A | 42,928,301.09 | 7.08 |
| PROCESADORA DE MARISCOS DE EL ORO PROMARO S.A. | 33,439,879.66 | 5.52 |
| Sociedad Nacional de Galapagos C.A. SONGA | 29,139,016.58 | 4.81 |
| Total | 210,142,460.95 | 34.67 |
Other statementsNil
Other statements
□Applicable √Not applicable
8. Other receivables
Presentation of items
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Interest receivable | - | 92,249,275.44 |
| Other receivables | 419,398,092.62 | 1,263,675,007.52 |
| Total | 419,398,092.62 | 1,355,924,282.96 |
Other notes:
□Applicable √Not applicable
Interest receivable
(1). Classification of interest receivable
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Cash occupation fee for receivables | - | 92,249,275.44 |
| Total | - | 92,249,275.44 |
(2). Significant overdue interest
□Applicable √Not applicable
(3). Bad debt provision
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Dividend receivable
(1). Dividend receivable
□Applicable √Not applicable
(2). Important dividend receivable with an account age longer than 1 year
□Applicable √Not applicable
(3). Bad debt provision
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Other receivables
(1). Disclosure based on account age
√Applicable □Not applicable
Unit: RMB
| Account age | Closing book balance |
| Within 1 year | |
| In which: sub-items | |
| Within 1 year | 53,134,184.05 |
| Within 1 year | 53,134,184.05 |
| 1 to 2 years | 12,295,130.76 |
| 2 to 3 years | 341,676,912.95 |
| Over 3 years | 16,433,656.30 |
| Bad debt provision for other receivables | -4,141,791.44 |
| Total | 419,398,092.62 |
(2). Classification based on the nature of accounts
√Applicable □Not applicable
Unit: RMB
| Nature of receivable | Closing book balance | Opening book balance |
| Financial assistance receivable from joint ventures | 323,786,912.09 | 1,103,178,748.00 |
| Withholdings and deposits | 84,610,870.01 | 125,377,518.60 |
| Receivables from export tax rebate | 10,041,570.82 | 34,759,474.84 |
| Reserve | 958,739.70 | 359,266.08 |
| Total | 419,398,092.62 | 1,263,675,007.52 |
(3). Bad debt provision
√Applicable □Not applicable
Unit: RMB
| Bad debt provision | Stage 1 | Stage 2 | Stage 3 | Total |
| Expected credit loss in the coming 12 months | Expected credit loss in the entire duration (credit has not been impaired) | Expected credit loss in the entire duration (credit has been impaired) | ||
| Balance as at January 1, 2022 | 4,355,084.46 | 4,355,084.46 | ||
| Balance as of January 1, 2022 in current period | ||||
| Provision made in the current period | 130,607.13 | 130,607.13 | ||
| Current reversal | 340,011.54 | 340,011.54 | ||
| Current write-off | 3,888.61 | 3,888.61 | ||
| Balance as of December 31, 2022 | 4,141,791.44 | 4,141,791.44 |
Significant changes in the book balance of other receivables with changes in loss provisions:
□Applicable √Not applicable
Basis for the bad debt provision made in the current period and for assessing whether thecredit risk of financial instruments has increased significantly:
□Applicable √Not applicable
(4). Provisions for bad debts
√Applicable □Not applicable
Unit: RMB
| Category | Opening balance | Amount of change during the current period | Closing balance | ||
| Provision | Recovery or reversal | Charge-off or write-off | |||
| Bad debt provision for other receivables | 4,355,084.46 | 130,607.13 | 340,011.54 | 3,888.61 | 4,141,791.44 |
| Total | 4,355,084.46 | 130,607.13 | 340,011.54 | 3,888.61 | 4,141,791.44 |
In which the recovered or reversed amount is important:
□Applicable √Not applicable
(5). Other receivables actually written off during the current period
√Applicable □Not applicable
Unit: RMB
| Item | Amount written-off |
| Other receivables actually written off | 3,888.61 |
Of which, important write-offs of other receivables:
□Applicable √Not applicable
Notes on the write-off of other receivables:
□Applicable √Not applicable
(6). Other receivables from the five debtors with highest closing balance
√Applicable □Not applicable
Unit: RMB
| Debtor | Nature of receivable | Closing balance | Account age | Weight in the total closing balance of other receivables (%) | Bad debt provision Closing balance |
| Yiwu Handing Shangbo Real Estate Co., Ltd. | Financial assistance | 207,750,200.00 | 2-3 years | 49.05 | - |
| Yiwu Tonghui Shangbo Real Estate Co., Ltd. | Financial assistance | 116,036,712.09 | 2-3 years | 27.40 | - |
| Yiwu Municipal Bureau of Finance | Land security deposit | 34,270,272.36 | Within 1 year | 8.09 | - |
| Yiwu Taxation Bureau, State Administration of Taxation | Export tax rebate | 10,041,570.82 | Within 1 year | 2.37 | - |
| Yiwu Shengran Trading Co., Ltd. | Advance payment | 3,532,000.00 | Within 1 year | 0.83 | |
| Total | / | 371,630,755.27 | / | 87.74 | - |
(7). Receivables involving government grants
□Applicable √Not applicable
(8). Other receivables derecognized due to transfer of financial assets
□Applicable √Not applicable
(9). Amounts of assets and liabilities formed by the transfer of accounts receivable andcontinuing involvement
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
9. Inventory
(1). Classification of inventory
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance | ||||
| Book balance | Provision for inventory depreciation/provision for impairment of contract performance cost | Book value | Book balance | Provision for inventory depreciation/provision for impairment of contract performance cost | Book value | |
| Raw materials | 555,462.87 | - | 555,462.87 | 723,775.34 | - | 723,775.34 |
| Finished goods | 212,470,958.56 | - | 212,470,958.56 | 75,079,555.38 | - | 75,079,555.38 |
| Work-in-progress materials | 2,445,689.69 | - | 2,445,689.69 | 4,217,610.61 | - | 4,217,610.61 |
| Development cost | 67,907,950.27 | 28,303,338.06 | 39,604,612.21 | 347,123,927.41 | 28,303,338.06 | 318,820,589.35 |
| Development products | 1,075,274,520.54 | - | 1,075,274,520.54 | 928,561,037.31 | - | 928,561,037.31 |
| Total | 1,358,654,581.93 | 28,303,338.06 | 1,330,351,243.87 | 1,355,705,906.05 | 28,303,338.06 | 1,327,402,567.99 |
(2). Provision for inventory depreciation/provision for impairment of contractperformance cost
√Applicable □Not applicable
Unit: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance | ||
| Provision | Others | Charge-off or write-off | Others | |||
| Development cost | 28,303,338.06 | - | - | - | - | 28,303,338.06 |
| Total | 28,303,338.06 | - | - | - | - | 28,303,338.06 |
(3). Closing balance of inventory containing capitalized borrowing costs
√Applicable □Not applicable
On December 31, 2022, the inventory with a book value of RMB 35,797,443.87(December 31, 2021: RMB 35,797,443.87) was formed by capitalization of borrowing costs.
(4). Amortization of contract performance cost during the current period
□Applicable √Not applicable
Other statements
√Applicable □Not applicable
Inventory-Development Cost Unit: RMB-yuan Currency: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| Haicheng Phase I Business Street | 67,907,950.27 | - | - | 67,907,950.27 |
| Haicheng Phase II Business Street | 279,215,977.14 | 69,696,080.84 | 348,912,057.98 | - |
| Total | 347,123,927.41 | 69,696,080.84 | 348,912,057.98 | 67,907,950.27 |
Inventory-Developed Products Unit: RMB-yuan Currency: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Other transfer-out | Closing balance |
| Haicheng Phase I Business Street | 915,616,130.79 | - | - | - | 915,616,130.79 |
| Haicheng Phase II Business Street | - | 348,912,057.98 | 189,253,668.23 | - | 159,658,389.75 |
| Shuangchuang Building | 12,944,906.52 | - | 1,405,473.53 | 11,539,432.99 | - |
| Total | 928,561,037.31 | 348,912,057.98 | 190,659,141.76 | 11,539,432.99 | 1,075,274,520.54 |
10. Contract assets
(1). Overview of contract assets
□Applicable √Not applicable
(2). Amount of and reasons for material changes to book value during the reporting
period
□Applicable √Not applicable
(3). Provision for impairment of contract assets in the current period
□Applicable √Not applicable
If the bad debt provision is made according to the general model of expected credit loss,please refer to the disclosure of other receivables:
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
11. Held-for-sale assets
□Applicable √Not applicable
12. Non-current assets due within one year
□Applicable √Not applicable
Important debt investments and other debt investments at the end of the period:
□Applicable √Not applicable
Other statementsNil
13. Other current assets
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Payment business reserve | 367,484,914.87 | - |
| To-be-deducted input tax | 146,697,598.28 | 234,080,141.55 |
| Advance income tax | 113,127,305.76 | - |
| To-be-certified input tax | 5,348,152.36 | 4,357,934.03 |
| Contract acquisition cost | - | 7,629,349.00 |
| Entrusted loans to the market traders | 1,737,479.42 | 2,780,294.82 |
| Less: bad debt provision for entrusted loans | -185,500.00 | -185,500.00 |
| Total | 634,209,950.69 | 248,662,219.40 |
Other statementsNil
14. Debt investments
(1). Overview of debt investment
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance | ||||
| Book balance | Impairment Provision | Book value | Book balance | Impairment Provision | Book value | |
| Entrusted Loans | 48,079,561.64 | - | 48,079,561.64 | - | - | - |
| Total | 48,079,561.64 | - | 48,079,561.64 | - | - | - |
(2). Important debt investment as of the close of the reporting period
□Applicable √Not applicable
(3). Provision for impairment
□Applicable √Not applicable
Amount of impairment provision for the current period and the basis for assessing whether thereis significant increase in the credit risk of financial instruments
□Applicable √Not applicable
Other statements
□Applicable √Not applicable
15. Other debt investments
(1). Overview of other debt investment
□Applicable √Not applicable
(2). Important other debt investment as of the close of the reporting period
□Applicable √Not applicable
(3). Provision for impairment
□Applicable √Not applicable
Amount of impairment provision for the current period and the basis for assessing whether thereis significant increase in the credit risk of financial instruments
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
16. Long-term receivables
(1). Overview of long-term receivables
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance | Range of discount rate | ||||
| Book balance | Bad debt provision | Book value | Book balance | Bad debt provision | Book value | ||
| Financial assistance receivable from joint ventures | 269,877,115.20 | - | 269,877,115.20 | 214,752,001.51 | - | 214,752,001.51 | |
| Guarantee deposit | 8,422,485.53 | - | 8,422,485.53 | 7,555,361.89 | - | 7,555,361.89 | |
| Total | 278,299,600.73 | - | 278,299,600.73 | 222,307,363.40 | - | 222,307,363.40 | / |
(2). Bad debt provision
□Applicable √Not applicable
Amount of bad debt provision for the current period and the basis for assessing whether there issignificant increase in the credit risk of financial instruments
□Applicable √Not applicable
(3). Long-term receivables derecognized due to transfer of financial assets
□Applicable √Not applicable
(4). Amounts of assets and liabilities formed by the transfer of long-term receivables andcontinuing involvement
□Applicable √Not applicable
Other statements
□Applicable √Not applicable
17. Long-term equity investment
√Applicable □Not applicable
Unit: RMB
| Investee | Opening amount Balance | Change in the current period | Closing amount Balance | Closing balance of impairment provision | ||||
| Additional investment | Decrease in investment | Investment profits or losses recognized with the equity method | Other comprehensive income Adjust | Declared a cash dividend or profit | ||||
| 1. Joint ventures | ||||||||
| Yiwu Shanglv | 383,668,354.21 | - | - | 13,304,094.72 | - | - | 396,972,448.93 | - |
| Yiwu Rongshang Real Estate Co., Ltd. | 217,387,537.94 | - | - | 429,128,964.52 | - | 580,865,600.00 | 65,650,902.46 | - |
| Yiwu Chuangcheng Real Estate | 88,063,325.80 | - | - | 134,862,766.92 | - | 194,476,800.00 | 28,449,292.72 | - |
| Others | 60,140,520.92 | - | - | 50,910,854.11 | - | - | 111,051,375.03 | 3,327,216.16 |
| Sub-total | 749,259,738.87 | - | - | 628,206,680.27 | - | 775,342,400.00 | 602,124,019.14 | 3,327,216.16 |
| 2. Associates | ||||||||
| Hangzhou Binjiang Shangbo Property Development Co., Ltd. | 34,476,229.08 | - | 24,500,000.00 | 3,893,136.86 | - | 13,869,365.94 | - | - |
| Huishang Micro-finance | 82,824,696.64 | - | 6,210,000.00 | 1,595,283.18 | - | - | 78,209,979.82 | - |
| Yiwu Huishang Redbud Equity Investment Co., Ltd. | 70,996,992.21 | - | - | 9,254,883.12 | - | - | 80,251,875.33 | - |
| Chouzhou Financial Lease | 426,020,849.24 | - | - | 63,184,700.67 | - | - | 489,205,549.91 | - |
| Yiwu China Commodities City Investment Management Co., Ltd. | 9,508,049.22 | - | - | - | - | - | 9,508,049.22 | 9,508,049.22 |
| Yiwu China Commodities City Fuxing Investment Center (Limited Liability Partnership) | 102,918,559.00 | - | - | - | - | - | 102,918,559.00 | - |
| Pujiang Lvgu Property Co., Ltd. | 459,281,437.25 | - | - | 7,758,159.75 | - | 88,200,000.00 | 378,839,597.00 | - |
| Yiwu China Commodities City Property Development Co., Ltd. | 2,756,938,444.33 | - | - | 228,542,250.22 | - | - | 2,985,480,694.55 | - |
| Yiwu Hongyi Equity Investment Fund Partnership | 887,872,262.46 | - | - | 57,848,377.09 | -78,554.53 | - | 945,642,085.02 | - |
| Zhejiang Zhijie Yuangang International Supply Chain Technology Co., Ltd. | - | 150,000,000.00 | - | -4,436,560.67 | - | - | 145,563,439.33 | - |
| Others | 205,193,249.92 | 18,970,493.87 | - | 261,507.20 | 4,139,085.99 | - | 228,564,336.98 | - |
| Sub-total | 5,036,030,769.35 | 168,970,493.87 | 30,710,000.00 | 367,901,737.42 | 4,060,531.46 | 102,069,365.94 | 5,444,184,166.16 | 9,508,049.22 |
| Total | 5,785,290,508.22 | 168,970,493.87 | 30,710,000.00 | 996,108,417.69 | 4,060,531.46 | 877,411,765.94 | 6,046,308,185.30 | 12,835,265.38 |
Other statementsProvision for impairment of long-term equity investment：
Unit: RMB
| Investee | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| Yiwu China Commodities City Investment Management Co., Ltd. [Note 1] | 9,508,049.22 | - | - | 9,508,049.22 |
| Others | 3,327,216.16 | - | - | 3,327,216.16 |
| Total | 12,835,265.38 | - | - | 12,835,265.38 |
Note 1: In 2017, CCCF, a wholly-owned subsidiary of the Group, and Shanghai Fuxing Industrial Group Co., Ltd. (hereinafter referred to as"Fuxing") jointly established Industrial Fund Yiwu China Commodities City Fuxing Investment Center (LLP) (hereinafter referred to as the "Funds ofFunds"), the Fund of Funds has invested in 12 sub-funds including Yiwu Shangfu Chuangzhi Investment Center (LLP) (hereinafter referred to as"Shangfu Chuangzhi Fund").CCCF, as a limited partner, subscribed RMB 998 million in the FOF, accounting for 49.9% of the subscribed capital. The paid-in capital wasRMB 102.92 million, and there is no deadline for the payment for the unpaid capital contribution. The other limited partner of the FOF is Fuxing.CCCF also contributed RMB 9.8 million, 49% of total shares, to jointly establish Yiwu China Commodities City Investment Management Co., Ltd.(hereinafter referred to as “CCCIM”) with Fuxing as the general partner of the above-mentioned FOF and sub-funds. The FoF and CCCIM are bothunder the control of Fuxing and are associates of CCCF.As a limited partner of Shangfu Chuangzhi Fund, CCCF has subscribed and paid in a capital contribution of RMB 617.51 million. Since thecapital contribution was guaranteed by Fuxing's fixed income, it was recognized as other non-current financial assets. The above paid-in capital
contribution made by CCCF to the FoF has been contributed to Shangfu Chuangzhi Fund together with the capital contribution of Fuxing to the FoFthrough the FoF as a limited partner. With the capital contribution from the FoF as a limited partner and CCCF’s capital contribution to ShangfuChuangzhi Fund as a limited partner, Shangfu Chuangzhi Fund made capital contribution of RMB820.54million to subscribe for the increase in theregistered capital of Hubei Provincial Asset Management Co., Ltd. to acquire 22.667% equity therein.In 2018, CCCF learned during its after-investment follow-up management that Fuxing and its actual controller ZHU Yidong were suspected ofhaving committed a criminal offense and the 22.667% equity held by Shangfu Chuangzhi Fund in Hubei Provincial Asset Management Co., Ltd. wasfrozen by the Public Security Bureau of Shanghai due to Fuxing’s contribution to the sources of the capital contribution. The Group believes that, onDecember 31, 2022, the Group’s investment in the Fund of Funds and Shangfu Chuangzhi Fund was non-related to Fuxing’s investment, and therewas no indication of impairment of the underlying assets. Although they were still frozen, but without affecting the Group’s equity. Therefore, therewas no impairment. However, for the equity investment managed for the Yiwu CCC, a full impairment provision has been made since 2018. SeeNotes VII.81 and Notes XIV. 1 for details.
18. Other equity instruments investment
(1). Overview of other equity instruments investment
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Shenwan Hongyuan Group Co., Ltd. | 499,200,803.85 | 642,187,968.77 |
| Total | 499,200,803.85 | 642,187,968.77 |
(2). Non-trading equity instruments investment
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
19. Other non-current financial assets
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| PE investment | 1,242,537,387.23 | 1,263,329,797.13 |
| Unlisted equity investment | 210,030,495.82 | 213,607,388.98 |
| NEEQ equity investment | 47,739,679.08 | 47,882,069.30 |
| Total | 1,500,307,562.13 | 1,524,819,255.41 |
Other notes:
□Applicable √Not applicable
20. Property investment
Measurement models
(1). Property investment measured by cost
Unit: RMB
| Item | Buildings and structures | Land use right | Total |
| I. Original book value | |||
| 1. Opening balance | 3,062,389,558.31 | 438,760,984.63 | 3,501,150,542.94 |
| 2. Increase in the current period | 8,520,184.69 | 3,019,248.30 | 11,539,432.99 |
| (2) Inventory\fixed assets\construction in progress changed into property investment | 8,520,184.69 | 3,019,248.30 | 11,539,432.99 |
| 3. Decrease in the current period | 4,183,242.34 | - | 4,183,242.34 |
| (1) Differences in final settlement of completion | 4,183,242.34 | - | 4,183,242.34 |
| 4. Closing balance | 3,066,726,500.66 | 441,780,232.93 | 3,508,506,733.59 |
| II. Accumulated depreciation and accumulated amortization | |||
| 1. Opening balance | 445,818,997.23 | 81,395,145.25 | 527,214,142.48 |
| 2. Increase in the current period | 118,346,091.24 | 11,303,319.45 | 129,649,410.69 |
| (1) Provision or amortization | 118,346,091.24 | 11,303,319.45 | 129,649,410.69 |
| 3. Decrease in the current period | - | - | - |
| 4. Closing balance | 564,165,088.47 | 92,698,464.70 | 656,863,553.17 |
| III. Depreciation provision | |||
| 1. Opening balance | - | - | - |
| 4. Closing balance | - | - | - |
| IV. Book value | |||
| 1. Opening book value | 2,502,561,412.19 | 349,081,768.23 | 2,851,643,180.42 |
| 2. Closing book value | 2,616,570,561.08 | 357,365,839.38 | 2,973,936,400.46 |
(2). Information of investment real estate without property right certificates
√Applicable □Not applicable
Unit: RMB
| Item | Book value | Reasons for having not obtained the ownership certificate |
| Comprehensive Bonded Zone | 974,757,995.98 | Completion settlement not completed |
| Trading Station of Yiwu CCC Warehousing Park | 93,034,948.67 | Completion settlement not completed |
| Office building of the auxiliary project in western Yiwu | 86,794,063.23 | Completion settlement not completed |
| Total | 1,154,587,007.88 |
Other statements
√Applicable □Not applicable
As of December 31, 2022, the total amount of investment real estate for which theproperty right certificates had not been received due to that the final settlement was still inprogress was RMB 1,154,587,007.88.
21. Fixed assets
Presentation of items
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Fixed assets | 5,220,882,784.47 | 5,078,590,929.75 |
| Total | 5,220,882,784.47 | 5,078,590,929.75 |
Other notes:
□Applicable √Not applicable
Fixed assets
(1). Overview of fixed assets
√Applicable □Not applicable
Unit: RMB
| Item | Buildings and structures | Machinery equipment | Transportation equipment | Total |
| I. Original book value: | ||||
| 1. Opening balance | 7,561,987,149.45 | 3,867,198,470.98 | 13,325,615.62 | 11,442,511,236.05 |
| 2. Increase in the current period | 366,181,407.35 | 147,393,012.04 | 91,997.42 | 513,666,416.81 |
| (1) Purchase | - | 24,440,280.52 | 91,997.42 | 24,532,277.94 |
| (2) Changeover from construction in progress | 363,898,268.53 | 111,797,716.52 | - | 475,695,985.05 |
| (3) Increase due to mergers | - | 11,155,015.00 | - | 11,155,015.00 |
| (4) Other transfer -in | 2,283,138.82 | - | - | 2,283,138.82 |
| 3. Decrease in the current period | 3,868,194.99 | 27,287,697.41 | 3,497,514.67 | 34,653,407.07 |
| (1) Disposal or retirement | 3,868,194.99 | 27,287,697.41 | 3,497,514.67 | 34,653,407.07 |
| 4. Closing balance | 7,924,300,361.81 | 3,987,303,785.61 | 9,920,098.37 | 11,921,524,245.79 |
| II. Accumulated depreciation | ||||
| 1. Opening balance | 2,729,655,577.54 | 3,154,632,991.35 | 8,468,269.56 | 5,892,756,838.45 |
| 2. Increase in the current period | 292,331,556.43 | 68,862,229.19 | 1,873,832.47 | 363,067,618.09 |
| (1) Provision | 292,331,556.43 | 68,862,229.19 | 1,873,832.47 | 363,067,618.09 |
| 3. Decrease in the current period | - | 23,495,067.46 | 2,851,395.61 | 26,346,463.07 |
| (1) Disposal or retirement | - | 23,495,067.46 | 2,851,395.61 | 26,346,463.07 |
| 4. Closing balance | 3,021,987,133.97 | 3,200,000,153.08 | 7,490,706.42 | 6,229,477,993.47 |
| III. Depreciation provision | ||||
| 1. Opening balance | 471,163,467.85 | - | - | 471,163,467.85 |
| 4. Closing balance | 471,163,467.85 | - | - | 471,163,467.85 |
| IV. Book value | ||||
| 1. Opening book value | 4,431,149,759.99 | 787,303,632.53 | 2,429,391.95 | 5,220,882,784.47 |
| 2. Closing book value | 4,361,168,104.06 | 712,565,479.63 | 4,857,346.06 | 5,078,590,929.75 |
(2). Temporarily idle fixed assets
□Applicable √Not applicable
(3). Fixed assets leased in through financial lease
√Applicable □Not applicable
Unit: RMB
| Item | Original book value | Accumulated depreciation | Impairment provision | Book value |
| General equipment | 6,084,431.99 | 5,841,054.71 | - | 243,377.28 |
(4). Fixed assets leased out through operating lease
□Applicable √Not applicable
(5). Fixed assets for which the ownership certificates have not been obtained
√Applicable □Not applicable
Unit: RMB
| Item | Book value | Reasons for having not obtained the ownership certificate |
| Auxiliary project in western Yiwu | 591,632,268.53 | Completion settlement not completed |
| Liaoning Xiliu Yiwu China Commodities City | 324,783,769.58 | Completion settlement not completed |
| Huangyuan Clothing Market | 245,004,629.45 | Completion settlement not completed |
| CCC Hotel | 51,462,875.75 | Completion settlement not completed |
| Total | 1,212,883,543.31 |
Other notes:
√Applicable □Not applicable
The impairment of fixed assets was RMB 471,163,467.85, which was the impairment offixed assets of Haicheng Yiwu China Commodities City.As of December 31, 2022, the total amount of property, plant and equipmentfor which theproperty right certificates had not been received due to that the final settlement was still inprogress was RMB 1,212,883,543.31.
Disposal of fixed assets
□Applicable √Not applicable
22. Construction in progress
Presentation of items
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Construction in progress | 2,860,064,818.36 | 1,090,577,963.27 |
| Total | 2,860,064,818.36 | 1,090,577,963.27 |
Other notes:
□Applicable √Not applicable
Construction in progress
(1). Overview of construction in progress
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance | ||||
| Book balance | Impairment provision | Book value | Book balance | Impairment provision | Book value | |
| West Yiwu International Means of Production Market Auxiliary Project | - | - | - | 212,637,292.78 | - | 212,637,292.78 |
| Liaoning Xiliu Yiwu China Commodities City Commerce Phase I Project—Hotel Project | 32,290,506.33 | -4,635,059.96 | 27,655,446.37 | 32,290,506.33 | -4,635,059.96 | 27,655,446.37 |
| The Yiwu Comprehensive Bonded Zone Project | 1,853,596,168.27 | - | 1,853,596,168.27 | 357,114,238.02 | - | 357,114,238.02 |
| Logistics Park S3 | 304,000,538.70 | - | 304,000,538.70 | - | - | - |
| Logistics Park S2 | 235,339,023.06 | - | 235,339,023.06 | - | - | - |
| Yiwu Digital Trade Industrial Park | 158,150,730.63 | - | 158,150,730.63 | 60,070,777.68 | - | 60,070,777.68 |
| Yiwu International Digital Logistics Market | 116,022,418.71 | - | 116,022,418.71 | - | - | - |
| Global Digital Free Trade Center | 71,878,178.97 | - | 71,878,178.97 | 30,126,457.56 | - | 30,126,457.56 |
| The Chian West Sea tourism project | 70,003,472.35 | - | 70,003,472.35 | 68,040,671.22 | - | 68,040,671.22 |
| The Zhimei Dachen Tourism Project | 22,801,228.71 | - | 22,801,228.71 | 58,285,106.90 | - | 58,285,106.90 |
| Zone II East Parking Lot Project | - | - | - | 276,099,117.75 | - | 276,099,117.75 |
| Other projects | 617,612.59 | - | 617,612.59 | 548,854.99 | - | 548,854.99 |
| Total | 2,864,699,878.32 | -4,635,059.96 | 2,860,064,818.36 | 1,095,213,023.23 | -4,635,059.96 | 1,090,577,963.27 |
(2). Changes to important construction in progress during the current period
√Applicable □Not applicable
Unit: RMB10,000
| Item | Budget | Opening amount Balance | Increase in the current period | Amount changed into fixed assets | Closing amount Balance | Ratio of accumulated investment to budget (%) | Project Progress | Accumulated capitalized interest | In which: capitalized interest in the current period | Interest capitalization ratio for the current period (%) | Source of funds |
| West Yiwu International Means of Production Market Auxiliary Project | 133,916.00 | 21,263.73 | 9,291.78 | 30,555.51 | - | 100.00 | completed | 9,938.28 | - | - | Own funds/ financing |
| Liaoning Xiliu Yiwu China Commodities City Commerce Phase I Project—Hotel Project | 180,000.00 | 3,229.05 | - | - | 3,229.05 | 96.32 | Shutdown | 154.61 | - | - | Own funds/ financing |
| The Yiwu Comprehensive Bonded Zone Project | 624,250.00 | 35,711.42 | 149,648.20 | - | 185,359.62 | 46.55 | Under construction | - | - | - | Self-owned |
| Logistics Park S2 | 108,000.00 | - | 23,533.90 | - | 23,533.90 | 21.79 | Under construction | - | - | - | Self-owned |
| Logistics Park S3 | 132,000.00 | - | 30,400.05 | - | 30,400.05 | 23.03 | Under construction | 91.83 | 91.83 | 2.90 | Own funds/ financing |
| Yiwu Digital Trade Industrial Park | 39,579.00 | 6,007.08 | 9,807.99 | - | 15,815.07 | 39.96 | Under construction | - | - | - | Self-owned |
| Yiwu International Digital Logistics Market | 113,600.00 | - | 11,602.24 | - | 11,602.24 | 10.21 | Under construction | 94.25 | 94.25 | 2.90 | Own funds/ financing |
| Global Digital Free Trade Center | 832,082.00 | 3,012.65 | 4,175.17 | - | 7,187.82 | 0.90 | Under construction | - | - | - | Self-owned |
| The Chian West Sea tourism project | 8,000.00 | 6,804.06 | 196.29 | - | 7,000.35 | 85.07 | Under construction | - | - | - | Self-owned |
| The Zhimei Dachen tourism project | 6,000.00 | 5,828.51 | 639.02 | 4,187.40 | 2,280.13 | 97.25 | Under construction | - | - | - | Self-owned |
| Zone II East Parking Lot Project | 60,706.00 | 27,609.91 | 1,474.95 | 29,084.86 | - | 100.00 | completed | - | - | - | Self-owned |
| Other projects | - | 54.89 | 61.76 | 54.89 | 61.76 | - | - | - | Self-owned | ||
| Total | 2,238,133.00 | 109,521.30 | 240,831.35 | 63,882.66 | 286,469.99 | / | / | 10,278.97 | 186.08 | / | / |
(3). Provision made for the impairment of construction in progress in the current period
□Applicable √Not applicable
Other statements
√Applicable □Not applicable
The impairment value of the project under construction is RMB 4,635,059.96, which is the provision impairment of Liaoning Xiliu Yiwu ChinaCommodities City Commerce Phase I Project—Hotel Project.
Construction materials
(1). Engineering materials
□Applicable √Not applicable
23. Bearer biological asset
(1). Bearer biological asset measured by cost
□Applicable √Not applicable
(2). Bearer biological asset measured by fair value
□Applicable √Not applicable
Other statements
□Applicable √Not applicable
24. Oil and gas assets
□Applicable √Not applicable
25. Right-of-use assets
√Applicable □Not applicable
Unit: RMB
| Item | Buildings and structures | Land | Total |
| I. Original book value | |||
| 1. Opening balance | 128,748,477.02 | 125,879,033.69 | 254,627,510.71 |
| 2. Increase in the current period | 27,475,019.10 | - | 27,475,019.10 |
| (1) Lease in | 27,475,019.10 | - | 27,475,019.10 |
| 3. Decrease in the current period | - | - | - |
| 4. Closing balance | 156,223,496.12 | 125,879,033.69 | 282,102,529.81 |
| II. Accumulated depreciation | |||
| 1. Opening balance | 21,694,272.46 | 7,586,161.11 | 29,280,433.57 |
| 2. Increase in the current period | 32,077,371.07 | 3,041,814.36 | 35,119,185.43 |
| (1) Provision | 32,077,371.07 | 3,041,814.36 | 35,119,185.43 |
| 3. Decrease in the current period | - | - | - |
| 4. Closing balance | 53,771,643.53 | 10,627,975.47 | 64,399,619.00 |
| III. Depreciation provision | |||
| 1. Opening balance | - | - | - |
| 4. Closing balance | - | - | - |
| IV. Book value | |||
| 1. Opening book value | 102,451,852.59 | 115,251,058.22 | 217,702,910.81 |
| 2. Closing book value | 107,054,204.56 | 118,292,872.58 | 225,347,077.14 |
Other notes:
Nil
26. Intangible assets
(1). Overview of intangible assets
√Applicable □Not applicable
Unit: RMB
| Item | Land use right | Software and software copyright | Total |
| I. Original book value | |||
| 1. Opening balance | 5,620,777,656.44 | 72,090,272.16 | 5,692,867,928.60 |
| 2. Increase in the current period | 2,466,795,003.67 | 124,804,033.67 | 2,591,599,037.34 |
| (1) Purchase | 2,456,129,105.67 | 10,299,498.80 | 2,466,428,604.47 |
| (2) Internal R&D | - | 35,212,024.64 | 35,212,024.64 |
| (3) Increase due to mergers | - | 79,292,510.23 | 79,292,510.23 |
| (4) Other transfer -in | 10,665,898.00 | - | 10,665,898.00 |
| 3. Decrease in the current period | - | 1,918,946.22 | 1,918,946.22 |
| (1) Disposal | - | 1,918,946.22 | 1,918,946.22 |
| 4. Closing balance | 8,087,572,660.11 | 194,975,359.61 | 8,282,548,019.72 |
| II. Accumulated amortization | |||
| 1. Opening balance | 1,642,066,103.72 | 7,237,162.53 | 1,649,303,266.25 |
| 2. Increase in the current period | 160,844,157.04 | 10,723,906.07 | 171,568,063.11 |
| (1) Provision | 160,844,157.04 | 10,723,906.07 | 171,568,063.11 |
| 3. Decrease in the current period | - | 173,000.00 | 173,000.00 |
| (1) Disposal | - | 173,000.00 | 173,000.00 |
| 4. Closing balance | 1,802,910,260.76 | 17,788,068.60 | 1,820,698,329.36 |
| III. Depreciation provision | |||
| 1. Opening balance | - | - | - |
| 4. Closing balance | - | - | - |
| IV. Book value | |||
| 1. Opening book value | 6,284,662,399.35 | 177,187,291.01 | 6,461,849,690.36 |
| 2. Closing book value | 3,978,711,552.72 | 64,853,109.63 | 4,043,564,662.35 |
At the end of the period, the percentage of the intangible assets formed through theCompany's internal research and development in the balance of intangible assets was 0.96%
(2). Land use right for which the ownership certificate has not been obtained
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
27. Development expenses
√Applicable □Not applicable
Unit: RMB
| Item | Opening amount Balance | Increase in the current period | Decrease in the current period | Closing amount Balance | |
| Internal development expenditure | Business merger | Recognized as intangible assets | |||
| The development project for platform “chinagoods” | 6,359,814.02 | 29,404,851.33 | - | 35,212,024.64 | 552,640.71 |
| Kuaijietong Core Payment System | - | 2,516,395.62 | 1,591,959.54 | - | 4,108,355.16 |
| Total | 6,359,814.02 | 31,921,246.95 | 1,591,959.54 | 35,212,024.64 | 4,660,995.87 |
Other statementsNil
28. Goodwill
(1). Original book value of goodwill
√Applicable □Not applicable
Unit: RMB
| The name of the invested unit or matters forming goodwill | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| Formed by a business combination | Disposal | |||
| Xunchi Group | - | 284,916,367.87 | - | 284,916,367.87 |
| Total | - | 284,916,367.87 | - | 284,916,367.87 |
(2). Provision for goodwill impairment
√Applicable □Not applicable
Unit: RMB
| The name of the invested unit or matters forming goodwill | Opening balance | Increase in the current period | Decrease in the current period | Closing balance | ||
| Provision | Others | Disposal | Others | |||
| Xunchi Group | - | - | - | - | - | - |
| Total | - | - | - | - | - | - |
(3). Information on the assets group or combination of assets groups to which the
goodwill belongs
√Applicable □Not applicable
In July 2022, the Group acquired 100% equity of Zhejiang Haier Network Technology Co.,Ltd. and Zhejiang Haier Network Technology Co., Ltd.'s subsidiary Kuaijietong PaymentService Co., Ltd. (hereinafter referred to as "Xunchi Group"), forming a goodwill of RMB284,916,367.87. For the calculation process, please refer to Note VIII. 1. Businesscombinations involving enterprises not under common control.The goodwill obtained from business combination has been allocated to the followingasset groups or combination of asset groups for impairment test:
Kuaijietong asset group
The goodwill of the Group is allocated to the Kuaijietong asset group for impairmenttesting. The asset group is composed of Kuaijietong Payment Service Co., Ltd., a subsidiary of
Zhejiang Haier Network Technology Co., Ltd. Since the synergistic effect of the acquisition ofXunchi Group is reflected in the Kuaijietong's subsidiaries, the main cash flow generated by theKuaijietong's subsidiaries is independent of other subsidiaries of the Group, and the Groupmanages the production activities of the Kuaijietong's subsidiaries independently, so thegoodwill is allocated to the Kuaijietong asset group.
(4). Goodwill impairment test process, key parameters (e.g. growth rate in the forecastperiod, growth rate in the stable period, profit margin, discount rate, forecast periodfor the estimate of present value of future cash flows, if applicable) and recognitionof goodwill impairment loss
√Applicable □Not applicable
The book value of the Kuaijietong asset group was RMB 371,204,713.10. The recoverableamount adopts the present value of the expected future cash flow of the asset groupcombination, and is determined according to the cash flow forecast based on the 5-yearfinancial budget approved by the management. The pre-tax discount rate adopted bymanagement as of December 31, 2022 was 12.69%. The perpetual cash flow after five yearsdoes not take into account the perpetual growth rate.
The following illustrates the key assumptions made by management in determining thecash flow projections for the purposes of the goodwill impairment test:
Budgeted gross profit rate - The basis for determination is to increase the average grossprofit rate appropriately according to the expected market development on the basis of theaverage gross profit rate achieved in the year before the budget year.
Discount rate —— The discount rate adopted is the pre-tax discount rate reflecting thespecific risk of the relevant asset group or asset group combination.
(5). Impact of goodwill impairment test
√Applicable □Not applicable
Based on the above impairment test results, the Group believes that there was no need tomake provision for impairment of goodwill on December 31, 2022
Other statements
□Applicable √Not applicable
29. Long-term prepaid expenses
√Applicable □Not applicable
Unit: RMB
| Item | Opening balance | Increase in the current period | Amortized amount in the current period | Mergers of enterprises not under common control | Closing balance |
| Decoration of buildings and structures | 174,871,839.30 | 162,905,555.70 | 41,324,840.36 | - | 296,452,554.64 |
| Advertising facilities | 13,312,537.13 | 19,029,712.48 | 21,943,715.48 | 74,882.12 | 10,473,416.25 |
| Total | 188,184,376.43 | 181,935,268.18 | 63,268,555.84 | 74,882.12 | 306,925,970.89 |
Other notes:
Nil
30. Deferred income tax assets/deferred income tax liabilities
(1). Deferred income tax assets having not been offset
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance | ||
| Deductible temporary difference | Deferred income tax assets | Deductible temporary difference | Deferred income tax assets | |
| Provision for impairment of assets | 18,828,747.02 | 4,707,186.78 | 18,766,810.88 | 4,691,702.72 |
| Unrealized profits of internal transactions | 1,094,793.10 | 273,698.28 | 1,094,793.10 | 273,698.28 |
| Deductible losses | 1,039,362.23 | 259,840.56 | 10,635,059.71 | 2,658,764.93 |
| Recognized but unpaid liabilities | 301,006,872.77 | 75,251,718.21 | 359,852,941.25 | 89,963,235.31 |
| Overspent advertising cost | 12,547,314.43 | 3,136,828.61 | 8,497,106.53 | 2,124,276.63 |
| Right-of-use assets and lease liabilities | 6,238,418.88 | 1,559,604.71 | 3,291,235.93 | 822,808.98 |
| Asset-related government grants | 79,879,800.00 | 19,969,950.00 | 53,046,300.00 | 13,261,575.00 |
| Changes in fair value of other non-current financial assets | 122,472,837.68 | 30,618,209.42 | 87,763,868.16 | 21,940,967.04 |
| Changes in fair value of trading financial assets | 3,854,431.84 | 963,607.96 | - | - |
| Change in fair value of other equity instruments investment | 54,424,627.13 | 13,606,156.78 | - | - |
| Total | 601,387,205.08 | 150,346,801.31 | 542,948,115.56 | 135,737,028.89 |
(2). Deferred income tax liabilities having not been offset
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance | ||
| Taxable temporary difference | Deferred income tax Debt | Taxable temporary difference | Deferred income tax Debt | |
| Asset evaluation appreciation for merger of the enterprises not under common control | 27,573,081.34 | 6,893,270.33 | 879,727.84 | 219,931.94 |
| Change in fair value of other equity instruments investment | - | - | 88,562,537.79 | 22,140,634.45 |
| Changes in fair value of other non-current financial assets | 352,597,807.91 | 88,149,451.98 | 357,773,989.11 | 89,443,497.28 |
| Changes in fair value of trading financial assets | - | - | 373,599.00 | 93,399.75 |
| Total | 380,170,889.25 | 95,042,722.31 | 447,589,853.73 | 111,897,463.42 |
(3). Deferred income tax assets or liabilities presented in net amount after offsetting
□Applicable √Not applicable
(4). Breakdown of unrecognized deferred income tax assets
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Deductible temporary difference | 13,856,330.50 | 485,392,932.16 |
| Deductible losses | 857,701,806.92 | 1,090,714,817.48 |
| Total | 871,558,137.42 | 1,576,107,749.64 |
(5). The deductible loss in unrecognized deferred income tax assets will be due in thefollowing years
√Applicable □Not applicable
Unit: RMB
| Year | Closing amount | Opening amount | REMARKS |
| 2022 | - | 245,346,275.18 | |
| 2023 | 146,809,087.31 | 145,652,609.01 | |
| 2024 | 173,780,379.93 | 219,603,443.50 | |
| 2025 | 207,526,489.77 | 236,606,485.47 | |
| 2026 | 212,236,244.78 | 243,506,004.32 | |
| 2027 | 117,349,605.13 | - | |
| Total | 857,701,806.92 | 1,090,714,817.48 | / |
Other notes:
√Applicable □Not applicable
The Group believes that, the deductible temporary differences including theaforementioned provision for asset impairmentand the deductible losses of some subsidiariescan be deducted in the foreseeable future, and it is expected that the Group will have sufficientpre-tax profit for deduction during the reversing period. Therefore, the Group deemed itnecessary to recognize the above deferred income tax assets.
31. Other non-current assets
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance | ||||
| Book balance | Impairment provision | Book value | Book balance | Impairment provision | Book value | |
| Prepaid land transfer fees | 138,253,316.00 | - | 138,253,316.00 | 138,253,316.00 | - | 138,253,316.00 |
| Prepayment for renovation works and prepaid decoration rent | - | - | - | 5,681,334.45 | - | 5,681,334.45 |
| Prepaid equity transfer consideration | - | - | - | 67,395,000.00 | - | 67,395,000.00 |
| Total | 138,253,316.00 | - | 138,253,316.00 | 211,329,650.45 | - | 211,329,650.45 |
Other notes:
Nil
32. Short-term borrowings
(1). Classification of short-term borrowings
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Credit loans | 1,059,287,361.11 | 942,736,046.04 |
| Total | 1,059,287,361.11 | 942,736,046.04 |
Note to the classification of short-term borrowings:
Nil
(2). Overdue short-term borrowings
□Applicable √Not applicable
The important overdue and unpaid short-term loansare as follows:
□Applicable √Not applicable
Other statements
√Applicable □Not applicable
As of December 31, 2022, the range of the annual interest rates of the above-mentionedborrowings was 2.35%-4.151% (December 31, 2021: 1.20%-3.915%).
33. Held-for-trading financial liabilities
□Applicable √Not applicable
34. Derivative financial liabilities
□Applicable √Not applicable
35. Notes payable
(1). Presentation of notes payable
□Applicable √Not applicable
36. Accounts payable
(1). Presentation of accounts payable
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Accounts payable for market and auxiliary works projects | 881,114,454.44 | 301,995,294.63 |
| Accounts payable for real estate projects | 216,635,705.68 | 33,317,557.65 |
| Trade payables | 58,894,383.76 | 72,330,560.78 |
| Accounts payable for procurement for the hotel project | 17,465,421.40 | 58,722,226.25 |
| Others | 17,204,438.87 | 26,994,789.71 |
| Total | 1,191,314,404.15 | 493,360,429.02 |
(2). Important accounts payable with age over 1 year
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Reasons for not being paid or carried forward |
| Warranty premium | 11,095,956.69 | Under warranty or not billed |
| Total | 11,095,956.69 | / |
Other statements
√Applicable □Not applicable
The accounts payable are free of interest and are generally paid within two months afterreceipt of the payment notice or based on the project contracts and progress of projects. Thebalance payments for the projects are made after completion of settlement.
37. Advances from customers
(1). Presentation of advances from customers
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Advance receipt of merchant payment | 639,009,194.79 | - |
| Rental advances | 236,525,969.44 | 142,605,296.83 |
| Others | 10,458,105.25 | 10,961,014.30 |
| Total | 885,993,269.48 | 153,566,311.13 |
(2). Important advances with the age over 1 year
□Applicable √Not applicable
Other statements
√Applicable □Not applicable
Since the advances from customers are mainly from the advance use fees for shops, as ofDecember 31, 2022, there was no single large advance from customers with an age of morethan 1 year.
38. Contract liabilities
(1). Overview of contract liabilities
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Advances from customers for use fee of shops | 2,982,431,412.43 | 2,996,965,006.91 |
| Advances from customers for goods | 653,697,926.33 | 762,448,893.76 |
| Advances from customers for advertising fee | 228,163,127.56 | 66,129,057.15 |
| Advances from customers for housing purchase | 31,199,591.78 | 178,756,399.38 |
| Advances from customers for use fee of networking cables | 17,747,693.18 | 14,150,457.59 |
| Advances from customers for loyalty of brands | 11,119,366.97 | 17,997,985.07 |
| Others | 66,678,903.31 | 21,971,424.98 |
| Total | 3,991,038,021.56 | 4,058,419,224.84 |
(2). Amount of and reasons for material changes to book value during the reportingperiod
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
39. Payroll payable
(1). Presentation of payroll payable
√Applicable □Not applicable
Unit: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| I. Short-term compensation | 241,452,764.09 | 431,850,793.07 | 493,601,491.42 | 179,702,065.74 |
| II. Post employment benefits – defined contribution plan | 2,511,991.29 | 28,857,547.27 | 27,936,289.79 | 3,433,248.77 |
| III. Severance benefits | - | 704,729.26 | 704,729.26 | - |
| Total | 243,964,755.38 | 461,413,069.60 | 522,242,510.47 | 183,135,314.51 |
(2). Presentation of short-term compensation
√Applicable □Not applicable
Unit: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| 1. Salary, bonus, allowance and subsidy | 240,122,029.99 | 341,366,484.51 | 403,419,561.31 | 178,068,953.19 |
| 2. Employee benefits | - | 39,195,513.96 | 39,195,513.96 | - |
| 3. Social security contribution | 1,238,946.85 | 17,333,098.99 | 17,300,440.75 | 1,271,605.09 |
| In which: contribution to medical insurance scheme | 1,101,887.73 | 15,915,718.41 | 15,923,443.03 | 1,094,163.11 |
| Contribution to work-related injury insurance scheme | 28,926.87 | 574,342.48 | 484,309.15 | 118,960.20 |
| Contribution to maternity insurance scheme | 108,132.25 | 843,038.10 | 892,688.57 | 58,481.78 |
| 4. Housing provident fund | 79,760.00 | 24,490,564.00 | 24,506,373.00 | 63,951.00 |
| 5. Contribution to trade union fund and employee education fund | 12,027.25 | 9,465,131.61 | 9,179,602.40 | 297,556.46 |
| Total | 241,452,764.09 | 431,850,793.07 | 493,601,491.42 | 179,702,065.74 |
(3). Presentation of defined contribution plan
√Applicable □Not applicable
Unit: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| 1. Contribution to the basic endowment insurance scheme | 2,342,403.40 | 27,912,630.46 | 27,022,827.85 | 3,232,206.01 |
| 2. Contribution to the unemployment insurance scheme | 169,587.89 | 944,916.81 | 913,461.94 | 201,042.76 |
| Total | 2,511,991.29 | 28,857,547.27 | 27,936,289.79 | 3,433,248.77 |
Other notes:
□Applicable √Not applicable
40. Tax payable
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| VAT | 56,402,798.28 | 83,766,540.18 |
| Business tax | -240,013.55 | -240,013.55 |
| Urban maintenance and construction tax | 2,521,434.47 | 4,687,093.90 |
| Corporate income tax | 6,138,842.64 | 279,485,623.04 |
| Individual income tax | 1,275,355.73 | 1,260,803.19 |
| Land appreciation tax | 66,652.63 | 2,780,327.20 |
| Real estate tax | 84,142,438.27 | 171,138,711.99 |
| Land use tax | 60,454,035.23 | 10,612,069.24 |
| Others | 4,236,880.71 | 6,005,392.15 |
| Total | 214,998,424.41 | 559,496,547.34 |
Other notes:
As at December 31, 2022, the details of the main taxes prepaid by the Group are asfollows: Unit: Yuan Currency: RMB
| Item | Qiantang Impression Real Estate Project | Occident Center Real Estate Project | Total amount of prepaid tax |
| Business tax | 240,013.55 | - | 240,013.55 |
| Urban maintenance and construction tax | - | 731,793.32 | 731,793.32 |
| Land appreciation tax | 247,373.48 | 247,373.48 | |
| Education surcharge and local education surcharge | - | 522,709.51 | 522,709.51 |
| Total | 240,013.55 | 1,501,876.31 | 1,741,889.86 |
41. Other payables
Presentation of items
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Other payables | 1,325,596,105.43 | 1,908,742,835.15 |
| Total | 1,325,596,105.43 | 1,908,742,835.15 |
Other notes:
□Applicable √Not applicable
Interest payable
(1). Presentation by category
□Applicable √Not applicable
Dividend payable
(1). Presentation by category
□Applicable √Not applicable
Other payables
(1). Presentation of other payables by nature
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Withholdings, deposit and margin | 490,392,164.12 | 598,819,336.72 |
| Pending investment refunds | 429,637,665.00 | 877,464,692.76 |
| Operating expenses payable | 284,502,534.04 | 268,576,640.89 |
| Restricted stock incentive plan | 120,092,075.00 | 137,440,900.00 |
| Yiwugou’s bank reserve fund | - | 25,823,767.03 |
| Others | 971,667.27 | 617,497.75 |
| Total | 1,325,596,105.43 | 1,908,742,835.15 |
(2). Important other payables with account age over 1 year
□Applicable √Not applicable
Other notes:
√Applicable □Not applicable
Other payables mainly come from deposits for commercial spaces and bid deposits forengineering projects, with small individual amounts, so there were no important other payableswith an age of more than 1 year on December 31, 2022.
42. Held-for-sale liabilities
□Applicable √Not applicable
43. Non-current liabilities due within one year
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Long-term borrowings within one year | 345,934.69 | 100,918,614.59 |
| Bonds payable due within 1 year | 61,508,191.79 | 3,552,960,829.66 |
| Lease liabilities due within 1 year | 24,998,166.53 | 10,362,478.83 |
| Total | 86,852,293.01 | 3,664,241,923.08 |
Other notes:
Nil
44. Other current liabilities
Other current liabilities
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Short-term financing notes payable | 3,012,256,419.90 | 3,009,756,921.11 |
| Payment business reserve | 397,125,623.54 | - |
| To-be-reported output tax | 59,992,173.80 | 67,323,844.72 |
| Dividend payable to to-be-recognized accounts | 2,449,697.11 | 2,220,922.02 |
| Dividend announced but not collected before listing | 2,083,112.65 | 2,083,112.65 |
| Total | 3,473,907,027.00 | 3,081,384,800.50 |
Changes in short-term bonds payable:
√Applicable □Not applicable
Unit: RMB
| Bond Name | Face value | Issuing Date | Bond Term | Issuing Amount | Opening amount Balance | Current period Issuing | Interest accrued based on face value | Premium/discount amortization | Current period Repayment | Closing amount Balance |
| Super-short-term commercial paper | 100 | Oct 27, 2021 | 268 days | 1,000,000,000.00 | 1,004,835,068.49 | - | 16,492,054.79 | 553,424.66 | 1,021,880,547.93 | - |
| Super-short-term commercial paper | 100 | Nov 15, 2021 | 279 days | 1,000,000,000.00 | 1,003,076,172.00 | - | 17,534,520.55 | 619,444.44 | 1,021,230,136.99 | - |
| Super-short-term commercial paper | 100 | Nov 30, 2021 | 269 days | 1,000,000,000.00 | 1,001,845,680.63 | - | 18,440,547.95 | 658,333.33 | 1,020,944,561.91 | - |
| Super-short-term commercial paper | 100 | Jun 29, 2022 | 30 days | 1,000,000,000.00 | - | 1,000,000,000.00 | 1,808,219.18 | 83,333.33 | 1,001,891,552.51 | - |
| Super-short-term commercial paper | 100 | Jul 27, 2022 | 61 days | 1,000,000,000.00 | - | 1,000,000,000.00 | 3,158,630.14 | 169,444.44 | 1,003,328,074.58 | - |
| Super-short-term commercial paper | 100 | Aug 10, 2022 | 79 days | 1,000,000,000.00 | - | 1,000,000,000.00 | 3,787,671.23 | 219,444.44 | 1,004,007,115.67 | - |
| Super-short-term commercial paper | 100 | Aug 24, 2022 | 91 days | 1,000,000,000.00 | - | 1,000,000,000.00 | 4,363,013.70 | 252,777.78 | 1,004,615,791.48 | - |
| Super-short-term commercial paper | 100 | Sep 21, 2022 | 240 days | 1,000,000,000.00 | - | 1,000,000,000.00 | 5,840,547.95 | 283,333.33 | - | 1,005,457,214.61 |
| Super-short-term commercial paper | 100 | Oct 26, 2022 | 240 days | 1,000,000,000.00 | - | 1,000,000,000.00 | 4,221,917.81 | 178,505.14 | - | 1,003,733,756.28 |
| Super-short-term commercial paper | 100 | Nov 22, 2022 | 120D | 1,000,000,000.00 | - | 1,000,000,000.00 | 3,287,671.23 | 111,111.11 | - | 1,003,065,449.01 |
| Total | / | / | / | 10,000,000,000.00 | 3,009,756,921.11 | 7,000,000,000.00 | 78,934,794.53 | 3,129,152.00 | 7,077,897,781.07 | 3,012,256,419.90 |
Other notes:
√Applicable □Not applicable
As of December 31, 2022, the range of annual interest rates of the above-mentioned short-term financing bonds was 1.75%-3.00% (December31, 2021: 2.48%-2.98%).
45. Long-term borrowings
(1). Classification of long-term borrowings
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Credit loans | 404,500,000.00 | 771,250,000.00 |
| Total | 404,500,000.00 | 771,250,000.00 |
Notes on the classification of long-term borrowings:
Nil
Other notes, including the interest rate range:
√Applicable □Not applicable
As of December 31, 2022, the range of annual interest rates of the above borrowings was
2.70%-2.90% (December 31, 2021: 2.70%-3.92%).
46. Bonds payable
(1). Bonds payable
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Bonds payable | 3,497,416,819.75 | - |
| Total | 3,497,416,819.75 | - |
(2). Changes in bonds payable: (excluding preferred stocks, perpetual bonds and other financial instruments classified as financial liabilities)
√Applicable □Not applicable
Unit: RMB
| Bond Name | Face value | Issuing Date | Bond Term | Issuing Amount | Opening amount Balance | Current period Issuing | Interest accrued based on face value | Premium/discount amortization | Current period Repayment | Transferred in this year and due within one year | Closing amount Balance |
| MTN | 100 | Feb 24, 2022 | 3Y | 1,000,000,000.00 | - | 1,000,000,000.00 | 27,942,465.75 | 310,055.91 | - | 27,942,465.75 | 999,177,980.44 |
| MTN | 100 | Mar 29, 2022 | 3Y | 500,000,000.00 | - | 500,000,000.00 | 13,546,438.36 | 138,141.83 | - | 13,546,438.36 | 499,572,104.09 |
| MTN | 100 | Jul 20, 2022 | 3Y | 500,000,000.00 | - | 500,000,000.00 | 6,739,726.03 | 82,250.63 | - | 6,739,726.03 | 499,516,212.89 |
| Corporate bonds | 100 | Sep 1, 2022 | 3Y | 800,000,000.00 | - | 800,000,000.00 | 7,701,041.10 | 54,489.46 | - | 7,701,041.10 | 799,551,093.23 |
| Corporate bonds | 100 | Sep 22, 2022 | 3Y | 700,000,000.00 | - | 700,000,000.00 | 5,578,520.55 | 39,429.10 | - | 5,578,520.55 | 699,599,429.10 |
| Total | / | / | / | 3,500,000,000.00 | - | 3,500,000,000.00 | 61,508,191.79 | 624,366.93 | - | 61,508,191.79 | 3,497,416,819.75 |
(3). Conditions and time for the conversion of convertible corporate bonds
□Applicable √Not applicable
(4). Notes on other financial instruments classified as financial liabilitiesBasic information of other financial instruments such as preferred shares and perpetual bondsoutstanding at the end of the reporting period
□Applicable √Not applicable
Changes in other financial instruments such as preferred shares and perpetual bondsoutstanding at the end of the reporting period
□Applicable √Not applicable
The basis for classifying other financial instruments as financial liabilities:
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
47. Lease liabilities
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Undiscounted amount of finance lease payables | 320,577,235.56 | 334,659,632.28 |
| Unrecognized financing charges | -88,955,333.06 | -118,354,479.52 |
| Lease liabilities due within 1 year | -24,998,166.53 | -10,362,478.83 |
| Total | 206,623,735.97 | 205,942,673.93 |
Other notes:
Note: The Group uses the incremental borrowing rate of 2.78%-8.01% as the discount rateto calculate book value to determine the lease liability and measure right-of-use assets.
48. Long-term accounts payable
Presentation of items
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Long-term accounts payable
(1). Long-term payables by nature
□Applicable √Not applicable
Special accounts payable
(1). Special payables by nature
□Applicable √Not applicable
49. Long-term payroll payable
□Applicable √Not applicable
50. Estimated liabilities
√Applicable □Not applicable
Unit: RMB
| Item | Opening balance | Closing balance | Cause of formation |
| Pending L/C losses | 110,620,306.10 | 110,620,306.10 | |
| Total | 110,620,306.10 | 110,620,306.10 | / |
Other notes, including the notes on related important assumptions and estimates of importantestimated liabilities:
In 2017, the letters of credit issued by the Group’s subsidiary based on international tradeagency business became overdue successively due to the principals’ failure to make paymentsas agreed. Based on the principle of prudence, the Group recognized estimated liabilities forthe estimated potential losses. On Apr 30, 2018, the Group lost control over the subsidiary dueto its disposal of some equity in the subsidiary. As of December 31, 2022, the matter wasunder processing.
51. Deferred income
Overview of deferred income
√Applicable □Not applicable
Unit: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance | Cause of formation |
| Asset-related government grants | 78,170,103.62 | 26,833,500.00 | 1,421,473.68 | 103,582,129.94 | |
| Total | 78,170,103.62 | 26,833,500.00 | 1,421,473.68 | 103,582,129.94 | / |
Items involving government grants:
√Applicable □Not applicable
Unit: RMB
| Liability item | Opening balance | Increase in grant amount in the current period | Amount recognized in other income in the current period | Closing balance | Asset-related or income-related |
| Subsidy for service industry cluster project | 5,243,445.95 | - | 266,666.64 | 4,976,779.31 | Asset-related |
| Interest subsidy for the international exhibition center construction fund | 19,880,357.67 | - | 1,154,807.04 | 18,725,550.63 | Asset-related |
| Subsidy for Yiwu Comprehensive Bonded Zone Project | 53,046,300.00 | 26,833,500.00 | - | 79,879,800.00 | Asset-related |
| Total | 78,170,103.62 | 26,833,500.00 | 1,421,473.68 | 103,582,129.94 |
Other notes:
□Applicable √Not applicable
52. Other non-current liabilities
□Applicable √Not applicable
53. Capital stock
√Applicable □Not applicable
Unit: RMB
| Opening balance | Increase or decrease in the current period (+, -) | Closing balance | |||||
| Issuing New shares | Bonus shares | Provident funds Conversion into shares | Others | Sub-total | |||
| Total number of shares | 5,491,274,176.00 | - | - | - | -5,200,000.00 | -5,200,000.00 | 5,486,074,176.00 |
Other notes:
After consideration and approval at the 51st meeting of the eighth Board of Directors andthe 14th meeting of the eighth Board of Supervisors of the Group held on July 19, 2022, inview of the fact that among the original incentive objects, 45 no longer worked in the Companydue to their position adjustments or had resigned due to personal reasons, according to therelevant regulations of the "Incentive Plan" and the authorization of the Fifth ProvisionalGeneral Meeting of Shareholders in 2020, the Board of Directors of the Company decided torepurchase and cancel a total of 5,200,000 restricted shares granted to the above 45 peoplebut yet to be released. The Company would repurchase and cancel the restricted shares heldby the above-mentioned 45 people that had been granted but not yet been released at the sumof interest calculated at RMB 2.812 per share or RMB 2.317 per share plus the fixed depositinterest rate announced by the People's Bank of China for the same period. The total amountof restricted stock repurchase funds this time was RMB 14.9341 million. The above-mentionedrepurchase funds would all be paid with the Company's own funds, and the cancellation wouldbe completed on October 21, 2022.After this restricted stock repurchase, the share capital decreased by RMB 5,200,000 thisyear.
54. Other equity instruments
(1). Basic information of other financial instruments such as preferred shares and
perpetual bonds outstanding at the end of the reporting period
□Applicable √Not applicable
(2). Changes in other financial instruments such as preferred shares and perpetual bonds
outstanding at the end of the reporting period
□Applicable √Not applicable
Changes in other equity instruments in the current period, the reasons therefor and the basisfor relevant accounting treatment:
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
55. Capital reserve
√Applicable □Not applicable
Unit: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| Capital surplus (share premium) | 1,559,964,197.11 | - | 10,055,000.00 | 1,549,909,197.11 |
| Stock incentive | 33,414,344.66 | 29,691,919.00 | - | 63,106,263.66 |
| Others | 38,130,573.19 | - | - | 38,130,573.19 |
| Total | 1,631,509,114.96 | 29,691,919.00 | 10,055,000.00 | 1,651,146,033.96 |
Other notes including those on the changes in the current period and the reasons therefor:
During the reporting period, the capital reserve-equity incentive increase was due to theCompany’s confirmation of share-based payment expenses of RMB 29,691,919.00 during thewaiting period, and the decrease was due to the Company’s repurchase and cancellation ofrestricted stock write-offs of RMB 10,055,000.00 for those who did not meet the unlockingconditions, which were included in this item accordingly.
56. Treasury shares
√Applicable □Not applicable
Unit: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| Restricted stock incentive plan | 137,494,800.00 | - | 18,011,125.00 | 119,483,675.00 |
| Total | 137,494,800.00 | - | 18,011,125.00 | 119,483,675.00 |
Other notes including those on the changes in the current period and the reasons therefor:
Because some incentive objects resigned or left office for personnel transfer during thewaiting period and thus no longer had the incentive qualification, the Company repurchasedthe restricted shares for cancellation and offset the corresponding treasury shares. For details,please refer to Note VII. 53 Share capital.
57. Other comprehensive income
√Applicable □Not applicable
Unit: RMB
| Item | Opening amount Balance | Amount in the current period | Closing amount Balance | ||
| Current income amount before tax | Less: income tax | Amount after tax attributable to parent company | |||
| I. Other comprehensive income that cannot be reclassified into profit or loss | 66,421,903.33 | -142,987,164.92 | -35,746,791.23 | -107,240,373.69 | -40,818,470.36 |
| Change in fair value of other equity instruments investment | 66,421,903.33 | -142,987,164.92 | -35,746,791.23 | -107,240,373.69 | -40,818,470.36 |
| II. Other comprehensive income to be | -5,571,168.31 | 22,381,165.07 | - | 22,381,165.07 | 16,809,996.76 |
| reclassified into profit or loss | |||||
| Other comprehensive income that can be transferred into profit and loss under equity method | - | 4,060,531.46 | - | 4,060,531.46 | 4,060,531.46 |
| Difference arising from the translation of foreign currency financial statements | -5,571,168.31 | 18,320,633.61 | - | 18,320,633.61 | 12,749,465.30 |
| Total other comprehensive income | 60,850,735.02 | -120,605,999.85 | -35,746,791.23 | -84,859,208.62 | -24,008,473.60 |
Other notes, including those on the adjustment of the initially recognized amount of hedgeditems converted from the effective part of profits or losses from cash flow hedging:
Nil
58. Special reserve
□Applicable √Not applicable
59. Surplus reserve
√Applicable □Not applicable
Unit: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| Statutory surplus reserve | 1,453,325,098.91 | 110,873,341.23 | - | 1,564,198,440.14 |
| Discretionary surplus reserve | 40,195,855.68 | - | - | 40,195,855.68 |
| Others | 11,688,840.91 | - | - | 11,688,840.91 |
| Total | 1,505,209,795.50 | 110,873,341.23 | - | 1,616,083,136.73 |
Notes on surplus reserves, including those on the changes in the current period and thereasons therefor:
According to the “Company Law” and the Company’s articles of association, the Companyaccrued a statutory surplus reserve in terms of 10% of its net profit. Statutory surplus reserveIf the amount of statutory surplus reserve accrued reaches more than 50% of the Company'sregistered capital, the accrual may cease.The Company can accrue free surplus reserve after accruing the statutory surplusreserve. With the approval, the free surplus reserve can be used to make up for previouslosses or to increase share capital.
60. Undistributed profits
√Applicable □Not applicable
Unit: RMB
| Item | Current period | Previous period |
| Undistributed profits at the end of the previous reporting period before adjustment | 6,059,496,846.85 | 5,168,298,206.50 |
| Opening undistributed profits after adjustment | 6,059,496,846.85 | 5,168,298,206.50 |
| Plus: net profits attributable to shareholders of the parent company in the current period | 1,104,719,091.71 | 1,334,095,906.95 |
| Less: withdrawal of statutory surplus reserve | 110,873,341.23 | 140,951,986.92 |
| General risk reserve | 1,038,991.13 | - |
| Common share dividend payable | 400,863,014.85 | 301,945,279.68 |
| Closing undistributed profits | 6,651,440,591.35 | 6,059,496,846.85 |
Details of the adjustment of opening undistributed profits:
1. The opening undistributed profits affected by the retroactive adjustment made in accordancewith the Accounting Standards for Enterprises and related new provisions amounted to RMB0.
2.The opening undistributed profits affected by the changes in accounting policies amounted toRMB0.
3. The opening undistributed profits affected by the correction of major accounting errorsamounted to RMB0.
4. The opening undistributed profits affected by changes in the scope of mergers caused bycommon control amounted to RMB0.
5. The opening undistributed profits affected by other adjustments together amounted toRMB0.
61. Operating revenue and operating cost
(1). Overview of operating revenue and operating cost
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period | ||
| Revenue | Cost of sales | Revenue | Cost of sales | |
| Main business | 7,326,780,315.71 | 6,335,697,349.65 | 5,586,058,113.32 | 3,870,814,652.77 |
| Other businesses | 292,913,426.89 | 117,212,480.31 | 447,784,859.63 | 156,728,485.79 |
| Total | 7,619,693,742.60 | 6,452,909,829.96 | 6,033,842,972.95 | 4,027,543,138.56 |
(2). Revenue generated from contracts
√Applicable □Not applicable
Unit: RMB
| Classified by type of contract | Total |
| Types of goods | |
| Sales of goods | 5,164,806,897.49 |
| The use of shops in the Commodity City and its supporting services | 1,466,324,121.47 |
| Hotel accommodation and catering services | 195,953,697.59 |
| Revenue from use fees | 52,315,023.80 |
| Other services | 504,563,377.32 |
| Classified by business area | |
| Chinamainland | 7,383,963,117.67 |
| Classified by contract period | |
| Revenue confirmed at certain time point | |
| Sales of goods | 5,164,806,897.49 |
| Hotel catering services | 109,676,970.73 |
| Other services | 347,884,728.81 |
| Revenue confirmed during certain time period | |
| The use of shops in the Commodity City and its supporting services | 1,466,324,121.47 |
| Hotel accommodation service | 86,276,726.86 |
| Revenue from use fees | 52,315,023.80 |
| Other services | 156,678,648.51 |
| Total | 7,383,963,117.67 |
Description of the income from contracts:
√Applicable □Not applicable
The income recognized in the current year and included in the opening book value ofcontractual liabilities is as follows:
Unit: RMB
| Type of contract | Current period |
| Sales of goods | 897,026,499.46 |
| The use of shops in the Commodity City and its supporting services | 1,466,324,121.47 |
| Hotel accommodation service | 11,260,471.19 |
| Other services | 97,370,720.14 |
| Total | 2,471,981,812.26 |
(3). Contract performance obligations
√Applicable □Not applicable
Sales of goods
The performance obligation is fulfilled when the goods are delivered to the customer, andthe contract price is collected in advance before the goods are delivered to the customer orreceived upon the delivery of the goods.
The use of shops in the Commodity City and its supporting services
The contractual performance obligation is fulfilled when providing the use of shops in theCommodity City and the supporting services for business. For the use of shops in theCommodity City and the supporting services for business, the progress of contractperformance is determined based on the number of using days of the shops. Customersusually need to pay in advance before the use of shops in the Commodity City and thesupporting services for business are provided.
Hotel accommodation business
The performance obligation is fulfilled when providing hotel accommodation services. Forthe hotel accommodation business, the progress of contractual performance is determinedbased on the number of days of stay. For hotel accommodation services, a partial deposit iscollected from the customer first, and the remaining contract price is usually collected upon thecompletion of the hotel accommodation services.Hotel catering businessThe performance obligation is fulfilled when the hotel catering services are provided. Thecontract price for hotel catering services is usually charged when the hotel catering servicesare performed.
Fixed -time paid funding services
The performance obligation is fulfilled when the fixed-time paid funding service isprovided. For the fixed-time paid funding service, the progress of contractual performance isdetermined based on the number of using days the fund. For the fixed-time paid fundingservice, the contract price is usually charged regularly as agreed in the contract.
(4). Amortization to remaining contract performance obligations
□Applicable √Not applicable
Other notes:
As of December 31, 2022, the transaction price allocated to the remaining contractperformance obligations was RMB 3,991,038,021.56. The Group expects that this amount willbe recognized as an income in the next 5 years with the progress of the relevant service.
62. Taxes and surcharges
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Real estate tax | 118,168,544.44 | 118,182,369.56 |
| Land use tax | 60,280,050.01 | 11,029,363.42 |
| Stamp duty | 6,790,568.05 | 7,188,521.64 |
| Urban maintenance and construction tax | 6,479,070.41 | 12,672,573.75 |
| Education surcharge | 2,800,755.18 | 5,476,928.89 |
| Land appreciation tax | 2,035,123.43 | 3,349,307.04 |
| Local education surcharge | 1,867,176.45 | 3,651,285.86 |
| Cultural undertaking development fee | 470,626.83 | -1,440.00 |
| Business tax | 13,549.21 | 206,842.50 |
| Travel tax | 2,040.00 | 3,456.16 |
| Total | 198,907,504.01 | 161,759,208.82 |
Other notes:
Nil
63. Sales expenses
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Marketing expenses | 89,853,590.72 | 115,754,997.02 |
| Security and insurance expenses | 33,844,271.39 | 38,306,012.40 |
| Advertising expenses | 31,743,030.06 | 45,648,963.60 |
| Depreciation and amortization | 17,375,946.53 | 950,256.30 |
| Water, electricity and fuel expenses | 6,953,269.50 | 1,351,892.26 |
| Others | 17,909,872.89 | 2,733,852.99 |
| Total | 197,679,981.09 | 204,745,974.57 |
Other notes:
Nil
64. Administrative expenses
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Employee and uniform expenses | 317,219,351.11 | 326,368,947.18 |
| Depreciation and amortization | 96,689,173.47 | 37,743,155.62 |
| Start-up fee | 40,895,776.63 | 16,102,068.61 |
| Intermediary expenses | 19,137,790.40 | 23,480,815.21 |
| Office expenses | 14,118,875.61 | 17,616,097.42 |
| Travel expenses | 2,365,796.11 | 4,761,152.09 |
| Others | 39,039,507.38 | 27,471,191.67 |
| Total | 529,466,270.71 | 453,543,427.80 |
Other notes:
Nil
65. R&D expenses
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Labor cost | 8,829,647.10 | 6,076,406.11 |
| Depreciation and amortization | 3,981,240.06 | 122,541.44 |
| Technology development fee | 4,449,479.90 | 650,354.19 |
| Others | 116,794.82 | 3,459,500.10 |
| Total | 17,377,161.88 | 10,308,801.84 |
Other notes:
Nil
66. Financial expenses
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Interest expenses | 280,924,664.39 | 341,313,765.39 |
| Amortization of commercial paper discount | 4,370,938.50 | 4,735,876.54 |
| Amortization of discounted bonds payable | - | - |
| Less: interest income | -132,216,250.44 | -177,964,682.68 |
| Less:capitalized amount of interest | -1,860,833.33 | -10,245,795.84 |
| Foreign exchange profits or losses | -17,091,915.89 | 5,841,186.27 |
| Amortization of unrecognized financing expenses | 13,010,514.37 | 12,864,558.43 |
| Others | 2,011,772.20 | 3,366,705.59 |
| Total | 149,148,889.80 | 179,911,613.70 |
Other notes:
The capitalized amount of borrowing costs has been included in the construction inprogress.
67. Other income
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| 2021 Promotion of Business Development Awards | 8,220,591.24 | - |
| Comprehensive Bonded Area Enterprise Development Support Policy Subsidy | 5,000,000.00 | - |
| Additional deduction of input tax | 4,814,300.56 | 6,244,434.23 |
| Subsidies for energy saving and consumption reduction | 4,000,000.00 | 4,863,474.00 |
| Credit center platform construction and operation and maintenance subsidies | 3,500,000.00 | - |
| Special incentive funds for modern supply chain system innovation | 2,300,000.00 | 2,682,704.00 |
| Yiwu Fair Construction Subsidy | 2,000,000.00 | - |
| 2021 Export Credit Insurance Grant | 1,658,610.03 | - |
| Interest subsidy for the international exhibition center construction fund | 1,154,807.04 | 1,154,807.04 |
| Job stabilization and job expansion subsidies | 1,461,352.01 | - |
| Government subsidy for service industry cluster for 2011 | 266,666.64 | 266,666.64 |
| Industrial Cluster Cross-border E-commerce Development Pilot Subsidy | - | 1,879,093.83 |
| Reward for "three collections and three rebates" | - | 1,084,878.00 |
| Refund of social security contribution | - | 14,595.20 |
| Others | 4,426,356.93 | 5,366,295.07 |
| Total | 38,802,684.45 | 23,556,948.01 |
Other notes:
Nil
68. Investment income
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Income from long-term equity investment calculated with the equity method | 996,108,417.69 | 599,180,325.58 |
| Investment income from held-for-trading financial assets during holding period | 448,207.50 | - |
| Dividend income from other equity instruments investment during holding period | 12,542,733.80 | 12,542,733.80 |
| Interest income from debt investment during holding period | 79,561.64 | - |
| Investment income from disposal of held-for-trading financial assets | 1,841,491.90 | 67,265.72 |
| Income acquired from other non-current financial assets during the holding period | 26,916,977.43 | 20,833,465.43 |
| Investment income from disposal of other non-current financial assets | 2,118,067.24 | - |
| Investment income from disposal of wealth management products | 1,469,407.05 | 1,604,200.49 |
| Total | 1,041,524,864.25 | 634,227,991.02 |
Other notes:
Nil
69. Income from net exposure hedging
□Applicable √Not applicable
70. Income from changes in fair value
√Applicable □Not applicable
Unit: RMB
| Sources of income from changes in fair value | Amount in the current period | Amount in the previous period |
| Held-for-trading financial assets | -3,886,171.10 | -1,332,503.10 |
| Other non-current financial assets | -1,376,305.49 | 8,563,824.94 |
| Total | -5,262,476.59 | 7,231,321.84 |
Other notes:
Nil
71. Loss of impairment of credit
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Bad debt loss of accounts receivable | 2,024,409.36 | 6,343,395.56 |
| Loss for bad debts of other receivables | -209,404.41 | 956,299.11 |
| Total | 1,815,004.95 | 7,299,694.67 |
Other notes:
Nil
72. Loss of impairment of assets
□Applicable √Not applicable
73. Income from disposal of assets
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Income from disposal of property, plant and equipment | -941,780.66 | - |
| Income from disposal of intangible assets | - | 76,006.41 |
| Total | -941,780.66 | 76,006.41 |
Other notes:
Nil
74. Revenue from non-operating activities
Information of non-operating incomes
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period | Amount recognized in profit or loss of nonrecurring items for the current period |
| Government grants not related to the daily activities of the Company | 239,122.00 | 2,950.00 | 239,122.00 |
| Incomes from liquidated damages | 4,025,760.93 | 5,552,161.47 | 4,025,760.93 |
| Others | 3,234,387.95 | 211,260.99 | 3,234,387.95 |
| Total | 7,499,270.88 | 5,766,372.46 | 7,499,270.88 |
Government grant included in current profit or loss
√Applicable □Not applicable
Unit: RMB
| Grant items | Amount in the current period | Previous amount | Asset-related or income-related |
| Financial subsidies for the development of the digital entertainment industry | 200,000.00 | - | Income-related |
| Epidemic subsidy | 39,122.00 | - | Income-related |
| Yiwu Comprehensive Bonded Zone Enterprise Development Support Policy | - | 1,750.00 | Income-related |
| Subsidy from Yiwu Market Development Committee | - | 1,200.00 | Income-related |
| Total | 239,122.00 | 2,950.00 |
Other notes:
□Applicable √Not applicable
75. Expenses from non-operating activities
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period | Amount recognized in profit or loss of nonrecurring items for the current period |
| Total loss for disposal of non-current assets | 188,806.68 | 637,423.30 | 188,806.68 |
| Including: loss for disposal of property, plant and equipment | 188,806.68 | 637,423.30 | 188,806.68 |
| Income from disposal of intangible assets | - | - | - |
| External donation | 3,393,094.06 | 1,107,540.00 | 3,393,094.06 |
| Others | 622,929.19 | 1,150,965.46 | 622,929.19 |
| Total | 4,204,829.93 | 2,895,928.76 | 4,204,829.93 |
Other notes:
Nil
76. Income tax expenses
(1). Overview of income tax expenses
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Current income tax expenses | 49,512,382.53 | 360,286,304.87 |
| Deferred income tax expenses | -3,306,682.14 | -32,761,066.92 |
| Total | 46,205,700.39 | 327,525,237.95 |
(2). Adjustment process of accounting profits and income tax expenses
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period |
| Profits before tax | 1,149,806,832.60 |
| Income tax expenses calculated at the statutory/applicable tax rate | 287,451,708.15 |
| Impact of different tax rates applied by subsidiaries | 1,573,320.93 |
| Effect of adjusting income tax of previous period | -18,741,155.49 |
| Effect of non-taxable income | -3,696,884.99 |
| Effect of non-deductible costs, expenses and losses | 1,275,710.21 |
| Effect of using deductible losses of unrecognized deferred income tax assets in previous period | -21,922,246.14 |
| Effect of deductible temporary differences or deductible losses of unrecognized deferred income tax assets in the current period | 49,354,324.47 |
| Profits or losses attributable to joint ventures and associates | -249,089,076.75 |
| Income tax expenses | 46,205,700.39 |
Other notes:
□Applicable √Not applicable
77. Other comprehensive income
√Applicable □Not applicable
For details, please refer to Note 57. Other comprehensive income
78. Items of cash flow statement
(1). Other cash receipts relating to operating activities
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Deposit and margin received | 231,395,229.79 | 212,256,986.10 |
| Bank deposit interest income received | 131,393,012.77 | 177,964,682.68 |
| Government grants received | 64,453,832.77 | 63,576,554.04 |
| Liquidated damages received | 4,025,760.93 | 5,766,372.46 |
| Bank reserve received | 2,217,933.25 | 2,600,157.57 |
| Others | 1,230,207.23 | 63,243,577.73 |
| Total | 434,715,976.74 | 525,408,330.58 |
Notes on other cash receipts relating to operating activities:
Nil
(2). Other cash payments relating to operating activities
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Major expenses paid | 270,289,936.11 | 319,328,171.57 |
| Deposit and security paid | 219,259,625.81 | 157,057,755.29 |
| Repair costs and expenses paid | 62,055,970.52 | 120,690,572.43 |
| Others | 3,728,976.21 | 1,107,540.00 |
| Total | 555,334,508.65 | 598,184,039.29 |
Notes on other cash payments relating to operating activities:
Nil
(3). Other cash receipts relating to investing activities
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Received funding from joint ventures and their subsidiaries | 900,328,548.00 | 2,924,599,831.00 |
| Recovered pending investment refunds | 358,879,565.00 | 822,300,000.00 |
| Total | 1,259,208,113.00 | 3,746,899,831.00 |
Notes on other cash receipts relating to investing activities:
Nil
(4). Other cash payments relating to investing activities
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Financial subsidy paid to the joint venture in Dubai | 41,772,885.00 | 104,456,205.00 |
| Paid the financial assistance for Guoshen Shangbo | - | 1,372,000,000.00 |
| Financial subsidy paid to Tonghui Shangbo | - | 138,160,000.00 |
| Payment of financial assistance to Handing Shangbo | - | 17,845,800.00 |
| Total | 41,772,885.00 | 1,632,462,005.00 |
Other cash paid related to investment activities:
Nil
(5). Other cash receipts relating to financing activities
□Applicable √Not applicable
(6). Other cash payments relating to financing activities
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Lease payments paid | 35,194,742.95 | 37,531,483.07 |
| Restricted stock cancellation payment paid | 14,934,064.64 | 2,827,300.00 |
| Total | 50,128,807.59 | 40,358,783.07 |
Other cash paid related to financing activities:
Nil
79. Supplements to cash flow statement
(1). Supplements to cash flow statement
√Applicable □Not applicable
Unit: RMB
| Supplements | Amount in the current period | Amount in the previous period |
| 1．Adjust net profits to cash flow from operating activities: | ||
| Net profits | 1,103,601,132.21 | 1,329,168,586.02 |
| Plus: provision for impairment of assets | - | - |
| Loss of impairment of credit | 1,815,004.95 | 7,299,694.67 |
| Depreciation of fixed assets, depletion of oil and gas assets and depreciation of bearer biological assets | 360,066,867.91 | 391,927,445.01 |
| Amortization of right-of-use assets | 35,119,185.43 | 29,280,433.57 |
| Amortization of intangible assets | 171,380,383.22 | 140,522,789.88 |
| Depreciation and amortization of investment real estate | 129,649,410.69 | 106,638,821.16 |
| Amortization of long-term prepaid expenses | 63,268,555.84 | 62,397,515.62 |
| Loss from disposal of fixed assets, intangible assets and other long-term assets (gains indicated by “-”) | 564,167.30 | -76,006.41 |
| Loss from fixed assets retirement (gains indicated by “-”) | 188,806.68 | 637,423.30 |
| Loss from changes in fair value (gains indicated by “-”) | 5,262,476.59 | -7,231,321.84 |
| Financial expenses (gains indicated by “-”) | 300,670,345.73 | 336,909,155.82 |
| Investment loss (gains indicated by “-”) | -1,093,839,888.05 | -769,582,290.36 |
| Decrease in deferred income tax assets (increase indicated by “－”) | -1,003,615.63 | -36,072,700.05 |
| Increase in deferred income tax liabilities (decrease indicated by “－”) | -2,303,066.49 | -1,705,460.37 |
| Decrease in inventory (increase indicated by “－”) | -2,892,260.80 | -8,180,635.66 |
| Decrease in operating receivables (increase indicated by “－”) | 210,882,645.92 | -912,160,213.18 |
| Increase in operating payables (decrease indicated by “－”) | 117,660,562.27 | 1,363,309,270.58 |
| Others | - | - |
| Net cash flow from operating activities | 1,400,090,713.77 | 2,033,082,507.76 |
| 2．Significant investing and financing activities not involving cash receipt and payment: | ||
| 3．Net changes in cash and cash equivalents: | ||
| Closing balance of cash | 1,981,200,941.64 | 4,006,468,325.47 |
| Less: opening balance of cash | 4,006,468,325.47 | 2,032,642,871.63 |
| Add: closing balance of cash equivalents | ||
| Less: opening balance of cash equivalents | ||
| Net increase in cash and cash equivalents | -2,025,267,383.83 | 1,973,825,453.84 |
(2). Net cash paid for acquisition of subsidiaries in the current period
√Applicable □Not applicable
Unit: RMB
| Amount | |
| Cash or cash equivalents paid in the current period for business combination occurred in the current period | 368,062,500.00 |
| Less: Cash and cash equivalents held by the Company on the date of acquisition | 55,445,535.89 |
| Net cash paid by subsidiaries | 312,616,964.11 |
Other notes:
On June 16, 2021, the Company signed the "Equity Transfer Agreement" with HaierGroup (Qingdao) Financial Holdings Co., Ltd. (hereinafter referred to as "Haier FinancialHoldings"), agreeing that the Company would acquire 100% equity of Haier NetworkTechnology Co., Ltd. (Hereinafter referred to as "Haier Network") and 100% equity ofKuaijietong Payment Service Co., Ltd. (hereinafter referred to as "Kuaijietong"), a subsidiary ofZhejiang Haier Network Technology Co., Ltd. at RMB 449,300,000.00.On June 25, 2021, the Company paid the first delivery payment of RMB 67,395,000.00.On December 3, 2021, as the prerequisites for the delivery of the second and third phasesunder the "Equity Transfer Agreement" were not met as scheduled, the Company signed the"Supplementary Agreement to the Equity Transfer Agreement" with Haier Financial Holdings,Haier Network and Kuaijietong, agreeing that if all the delivery was finally completed, HaierFinancial Holdings would compensate the Company for losses of RMB 5,000,000.00, and theequity transfer consideration would be adjusted to RMB 444,300,000.00 in the end.On June 15, 2022, the Company signed the "Fine Bearing Agreement" with HaierFinancial Holdings, Haier Network and Kuaijietong, agreeing that Haier Financial Holdingswould bear the fine of RMB 8,842,500.00 before the completion of delivery of Kuaijietong.
On July 26, 2022, the Company signed the "Four-Party Agreement" with Haier FinancialHoldings, Haier Network and Kuaijietong, agreeing that the fine of RMB 8,842,500.00 and theequity transfer payment to be borne by Haier Financial Holdings should be settled on a netbasis. The actual net cash paid for acquisition of subsidiaries was RMB 312,616,964.11
(3). Net cash received from disposal of subsidiaries in the current period
□Applicable √Not applicable
(4). Composition of cash and cash equivalents
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| I. Cash | 1,981,200,941.64 | 4,006,468,325.47 |
| In which: cash on hand | 220,471.11 | 154,264.94 |
| Bank deposit that can be used for payment at any time | 1,980,229,200.48 | 4,006,258,722.95 |
| Other monetary capital that can be used for payment at any time | 751,270.05 | 55,337.58 |
| II. Cash equivalents | ||
| Including: bond investments due within three months | ||
| III. Closing balance of cash and cash equivalents | 1,981,200,941.64 | 4,006,468,325.47 |
| Including:cash and cash equivalents with restricted use by the parent company or its subsidiaries | 7,220,060.97 | 60.78 |
Other notes:
√Applicable □Not applicable
Monetary funds with a deposit period of more than three months: Currency: RMB
| Item | Closing balance | Opening balance |
| Negotiated deposits | - | 825,000,000.00 |
80. Notes to items in statement of changes in owners’ equity
Names of “others” items whose closing balances in the previous year were adjusted and theamounts of adjustments:
□Applicable √Not applicable
81. Assets with restricted title or right of use
√Applicable □Not applicable
Unit: RMB
| Item | Closing book value | Reasons for restriction |
| Cash and cash equivalents | 10,098,029.66 | [Note 2] |
| Long-term equity investment | 102,918,559.00 | [Note 3] |
| Other non-current financial assets | 621,447,424.37 | [Note 3] |
| Other current assets | 367,484,914.87 | [Note 4] |
| Total | 1,101,948,927.90 | / |
Other notes:
Note 2. As of December 31, 2022, bank deposits with a book value of RMB 60.97(December 31, 2021: RMB 60.78) were restricted for ownership or use rights due to being assecurity deposits for obtaining commercial housing mortgage loan. As of December 31, 2022,bank deposits with a book value of RMB 7,220,000.00 (December 31, 2021: RMB 0.00) wereused as a performance bond for civil air defense projects under construction and theownership or use rights were restricted. As of December 31, 2022, bank deposits with a bookvalue of RMB 2,877,968.69 (December 31, 2021: RMB 0.00) were used as fast paymentbusiness risk deposits with restricted ownership or use rights.Note 3: As of December 31, 2022, long-term equity investments with a book value of RMB102,918,559.00 (December 31, 2021: RMB 102,918,559.00) and other non-current assets ofRMB 621,447,424.37 (December 31, 2021: RMB 636,870,392.09) were frozen by ShanghaiMunicipal Public Security Bureau. See Note XIV.1 Important commitments for details.Note 4. As of December 31, 2022, the payment business reserve fund with a book valueof RMB 367,484,914.87 (December 31, 2021: RMB0.00) was established by the Company inaccordance with the "Administrative Measures for Payment Services of Non-financialInstitutions" and "Measures for the Custody of Customer Reserve Funds of PaymentInstitutions" Bank special deposit account. The scope of funds stored and received by theCompany through the customer reserve account includes: funds received from bank cardacquiring business, third-party payment convenience service business, credit card repaymentbusiness, credit payment settlement business, and other part of the Company's business. SeeNote VII. 13 Other current assets for details.
82. Foreign currency monetary items
(1). Foreign currency monetary items
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance in foreign currency | Exchange rate | Closing amount after conversation: RMB Balance |
| Cash and cash equivalents | - | - | |
| In which: USD | 12,105,648.01 | 6.9646 | 84,310,996.13 |
| EURO | 81,370.70 | 7.4229 | 604,006.57 |
| Rwandan Franc | 3,320.96 | 0.0068 | 22.58 |
| Dirham | 62,205.15 | 1.8966 | 117,978.29 |
| Koruna | 2,273,111.17 | 0.3069 | 697,617.82 |
| Accounts receivable | - | - | |
| In which: USD | 5,926,323.22 | 6.9646 | 41,274,470.70 |
| EURO | 154,711.02 | 7.4229 | 1,148,404.43 |
| Koruna | 7,166,958.46 | 0.3069 | 2,199,539.55 |
| Other receivables | - | - | |
| In which: USD | 19,395.10 | 6.9646 | 135,079.11 |
| EURO | 770,300.00 | 7.4229 | 5,717,859.87 |
| Koruna | 85,733.56 | 0.3069 | 26,311.63 |
| Accounts payable | - | - | |
| In which: USD | 8,745,903.07 | 6.9646 | 60,911,716.52 |
| EURO | 1,439.90 | 7.4229 | 10,688.23 |
| Other payables | - | - | |
| In which: USD | 981,222.25 | 6.9646 | 6,833,820.48 |
| EURO | 512,395.62 | 7.4229 | 3,803,461.45 |
| Rwandan Franc | 3,062,500.00 | 0.0068 | 20,825.00 |
| Koruna | 19,992.07 | 0.3069 | 6,135.57 |
Other notes:
Nil
(2). Description of overseas operations, for important overseas operations, also includes
the disclosure of principal overseas place of business, bookkeeping currency andthe basis for selection, and the reason for the change in bookkeeping currency.
□Applicable √Not applicable
83. Hedging
□Applicable √Not applicable
84. Government grants
(1). Overview of government grants
√Applicable □Not applicable
Unit: RMB
| Type | Amount | Presentation | Amount recognized in profit or loss for the current period |
| Financial subsidies for the development of the digital entertainment industry | 200,000.00 | Revenue from non-operating activities | 200,000.00 |
| Epidemic subsidy | 39,122.00 | Revenue from non-operating activities | 39,122.00 |
| 2021 Promotion of Business Development Awards | 8,220,591.24 | Other income | 8,220,591.24 |
| Comprehensive Bonded Area Enterprise Development Support Policy Subsidy | 5,000,000.00 | Other income | 5,000,000.00 |
| Additional deduction of input tax | 4,814,300.56 | Other income | 4,814,300.56 |
| Subsidies for energy saving and consumption reduction | 4,000,000.00 | Other income | 4,000,000.00 |
| Credit center platform construction and operation and maintenance subsidies | 3,500,000.00 | Other income | 3,500,000.00 |
| Special incentive funds for modern supply chain system innovation | 2,300,000.00 | Other income | 2,300,000.00 |
| Yiwu Fair Construction Subsidy | 2,000,000.00 | Other income | 2,000,000.00 |
| 2021 Export Credit Insurance Grant | 1,658,610.03 | Other income | 1,658,610.03 |
| Interest subsidy for the international exhibition center construction fund | 1,154,807.04 | Other income | 1,154,807.04 |
| Job stabilization and job expansion subsidies | 1,461,352.01 | Other income | 1,461,352.01 |
| Government subsidy for service industry cluster for 2011 | 266,666.64 | Other income | 266,666.64 |
| Others | 4,186,987.29 | Other income | 4,186,987.29 |
| Total | 38,802,436.81 | 38,802,436.81 |
(2). Refund of government grants
□Applicable √Not applicable
Other notes:
Nil
85. Others
□Applicable √Not applicable
VIII. Changes in consolidation scope
1. Mergers of enterprises not under common control
√Applicable □Not applicable
(1). Business combinations under not under common control occurred in the currentperiod
√Applicable □Not applicable
Unit: RMB
| Purchased party Name | Time point of equity acquisition | Cost of equity acquisition | Percentage of equity acquired （%） | Method of equity acquisition | Acquisition date | Date for determining acquisition date | Income of acquiree from acquisition date until end of the period | Net profit of acquiree from acquisition date until end of the period |
| Zhejiang Xunchi Digital Technology Co., Ltd. | July 29, 2022 | 444,300,000.00 | 100 | Acquisition | July 29, 2022 | Delivery of property rights and acquisition of control | 29,528,386.62 | 9,433,900.78 |
Other notes:
During the year, the Company acquired 100% equity of Zhejiang Haier NetworkTechnology Co., Ltd. and 100% equity of Zhejiang Haier Network Technology Co., Ltd.’ssubsidiary Kuaijietong Payment Service Co., Ltd. with cash of RMB 435,457,500.00 and thefair value of debts assumed of RMB 8,842,500.00. After the completion of the transaction, thename of Zhejiang Haier Network Technology Co., Ltd. was changed to Zhejiang Xunchi DigitalTechnology Co., Ltd., and the Group held 100% equity of Zhejiang Xunchi Digital TechnologyCo., Ltd. and 100% equity of Kuaijietong Payment Service Co., Ltd. (collectively referred to as"Xunchi Relax Group"), to gain control over it. The date of purchase was determined to be July29, 2022 according to the time when the property rights were delivered and control wasobtained.
(2). Merger costs and goodwill
√Applicable □Not applicable
Unit: RMB
| Merger cost | Zhejiang Xunchi Digital Technology Co., Ltd. |
| --Cash | 435,457,500.00 |
| -- Fair value of non-cash assets | |
| -- Fair value of debt issued or assumed | 8,842,500.00 |
| -- Fair value of equity securities issued | |
| -- Fair value of contingent consideration | |
| --Fair value of the equity that had been held before the acquisition date on the acquisition date | |
| --Others | |
| Total merger costs | 444,300,000.00 |
| Less: The share in the fair value of identifiable net assets acquired | 159,383,632.13 |
| The difference between the goodwill/consolidation cost and the share in the fair value of identifiable net assets acquired | 284,916,367.87 |
The method of determining the fair value of the merger cost, contingent consideration and itschanges:
Nil
Main reasons for the formation of large -sum goodwill:
Nil
Other notes:
On June 15, 2021, it was reviewed and approved by the Board of Directors of the Group topurchase 100% of the equity of Zhejiang Haier Network Technology Co., Ltd. (hereinafterreferred to as "Haier Network") and 100% of the equity of Kuaijietong Payment Service Co.,Ltd. ((hereinafter referred to as "Kuaijietong"), a subsidiary of Zhejiang Haier NetworkTechnology Co., Ltd., held by Haier Group (Qingdao) Financial Holdings Co., Ltd. Co.,Ltd.(hereinafter referred to as "Haier Financial Holdings"), from Haier Financial Holdings, atcash of RMB 449,300,000.00. However, due to the fact that some pre-conditions for thedelivery could not be fulfilled as scheduled, the Company signed a supplementary agreementwith Haier Financial Holdings, Haier Network, and Kuaijietong on December 3, 2021, agreeingthat the transaction price would be adjusted to RMB 444.3 million, of which RMB 435.4575million was in cash, and RMB 8,842,500 was the fair value of the fines paid before thecompletion of the delivery of Kuaijietong.
(3). Acquiree’s identifiable assets and liabilities on the acquisition date
√Applicable □Not applicable
Unit: RMB
| Zhejiang Xunchi Digital Technology Co., Ltd. | ||
| Fair value on acquisition date | Book value acquisition date | |
| Assets: | 625,888,320.15 | 595,532,480.88 |
| Cash and cash equivalents | 55,445,535.89 | 55,445,535.89 |
| Held-for-trading financial assets | 10,019,397.26 | 10,019,397.26 |
| Receivables | 984,468.13 | 984,468.13 |
| Prepayments | 918,774.84 | 918,774.84 |
| Other receivables | 13,910,233.61 | 13,910,233.61 |
| Inventory | 56,415.08 | 56,415.08 |
| Other current assets | 452,436,385.09 | 452,436,385.09 |
| Fixed assets | 11,155,015.00 | 4,508,129.95 |
| Construction in progress | 2,743.36 | 2,743.36 |
| Intangible assets | 79,292,510.23 | 55,583,556.01 |
| Development expenses | 1,591,959.54 | 1,591,959.54 |
| Long-term prepaid expenses | 74,882.12 | 74,882.12 |
| Liabilities: | 466,504,688.02 | 458,915,728.20 |
| Payables | 1,400,556.96 | 1,400,556.96 |
| Contract liabilities | 30,258.29 | 30,258.29 |
| Payroll payable | 3,204,428.12 | 3,204,428.12 |
| Tax payable | 245,091.36 | 245,091.36 |
| Other payables | 1,599,008.38 | 1,599,008.38 |
| Deferred income tax liabilities | 7,588,959.82 | - |
| Other current liabilities | 452,436,385.09 | 452,436,385.09 |
| Net assets | 159,383,632.13 | 136,616,752.68 |
| Less: Minority shareholders' equity | - | - |
| Net assets acquired | 159,383,632.13 | 136,616,752.68 |
Method for determining fair value of identifiable assets and liabilities:
The method for determining fair value of the acquiree’s identifiable assets and liabilitiesacquired in business mergers not under the same control is evaluation by management expertusing the asset-based method.The acquiree’s contingent liabilities assumed in the business merger:
NilOther notes:
Nil
(4). Profits or losses arising from the re -measurement of equity held before the
acquisition date at fair valueWhether there was any transaction that realized a business merger step by step in a packagedeal and where the enterprise obtained control during the reporting period
□Applicable √Not applicable
(5). Relevant explanations on the circumstances where the merger consideration or thefair value of the acquiree’s identifiable assets and liabilities could not be reasonablydetermined on the acquisition date or at the end of the current period
□Applicable √Not applicable
(6). Other statements
□Applicable √Not applicable
2. Mergers of the enterprises under common control
□Applicable √Not applicable
3. Reverse acquisition
□Applicable √Not applicable
4. Disposal of subsidiaries
Has the Group lost control upon a single disposal of investment in a subsidiary?
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
5. Changes in consolidation scope for other reasons
Changes in the consolidation scope for other reasons (e.g. new establishment of subsidiaries,liquidation of subsidiaries, etc.) and the related information:
√Applicable □Not applicable
The Company established subsidiaries Yiwu Shangbo Data Intelligence EnterpriseManagement Co., Ltd., Yiwu Zheqing Trading Co., Ltd. and Yiwu China Commodities City(Spain) Co., Ltd. in the current period.
6. Others
□Applicable √Not applicable
IX. Equity in Other Entities
1. Equity in subsidiaries
(1). Composition of the enterprise group
√Applicable □Not applicable
| Subsidiary Name | Main place of business | Place of registration | Business | Shareholding ratio (%) | Acquisition Method | |
| Direct | Indirect | |||||
| Yiwu China Commodities City Import and Export Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Wholesale | 100 | Establishment | |
| Yiwu China Commodities City Supply Chain Management Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Wholesale | 100 | Establishment | |
| Yiwu Comprehensive Bonded Zone Operation and Management Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Business service | 100 | Establishment | |
| Yiwu China Commodities City Overseas Investment and Development Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Business service | 100 | Establishment | |
| Yiwu China Commodities City Tourism Development Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Business service | 100 | Establishment | |
| Yiwu China Commodities City Assets Operation and Management Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Business service | 100 | Establishment | |
| Zhejiang Yindu Hotel Management Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Business service | 100 | Establishment | |
| Yiwu China Commodities City Research Institute Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Business service | 100 | Establishment | |
| Yiwu Shangbo Shuzhi Enterprise Management Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Business service | 100 | Establishment | |
| Yiwu China Commodities City Big Data Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Software and Information Technology Service Industry | 100 | Establishment | |
| Yiwu Commodities City Gonglian Property Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Real estate | 100 | Establishment | |
| Yiwu Shangbo | Yiwu, Zhejiang | Yiwu, Zhejiang | Real estate | 100 | Establishment | |
| Yiwu China Commodities City Information Technology Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | IT | 100 | Establishment | |
| Yiwu China Commodities City Financial Holdings Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Service | 100 | Establishment | |
| Yiwu China Commodities City Logistics and Warehousing Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Multimodal transport and transportation agency | 100 | Establishment | |
| Yiwu China Commodities City Commerce and Trade Service Training Center Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Education | 100 | Establishment | |
| Yiwu China Commodities City Exhibition Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Business service | 98 | 2 | Establishment |
| Zhejiang Huajie Investment and Development Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Business service | 96.4 | Incorporation+acquisition | |
| European Huajie Investment Development Co., Ltd. | Prague, Czech Republic | Prague, Czech Republic | Business service | 96.4 | Incorporation+acquisition | |
| Zhejiang China Commodities City Group Commercial Factoring Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Service | 60 | 40 | Establishment |
| Zhejiang Yiwugou E-commerce Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | IT | 51 | Establishment | |
| Yiwu Xinlian Technology Service Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Service | 51 | Establishment | |
| Yiwu China Commodities City Payment Network Technology Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | IT | 100 | Establishment |
| Yiwu China Commodities City Advertising Co., Ld. | Yiwu, Zhejiang | Yiwu, Zhejiang | Advertising | 100 | Establishment | |
| Yiwu International Trade Comprehensive Service Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Wholesale | 60 | Establishment | |
| Yiwu China Commodities City Credit Investigation Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Service | 85 | Establishment | |
| Yiwu Aiximao Supply Chain Management Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Service | 100 | Establishment | |
| Yiwu Huanqiuyida Logistics Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Multimodal transport and transportation agency | 60 | Establishment | |
| Yiwu China Commodities City Internet Financial Information Service Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Service | 100 | Incorporation+acquisition | |
| Yiwu China Commodities City RMB and Foreign Currency Exchange Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Service | 100 | Establishment | |
| Hangzhou Shangbo Nanxing Property Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Real estate | 100 | Establishment | |
| Haicheng Yiwu China Commodities City Investment Development Co., Ltd. | Haicheng, Liaoning | Haicheng, Liaoning | Real estate | 95 | Establishment | |
| Ningxia Yiwu China Commodities City Supply Chain Management Co., Ltd. | Shizuishan, Ningxia | Shizuishan, Ningxia | Service | 100 | Establishment | |
| Yiwu China Commodities City (Hong Kong) International Trade Co., Ltd. | Hong Kong, China | Hong Kong, China | Wholesale | 100 | Establishment | |
| Hong Kong Better Silk Road Co., Ltd. | Hong Kong, China | Hong Kong, China | Service | 100 | Establishment |
| BETTER SILK ROAD FZE | Dubai, UAE | Dubai, UAE | Service | 100 | Establishment | |
| BETTER SILK ROAD RWANDA Ltd | Kigali, Rwanda | Kigali, Rwanda | Service | 100 | Establishment | |
| Yiwu Zheqing Trading Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Wholesale | 100 | Establishment | |
| Yiwu China Commodities City (Germany) Co., Ltd. | Frankfurt, Germany | Frankfurt, Germany | Service | 100 | Establishment | |
| Yiwu China Commodities City (Spain) Co., Ltd. | Madrid, Spain | Madrid, Spain | Service | 100 | Establishment | |
| Zhejiang Xunchi Digital Technology Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | IT | 100 | Acquisition | |
| Kuaijietong Payment Service Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | IT | 100 | Acquisition |
Explanation for the difference between the shareholding ratio and voting right ratio in asubsidiary:
Nil
Basis for holding half or less voting rights in but still controlling an investee, and holding morethan half of the voting rights in but not controlling an investee:
Nil
Basis for controlling important structured entities included in the consolidation scope:
Nil
Basis for determining whether a company is an agent or a principal:
Nil
Other notes:
Nil
(2). Important non-wholly-owned subsidiaries
√Applicable □Not applicable
Unit: RMB
| Name of subsidiary | Shareholding ratio of minority shareholders Scale | Profits or losses attributable to minority shareholders in the current period | Dividends declared to be distributed to minority shareholders for the current period | Closing balance of minority interest |
| Zhejiang Yiwugou E-commerce Co., Ltd. | 49% | 5,913,716.72 | - | 50,731,098.66 |
| Haicheng Company | 5% | -4,426,825.19 | - | -47,419,869.20 |
Explanation for the difference between the shareholding ratio and voting right ratio of minority shareholders in a subsidiary:
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
(3). Major financial information of important non-wholly-owned subsidiaries
√Applicable □Not applicable
Unit: RMB10,000
| Name of subsidiary | Closing balance | Opening balance | ||||||||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | Current assets | Non-current assets | Total assets | Current liabilities | Non-current Debt | Total liabilities | |
| Zhejiang Yiwugou E-commerce Co., Ltd. | 9,108.24 | 5,688.44 | 14,796.68 | 4,438.90 | 4.49 | 4,443.39 | 11,899.73 | 900.21 | 12,799.94 | 3,653.53 | - | 3,653.53 |
| Haicheng Company | 112,283.93 | 89,899.98 | 202,183.91 | 297,023.65 | - | 297,023.65 | 126,423.87 | 98,154.04 | 224,577.91 | 310,564.00 | - | 310,564.00 |
| Name of subsidiary | Amount in the current period | Amount in the previous period | ||||||
| Operating revenue | Net profits | Total comprehensive income | Cash flow from operating activities | Operating revenue | Net profits | Total comprehensive income | Cash flow from operating activities | |
| Zhejiang Yiwugou E-commerce Co., Ltd. | 4,881.33 | 1,206.88 | 1,206.88 | 2,240.52 | 4,747.83 | 659.45 | 659.45 | -2,891.61 |
| Haicheng Company | 24,288.25 | -8,909.95 | -8,909.95 | -1,114.29 | 898.01 | -14,685.04 | -14,685.04 | 11,694.15 |
Other notes:
Nil
(4). Significant restrictions on the use of enterprise group’s assets and the settlement of
enterprise group’s debts
□Applicable √Not applicable
(5). Financial or other supports provided to structured entities included in the scope ofconsolidated financial statements
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
2. Transactions in which the Group’s share of owners’ equity in a subsidiary changes
and the Group still controls the subsidiary
□Applicable √Not applicable
3. Equity in joint ventures or associates
√Applicable □Not applicable
(1). Important joint ventures or associates
√Applicable □Not applicable
Unit: RMB
| Name of joint venture or associate | Main place of business | Place of registration | Business | Shareholding ratio (%) | Accounting treatment method of investment in the joint venture or associate | |
| Direct | Indirect | |||||
| Joint venture | ||||||
| Yiwu Shanglv Investment Development Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Real estate | 49 | Equity method | |
| Yiwu Huishang Redbud Capital Management Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Service | 20 | Equity method | |
| Yiwu Rongshang Real Estate Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Real estate | 49 | Equity method | |
| Yiwu Chuangcheng Real Estate Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Real estate | 24 | Equity method | |
| Associate | ||||||
| Yiwu Huishang Redbud Equity Investment Co., Ltd. (Note 5) | Yiwu, Zhejiang | Yiwu, Zhejiang | Commercial services | 10.42 | Equity method | |
| Zhejiang Chouzhou Financial Lease Co., Ltd. | Hangzhou, Zhejiang | Yiwu, Zhejiang | Service | 26 | Equity method | |
| Yiwu Huishang Redbud Phase II Investment Partnership (limited partnership) [Note 6] | Yiwu, Zhejiang | Yiwu, Zhejiang | Lease and business service | 10.41 | Equity method | |
| Yiwu Hongyi Equity Investment Fund Partnership | Yiwu, Zhejiang | Yiwu, Zhejiang | Service | 49.975 | Equity method | |
| Pujiang Lvgu Property Co., Ltd. | Pujiang, Zhejiang | Pujiang, Zhejiang | Real estate | 49 | Equity method | |
| Yiwu China Commodities City Property Development Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Real estate | 49 | Equity method | |
| Zhejiang Zhijie Yuangang International Supply Chain Technology Co., Ltd. | Yiwu, Zhejiang | Yiwu, Zhejiang | Technology promotion and application service industry | 27 | Equity method | |
Explanation for the difference between the shareholding ratio and voting right ratio in a jointventure or associate:
Nil
Bases for holding less than 20% of the voting rights but having significant influence, or holding20% or more of the voting rights but not having significant influence:
Note 5: The Company held 10.42% (2021: 10.42%) of equity of Yiwu Huishang RedbudEquity Investment Co., Ltd. (hereinafter referred to as "Redbud Equity Investment"), butregarded it as an associated company of the Company. According to Redbud Investment’sarticles of association, it is engaged in investing and its important financial and operatingdecision-making activities are to pick and manage investment projects, which have been fullyentrusted to the Company’s joint venture Yiwu Huishang Redbud Capital Management Co.,Ltd. (“Redbud Capital”). Redbud Capital picks and manages investment projects via itsinvestment decision-making committee. Except for special investment matters, which aresubject to the resolution of Redbud Investment’s board of directors, other important financialand operating decision-making activities are conducted by Redbud Capital on the behalf ofRedbud Investment. Therefore, the Company was able to exercise significant influence onRedbud Investment in which the Company held 10.42% of total equity.Note 6: The Company held 10.41% (2021: 9.43% ) equity of Yiwu Huishang RedbudPhase II Investment Partnership (limited partnership) (“Redbud Phase II”), but regarded it asan associated company of the Company. According to Redbud Phase II’s articles ofassociation, it is engaged in investing and its important financial and operating decision-makingactivities are to pick and manage investment projects, which have been fully entrusted to theCompany’s joint venture Redbud Capital. Redbud Capital picks and manages investmentprojects via its investment decision-making committee. Except for special investment matters,which are subject to the resolution of Redbud Phase II’s board of directors, other importantfinancial and operating decision-making activities are conducted by Redbud Capital on thebehalf of Redbud Phase II. Therefore, the Company could exert significant influence onRedbud Phase II of which it held 10.41% equity.
(2). Main financial information of important joint ventures
√Applicable □Not applicable
Unit: RMB10,000
| Closing balance/amount in the current period | Opening balance/amount in the previous period | |||||
| Yiwu Shanglv | Yiwu Rongshang Real Estate | Yiwu Chuangcheng Real Estate | Yiwu Shanglv | Yiwu Rongshang Real Estate | Yiwu Chuangcheng Real Estate | |
| Current assets | 6,039.08 | 13,547.12 | 47,538.36 | 9,499.55 | 564,093.80 | 385,685.30 |
| In which: cash and cash equivalents | 4,316.44 | 198.23 | 540.41 | 1,720.42 | 23,898.97 | 37,501.70 |
| Non-current assets | 129,575.34 | - | 2.12 | 133,261.86 | 8,395.40 | 5,324.96 |
| Total assets | 135,614.42 | 13,547.12 | 47,540.47 | 142,761.41 | 572,489.20 | 391,010.26 |
| Current liabilities | 39,891.24 | 148.98 | 34,353.43 | 37,527.54 | 528,124.40 | 354,317.21 |
| Non-current liabilities | 11,566.36 | - | 1,333.17 | 23,695.72 | - | - |
| Total liabilities | 51,457.60 | 148.98 | 35,686.60 | 61,223.26 | 528,124.40 | 354,317.21 |
| Shareholders’ equity attributable to parent company | 84,156.82 | 13,398.14 | 11,853.87 | 81,538.15 | 44,364.80 | 36,693.05 |
| Share of net assets calculated based shareholding ratio | 41,236.84 | 6,565.09 | 2,844.93 | 39,953.69 | 21,738.75 | 8,806.33 |
| Adjustments | -1,539.60 | - | - | -1,586.85 | - | - |
| --unrealized profits of internal transactions | -1,539.60 | - | - | -1,586.85 | - | - |
| Book value of equity investment in joint ventures | 39,697.24 | 6,565.09 | 2,844.93 | 38,366.84 | 21,738.75 | 8,806.33 |
| Operating revenue | 17,580.08 | 395,959.62 | 302,152.46 | 23,511.11 | 272,636.85 | 199,877.07 |
| Financial expenses | 1,608.93 | -0.94 | -33.92 | 2,436.46 | -384.84 | -213.22 |
| Net profits | 2,618.68 | 87,577.34 | 56,192.82 | 3,543.88 | 39,544.26 | 31,495.95 |
| Total comprehensive income | 2,618.68 | 87,577.34 | 56,192.82 | 3,543.88 | 39,544.26 | 31,495.95 |
| Dividends received from joint ventures this year | - | 58,086.56 | 19,447.68 | - | - | - |
Other statementsNil
(3). Main financial information of important associates
√Applicable □Not applicable
Unit: RMB10,000
| Closing balance/amount in the current period | Opening balance/amount in the previous period | |||||||||
| Chouzhou Financial Lease | Hongyi Fund | CCCP | Pujiang Lvgu | Zhijie Yuangang | Chouzhou Financial Lease | Hongyi Fund | CCCP | Pujiang Lvgu | Zhijie Yuangang | |
| Current assets | 77,387.23 | 25,476.19 | 1,752,170.30 | 121,318.40 | 45,894.85 | 77,805.80 | 21,730.37 | 1,492,712.71 | 122,804.10 | - |
| Non-current assets | 1,605,298.30 | 163,831.11 | 43,109.75 | 777.45 | 137.68 | 1,356,968.91 | 155,970.63 | 42,919.44 | 459.02 | - |
| Total assets | 1,682,685.53 | 189,307.30 | 1,795,280.05 | 122,095.85 | 46,032.53 | 1,434,774.71 | 177,701.00 | 1,535,632.15 | 123,263.12 | - |
| Current liabilities | 1,132,279.05 | 89.88 | 1,029,256.12 | 45,646.63 | 2,363.50 | 1,020,585.17 | 37.71 | 915,862.90 | 31,456.60 | - |
| Non-current liabilities | 362,250.51 | - | 147,172.22 | - | - | 250,335.36 | - | 49,089.63 | - | - |
| Total liabilities | 1,494,529.55 | 89.88 | 1,176,428.34 | 45,646.63 | 2,363.50 | 1,270,920.53 | 37.71 | 964,952.53 | 31,456.60 | - |
| Shareholders’ equity attributable to parent company | 188,155.98 | 189,217.42 | 618,851.71 | 76,449.22 | 43,669.03 | 163,854.18 | 177,663.29 | 570,679.62 | 91,806.52 | - |
| Share of net assets calculated based shareholding ratio | 48,920.55 | 94,570.87 | 303,237.34 | 37,460.12 | 11,790.64 | 42,602.08 | 88,796.11 | 279,633.01 | 44,985.19 | - |
| Adjustments | - | -6.66 | -4,689.27 | 423.84 | 2,765.71 | - | -8.88 | -3,939.17 | 942.95 | - |
| --unrealized profits of internal transactions | - | -6.66 | -4,689.27 | 423.84 | 2,765.71 | - | -8.88 | -3,939.17 | 942.95 | - |
| Book value of equity investment in joint ventures | 48,920.55 | 94,564.21 | 298,548.07 | 37,883.96 | 14,556.34 | 42,602.08 | 88,787.23 | 275,693.84 | 45,928.14 | - |
| Operating revenue | 56,469.66 | - | 209,890.13 | 9,831.72 | 2,554.69 | 43,115.27 | 177.83 | 138,101.44 | 90,893.54 | - |
| Net profits | 24,301.81 | 10,670.77 | 43,105.17 | 2,642.70 | -1,330.97 | 20,984.32 | 9,749.03 | 14,621.40 | 16,246.73 | - |
| Total comprehensive income | 24,301.81 | 10,655.05 | 43,105.17 | 2,642.70 | -1,330.97 | 20,984.32 | 9,749.03 | 14,621.40 | 16,246.73 | - |
| Dividend on associates received in the current year | - | - | - | 8,820.00 | - | - | - | - | - | - |
Other statementsNil
(4). Summary financial information of unimportant joint ventures and associates
√Applicable □Not applicable
Unit: RMB
| Closing balance/amount in the current period | Opening balance/amount in the previous period | |
| Joint ventures: | ||
| Total book value of investments | 107,724,158.88 | 56,813,304.76 |
| Total amounts of the following items calculated based on shareholding ratio | ||
| --Net profits | 50,910,854.11 | 23,678,584.58 |
| --Other comprehensive income | - | - |
| --Total comprehensive income | 50,910,854.11 | 23,678,584.58 |
| Associates: | ||
| Total book value of investments | 489,944,751.13 | 461,933,497.77 |
| Total amounts of the following items calculated based on shareholding ratio | ||
| --Net profits | 15,004,810.36 | 25,663,075.10 |
| --Other comprehensive income | 4,139,085.99 | - |
| --Total comprehensive income | 19,143,896.35 | 25,663,075.10 |
Other statementsNil
(5). Restrictions on the ability of joint ventures or associates to transfer money to the
Company
□Applicable √Not applicable
(6). Excess losses of joint ventures or associates
□Applicable √Not applicable
(7). Unrecognized commitments relating to investment in joint ventures
□Applicable √Not applicable
(8). Contingent liabilities relating to investment in joint ventures or associates
□Applicable √Not applicable
4. Important joint operations
□Applicable √Not applicable
5. Equity in structured entities not included in the consolidated financial statementsNotes on structured entities not included in the consolidated financial statements:
□Applicable √Not applicable
6. Others
□Applicable √Not applicable
X. Risks associated with financial instruments
√Applicable □Not applicable
1. Categorization of financial instruments
The book values of financial instruments on the balance sheet date are as follows:
December 31, 2022Financial assets
| Financial assets that are measured by fair value and of which the changes in fair value are recognized in the profit or loss for the current period | Measured at amortized cost | measured at fair value and whose changes are included in other comprehensive income | Total | ||||
| Requirements in the standard | Designated | ||||||
| Cash and cash equivalents | - | 1,991,298,971.30 | - | 1,991,298,971.30 | |||
| Held-for-trading financial assets | 62,331,000.66 | - | - | 62,331,000.66 | |||
| Accounts receivable | - | 210,750,725.36 | - | 210,750,725.36 | |||
| Other receivables | - | 419,398,092.62 | - | 419,398,092.62 | |||
| Other current assets | - | 369,222,394.29 | - | 369,222,394.29 | |||
| Debt investments | - | 48,079,561.64 | - | 48,079,561.64 | |||
| Long-term receivables | - | 278,299,600.73 | - | 278,299,600.73 | |||
| Other non-current assets | - | 138,253,316.00 | - | 138,253,316.00 | |||
| Other equity instruments investment | - | - | 499,200,803.85 | 499,200,803.85 | |||
| Other non-current financial assets | 1,500,307,562.13 | - | - | 1,500,307,562.13 | |||
| 1,562,638,562.79 | 3,455,302,661.94 | 499,200,803.85 | 5,517,142,028.58 |
| Financial liabilities | Other financial liabilities | ||
| Short-term borrowings | 1,059,287,361.11 | ||
| Accounts payable | 1,191,314,404.15 | ||
| Other payables | 1,325,596,105.43 | ||
| Non-current liabilities due within one year | 86,852,293.01 | ||
| Other current liabilities | 3,473,907,027.00 | ||
| Long-term borrowings | 404,500,000.00 | ||
| Bonds payable | 3,497,416,819.75 | ||
| Lease liabilities | 206,623,735.97 | ||
| 11,245,497,746.42 |
2021Financial assets
| Financial assets that are measured by fair value and of which the changes in fair value are recognized in the profit or loss for | Measured at amortized cost | measured at fair value and whose changes are included in other comprehensive income | Total |
| the current period | |||||||
| Requirements in the standard | Designated | ||||||
| Cash and cash equivalents | - | 4,831,468,386.25 | - | 4,831,468,386.25 | |||
| Held-for-trading financial assets | 75,375,083.20 | - | - | 75,375,083.20 | |||
| Accounts receivable | - | 185,237,530.89 | - | 185,237,530.89 | |||
| Other receivables | - | 1,355,924,282.96 | - | 1,355,924,282.96 | |||
| Other current assets | - | 2,780,294.82 | - | 2,780,294.82 | |||
| Long-term receivables | - | 222,307,363.40 | - | 222,307,363.40 | |||
| Other equity instruments investment | - | - | 642,187,968.77 | 642,187,968.77 | |||
| Other non-current financial assets | 1,524,819,255.41 | - | - | 1,524,819,255.41 | |||
| 1,600,194,338.61 | 6,597,717,858.32 | 642,187,968.77 | 8,840,100,165.70 |
| Financial liabilities | Other financial liabilities | ||
| Short-term borrowings | 942,736,046.04 | ||
| Accounts payable | 493,360,429.02 | ||
| Other payables | 1,908,742,835.15 | ||
| Non-current liabilities due within one year | 3,664,241,923.08 | ||
| Other current liabilities | 3,081,384,800.50 | ||
| Long-term borrowings | 771,250,000.00 | ||
| Lease liabilities | 205,942,673.93 | ||
| 11,067,658,707.72 |
2. Financial risk tools
The risks associated with financial instruments faced by the Group in regular activitiesmainly include credit risk, liquidity risk and market risk. The main financial instrumentsof the Group include cash, borrowings from banks, bonds payable and commercialpapers payable. Those instruments are used mainly to finance the operation of theGroup. The Group has lots of other financial assets and liabilities directly arising fromoperation, such as accounts receivable, other receivables, accounts payable and otherpayables. The risks associated with those financial instruments and the riskmanagement strategy taken by the Group to reduce those risks are stated as follows.
Credit risk
The Group only deals with the recognized third parties with good reputation. Accordingto its policy, the Group needs to carry out credit review on all clients who require todeal with the Group on credit. In addition, the Group keeps monitoring the balance ofaccounts receivable to ensure it will not face any material bad debt risk. For thetransactions settled other than in the functional currency of related business entities,unless with specific approval of the Group’s credit control department, the Group willnot provide the conditions for dealing on credit. The Group also faces credit risks dueto the provision of financial guarantees. See Note XIV. 2 for details.
As the counterparties to the transactions of cash are banks with good reputation andhigh credit ratings, the credit risk of those financial instruments is relatively low.
The Group’s other financial assets include cash, debt investment, other receivables andcertain derivatives, the credit risk of which is sourced from default by the counterparties,and the maximum risk exposure is equal to the book value of those instruments.
As the clients from which the Group’s accounts receivable are receivable are scatteredin different sectors and industries, there’s no material credit risk concentrated within theGroup. The Group does not have any collaterals or other credit enhancements for thebalance of its accounts receivable.
See Notes VII. 5 and 8 for quantitative data on the Group's credit risk exposure in relationto receivables and other receivables.
Criteria for significant increase in credit riskThe Group evaluates, on each balance sheet date, whether the credit risk of relatedfinancial instruments has increased significantly since the initial recognition thereof. Indetermining whether the credit risk of a financial instrument has increased significantlysince the initial recognition thereof, the Group takes into account the reasonable andwell-grounded information that is accessible without unnecessary extra costs or efforts,including the qualitative and quantitative analyses based on the Group’s historical data,external credit risk rating and forward-looking information. The Group compares the riskof financial instruments defaulting on the balance sheet date and the risk of themdefaulting on the date of initial recognition based on an individual financial instrumentor a group of financial instruments with similar credit risk characteristics to determinethe changes in anticipated default risk of the financial instrument(s) within the durationthereof.
If a financial instrument meets one or more of the following quantitative or qualitativecriteria, the Group will determine that its credit risk has increased significantly:
（1） The main quantitative criterion is that its probability of default within the
remaining duration on the reporting date rises by a certain margin from that atits initial recognition;
（2） The main qualitative criterion is that the debtor has materially adverse changes
in business or financial conditions or is on the warning list of clients.
Definition of the assets whose credit has been impairedIn order to determine whether the credit of an asset has been impaired, the Groupadopts the criteria consistent with its internal credit risk management goal for relatedfinancial instruments and also takes into account the quantitative and qualitativeindicators. The Group mainly considers the following factors while assessing whetherthe credit of a debtor has been impaired:
（1） the issuer or debtor suffers material financial difficulty;
（2） the debtor is in breach of contract, such as breach in interest payment, principal
repayment or overdue payment;
（3） the creditor makes a compromise to the debtor which it would in no case make,
based on the economic or contract considerations in connection with thedebtor’s financial difficulty;
（4） the debtor is very likely to go bankrupt or enter into other financial
reorganizations;
（5） the financial difficulty of the issuer or debtor results in the disappearance of the
active market of the financial asset;
（6） a financial asset is purchased or derived at a large discount and the discount
points to the fact of credit loss having been incurred.The credit impairment of financial assets may be caused by multiple events together andmay not necessarily be caused by an individually identifiable event.
The Group makes impairment provisions for the expected credit loss of accountsreceivable and other receivables within the coming 12 months with the simplifiedmethod and general method respectively. Please refer to Notes VII. 5 and 8 for details.
Liquidity riskThe Group manages the cash shortage risk with the cyclical liquidity plan tool. The toolconsiders not only the maturity dates of financial instruments but also the estimated cashflows arising from the operation of the Group.
The Group aims to make use of such financing instruments as bank loans, commercialpapers, MTNs, corporate bonds and long-term borrowings to maintain the balancebetween the continuity and flexibility of financing. As of December 31, 2022, 59.75% ofthe Group's debts would be due within one year (December 31, 2021: 87.59%).The following table summarizes the analysis on the due day of financial liabilities basedon non-discounted contractual cash flows:
December 31, 2022
| Item | At call | 1-3 months | 3 months-1 year (1 year inclusive) | 1 year - 5 years (5 years inclusive) | Above 5 years | Total |
| Short-term borrowings | 2,754,166.67 | 304,518,333.33 | 759,490,833.33 | - | - | 1,066,763,333.33 |
| Accounts payable | 957,474,259.60 | 233,840,144.55 | - | - | - | 1,191,314,404.15 |
| Other payables | 835,667,583.73 | - | - | 489,928,521.70 | - | 1,325,596,105.43 |
| Other current liabilities | 401,658,433.30 | 1,009,863,013.70 | 2,028,865,753.42 | - | - | 3,440,387,200.42 |
| Non-current liabilities due within one year | 24,998,166.53 | 41,488,904.11 | 20,019,287.68 | - | - | 86,506,358.32 |
| Long-term borrowings | 943,458.33 | 1,886,916.67 | 8,491,125.00 | 233,761,125.00 | 257,210,555.56 | 502,293,180.56 |
| Bonds payable | - | - | - | 3,486,038,427.42 | - | 3,486,038,427.42 |
| Total | 2,223,496,068.16 | 1,591,597,312.36 | 2,816,866,999.43 | 4,209,728,074.12 | 257,210,555.56 | 11,098,899,009.63 |
2021
| Item | At call | 1-3 months | 3 months-1 year (1 year inclusive) | 1 year - 5 years (5 years inclusive) | Above 5 years | Total |
| Short-term borrowings | 2,580,651.41 | 253,953,316.72 | 702,138,696.23 | - | - | 958,672,664.36 |
| Accounts payable | 433,048,081.66 | 60,312,347.36 | - | - | - | 493,360,429.02 |
| Other payables | 1,337,432,161.48 | - | - | 571,310,673.67 | - | 1,908,742,835.15 |
| Other current liabilities | 4,304,034.67 | - | 3,064,041,095.89 | - | - | 3,068,345,130.56 |
| Non-current liabilities due within one year | 326,666.67 | 50,424,666.67 | 3,639,370,038.05 | - | - | 3,690,121,371.39 |
| Long-term borrowings | 2,178,645.83 | 4,357,291.67 | 19,607,812.50 | 785,678,164.58 | - | 811,821,914.58 |
| Total | 1,779,870,241.72 | 369,047,622.42 | 7,425,157,642.67 | 1,356,988,838.25 | - | 10,931,064,345.06 |
Market risks
Interest rate riskThe risk of changes in market interest rates faced by the Group is mainly related tothe Group's long-term liabilities at floating interest rates.
The Group manages interest costs by maintaining an appropriate combination offixed-rate debts and variable-rate debts. In the long-term debts of the Group as ofDecember 31, 2022, there are long-term loans of RMB 405 million in total. Theinterest rate is adjusted based on the benchmark loan interest rate on that day at the
end of each year, and will not be adjusted in the middle of the year. Therefore, themanagement believes that the risk of changes in market interest rates is relativelylow.
Foreign exchange rate riskThe Group faces trading exchange rate risks. Such risks are caused by sales orpurchases made by certain business units in currencies other than their bookkeepingcurrency. 7.94% (2021: 0.86%) of the Group's sales in the current period weredenominated in a currency other than the functional currency of the operating unitwhere the sales occurred, while 92.06% (2021: 99.14%) of the costs weredenominated in the functional currency of the operating unit. Considering theGroup’s short time of inventory and timely collection of accounts receivable, themanagement believe that its foreign exchange rate risk is relatively low.
Price risk of equity instrument investmentsThe price risk of equity instrument investments refers to the risk of the fair value of
equity securities decreasing due to the changes in stock indices and value of
individual securities. As of December 31, 2022, the Group was exposed to the price
risk of equity instrument investments arising from the individual equity instrument
investments classified as the financial instruments that are measured by fair value
and of which the changes in fair value are recognized in income in current period
(Note VII. 2) or recognized in other comprehensive income (Note VII. 18). The listed
equity instruments that were invested and held by the Group were listed on the
Shanghai Stock Exchange and the Shenzhen Stock Exchange, respectively,the
determination is made through discounting and adjustment using the trading prices
of similar circulating stocks of the same listed company on the balance sheet date,
combined with liquidity.
The market stock indexes of the following stock exchanges at the closing point of thetrading day that is closest to the balance sheet date, and their respective highest andlowest closing points during the year are as follows:
| At the end of 2022 | 2022 Highest/lowest | At the end of 2021 | 2021 Highest/lowest | |
| SZSE-A Share Index | 2,067 | 2,661/1,804 | 2,648 | 2,691/2,229 |
| SSE-A Share Index | 3,238 | 3,827/3,001 | 3,814 | 3,912/3,472 |
The following table indicates the sensitivity of the Group’s net profit and loss and othercomprehensive income after tax to the change each 10% of the fair value of equityinstrument investment (based on the book value on the balance sheet date) underthe assumption that all other variables remain unchanged.
2022
| Equity instrument investment Book value | Net profit or loss | Other comprehensive income net after tax | Total shareholders' equity | |
| Equity instrument investment | Increase/(decrease) | Increase/(decrease) | Increase/(decrease) | |
| Fair value increase/decrease by10% |
| Shenzhen - Investment in the equity instruments that are measured by fair value and of which the changes in fair value are recognized in other comprehensive income | 499,200,803.85 | - | 37,440,060.29 | 37,440,060.29 |
| Shanghai - Equity instrument investment at fair value through profit or loss | 23,651,565.00 | 1,773,867.38 | - | 1,773,867.38 |
2021
| Equity instrument investment Book value | Net profit or loss | Other comprehensive income net after tax | Total shareholders' equity | |
| Equity instrument investment | Increase/(decrease) | Increase/(decrease) | Increase/(decrease) | |
| Fair value increase/decrease by10% | ||||
| Shenzhen - Investment in the equity instruments that are measured by fair value and of which the changes in fair value are recognized in other comprehensive income | 642,187,968.77 | 48,164,097.66 | 48,164,097.66 | |
| Shanghai - Equity instrument investment at fair value through profit or loss | 50,375,083.20 | 3,778,131.24 | - | 3,778,131.24 |
3. Capital management
The main objective of the Group in capital management is to ensure the Group’sability to continue operations and maintain a healthy capital ratio to support itsbusiness development and maximize the values for shareholders.The Group manages and adjusts its capital structure based on the changes in theeconomic situation and the risk characteristics of related assets. To maintain oradjust the capital structure, the Group may adjust the distribution of profits toshareholders, return capital contribution to shareholders or issue new shares. TheGroup is not subject to external mandatory capital requirements. From 2021 to2022, there was no change in capital management objectives, policies orprocedures.
XI. Disclosure of fair value
1. Closing fair value of the assets and liabilities measured by fair value
√Applicable □Not applicable
Unit: RMB
| Item | Closing fair value | |||
| Level 1 fair value | Level 2 fair value | Level 3 fair value | Total | |
| I. Continuous fair value measurement | ||||
| (1) Held-for-trading financial assets | 23,651,565.00 | - | 38,679,435.66 | 62,331,000.66 |
| 1. Financial assets that are measured at fair value and whose changes are included in the current profit and loss | 23,651,565.00 | - | 38,679,435.66 | 62,331,000.66 |
| (2) Investment in equity instruments | 23,651,565.00 | - | - | 23,651,565.00 |
| (4) Bank wealth management products | - | - | 38,679,435.66 | 38,679,435.66 |
| (3) Other equity instruments investment | 499,200,803.85 | - | - | 499,200,803.85 |
| (vi) Other non-current financial assets | - | 875,102,686.90 | 625,204,875.23 | 1,500,307,562.13 |
| Total assets continuously measured by fair value | 522,852,368.85 | 875,102,686.90 | 663,884,310.89 | 2,061,839,366.64 |
2. Basis for determining the market prices of the items continuously and non-continuously measured by Level 1 fair value
√Applicable □Not applicable
The Group's continuous first-level fair value measurement items mainly include listedequity instruments, whose fair value is determined based on the market quotation on the lasttrading day of 2022.
3. Valuation techniques and qualitative and quantitative information of important
parameters for the items continuously and non-continuously measured by Level 2
fair value
√Applicable □Not applicable
The Group’s level-2 items continuously measured at fair value mainly include unlistedequity investments and listed equity instruments with restricted sales conditions. The fair valueof unlisted equity investments is determined based on the information in the financialstatements of these unlisted companies on December 31, 2022, combined with comparableinformation of listed companies in the same industry under the comparable company multipliermethod. In the listed equity instruments subject to restricted sales conditions, the valuation
model is used to determine the fair value based on the market quotation, and the importantobservable input value is the liquidity discount.
4. Valuation techniques and qualitative and quantitative information of importantparameters for the items continuously and non-continuously measured by Level 3fair value
√Applicable □Not applicable
The Group’s level-3 items continuously measured at fair value include wealthmanagement products and equity investments in non-listed companies for which thecomparable company multiplier method cannot be used. Wealth management products aredetermined by the discounted cash flow valuation model. The Group will also consider theinitial transaction price, recent transactions of the same or similar financial instruments, orcomplete third-party transactions of comparable financial instruments. Adjustments to theassessment model are made based on changes in liquidity, liquidity, default risk, and market,economic, or company-specific circumstances. The fair value of the equity investments in non-listed companies for which the comparable company multiplier method cannot be used aredetermined under the net asset-based method as of December 31, 2022.
5. Adjustment information between the opening book value and closing book value, and
the sensitivity analysis of unobservable parameters for items continuously measured
by Level 3 fair value
□Applicable √Not applicable
6. For items continuously measured by fair value, if there is conversion between
different levels in the current period, the reasons for the conversion and the policy
for determining the time of conversion
□Applicable √Not applicable
7. Changes in valuation techniques in the current period and reasons for changes
□Applicable √Not applicable
8. Fair value of financial assets and financial liabilities not measured by fair value
√Applicable □Not applicable
December 31, 2022
| Entries used in the fair value measurement | ||||
| Quotation in an active market | Important observable entry | Important non-observable entry | ||
| Level 1 | Level 2 | Level 3 | Total | |
| Bonds payable (current portion included) | 3,544,625,864.62 | 3,544,625,864.62 | ||
9. Others
√Applicable □Not applicable
Fair value of financial instrumentsThe table below shows the differences between book value and fair value ofthe Group’s financial instruments other than the financial instruments withvery small differences between book value and fair value and the equityinstruments that did not have an offering price in the active market and whosefair value could not be measured reliably:
| Book value | Fair value | ||||
| 2022 | 2021 | 2022 | 2021 | ||
| Financial liabilities Bonds payable (current portion included) | 3,558,925,011.54 | 3.552.960.829.66 | 3,544,625,864.62 | 3.549.754.103.37 | |
The management have evaluated cash and cash equivalents, accounts receivable,notes payable and accounts payable. Their fair values were equivalent to their bookvalues as their remaining terms were not long. The fair values of long-termreceivables, other non-current assets, long and short-term borrowings and long-termaccounts payable were determined with the discounted future cash flow method,with the market yields of other financial instruments with similar contract terms, creditrisks and remaining terms as the discount rates. Their fair values were equivalent totheir book values.The Group's finance department, headed by the General manager of the GroupFinance Center, is responsible for developing policies and procedures for the fairvalue measurement of financial instruments. The General Manager of the GroupFinance Center reports directly to the Group Finance Officer, who reports to the AuditCommittee. On each balance sheet date, the financial department analyzes thechanges in the value of financial instruments and determines the main input valuesapplicable to the valuation. The valuation shall be reviewed and approved by theGroup's Financial Director. For the preparation of semi-annual and annual financialstatements, the valuation process and results are discussed with the auditcommittee twice a year.
The fair values of financial assets and financial liabilities refer to the amountsdetermined based on the voluntary exchange of assets or repayment of debts by theparties to arm’s length transactions who are familiar with the transactions rather thanforced sale or liquidation. The following methods and assumptions are used toestimate fair value.
The fair value of bonds payable is determined with the discounted future cash flowmethod, with the market yields of other financial instruments with similar contractterms, credit risks and remaining terms as the discount rates, and falls in Level 2.The significant unobservable inputs for measurement of the fair value of bondspayable are the prepayment rate and loss given default.
If there are no restrictions on the sale of listed equity instruments, the fair value isdetermined at the quoted market price. In the listed equity instruments subject torestricted sales conditions, the valuation model is used to determine the fair valuebased on the market quotation, and the important observable input value is theliquidity discount. The Group believes that the fair value estimated by valuationtechniques is reasonable and is also the most appropriate value on the balancesheet date.
There was no significant conversion of the Group’s and the Company’s financialinstruments measured by fair value between different levels in the current year andin the previous year.
XII. Related parties and related-party transactions
1. Parent company of the Company
√Applicable □Not applicable
Unit: RMB10,000
| Name of parent company | Place of registration | Business | Registered capital | Shareholding ratio in the Company (%) | Voting right ratio in the Company (%) |
| Yiwu China Commodities City Holdings Limited | Yiwu, Zhejiang | Asset management | 100,000 | 55.38 | 55.38 |
Notes on the parent company of the CompanyNilThe ultimate controlling party of this enterprise is the State-owned Assets Supervision andAdministration Office of Yiwu Municipal People's Government.Other notes:
Nil
2. Subsidiaries of the Company
For details of the Company’s subsidiaries, please refer to the Notes
√Applicable □Not applicable
For details, please refer to Note IX. 1. Equity in subsidiaries
3. Joint ventures and associates of the Company
For details of the Company’s important joint ventures or associates, please refer to the Notes
√Applicable □Not applicable
For details, please refer to Note IX. 3. Interests in joint ventures or associated enterprises
Other joint ventures or associates that have related-party transactions with the Company in thecurrent period or had related-party transactions with the Company in the prior year whichresulted in an outstanding amount are as follows
√Applicable □Not applicable
| Name of joint venture or associate | Relationship with the Company |
| Yiwu Shanglv | Joint venture |
| Yiwu Huishang Redbud Capital Management Co., Ltd. | Joint venture |
| Yiwu China Commodities City Creative Design and Development Services Co., Ltd. | Joint venture |
| Yiwu Guoshen Shangbo Property Co., Ltd. | Joint venture |
| Yiwu Rongshang Real Estate Co., Ltd. | Joint venture |
| Hangzhou Binjiang Shangbo Property Development Co., Ltd. | Associate |
| Huishang Micro-finance | Associate |
| Zhejiang Yemai Data Technology Co., Ltd. | Associate |
| Yiwu Meipinshu Supply Chain Management Co., Ltd. | Associate |
| JEBEL ALI FREE ZONE TRADER MARKET DEVELOPMENT AND OPERATION FZCO | Associate |
| Yiwu Digital Port Technology Co., Ltd. | Associate |
| CCCP | Associate |
| Hangzhou MicroAnts Co., Ltd. | Associate |
| Yiwu Huishang Redbud Equity Investment Co., Ltd. | Associate |
| Zhejiang Zhijie Yuangang International Supply Chain Technology Co., Ltd. | Associate |
| Yiwu Heimahui Enterprise Service Co., Ltd. | Associate |
| Yiwu Shangfu Chuangzhi Investment Center (limited partnership) | Associate |
Other statements
□Applicable √Not applicable
4. Other related parties
√Applicable □Not applicable
| Name of other related party | Relationship with the Company |
| SCO | Parent company of controlling shareholder of the Company’s largest shareholder |
| Yiwu Market Development Group Co., Ltd. | Controlling shareholder of the Company’s largest shareholder |
| Yourworld International Conference Center Company of Yiwu Market Development Group Co., Ltd. | Branch of Controlling shareholder of the Company’s largest shareholder |
| Yiwu Security Service Co., Ltd. | Subsidiary of controlling shareholder of the Company’s largest shareholder |
| Yiwu Agriculture Development Co., Ltd. | Subsidiary of controlling shareholder of the Company’s largest shareholder |
| Zhejiang Yiwu Rural Economic Development Co., Ltd. | Subsidiary of controlling shareholder of the Company’s largest shareholder |
| Yiwu Market Development Service Center Co., Ltd. | Subsidiary of controlling shareholder of the Company’s largest shareholder |
| Yiwu China Commodities City Property Service Co., Ltd. | Subsidiary of the Company’s largest shareholder |
| Yiwu Handing Shangbo Real Estate Co., Ltd. | Subsidiary of the Company’s largest shareholder |
| Yiwu Gongchen Shangbo Property Co., Ltd. | Subsidiary of the Company’s largest shareholder |
| Yiwu Shangbo Yungu Enterprise Management Co., Ltd. | Subsidiary of the Company’s largest shareholder |
| Yiwu Tonghui Shangbo Real Estate Co., Ltd. | Subsidiaries of joint ventures |
| Yiwu Gongchen Shangbo Property Co., Ltd. | Subsidiaries of joint ventures |
| Yiwu Chengzhen Property Co., Ltd. | Subsidiaries of joint ventures |
| Yisha Chengdu International Trade City Co., Ltd. | Minority shareholder of major subsidiaries |
Other statementsNil
5. Related-party transactions
(1). Related-party transactions of purchasing and selling goods and rendering and
accepting servicePurchasing goods/accepting service
√Applicable □Not applicable
Unit: RMB
| Related party | Contents of related-party transaction | Amount in the current period | Approved transaction amount (if applicable) | Whether the transaction limit is exceeded (if applicable) | Amount in the previous period |
| Yiwu China Commodities City Property Service Co., Ltd. | Property service fee and greening maintenance fee | 184,739,755.70 | 13,721,576.38 | ||
| Yiwu Security Service Co., Ltd. | Exhibition security service fee | 28,188,230.28 | 23,279,926.97 | ||
| Yiwu Digital Port Technology Co., Ltd. | Technical service fee and hardware equipment fee | 4,948,197.00 | - | ||
| Yiwu China Commodities City Creative Design and Development Services Co., Ltd. | Design fee | 3,472,843.99 | 1,953,465.33 | ||
| Zhejiang Yemai Data Technology Co., Ltd. | Purchase payment and platform service fee | 2,291,695.43 | - | ||
| Yiwu Agriculture Development Co., Ltd. | Purchase payment | 2,042,604.35 | - | ||
| Yiwu Shangbo Yungu Enterprise Management Co., Ltd. | Construction fee | 1,100,800.00 | - |
Selling goods/rendering service
√Applicable □Not applicable
Unit: RMB
| Related party | Contents of related-party transaction | Amount in the current period | Amount in the previous period |
| Yiwu China Commodities City Property Service Co., Ltd. | Sales of goods | 2,175,245.60 | - |
| MDG and its branch Xingfuhu International Conference Center | Laundering fees | 1,054,026.05 | 1,594,054.55 |
| Yiwu Meipinshu Supply Chain Management Co., Ltd. | Procurement agency | - | 231,822.45 |
Notes on related-party transactions of purchasing and selling goods and rendering andaccepting service
□Applicable √Not applicable
(2). Entrustment/contracting from and to related parties
Entrustment/contracting to the Company:
√Applicable □Not applicable
Unit: RMB
| Name of consignor/employer | Name of consignee/contractor | Type of entrusted/contracted assets | Starting date of entrustment /contracting | Ending date of entrustment /contracting | Pricing of entrustment income/contracting income | Entrustment income/contracting income recognized in the current period |
| MDG | The Company | Entrustment of other assets | Feb 1, 2020 | Jan 31, 2025 | Negotiated price | 514,979.27 |
Notes on entrustment/contracting from related parties
√Applicable □Not applicable
According to the Yourworld International Conference Center Management Contract signedby and between the Company and the Market Development Group, the Company is entrustedto manage Yourworld International Conference Center Hotel located at No. 100, XingfuhuRoad, Yiwu City. The hotel management fee collected during the reporting period was RMB514,979.27 (2021: RMB 1,453,314.18)
Entrusted management/contracted by the Company
□Applicable √Not applicable
Notes on related-party management/contracting
□Applicable √Not applicable
(3). Related-party lease
The Company as the lessor:
√Applicable □Not applicable
Unit: RMB
| Name of lessee | Type of leased asset | Rental income recognized in the current period | Rental income recognized in the previous period |
| Yiwu Shanglv | Office space | 1,376,146.79 | - |
| CCCP | Office space | 1,126,617.29 | 3,767,104.11 |
| Yiwu Market Development Service Center Co., Ltd. | Parking lot | 516,288.99 | - |
| Yiwu Huishang Redbud Capital Management Co., Ltd. | Office space | 246,819.06 | - |
| Yiwu Meipinshu Supply Chain Management Co., Ltd. | Office space | 207,058.99 | - |
| Yiwu China Commodities City Property Service Co., Ltd. | Office space | 122,445.99 | - |
| Huishang Micro-finance | Office space | 49,791.48 | 103,301.70 |
The Company as the lessee
√Applicable □Not applicable
Unit: RMB
| lessor name | Type of leased asset | Simplified treatment of rental expenses for short-term leases and leases of low-value assets (if applicable) | Variable lease payments not included in the measurement of the lease liability (if applicable) | Rent paid | Interest expense on lease liability assumed | Increased right-of-use assets | |||||
| Amount in the current period | Amount in the previous period | Amount in the current period | Amount in the previous period | Amount in the current period | Amount in the previous period | Amount in the current period | Amount in the previous period | Amount in the current period | Amount in the previous period | ||
| CCCH | Warehouses | 15,015,618.37 | 3,947,798.16 | - | - | 16,378,272.00 | 15,210,700.00 | - | - | - | - |
Notes on related-party lease
√Applicable □Not applicable
The Group rent office spaces from above related parties at market prices
(4). Related-party guarantees
The Company as the guarantor
√Applicable □Not applicable
Unit: RMB
| The guaranteed | Amount of guarantee | Starting date of the guarantee | Expiry date of the guarantee | Is the guarantee fulfilled in full |
| Yiwu Shanglv | 94,799,347.65 | Jul 1, 2015 | Dec 15, 2026 | No |
The Company as the guaranteed party
□Applicable √Not applicable
Notes on related-party guarantees
√Applicable □Not applicable
The Group provided guarantee for the borrowings of Yiwu Shanglv. As of December 31,2022, Yiwu Shanglv actually borrowed RMB 193.4681 million ( Dec 31, 2021: RMB 296.5056million ) from banks. According to the guarantee contract, the Group assumed guaranteeliability for RMB 94.7993 million (Dec 31, 2021: RMB 145.2877 million). SCO provided acounter-guarantee
(5). Related-party lending and borrowing
√Applicable □Not applicable
Unit: RMB
| Related party | Amount | Starting date | Maturity date | Description of |
| Borrowings | ||||
| Huangyuan Shangbo | 436,100,000.00 | Jul 31, 2020 | The Group allocated a total of RMB 436,100,000.00 of surplus funds from Huangyuan Shangbo in 2020, and allocated a total of RMB 171,500,000.00 of surplus funds from Huangyuan Shangbo in 2021. The allocations were based on the share holding rate and the annual interest rate was 0%. As of December 31, 2022, RMB 580,865,600.00 was converted into dividends, and the remaining RMB 26,734,400.00 was transferred back to Huangyuan Shangbo. | |
| Huangyuan Shangbo | 171,500,000.00 | Jan 26, 2021 | Ditto | |
| Chengzhen Property | 27,200,000.00 | Oct 22, 2020 | The Group allocated a total of RMB 27,200,000.00 of surplus funds from Chengzhen Real Estate in 2020, a total of RMB172,800,000.00 of surplus funds from Chengzhen Real Estate in 2021, and a total of RMB 72,000,000.00 of surplus funds from Chengzhen Real Estate in 2022. The allocations were based on the share holding rate and the annual interest rate was 0%. As of December 31, 2022, RMB 18,720,000.00 was transferred back, of which RMB 194,476,800.00 was converted into dividends, and the return date of the remaining funds would be determined according to the fund needs of Chengzhen Real Estate projects. | |
| Chengzhen Property | 172,800,000.00 | Jan 26, 2021 | Ditto | |
| Chengzhen Property | 72,000,000.00 | Jan 18, 2022 | Ditto | |
| Yiwu Guoshen Shangbo Property Co., Ltd. | 230,600,000.00 | Dec 31, 2022 | In 2022, the Group transferred a total of RMB 230,600,000.00 from Guoshen Shangbo according to the shareholding ratio, at the annual interest rate of 0%. The due date would be determined according to the funding needs of Guoshen Shangbo projects. | |
| Yiwu Rongshang Real Estate Co., Ltd. | 64,418,683.00 | Jun 30, 2022 | The Company received a pre-dividend of RMB 64,418,683.00 from Rongshang Real Estate in 2022, and the specific date of repayment of funds would be determined according to the distribution of dividend resolutions. | |
| Huishang Zijing | 4,500,000.00 | Dec 31, 2021 | The Company received a pre-dividend of RMB 4,500,000.00 from Huishang Redbud in 2021, and a pre-dividend of RMB12,000,000.00 from Huishang Redbud in 2022. The specific date of return of funds would be determined according to the distribution of dividend resolutions. | |
| Huishang Zijing | 12,000,000 | Dec 31, 2022 | Ditto |
| Related party | Amount | Starting date | Maturity date | Description of |
| Lending to | ||||
| Yiwu Tonghui Shangbo Real Estate Co., Ltd. | 742,568,548.00 | Nov 17, 2020 | In 2020, the Group provided a total of RMB 742,568,548.00 in financial assistance to Tonghui Shangbo, and in 2021, it provided a total of RMB138,160,000.00 in financial assistance to Tonghui Shangbo, with an annual interest rate of 6.5%. Tonghui Shangbo repaid all the funds as of December 31, 2022. | |
| Yiwu Tonghui Shangbo Real Estate Co., Ltd. | 138,160,000.00 | Feb 26, 2021 | Ditto | |
| Yiwu Handing Shangbo Real Estate Co., Ltd. | 204,604,400.00 | Dec 11, 2020 | In 2020, the Group provided financial assistance to Handing Shangbo totaling RMB 204,604,400.00, and in 2021, the Group provided financial assistance to Handing Shangbo totaling RMB 17,845,800.00, with an annual interest rate of 6%. Handing Shangbo repaid RMB 14,700,000.00 successively in 2022. | |
| Yiwu Handing Shangbo Real Estate Co., Ltd. | 17,845,800.00 | May 11, 2021 | Ditto | |
| JEBEL ALI FREE ZONE TRADER MARKET DEVELOPMENT AND OPERATION FZCO | 63,465,484.42 | Mar 9, 2020 | In 2020, the Group provided JEBEL ALI FREE ZONE TRADER MARKET DEVELOPMENT AND OPERATION FZCO financial assistance totaling RMB 63,465,484.42; in 2021, the Group provided it with financial assistance totaling RMB 109,636,517.09; in 2022, the Group provided it with financial assistance totaling RMB 41,772,885.00, all at an annual interest rate of 6-month average EIBOR plus 5%. The repayment term of the financial assistance would be determined based on the | |
| progress of the project. | ||||
| JEBEL ALI FREE ZONE TRADER MARKET DEVELOPMENT AND OPERATION FZCO | 109,636,517.09 | Mar 31, 2021 | Ditto | |
| JEBEL ALI FREE ZONE TRADER MARKET DEVELOPMENT AND OPERATION FZCO | 41,772,885.00 | May 12, 2022 | Ditto |
(6). Related-party transfer of assets and restructuring of debts
□Applicable √Not applicable
(7). Remunerations of key officers
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Remunerations of key officers | 17,759,375.82 | 23,333,482.40 |
(8). Other related-party transactions
√Applicable □Not applicable
Related party entrusted loan
Unit: RMB
| Unit | 2022 | 2021 |
| Yisha Chengdu International Trade City Co., Ltd. | 48,000,000.00 | - |
After deliberation and approval at the fifth meeting of the ninth Board of Directors held bythe Group on December 15, 2022, Yiwugou, an indirectly controlled subsidiary of the Group,provided an entrusted loan of RMB 48 million yuan to Yisha Chengdu International Trade CityCo., Ltd., a minority shareholder of Yiwugou, in the form of monetary funds through YiwuBranch of Agricultural Bank of China Co., Ltd., with a term of 2 years and an annual interestrate of 5.5%.
6. Accounts receivable from and payable to related parties
(1). Receivables
√Applicable □Not applicable
Unit: RMB
| Item | Related party | Closing balance | Opening balance | ||
| Book balance | Bad debt provision | Book balance | Bad debt provision | ||
| Accounts receivable | Tonghui Shangbo | 6,200,000.00 | 61,573.54 | 6,200,000.00 | - |
| Accounts receivable | Yourworld International Conference Center | 168,814.20 | 1,676.53 | 369,743.93 | - |
| Company of Yiwu Market Development Group Co., Ltd. | |||||
| Accounts receivable | Yiwu Gongchen Shangbo Property Co., Ltd. | - | - | 97,351.08 | - |
| Accounts receivable | CCCP | - | - | 9,000.00 | - |
| Total | 6,368,814.20 | 63,250.07 | 6,676,095.01 | - | |
| Other receivables-interest receivable | Tonghui Shangbo | - | - | 92,249,275.44 | - |
| Total | - | - | 92,249,275.44 | - | |
| Other receivables | Handing Shangbo | 207,750,200.00 | - | 222,450,200.00 | - |
| Other receivables | Tonghui Shangbo | 116,036,712.09 | - | - | - |
| Other receivables | Yiwu Gongchen Shangbo Property Co., Ltd. | 562,755.00 | - | - | - |
| Other receivables | Hangzhou MicroAnts Co., Ltd. | 1,288.00 | - | - | - |
| Other receivables | Tonghui Shangbo | - | - | 880,728,548.00 | - |
| Total | 324,350,955.09 | - | 1,195,428,023.44 | - | |
| Debt investments | Yisha Chengdu International Trade City Co., Ltd. | 48,079,561.64 | - | - | - |
| Total | 48,079,561.64 | - | - | - | |
| Long-term receivables | Yiwu Shanglv | 36,750,000.00 | - | 41,650,000.00 | - |
| Long-term receivables | JEBEL ALI FREE ZONE TRADER MARKET DEVELOPMENT AND OPERATION FZCO | 233,127,115.20 | - | 173,102,001.51 | - |
| Total | 269,877,115.20 | - | 214,752,001.51 | - |
(2). Payables
√Applicable □Not applicable
Unit: RMB
| Item | Related party | Closing book balance | Opening book balance |
| Accounts payable | Yiwu China Commodities City Property Service Co., Ltd. | 6,653,942.97 | - |
| Accounts payable | Yiwu Agriculture Development Co., Ltd. | 1,791,720.12 | - |
| Accounts payable | Yiwu Security Service Co., Ltd. | 919,817.45 | - |
| Accounts payable | Zhejiang Yemai Data Technology Co., Ltd. | 713,020.54 | 176,873.43 |
| Total | 10,078,501.08 | 176,873.43 | |
| Advance from customers | Yiwu China Commodities City Property Development Co., Ltd. | 583,018.86 | 612,288.99 |
| Advance from customers | Yiwu Digital Port Technology Co., Ltd. | - | 112,281.94 |
| Advance from customers | Redbud Capital | - | 82,273.06 |
| Advance from customers | Yiwu China Commodities City Property Service Co., Ltd. | - | 32,052.85 |
| Advance from customers | Yiwu Meipinshu Supply Chain Management Co., Ltd. | - | 31,195.06 |
| Advance from customers | Huishang Micro-finance | - | 20,798.09 |
| Total | 583,018.86 | 890,889.99 | |
| Contract liabilities | Yiwu China Commodities City Property Service Co., Ltd. | 94,027.70 | 332.00 |
| Contract liabilities | Zhejiang Yiwu Rural Economic Development Co., Ltd. | 84,905.66 | - |
| Contract liabilities | Yiwu Digital Port Technology Co., Ltd. | 35,519.71 | 22,205.25 |
| Contract liabilities | Huishang Micro-finance | 11,792.46 | 7,966.42 |
| Contract liabilities | Yiwu Security Service Co., Ltd. | 974.76 | 2,004.40 |
| Total | 227,220.29 | 32,508.07 | |
| Other payables | Yiwu Guoshen Shangbo Property Co., Ltd. | 230,600,000.00 | - |
| Other payables | Yiwu Rongshang Real Estate Co., Ltd. | 64,418,683.00 | - |
| Other payables | Yiwu Chengzhen Property Co., Ltd. | 58,803,200.00 | 200,000,000.00 |
| Other payables | Yiwu Huishang Redbud Equity Investment Co., Ltd. | 16,500,000.00 | 4,500,000.00 |
| Other payables | CCCP | 240,000.00 | 240,000.00 |
| Other payables | Yiwu Shangbo Yungu Enterprise Management Co., Ltd. | 200,000.00 | - |
| Other payables | Zhejiang Zhijie Yuangang International Supply Chain Technology Co., Ltd. | 150,000.00 | - |
| Other payables | Yiwu Shanglv Investment Development Co., Ltd. | 108,333.33 | 75,000.00 |
| Other payables | Yiwu Heimahui Enterprise Service Co., Ltd. | 100,000.00 | - |
| Other payables | Yourworld International Conference Center Company of Yiwu Market Development Group Co., Ltd. | 78,908.97 | 63,334.76 |
| Other payables | Yiwu Meipinshu Supply Chain Management Co., Ltd. | 57,000.00 | 57,000.00 |
| Other payables | Hangzhou MicroAnts Co., Ltd. | 26,000.00 | - |
| Other payables | Zhejiang Yemai Data Technology Co., Ltd. | 21,328.50 | - |
| Other payables | Yiwu Security Service Co., Ltd. | 14,740.00 | - |
| Other payables | Yiwu China Commodities City Trading Co., Ld. | 2,500.00 | - |
| Other payables | Huangyuan Shangbo | - | 607,600,000.00 |
| Other payables | Yiwu Shangfu Chuangzhi Investment Center (limited partnership) | - | 34,000,500.00 |
| Other payables | Hangzhou Binjiang Shangbo Property Development Co., Ltd. | - | 14,700,000.00 |
| Other payables | Huishang Micro-finance | - | 33,000.00 |
| Other payables | Yiwu Digital Port Technology Co., Ltd. | - | 26,300.00 |
| Other payables | Yiwu Gongchen Shangbo Property Co., Ltd. | - | 3,000.00 |
| Total | 371,320,693.80 | 861,298,134.76 |
7. Related-party commitments
□Applicable √Not applicable
8. Others
□Applicable √Not applicable
XIII. Share-based payment
1. Overview of share-based payment
√Applicable □Not applicable
Unit: Share, Currency: RMB
| Total amount of equity instruments granted by the Company in the current period | - |
| The total amount of equity instruments exercised by the Company during the current period | - |
| The total amount of the Company's equity instruments that have lapsed during the current period | 5,200,000.00 |
| Scope of the exercise price of the stock options issued by the Company and the remaining period of the contract at the end of the period | NA |
| Scope of the exercise price of other equity instruments issued by the Company and the remaining period of the contract at the end of the period | The grant prices were RMB 2.94 and RMB 2.39, respectively, both in 60 months from the date of grant registration |
Other statementsNil
2. Share-based payment settled with equity
√Applicable □Not applicable
Unit: RMB
| Method for determining the fair value of equity instruments on the grant date | Market price on grant day |
| Basis for determining the number of exercisable equity instruments | Determined based on the number of incentive objects that have reached the assessment target, through annual assessment on the Company’s financial performance indicators and personal performance indicators. |
| Reason for the significant difference between the estimates in the current period and in the previous period | NA |
| Cumulative amount of equity-settled share-based payments included in the capital reserve | 63,106,263.66 |
| Total amount of expenses recognized by equity-settled share payments in the current period | 27,154,798.61 |
Other statementsOn December 10, 2020, the 2020 fifth provisional general meeting of shareholders of theCompany reviewed and approved the “Plan on the Company's Restricted Stock Incentive Plan2020 (Draft)” and its summary. A total of 50,480,000 restricted shares were granted,accounting for about 0.927% of the Company's total share capital of 5,443,214,176 shares, ofwhich 47,920,000 shares were granted for the first time and 2,560,000 shares were reserved.During the subscription process, 10 incentive objects voluntarily waived the 1,220,000restricted shares to be granted to them due to personal reasons. Therefore, 46,700,000restricted shares were actually granted this time, and the number of incentive objects was 395.
On January 15, 2021, the Company's board of directors has completed the registration of thefirst grant of restricted stocks.On September 6, 2021, Zhejiang Zhicheng Certified Public Accountants (Special GeneralPartnership) issued the capital verification report (Zhezhihuiyizi [2021] No. 17): The Companyhas received a total of RMB 5,592,600.00 for subscription of restricted shares from 31restricted stock incentive objects, including RMB 2,340,000.00 in newly registered capital(share capital), and RMB 3,252,600.00 in capital reserve. The registered capital and sharecapital of the Company before the capital increase were both RMB 5,489,914,176.00, and theregistered capital and share capital after the change were both RMB 5,492,254,176.00. Duringthis grant registration process, in view of the fact that 3 of the incentive objects to be grantedon the reserved grant date are no longer eligible for incentive objects due to their voluntaryabandonment; 31 incentive objects actually subscribed this time, and 2.34 million shares weresubscribed. On November 4, 2021, the registration procedures for the reserved grant ofrestricted stocks involved in this incentive plan were completed, and the Shanghai Branch ofChina Securities Depository and Clearing Corporation Limited issued the "Securities ChangeRegistration Certificate".The restricted stocks granted for the first time under the restricted stock incentive plan shouldbe vested in three terms from the first trading day after 24 months after the grant registration iscompleted until the last trading day in 60 months after the grant registration is completed. Thatis, after the vesting conditions have been satisfied, employees have the right to purchasestocks at the vesting price. If the vesting conditions of the restricted stock incentive plan havebeen satisfied during the vesting period, the incentive objects can apply for the ownership ofstocks and being listed for circulation.
3. Share-based payment settled with cash
□Applicable √Not applicable
4. Modification and termination of share-based payment
□Applicable √Not applicable
5. Others
□Applicable √Not applicable
XIV. Commitments and contingencies
1. Important commitments
√Applicable □Not applicable
Important external commitments, nature and amount thereof as of the balance sheet dates
Unit: RMB
| Capital commitments | 2022 | 2021 |
| Signed but not provided | 3,451,663,094.71 | 2,165,863,780.60 |
Investment commitments:
In 2017, the Group’s wholly-owned subsidiary Yiwu China Commodities City FinancialHoldings Co., Ltd. (“CCCF”) and Shanghai Fuxing Industry Group Co., Ltd. (“Fuxing Group”)jointly established an industry fund Yiwu China Commodities City Fuxing Investment Center(limited partnership) (hereinafter referred to as the “FoF”). The FoF as a limited partnerinvested in 12 sub-funds including Yiwu Shangfu Chuangzhi Investment Center (limitedpartnership) (“Shangfu Chuangzhi Fund”). CCCF subscribed for capital contribution ofRMB998million in the FoF as a limited partner, accounting for 49.9% of the total capitalcontribution, and has paid in RMB102.92million. The unpaid portion of its subscribed capitalcontribution was promised to be RMB895.08million and was not subject to a term. CCCF alsomade capital contribution of RMB9.8million (49% equity) to Yiwu China Commodities CityInvestment and Management Co., Ltd. (hereinafter referred to as the “CCCIM”), which was ageneral partner of the above FoF and sub-funds. Fuxing made capital contribution of 51% toand had control over CCCIM.
Shangfu Chuangzhi Fund raised funds of RMB823.36million in total. The FoF hassubscribed for and paid in capital contribution of RMB205.84million as a limited partner(including the above RMB102.92million from CCCIM and the rest was contributed by Fuxing,the other limited partner of the FoF). As the other limited partner of Shangfu Chuangzhi Fund,CCCF has separately subscribed for and paid in capital contribution of RMB617.51million. Inaddition, neither the Group nor CCCF have invested in other sub-funds of the FoF.Subsequently, Shangfu Chuangzhi Fund made capital contribution of RMB820.54million tosubscribe for the increase in the registered capital of Hubei Provincial Asset Management Co.,Ltd. to acquire 22.667% equity therein. By 2019, 9 out of the above 12 sub-funds had beenderegistered.
In 2018, CCCF learned during its after-investment follow-up management that Fuxing andits actual controller ZHU Yidong were suspected of having committed a criminal offense andthe 22.667% equity held by Shangfu Chuangzhi Fund in Hubei Provincial Asset ManagementCo., Ltd. was frozen by the Public Security Bureau of Shanghai for a term from Sep 6, 2018 toSep 6, 2019 due to Fuxing’s contribution in the sources of the capital contribution. As of thereporting date, the equity was still frozen by the Shanghai Municipal Public Security Bureau.
As of the date of this report, the Group had not received any notice of capital contributionother than the above contributions that had been made or any notice of action involving theGroup, CCCF, FoF and its sub-funds.
In addition, as of December 31, 2022, the Group had other investment commitmentstotaling RMB 281.99 million (December 31, 2021: RMB 1.28078 billion).
2. Contingencies
(1). Important contingencies on the balance sheet dates
√Applicable □Not applicable
Unit: RMB
| Item | 2022 | 2021 |
| Contingent liabilities resulting from the guarantee provided externally | 99,645,681.29 | 158,634,169.67 |
According to relevant regulations, before the purchaser of the commercial housing sold bythe Group has obtained the property certificate, the Group shall provide the purchaser with abank mortgage guarantee. As of December 31, 2022, the unsettled guarantee amount was
RMB 4,846,333.64 (December 31, 2021: RMB 5,063,333.60). Those guarantees would bereleased after the issuance of the property ownership certificates and are thus little likely toincur losses. Therefore, the management believed that it was not necessary to make provisionfor the guarantees.
According to the resolution of the 15th meeting of the 7th Board of Directors on Jul 1,2015, the Group applied to the Yiwu Branch of ABC for a RMB750million loan for YiwuShanglv and provided guarantee based on its shareholding ratio. The guarantee was a jointand several liability guarantee, the maximum amount of guarantee was RMB367.5million andthe term was 11 years. As of December 31, 2022, Yiwu Shanglv actually borrowed RMB193,468,056.42 (December 31, 2021: 296,505,577.63) from banks in total. According to theagreement of the guarantee contract, it assumed the guarantee liability of RMB 94,799,347.65(December 31, 2021: RMB 145,287,733.04) for the Agricultural Bank of China Yiwu Branch.SCO provided a counter-guarantee for this guarantee.
(2). Notes shall also be made even if the Company has no important contingencies to be
disclosed:
□Applicable √Not applicable
3. Others
□Applicable √Not applicable
XV. Post-balance sheet date events
1. Important non-adjusting events
√Applicable □Not applicable
Unit: RMB
| Item | Content | Effect on financial status and operating results | Reasons for inability to estimate the effect |
| Issuance of super-short-term financing bonds | On March 16, 2023, the Company issued 179-day Zhejiang China Commodities City Group Co., Ltd.’s 2023 super-short-term financing bond (Issue 1) for RMB 1 billion at the rate of 2.85%. |
2. Profit distribution
√Applicable □Not applicable
Unit: RMB
| Profits or dividends to be distributed | 356,594,821.44 |
| Profits or dividends announced through deliberation and approval | 356,594,821.44 |
3. Sales return
□Applicable √Not applicable
4. Other post-balance sheet date events
□Applicable √Not applicable
XVI. Other important events
1. Correction of previous accounting errors
(1). Retrospective restatement
□Applicable √Not applicable
(2). Prospective application
□Applicable √Not applicable
2. Debt restructuring
□Applicable √Not applicable
3. Exchange of assets
(1). Exchange of non-monetary assets
□Applicable √Not applicable
(2). Exchange of other assets
□Applicable √Not applicable
4. Annuity plan
□Applicable √Not applicable
5. Termination of operations
□Applicable √Not applicable
6. Information of divisions
(1). Determination basis and accounting policy of reporting divisions
√Applicable □Not applicable
Information of divisions is reported based on business divisions of the Group. In theidentification of region-based divisions, revenue is attributable to the divisions in the regionswhere the clients are located, and assets are attributable to the divisions in the regions wherethe assets are located. As the Group’s main operating activities and operating assets are bothconcentrated in mainland China, it is not required to report more detailed information onregion-based divisions.
The Group’s businesses are organized and managed separately based on the nature ofbusiness and the products and services provided. Each business division of the Group is abusiness department or a subsidiary and provides the products and services that face the riskdifferent from that faced by other business divisions and bring the compensations differentfrom those brought by other business divisions. The detailed information on business divisionsare summarized as follows:
(a) Market operation segment refers to the business that the Group is engaged in marketoperation, including the collection of business space usage fees and the rent of auxiliarybuildings and office buildings;
(b) The commodities sales division engages in the purchase and sale of goods such asexport trade;
(c) The hotel service division engages in the operation of hotels including accommodationand catering services;
(d) The exhibition advertising division engages in the design, production, placement andagency of advertisements;
(e) Other services division covers the provision of market-related auxiliary services.
The transfer pricing between divisions is made based on the prices offered to third partiesand the then prevailing market prices.
(2). Financial information of reporting divisions
√Applicable □Not applicable
Unit: RMB million
| Item | Market operation | Sales of goods | Hotel service | Exhibition and advertising | Other services | Set-offs among divisions | Total |
| Revenue from external transactions | 1,964 | 4,962 | 190 | 86 | 418 | - | 7,620 |
| Revenue from inter-division transactions | 38 | 140 | 8 | 23 | 78 | 287 | - |
| Profits before tax | 1,174 | 29 | -46 | -8 | -11 | -13 | 1,151 |
| Total assets | 40,624 | 1,199 | 440 | 176 | 10,127 | 20,454 | 32,112 |
| Total liabilities | 25,052 | 1,060 | 478 | 97 | 5,064 | 14,922 | 16,829 |
| Capital expenditures | 1,501 | 1 | 2 | 3 | 2,378 | - | 3,885 |
| Long-term equity investment in joint ventures and associates | 4,805 | 1 | - | - | 1,227 | - | 6,033 |
(3). If the Company does not have reporting divisions or is unable to disclose the total
assets and total liabilities of each division, please explain
□Applicable √Not applicable
(4). Other statements
□Applicable √Not applicable
7. Other important transactions and events that have influence on investors’ decisions
□Applicable √Not applicable
8. Others
□Applicable √Not applicable
XVII. Notes to main items in financial statements of parent company
1. Accounts receivable
(1). Disclosure based on account age
√Applicable □Not applicable
Unit: RMB
| Account age | Closing book balance |
| Within 1 year | |
| In which: sub-items | |
| Within 1 year | 20,584,932.68 |
| Within 1 year | 20,584,932.68 |
| 1 to 2 years | 1,764,722.07 |
| 2 to 3 years | 100,234.00 |
| Over 3 years | - |
| Total | 22,449,888.75 |
(2). Categorized disclosure based on the bad debt provision method
√Applicable □Not applicable
Unit: RMB
| Category | Closing balance | Opening balance | ||||||||
| Book balance | Bad debt provision | Book value | Book balance | Bad debt provision | Book value | |||||
| Amount | Proportion (%) | Amount | Provision ratio (%) | Amount | Proportion (%) | Amount | Provision ratio (%) | |||
| Accounts receivable for which bad debt provision is made individually | - | - | - | - | - | - | - | - | - | - |
| Accounts receivable for which bad debt provision is made by group | 22,449,888.75 | 100.00 | 417,498.04 | 1.86 | 22,032,390.71 | 23,657,185.16 | 100.00 | 27,502.47 | 0.12 | 23,629,682.69 |
| Among them: | ||||||||||
| Accounts receivable for which the bad debts are provided by combination of credit risk characteristics | 22,449,888.75 | 100.00 | 417,498.04 | 1.86 | 22,032,390.71 | 23,657,185.16 | 100.00 | 27,502.47 | 0.12 | 23,629,682.69 |
| Total | 22,449,888.75 | / | 417,498.04 | / | 22,032,390.71 | 23,657,185.16 | / | 27,502.47 | / | 23,629,682.69 |
Accounts receivable for which bad debt provision is made individually:
□Applicable √Not applicable
Explanation for making bad debt provision for accounts receivable by group:
√Applicable □Not applicable
Items for which the bad debts are provided for by combination: by combination of credit riskcharacteristics
Unit: RMB
| Name | Closing balance | ||
| Accounts receivable | Bad debt provision | Provision ratio (%) | |
| Provision for bad debt by combination of credit risk characteristics | 22,449,888.75 | 417,498.04 | 1.86 |
| Total | 22,449,888.75 | 417,498.04 | 1.86 |
Standard for recognition of provision for bad debt by combination of credit risk characteristicsand descriptions:
□Applicable √Not applicable
If the bad debt provision is made according to the general model of expected credit loss,please refer to the disclosure of other receivables:
√Applicable □Not applicable
Unit: RMB
| Account age | 2022 | 2021 | ||||
| Estimated book balance in default | Expected credit loss rate (%) | Expected credit loss in whole duration | Estimated book balance in default | Expected credit loss rate (%) | Expected credit loss in whole duration | |
| Within 1 year | 20,584,932.68 | 1.85 | 380,030.68 | 23,204,362.72 | 0.01 | 50.87 |
| 1 - 2 years | 1,764,722.07 | 1.76 | 30,982.21 | 100,234.00 | 0.29 | 286.13 |
| 2 -3 years | 100,234.00 | 6.47 | 6,485.15 | 352,588.44 | 7.70 | 27,165.47 |
| Total | 22,449,888.75 | 417,498.04 | 23,657,185.16 | 27,502.47 | ||
(3). Provisions for bad debts
√Applicable □Not applicable
Unit: RMB
| Category | Opening balance | Amount of change during the current period | Closing balance | |
| Provision | Recovery or reversal | |||
| Bad debt provision for accounts receivable | 27,502.47 | 762,218.41 | 372,222.84 | 417,498.04 |
| Total | 27,502.47 | 762,218.41 | 372,222.84 | 417,498.04 |
In which the recovered or reversed amount is important:
□Applicable √Not applicable
(4). Accounts receivable actually written off during the current period
□Applicable √Not applicable
Information of write-off of important accounts receivable
□Applicable √Not applicable
(5). Accounts receivable from the five debtors with the highest closing balance
□Applicable √Not applicable
(6). Accounts receivable derecognized due to transfer of financial assets
□Applicable √Not applicable
(7). Amounts of assets and liabilities formed by the transfer of accounts receivable and
continuing involvement
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
2. Other receivables
Presentation of items
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Interest receivable | - | 92,249,275.44 |
| Other receivables | 329,607,469.39 | 1,114,837,610.55 |
| Total | 329,607,469.39 | 1,207,086,885.99 |
Other notes:
□Applicable √Not applicable
Interest receivable
(1). Classification of interest receivable
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance |
| Cash occupation fee for receivables | - | 92,249,275.44 |
| Total | - | 92,249,275.44 |
(2). Significant overdue interest
□Applicable √Not applicable
(3). Bad debt provision
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Dividend receivable
(1). Dividend receivable
□Applicable √Not applicable
(2). Important dividend receivable with an account age longer than 1 year
□Applicable √Not applicable
(3). Bad debt provision
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Other receivables
(1). Disclosure based on account age
√Applicable □Not applicable
Unit: RMB
| Account age | Closing book balance |
| Within 1 year | |
| In which: sub-items | |
| Within 1 year | 4,851,948.94 |
| Within 1 year | 4,851,948.94 |
| 1 to 2 years | 419,739.44 |
| 2 to 3 years | 322,708,656.80 |
| Over 3 years | 2,415,046.44 |
| Bad debt provision for other receivables | -787,922.23 |
| Total | 329,607,469.39 |
(2). Classification based on the nature of accounts
√Applicable □Not applicable
Unit: RMB
| Nature of receivable | Closing book balance | Opening book balance |
| Financial assistance receivable from joint ventures | 323,786,912.09 | 1,103,178,748.00 |
| Withholdings, deposit and margin | 5,772,216.82 | 11,391,654.06 |
| Reserve | 48,340.48 | 267,208.49 |
| Total | 329,607,469.39 | 1,114,837,610.55 |
(3). Bad debt provision
√Applicable □Not applicable
Unit: RMB
| Bad debt provision | Stage 1 | Stage 2 | Stage 3 | Total |
| Expected credit loss in the coming 12 months | Expected credit loss in the entire duration (credit has not been impaired) | Expected credit loss in the entire duration (credit has been impaired) | ||
| Balance as at January 1, 2022 | 893,309.10 | 893,309.10 | ||
| Balance as of January 1, 2022 in current period | ||||
| Provision made in the current period | 26,743.27 | 26,743.27 | ||
| Current reversal | 128,241.54 | 128,241.54 | ||
| Current write-off | 3,888.60 | 3,888.60 | ||
| Balance as of December 31, 2022 | 787,922.23 | 787,922.23 |
Significant changes in the book balance of other receivables with changes in loss provisions:
□Applicable √Not applicable
Basis for the bad debt provision made in the current period and for assessing whether thecredit risk of financial instruments has increased significantly:
□Applicable √Not applicable
(4). Provisions for bad debts
√Applicable □Not applicable
Unit: RMB
| Category | Opening balance | Amount of change during the current period | Closing balance | ||
| Provision | Recovery or reversal | Charge-off or write-off | |||
| Bad debt provision for other receivables | 893,309.10 | 26,743.27 | 128,241.54 | 3,888.60 | 787,922.23 |
| Total | 893,309.10 | 26,743.27 | 128,241.54 | 3,888.60 | 787,922.23 |
In which the recovered or reversed amount is important:
□Applicable √Not applicable
(5). Other receivables actually written off during the current period
√Applicable □Not applicable
Unit: RMB
| Item | Amount written-off |
| Other receivables actually written off | 3,888.60 |
Of which, important write-offs of other receivables:
□Applicable √Not applicable
Notes on the write-off of other receivables:
□Applicable √Not applicable
(6). Other receivables from the five debtors with highest closing balance
√Applicable □Not applicable
Unit: RMB
| Debtor | Nature of receivable | Closing balance | Account age | Weight in the total closing balance of other receivables (%) | Bad debt provision Closing balance |
| Yiwu Handing Shangbo Real Estate Co., Ltd. | Financial assistance | 207,750,200.00 | 2-3 years | 62.88 | |
| Yiwu Tonghui Shangbo Real Estate Co., Ltd. | Financial assistance | 116,036,712.09 | 2-3 years | 35.12 | |
| Yiwu China Commodities City Information Technology Co., Ltd. | Current accounts | 648,400.16 | Within 1 year | 0.20 | |
| Zhejiang Yuntong Advertising Co., Ltd. | Current accounts | 596,580.00 | Over 3 years | 0.18 | 596,580.00 |
| Yiwu Market Development Service Center Co., Ltd. | Current accounts | 562,755.00 | Within 1 year | 0.17 | |
| Total | / | 325,594,647.25 | / | 98.55 | 596,580.00 |
(7). Receivables involving government grants
□Applicable √Not applicable
(8). Other receivables derecognized due to transfer of financial assets
□Applicable √Not applicable
(9). Amounts of assets and liabilities formed by the transfer of other receivables andcontinuing involvement
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
3. Long-term equity investment
√Applicable □Not applicable
Unit: RMB
| Item | Closing balance | Opening balance | ||||
| Book balance | Impairment provision | Book value | Book balance | Impairment provision | Book value | |
| Investment in subsidiaries | 4,980,206,448.14 | 570,000,000.00 | 4,410,206,448.14 | 4,190,057,937.33 | 570,000,000.00 | 3,620,057,937.33 |
| Investment in associates and joint ventures | 4,800,215,865.20 | - | 4,800,215,865.20 | 4,625,942,083.47 | - | 4,625,942,083.47 |
| Total | 9,780,422,313.34 | 570,000,000.00 | 9,210,422,313.34 | 8,816,000,020.80 | 570,000,000.00 | 8,246,000,020.80 |
(1). Investment in subsidiaries
√Applicable □Not applicable
Unit: RMB
| Investee | Opening balance | Increase in the current period | Decrease in the current period | Closing balance | Current provision for impairment | Closing balance of impairment provision |
| Yiwu China Commodities City Financial Holdings Co., Ltd. | 2,198,447,939.64 | 40,978,302.76 | 2,239,426,242.40 | - | ||
| Haicheng Yiwu China Commodities City Investment Development Co., Ltd. | 570,714,398.12 | 562,987.97 | 571,277,386.09 | - | 570,000,000.00 | |
| Yiwu Shangbo | 300,000,000.00 | - | 300,000,000.00 | - | ||
| Yiwu Commodities City Gonglian Property Co., Ltd. | 200,000,000.00 | 200,000,000.00 | - | |||
| Zhejiang China Commodities City Group Commercial Factoring Co., Ltd. | 120,000,000.00 | 59,576.13 | 120,059,576.13 | - | ||
| Yiwu China Commodities City Big Data Co., Ltd. | 101,431,713.08 | 1,552,922.55 | 102,984,635.63 | - |
| Yiwu China Commodities City Import and Export Co., Ltd. | 101,431,713.08 | 902,299.59 | 102,334,012.67 | - | ||
| Yiwu China Commodities City Supply Chain Management Co., Ltd. | 100,796,692.53 | 468,626.60 | 101,265,319.13 | - | ||
| Yiwu China Commodities City Overseas Investment and Development Co., Ltd. | 100,790,663.70 | 749,590.26 | 101,540,253.96 | - | ||
| Yiwu China Commodities City Tourism Development Co., Ltd. | 71,432,375.17 | 29,545,583.97 | 100,977,959.14 | - | ||
| Yiwu China Commodities City Logistics and Distribution Co., Ltd. | 63,381,789.92 | 38,549,367.17 | 101,931,157.09 | - | ||
| Zhejiang Huajie Investment and Development Co., Ltd. | 61,860,722.12 | 12,562,375.41 | 74,423,097.53 | - | ||
| Yiwu China Commodities City Information Technology Co., Ltd. | 50,594,000.00 | 371,115.90 | 50,965,115.90 | - | ||
| Hangzhou Shangbo Nanxing Property Co., Ltd. | 50,000,000.00 | - | 50,000,000.00 | - | ||
| Yiwu China Commodities City Exhibition Co., Ltd. | 18,857,277.74 | 1,168,783.16 | 360,000.00 | 19,666,060.90 | - | |
| Yiwu Comprehensive Bonded Zone Operation and Management Co., Ltd. | 18,692,136.32 | 17,976,554.04 | 36,668,690.36 | - | ||
| Yiwu China Commodities City Assets Operation and Management Co., Ltd. | 10,000,000.00 | 1,375,213.90 | 11,375,213.90 | - | ||
| Yiwu China Commodities City Advertising Co., Ld. | 39,983,736.30 | - | 39,983,736.30 | - | - | |
| Yiwu China Commodities City Research Institute Co., Ltd. | 5,795,057.77 | 5,413,134.72 | 11,208,192.49 | - | ||
| Zhejiang Yindu Hotel Management Co., Ltd. | 5,747,721.84 | 7,786,830.09 | 13,534,551.93 | - | ||
| Yiwu China Commodities City Commerce and Trade Service Training Center Co., Ltd. | 100,000.00 | 500,000.00 | 600,000.00 | - | ||
| Yiwu Shangbo Shuzhi Enterprise Management Co., Ltd. | - | 225,600,000.00 | 225,600,000.00 | - |
| Zhejiang Xunchi Digital Technology Co., Ltd. | - | 444,368,982.89 | 444,368,982.89 | - | ||
| Total | 4,190,057,937.33 | 830,492,247.11 | 40,343,736.30 | 4,980,206,448.14 | - | 570,000,000.00 |
(2). Investment in associates and joint ventures
√Applicable □Not applicable
Unit: RMB
| Investment Unit | Opening amount Balance | Change in the current period | Closing amount Balance | Closing balance of impairment provision | |||
| Additional investment | Decrease in investment | Investment profits or losses recognized with the equity method | Declared a cash dividend or profit | ||||
| 1. Joint ventures | |||||||
| Yiwu Shanglv Investment Development Co., Ltd. | 383,668,354.21 | 13,304,094.72 | 396,972,448.93 | ||||
| Yiwu Rongshang Real Estate Co., Ltd. | 217,387,537.94 | 429,128,964.52 | 580,865,600.00 | 65,650,902.46 | |||
| Yiwu Chuangcheng Real Estate Co., Ltd. | 88,063,325.80 | 134,862,766.92 | 194,476,800.00 | 28,449,292.72 | |||
| Others | 50,165,047.97 | 50,639,041.32 | - | 100,804,089.29 | |||
| Sub-total | 739,284,265.92 | 627,934,867.48 | 775,342,400.00 | 591,876,733.40 | |||
| 2. Associates | |||||||
| Hangzhou Binjiang Shangbo Property Development Co., Ltd. | 34,476,229.08 | 24,500,000.00 | 3,893,136.86 | 13,869,365.94 | - | ||
| Yiwu Huishang Micro-finance Co., Ltd. | 82,824,696.64 | 6,210,000.00 | 1,595,283.18 | 78,209,979.82 | |||
| Zhejiang Chouzhou Financial Lease Co., Ltd. | 426,020,849.24 | 63,184,700.67 | 489,205,549.91 | ||||
| Pujiang Lvgu Property Co., Ltd. | 449,927,811.36 | 12,873,349.31 | 88,200,000.00 | 374,601,160.67 | |||
| Yiwu China Commodities City | 2,785,883,275.44 | 198,926,743.97 | 2,984,810,019.41 | ||||
| Property Development Co., Ltd. | |||||||
| Zhejiang Zhijie Yuangang International Supply Chain Technology Co., Ltd. | - | 150,000,000.00 | -4,436,560.67 | 145,563,439.33 | |||
| Others | 107,524,955.79 | - | 28,424,026.87 | 135,948,982.66 | |||
| Sub-total | 3,886,657,817.55 | 150,000,000.00 | 30,710,000.00 | 304,460,680.19 | 102,069,365.94 | 4,208,339,131.80 | |
| Total | 4,625,942,083.47 | 150,000,000.00 | 30,710,000.00 | 932,395,547.67 | 877,411,765.94 | 4,800,215,865.20 |
Other notes:
Nil
4. Operating revenue and operating cost
(1). Overview of operating revenue and operating cost
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period | ||
| Revenue | Cost of sales | Revenue | Cost of sales | |
| Main business | 1,661,326,251.95 | 856,617,946.98 | 2,538,880,872.96 | 944,011,791.40 |
| Other businesses | 280,256,309.07 | 80,555,208.55 | 383,244,529.97 | 118,870,105.91 |
| Total | 1,941,582,561.02 | 937,173,155.53 | 2,922,125,402.93 | 1,062,881,897.31 |
(2). Revenue generated from contracts
√Applicable □Not applicable
Unit: RMB
| Classified by type of contract | Total |
| Types of goods | |
| The use of shops in the Commodity City and its supporting services | 1,508,941,417.59 |
| Hotel accommodation and catering services | 190,167,588.25 |
| Revenue from use fees | 35,930,028.91 |
| Other services | 3,007,248.54 |
| Classified by business area | |
| Chinese mainland | 1,738,046,283.29 |
| Classified by contract period | |
| Revenue confirmed at certain time point | |
| Hotel catering services | 103,890,861.39 |
| Other services | 2,907,210.24 |
| Revenue confirmed during certain time period | |
| The use of shops in the Commodity City and its supporting services | 1,508,941,417.59 |
| Hotel accommodation service | 86,276,726.86 |
| Revenue from use fees | 35,930,028.91 |
| Other services | 100,038.30 |
| Total | 1,738,046,283.29 |
Description of the income from contracts:
√Applicable □Not applicable
The income recognized in the current year and included in the opening book value ofcontractual liabilities is as follows:
Unit: RMB
| Type of contract | Current period |
| The use of shops in the Commodity City and its supporting services | 1,249,439,751.56 |
| Hotel accommodation service | 11,260,471.19 |
| Other services | 1,801,326.20 |
| Total | 1,262,501,548.95 |
(3). Contract performance obligations
√Applicable □Not applicable
The information related to the performance obligations of the Group is as follows:
The use of shops in the Commodity City and its supporting servicesThe contractual performance obligation is fulfilled when providing the use of shops in theCommodity City and the supporting services for business. For the use of shops in theCommodity City and the supporting services for business, the progress of contractperformance is determined based on the number of using days of the shops. Customersusually need to pay in advance before the use of shops in the Commodity City and thesupporting services for business are provided.Hotel accommodation businessThe performance obligation is fulfilled when providing hotel accommodation services. Forthe hotel accommodation business, the progress of contractual performance is determinedbased on the number of days of stay. For hotel accommodation services, a partial deposit iscollected from the customer first, and the remaining contract price is usually collected upon thecompletion of the hotel accommodation services.Hotel catering businessThe performance obligation is fulfilled when the hotel catering services are provided. Thecontract price for hotel catering services is usually charged when the hotel catering servicesare performed.Fixed -time paid funding servicesThe performance obligation is fulfilled when the fixed-time paid funding service isprovided. For the fixed-time paid funding service, the progress of contractual performance isdetermined based on the number of using days the fund. For the fixed-time paid fundingservice, the contract price is usually charged regularly as agreed in the contract.
(4). Amortization to remaining contract performance obligations
□Applicable √Not applicable
Other notes:
As of December 31, 2022, the transaction price allocated to the remaining performanceobligations was RMB 3,032,044,768.16. The Group expects that this amount will berecognized as an income in the coming 5 years with the progress of relevant service provision.
5. Investment income
√Applicable □Not applicable
Unit: RMB
| Item | Amount in the current period | Amount in the previous period |
| Income from long-term equity investment with the cost method | - | 40,000,000.00 |
| Income from long-term equity investment calculated with the equity method | 932,395,547.67 | 544,982,046.87 |
| Investment income from disposal of long-term equity investment | 270,094.36 | - |
| Dividend income from other equity instruments investment during holding period | 12,542,733.80 | 12,542,733.80 |
| Investment income from disposal of held-for-trading financial assets | 47,694.29 | 67,265.74 |
| Income acquired from other non-current financial assets during the holding period | 2,978,950.32 | 728,950.32 |
| Total | 948,235,020.44 | 598,320,996.73 |
Other notes:
Nil
6. Others
□Applicable √Not applicable
XVIII. Supplements
1. Detailed statement of current non-recurring items
√Applicable □Not applicable
Unit: RMB
| Item | Amount | Description |
| Profits or losses from the disposal of non-current assets | -1,130,587.34 | |
| Government grants that are recognized in the current profit or loss, excluding government grants that are closely related to the businesses of the Company and are provided in a fixed amount or quantity according to the unified national standards | 38,802,436.81 | Please refer to details of other income and government grants accounted for profit or loss for the current period |
| Cash occupation fees charged from non-financial enterprises that are recognized in the current profit or loss | 52,315,023.80 | Cash occupation fee for receiving financial aid |
| Profits or losses from changes in fair value of held-for-trading financial assets, derivative financial assets, financial liabilities held for trading and derivative financial liabilities, and investment income from the disposal of held-for-trading financial assets, derivative financial assets, financial liabilities held for trading, derivative financial liabilities and other debt instruments, except for effective hedging during the ordinary course of business | 166,489.60 | Mainly due to profits or losses arising from the change in fair value |
| Profits and losses arising from external entrusted loans | 79,561.64 | |
| Net income from other non-operating activities | 3,244,125.63 | |
| Other profit and loss items that meet the definition of non-recurring profit and loss | -975,086,670.50 | Mainly due to the implementation of the rent reduction policy |
| Less: effect of income tax | -223,084,975.36 | |
| Effect of minority interest | 1,843,816.52 | |
| Total | -660,368,461.52 |
Explanations shall be made for the non-recurring items identified by the Company accordingthe Explanatory Announcement No. 1 on Information Disclosure by Companies PubliclyOffering Securities – Non-recurring Items, and for the Company identifying the non-recurringitems enumerated in the Explanatory Announcement No. 1 on Information Disclosure byCompanies Publicly Offering Securities – Non-recurring Items as recurring items.
□Applicable √Not applicable
2. ROE and EPS
√Applicable □Not applicable
| Profits in the reporting period | Weighted average ROE (%) | EPS | |
| Basic EPS | Diluted EPS | ||
| Net profits attributable to common shareholders of the Company | 7.30 | 0.20 | 0.20 |
| Net profits attributable to common shareholders of the Company after deducting non-recurring profits and losses | 11.67 | 0.32 | 0.32 |
3. Differences in accounting data between foreign and Chinese accounting standards
□Applicable √Not applicable
4. Others
□Applicable √Not applicable
Chairman of Board of Directors: ZHAO WengeDate of approving by the board of directors for release: April 12, 2023
Amendment
□Applicable √Not applicable