深纺织Ｂ：2021年年度审计报告（英文版）

Shenzhen Textile (Holdings) Co., Ltd.

Auditor’s Report

Grant Thornton International Ltd（Special General Partnership）

Table of contents

Auditor’ s Report	1-4
Consolidated and Company Balance sheet	5-11
Consolidated and company Income statement	12-14
Consolidated and company Cash flow statement	15-19
Consolidated and company Statement on Change in Owners’Equity	20-24
Notes to financial statements	25-134

Auditor’ s Report

Zhi Tong Shen Zi（2022）No.441A002000

To all shareholders of Shenzhen Textile (Holdings) Co., Ltd：

I. OpinionWe have audited the financial statements of Shenzhen Textile (Holdings) Co., Ltd . (hereinafterreferred to as "the Company"), which comprise the balance sheet as at December 31, 2021, and theincome statement, the statement of cash flows and the statement of changes in owners' equity for theyear then ended and notes to the financial statements.In our opinion, the attached financial statements are prepared, in all material respects, in accordancewith Accounting Standards for Business Enterprises and present fairly the financial position of theCompany as at December 31, 2021 and its operating results and cash flows for the year then ended.II. Basis for Our OpinionWe conducted our audit in accordance with the Auditing Standards for Certified Public Accountantsin China. Our responsibilities under those standards are further described in the Auditor'sResponsibilities for the Audit of the Financial Statements section of our report. According to theCode of Ethics for Chinese CPA, we are independent of the Company in accordance with the Codeof Ethics for Chinese CPA and we have fulfilled our other ethical responsibilities in accordance withthese requirements. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion.III. Key Audit MattersKey audit matters are those matters that, in our professional judgment, were of most significance inour audit of the financial statements of the current period. These matters were addressed in thecontext of our audit of the financial statements as a whole, and in forming our opinion thereon, andwe do not provide a separate opinion on these matters.

(1) Recognition of revenue

Please refer to Note V, 26 and Note VII, 42 to the financial statement for details of the relevantinformation disclosure.

1.Description of matters

The operating income of Shenzhen Textile in 2021 was RMB 2,293.7479 million, of which themain business income was RMB 2,265.9906 million, accounting for 98.79%. As revenue is one ofthe key performance indicators of Shenzhen Textile, there is inherent risk that the Company'smanagement manipulates revenue recognition in order to achieve specific goals or expectations, andsince the main business income is large, we identify revenue recognition as a key audit item.

2. Response to the audit

For revenue recognition, we mainly implemented the following audit procedures:

(1) Understand, evaluate and test the design effectiveness and operation effectiveness of internalcontrol related to sales revenue cycle;

(2) Obtain the main sales contracts according to the products and business types, check the relevantclauses related to revenue recognition, and interview the management to evaluate whether therevenue recognition meets the requirements of accounting standards;

(3) Implement analytical procedures, compare the changes of income between this year and last yearaccording to product types, observe the fluctuations of income between months and the changes ofimportant customers in this period, and analyze the rationality of income changes based on factorssuch as the company's production capacity, market expansion and industry trends;

(4) Perform detailed tests to check whether the basis related to sales revenue recognition is sufficient,including checking sales contracts or performing detailed tests, including checking sales contracts ororders, delivery orders, customs declarations and other supporting documents, evaluate theauthenticity and accuracy of revenue recognition, and evaluate the authenticity and accuracy ofrevenue recognition;

(5) Perform cut-off test to evaluate whether income is recorded in the proper accounting period;

(6) Select samples from major customers on this recognition procedures, and perform alternativetests on the non-replied parts to judge the authenticity of sales revenue.

(2) Inventory falling price reserves

Please refer to Note V, 12 and Note VII, 8 to the financial statement for details of the relevantinformation disclosure.

1.Description of matters

As of December 31, 2021, the balance of inventory depreciation reserve of Shenzhen Textile isRMB 98.0359 million. As the inventory depreciation reserve and its changes have a significantinfluence on the financial statements, the determination of the net realizable value of inventoryinvolves the major judgment and estimation of the management, so we identify the inventorydepreciation reserve as a key audit item.

2. Response to the audit

The audit process implemented for inventory falling price reserves includes mainly:

(1) Understand, evaluate and test the design and operation effectiveness of internal control related toinventory depreciation reserve;

(2) Understand and evaluate the appropriateness of the Company's accrual policy for inventorydepreciation reserve;

(3) Understand and inquire about inventory storage location and inventory accounting method, anddetermine the scope of inventory supervision; Implement inventory supervision procedures to checkwhether the inventory is damaged, obsolete, outdated, defective, etc.;

(4) Obtain the inventory year-end inventory age list, and carry out analytical review of inventory ageaccording to the status of products to analyze whether the inventory depreciation reserve isreasonable;

(5) Review and evaluate the rationality of the major estimates made by the management whendetermining the net realizable value;

(6) Obtain the calculation table of inventory depreciation reserve, check whether the accrual ofinventory depreciation reserve is implemented according to relevant accounting policies, andrecalculate the inventory depreciation reserve; Check the changes of inventory depreciation accruedin previous years, evaluate the rationality of estimated selling price and estimated related taxes andfees as key parameters of net realizable value, review the sufficiency of basis of estimated sellingprice, and analyze the rationality of inventory depreciation reserve.IV. Other information

The management of the Company is responsible for the other information. The other informationcomprises information of the Company's annual report in 2021, but excludes the financial statementsand our auditor's report.Our opinion on the financial statements does not cover the other information and we do not and willnot express any form of assurance conclusion thereon.In connection with our audit of the financial statements, our responsibility is to read the otherinformation identified above and, in doing so, consider whether the other information is materiallyinconsistent with the financial statements or our knowledge obtained in the audit, or otherwiseappears to be materially misstated.If, based on the work we have performed on the other information that we obtained prior to the dateof this auditor's report, we conclude that there is a material misstatement of this other information,we are required to report that fact. We have nothing to report in this regardV. Responsibilities of Management and Those Charged with Governance for the FinancialStatementsThe Company's management is responsible for preparing the financial statements in accordance withthe requirements of Accounting Standards for Business Enterprises to achieve a fair presentation,and for designing, implementing and maintaining internal control that is necessary to ensure that thefinancial statements are free from material misstatements, whether due to frauds or errors.In preparing the financial statements, management of the Company is responsible for assessing theCompany's ability to continue as a going concern, disclosing matters related to going concern andusing the going concern basis of accounting unless management either intends to liquidate theCompany or to cease operations, or has no realistic alternative but to do so.Those charged with governance are responsible for overseeing the Company's financial reportingprocess.VI. Auditor's Responsibilities for the Audit of the Financial StatementsOur objectives are to obtain reasonable assurance about whether the financial statements as a wholeare free from material misstatement, whether due to fraud or error, and to issue an auditor's reportthat includes our opinion. Reasonable assurance is a high level of assurance, but is not a guaranteethat an audit conducted in accordance with the audit standards will always detect a materialmisstatement when it exists. Misstatements can arise from fraud or error and are considered materialif, individually or in the aggregate, they could reasonably be expected to influence the economicdecisions of users taken on the basis of these financial statements.As part of an audit in accordance with ISAs, we exercise professional judgment and maintainprofessional scepticism throughout the audit. We also:

(1) Identify and assess the risks of material misstatement of the financial statements, whether due tofraud or error, design and perform audit procedures responsive to those risks, and obtain auditevidence that is sufficient and appropriate to provide a basis for our opinion. The risk of notdetecting a material misstatement resulting from fraud is higher than for one resulting from error, asfraud may involve collusion, forgery, omissions, misrepresentations, or the override of internalcontrol.

(2) Obtain an understanding of internal control relevant to the audit in order to design auditprocedures that are appropriate in the circumstances.

(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accountingestimates and related disclosures made by management of the Company.

(4) Conclude on the appropriateness of using the going concern assumption by the management ofthe Company, and conclude, based on the audit evidence obtained, whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company's ability tocontinue as a going concern. If we conclude that a material uncertainty exists, we are required to

draw attention in our auditor's report to the related disclosures in the financial statements or, if suchdisclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However, future events or conditions may cause theCompany to cease to continue as a going concern.

(5) Evaluate the overall presentation, structure and content of the financial statements, including thedisclosures, and whether the financial statements represent the underlying transactions and events ina manner that achieves fair presentation.

(6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities orbusiness activities within the Company to express an opinion on the financial statements and bear allliability for the opinion.We communicate with those charged with governance regarding, among other matters, the plannedscope and timing of the audit and significant audit matters, including any significant deficiencies ininternal control that we identify during our audit.We also provide those charged with governance with a statement that we have complied withrelevant ethical requirements regarding independence, and to communicate with them allrelationships and other matters that may reasonably be thought to bear on our independence, andwhere applicable, related safeguards.From the matters communicated with those charged with governance, we determine those mattersthat were of most significance in the audit of the financial statements of the current period and aretherefore the key audit matters.We describe these matters in our auditor's report unless law or regulation precludes public disclosureabout the matter or when, in extremely rare circumstances, we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonably beexpected to outweigh the public interest benefits of such communication.

Grant Thornton International Ltd.(Special General Partnership ）	Chinese C.P.A.： Project Partner Chinese C.P.A.：
Beijing China	March 15,2022

Consolidated balance sheetPrepared by: Shenzhen Textile (Holdings) Co., Ltd. In RMB

Items	December 31,2021	December 31,2020
Current asset：
Monetary fund	302,472,828.60	279,087,236.95
Settlement provision
Outgoing call loan
Transactional financial assets	586,540,735.16	684,617,260.06
Derivative financial assets
Note receivable	149,942,880.28	16,813,657.28
Account receivable	479,998,708.57	547,310,217.90
Financing of receivables	21,474,101.07	102,051,314.08
Prepayments	15,406,619.53	16,902,516.39
Insurance receivable
Reinsurance receivable
Provisions of Reinsurance contracts receivable
Other account receivable	140,185,750.40	5,265,002.71
Including：Interest receivable
Dividend receivable
Repurchasing of financial assets
Inventories	667,461,447.03	480,847,581.44
Contract assets
Assets held for sales
Non-current asset due within 1 year
Other current asset	29,503,352.42	77,482,083.47
Total of current assets	2,392,986,423.06	2,210,376,870.28
Non-current assets：
Loans and payment on other’s behalf disbursed
Creditor's right investment
Other creditor's right investment
Long-term receivable
Long term share equity investment	133,022,325.77	147,929,137.23
Other equity instruments investment	186,033,829.72	190,607,427.54
Other non-current financial assets	30,650,943.40	30,650,943.40
Real estate investment	106,217,779.76	110,572,471.92
Fixed assets	2,424,741,252.86	790,183,905.38
Construction in progress	71,482,031.08	1,301,750,141.12
Production physical assets
Oil & gas assets
Use right assets	9,221,189.37
Intangible assets	48,635,160.00	36,048,978.91
Development expenses
Goodwill
Long-germ expenses to be amortized	5,387,295.94	2,876,561.53
Deferred income tax asset	3,708,596.78	5,243,425.26
Other non-current asset	84,560,280.09	143,307,689.66

Total of non-current assets	3,103,660,684.77	2,759,170,681.95
Total of assets	5,496,647,107.83	4,969,547,552.23
Current liabilities
Short-term loans	37,575,113.83
Loan from Central Bank
Borrowing funds
Transactional financial liabilities
Derivative financial liabilities
Notes payable	16,682,324.12
Account payable	283,643,842.23	329,468,601.90
Advance receipts	1,805,311.57	3,542,394.33
Contract liabilities	68,955.21	279,631.27
Selling of repurchased financial assets
Deposit taking and interbank deposit
Entrusted trading of securities
Entrusted selling of securities
Employees’ wage payable	59,719,860.24	55,642,549.53
Tax payable	9,200,627.09	12,198,522.02
Other account payable	201,317,421.35	156,118,440.42
Including：Interest payable
Dividend payable
Fees and commissions payable
Reinsurance fee payable
Liabilities held for sales
Non-current liability due within 1 year	5,175,393.52
Other current liability	27,523,903.58
Total of current liability	642,712,752.74	557,250,139.47
Non-current liabilities：
Reserve fund for insurance contracts
Long-term loan	683,016,243.25	343,100,174.35
Bond payable
Including：preferred stock
Sustainable debt
Lease liability	4,243,855.71
Long-term payable
Long-term remuneration payable to staff
Expected liabilities	30,741,055.00
Deferred income	110,461,293.15	110,740,322.21
Deferred income tax liability	61,642,660.91	59,141,666.58
Other non-current liabilities
Total non-current liabilities	890,105,108.02	512,982,163.14
Total of liability	1,532,817,860.76	1,070,232,302.61
Owners’ equity
Share capital	506,521,849.00	507,772,279.00
Other equity instruments
Including：preferred stock
Sustainable debt
Capital reserves	1,961,599,824.63	1,967,514,358.53
Less：Shares in stock		7,525,438.20
Other comprehensive income	119,682,119.05	116,605,932.42
Special reserve

Surplus reserves	98,245,845.47	94,954,652.14
Common risk provision
Retained profit	130,746,251.74	86,912,390.50
Total of owner’s equity belong to the parent company	2,816,795,889.89	2,766,234,174.39
Minority shareholders’ equity	1,147,033,357.18	1,133,081,075.23
Total of owners’ equity	3,963,829,247.07	3,899,315,249.62
Total of liabilities and owners’ equity	5,496,647,107.83	4,969,547,552.23

Legal Representative: Person-in-charge of the accounting work： Person-in -charge of the accountingorgan：

Parent Company Balance Sheet

In RMB

Items	December 31,2021	December 31,2020
Current asset：
Monetary fund	130,270,313.58	113,560,327.21
Transactional financial assets	586,540,735.16	514,277,000.82
Derivative financial assets
Note receivable
Account receivable	7,935,911.24	1,461,400.20
Financing of receivables
Prepayments		18,706.17
Other account receivable	14,383,631.68	7,450,934.40
Including：Interest receivable
Dividend receivable
Inventories	39,131.60	8,808.00
Contract assets
Assets held for sales
Non-current asset due within 1 year
Other current asset
Total of current assets	739,169,723.26	636,777,176.80
Non-current assets：
Creditor's right investment
Other creditor's right investment
Long-term receivable
Long term share equity investment	2,089,070,531.86	2,103,977,343.32
Other equity instruments investment	169,974,388.84	177,142,433.45
Other non-current financial assets
Real estate investment	98,174,132.57	101,644,481.93
Fixed assets	20,255,108.56	21,876,099.34
Construction in progress
Production physical assets
Oil & gas assets
Use right assets
Intangible assets	454,036.00	492,923.62
Development expenses
Goodwill

Long-germ expenses to be amortized
Deferred income tax asset	3,672,545.57	5,097,360.00
Other non-current asset	55,790,497.23	96,871,196.43
Total of non-current assets	2,437,391,240.63	2,507,101,838.09
Total of assets	3,176,560,963.89	3,143,879,014.89
Current liabilities
Short-term loans
Transactional financial liabilities
Derivative financial liabilities
Notes payable
Account payable	411,743.57	411,743.57
Advance receipts	639,024.58	2,875,936.58
Contract liabilities
Employees’ wage payable	16,712,946.96	14,824,723.81
Tax payable	1,943,470.48	11,497,591.21
Other account payable	116,648,650.39	95,023,378.12
Including：Interest payable
Dividend payable
Liabilities held for sales
Non-current liability due within 1 year
Other current liability
Total of current liability	136,355,835.98	124,633,373.29
Non-current liabilities：
Long-term loan
Bond payable
Including：preferred stock
Sustainable debt
Lease liability
Long-term payable
Long-term remuneration payable to staff
Expected liabilities
Deferred income	400,000.00	500,000.00
Deferred income tax liability	58,002,800.69	56,150,418.06
Other non-current liabilities
Total non-current liabilities	58,402,800.69	56,650,418.06
Total of liability	194,758,636.67	181,283,791.35
Owners’ equity
Share capital	506,521,849.00	507,772,279.00
Other equity instruments
Including：preferred stock
Sustainable debt
Capital reserves	1,577,392,975.96	1,583,307,509.86
Less：Shares in stock		7,525,438.20
Other comprehensive income	108,762,538.39	107,632,186.85
Special reserve
Surplus reserves	98,245,845.47	94,954,652.14
Retained profit	690,879,118.40	676,454,033.89
Total of owners’ equity	2,981,802,327.22	2,962,595,223.54
Total of liabilities and owners’ equity	3,176,560,963.89	3,143,879,014.89

Legal Representative: Person-in-charge of the accounting work： Person-in -charge of the accountingorgan：

Consolidated Income statement

In RMB

Items	Year 2021	Year 2020
I. Income from the key business	2,293,747,892.06	2,108,964,687.80
Incl：Business income	2,293,747,892.06	2,108,964,687.80
Interest income
Insurance fee earned
Fee and commission received
II. Total business cost	2,182,483,548.35	2,030,833,538.40
Incl：Business cost	1,908,519,413.28	1,814,298,395.02
Interest expense
Fee and commission paid
Insurance discharge payment
Net claim amount paid
Net amount of withdrawal of insurance contract reserve
Insurance policy dividend paid
Reinsurance expenses
Business tax and surcharge	10,523,548.09	7,347,125.65
Sales expense	37,973,336.39	28,644,230.87
Administrative expense	122,088,830.15	105,094,934.36
R & D costs	103,508,764.53	67,160,964.22
Financial expenses	-130,344.09	8,287,888.28
Including：Interest expense	14,306,275.13	234,815.67
Interest income	1,655,853.59	3,702,735.59
Add: Other income	19,643,379.33	29,506,252.69
Investment gain（“-”for loss）	22,663,013.06	22,599,670.74
Incl: investment gains from affiliates	33,984.66	-3,446,613.86
Financial assets measured at amortized cost cease to be recognized as income
Gains from currency exchange
Net exposure hedging income
Changing income of fair value	2,150,943.40	2,687,518.74
Credit impairment loss	-4,981,560.53	-10,394,533.65
Impairment loss of assets	-83,508,720.33	-72,412,477.63
Assets disposal income	-597,458.77	276,544.73
III. Operational profit（“-”for loss）	66,633,939.87	50,394,125.02
Add ：Non-operational income	21,285,786.64	1,445,662.38
Less: Non-operating expense	1,686,263.35	138,421.27
IV. Total profit(“-”for loss)	86,233,463.16	51,701,366.13
Less：Income tax expenses	11,118,796.96	8,203,720.98
V. Net profit	75,114,666.20	43,497,645.15
(I) Classification by business continuity
1.Net continuing operating profit	75,114,666.20	43,497,645.15
2.Termination of operating net profit

(II) Classification by ownership
1.Net profit attributable to the owners of parent company	61,162,384.25	37,267,995.74
2.Minority shareholders’ equity	13,952,281.95	6,229,649.41
VI. Net after-tax of other comprehensive income	3,076,186.63	-3,131,850.89
Net of profit of other comprehensive income attributable to owners of the parent company.	3,076,186.63	-3,131,850.89
（I）Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period	3,275,250.36	-2,815,824.67
1.Re-measurement of defined benefit plans of changes in net debt or net assets
2.Other comprehensive income under the equity method investee can not be reclassified into profit or loss.
3. Changes in the fair value of investments in other equity instruments	3,275,250.36	-2,815,824.67
4. Changes in the fair value of the company’s credit risks
5.Other
(II)Other comprehensive income that will be reclassified into profit or loss.	-199,063.73	-316,026.22
1.Other comprehensive income under the equity method investee can be reclassified into profit or loss.
2. Changes in the fair value of investments in other debt obligations
3. Other comprehensive income arising from the reclassification of financial assets
4.Allowance for credit impairments in investments in other debt obligations
5. Reserve for cash flow hedges
6.Translation differences in currency financial statements	-199,063.73	-316,026.22
7.Other
Net of profit of other comprehensive income attributable to Minority shareholders’ equity
VII. Total comprehensive income	78,190,852.83	40,365,794.26
Total comprehensive income attributable to the owner of the parent company	64,238,570.88	34,136,144.85
Total comprehensive income attributable minority shareholders	13,952,281.95	6,229,649.41
VIII. Earnings per share
（I）Basic earnings per share	0.12	0.07
(II)Diluted earnings per share	0.12	0.07

Legal Representative: Person-in-charge of the accounting work： Person-in -charge of the accountingorgan：

Income statement of the Parent Company

In RMB

Items	Year 2021	Year 2020
I. Income from the key business	78,159,686.19	61,296,888.21
Incl：Business cost	11,547,944.88	10,666,274.44
Business tax and surcharge	2,968,080.87	2,435,257.11
Sales expense	49,682.40
Administrative expense	45,821,418.49	38,680,586.21
R & D expense
Financial expenses	283,692.12	-1,020,628.37

Including：Interest expenses	645,507.87	13,780.96
Interest income	359,182.13	1,012,329.64
Add：Other income	602,709.52	117,006.72
Investment gain（“-”for loss）	20,409,098.48	35,656,479.65
Including: investment gains from affiliates	33,984.66	-3,446,613.86
Financial assets measured at amortized cost cease to be recognized as income
Net exposure hedging income
Changing income of fair value		392,767.12
Credit impairment loss	-710,513.74	-799,858.92
Impairment loss of assets	-32,769.22	-95,343.40
Assets disposal income	-386,933.41	286,963.56
II. Operational profit（“-”for loss）	37,370,459.06	46,093,413.55
Add ：Non-operational income	283,354.84	562,910.99
Less：Non -operational expenses		27,244.40
III. Total profit(“-”for loss)	37,653,813.90	46,629,080.14
Less：Income tax expenses	5,900,206.38	7,746,152.13
IV. Net profit	31,753,607.52	38,882,928.01
1.Net continuing operating profit
2.Termination of operating net profit	31,753,607.52	38,882,928.01
V. Net after-tax of other comprehensive income	1,130,351.54	-3,131,850.89
（I）Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period	1,329,415.27	-2,815,824.67
1.Re-measurement of defined benefit plans of changes in net debt or net assets
2.Other comprehensive income under the equity method investee can not be reclassified into profit or loss.
3. Changes in the fair value of investments in other equity instruments	1,329,415.27	-2,815,824.67
4. Changes in the fair value of the company’s credit risks
5.Other
(II)Other comprehensive income that will be reclassified into profit or loss	-199,063.73	-316,026.22
1.Other comprehensive income under the equity method investee can be reclassified into profit or loss.
2. Changes in the fair value of investments in other debt obligations
3. Other comprehensive income arising from the reclassification of financial assets
4.Allowance for credit impairments in investments in other debt obligations
5. Reserve for cash flow hedges
6.Translation differences in currency financial statements	-199,063.73	-316,026.22
7.Other
VI. Total comprehensive income	32,883,959.06	35,751,077.12
VII. Earnings per share
（I）Basic earnings per share	0	0
(II)Diluted earnings per share	0	0

Legal Representative: Person-in-charge of the accounting work： Person-in -charge of the accountingorgan：

Consolidated Cash flow statement

In RMB

Items	Year 2021	Year 2020
I.Cash flows from operating activities
Cash received from sales of goods or rending of services	2,335,256,168.54	1,827,292,276.43
Net increase of customer deposits and capital kept for brother company
Net increase of loans from central bank
Net increase of inter-bank loans from other financial bodies
Cash received against original insurance contract
Net cash received from reinsurance business
Net increase of client deposit and investment
Cash received from interest, commission charge and commission
Net increase of inter-bank fund received
Net increase of repurchasing business
Net cash received by agent in securities trading
Tax returned	9,423,408.29	116,428,895.93
Other cash received from business operation	88,625,329.53	123,408,000.43
Sub-total of cash inflow	2,433,304,906.36	2,067,129,172.79
Cash paid for purchasing of merchandise and services	1,860,349,920.78	1,742,576,211.51
Net increase of client trade and advance
Net increase of savings in central bank and brother company
Cash paid for original contract claim
Net increase in financial assets held for trading purposes
Net increase for Outgoing call loan
Cash paid for interest, processing fee and commission
Cash paid to staffs or paid for staffs	250,216,599.00	181,692,353.93
Taxes paid	101,786,653.96	43,712,017.07
Other cash paid for business activities	225,388,712.97	97,217,657.52
Sub-total of cash outflow from business activities	2,437,741,886.71	2,065,198,240.03
Net cash generated from /used in operating activities	-4,436,980.35	1,930,932.76
II. Cash flow generated by investing
Cash received from investment retrieving	10,817,803.07	6,437,640.00
Cash received as investment gains	14,881,941.03	2,908,856.94
Net cash retrieved from disposal of fixed assets, intangible assets, and other long-term assets	83,520.00	2,800,914.39
Net cash received from disposal of subsidiaries or other operational units
Other investment-related cash received	1,128,309,484.61	3,240,861,003.37
Sub-total of cash inflow due to investment activities	1,154,092,748.71	3,253,008,414.70
Cash paid for construction of fixed assets, intangible assets and other long-term assets	447,622,193.08	564,014,103.94
Cash paid as investment
Net increase of loan against pledge
Net cash received from subsidiaries and other operational units
Other cash paid for investment activities	965,000,000.00	3,008,065,275.20
Sub-total of cash outflow due to investment activities	1,412,622,193.08	3,572,079,379.14
Net cash flow generated by investment	-258,529,444.37	-319,070,964.44
III.Cash flow generated by financing
Cash received as investment

Including: Cash received as investment from minor shareholders
Cash received as loans	339,219,000.00	342,660,000.00
Other financing –related cash received
Sub-total of cash inflow from financing activities	339,219,000.00	342,660,000.00
Cash to repay debts
Cash paid as dividend, profit, or interests	38,306,691.13	3,511,622.58
Including: Dividend and profit paid by subsidiaries to minor shareholders
Other cash paid for financing activities	12,638,273.00	9,344,136.30
Sub-total of cash outflow due to financing activities	50,944,964.13	12,855,758.88
Net cash flow generated by financing	288,274,035.87	329,804,241.12
IV. Influence of exchange rate alternation on cash and cash equivalents	-1,236,414.38	-2,973,560.67
V.Net increase of cash and cash equivalents	24,071,196.77	9,690,648.77
Add: balance of cash and cash equivalents at the beginning of term	278,337,236.95	268,646,588.18
VI ..Balance of cash and cash equivalents at the end of term	302,408,433.72	278,337,236.95

Legal Representative: Person-in-charge of the accounting work： Person-in -charge of the accountingorgan：

Cash Flow Statement of the Parent Company

In RMB

Items	Year 2021	Year 2020
I.Cash flows from operating activities
Cash received from sales of goods or rending of services	66,467,384.64	64,167,036.73
Tax returned
Other cash received from business operation	42,417,781.16	6,524,378.62
Sub-total of cash inflow	108,885,165.80	70,691,415.35
Cash paid for purchasing of merchandise and services	13,344,258.31	4,462,365.49
Cash paid to staffs or paid for staffs	34,360,990.56	27,619,751.65
Taxes paid	23,084,768.18	34,788,061.46
Other cash paid for business activities	10,293,028.68	8,944,859.88
Sub-total of cash outflow from business activities	81,083,045.73	75,815,038.48
Net cash generated from /used in operating activities	27,802,120.07	-5,123,623.13
II. Cash flow generated by investing
Cash received from investment retrieving	10,817,803.07	6,437,640.00
Cash received as investment gains	11,479,752.94	1,957,306.47
Net cash retrieved from disposal of fixed assets, intangible assets, and other long-term assets		2,759,267.00
Net cash received from disposal of subsidiaries or other operational units
Other investment-related cash received	466,820,636.28	1,623,459,188.57
Sub-total of cash inflow due to investment activities	489,118,192.29	1,634,613,402.04
Cash paid for construction of fixed assets, intangible assets and other long-term assets	2,247,719.06	2,528,077.97
Cash paid as investment		3,555,968.96
Net cash received from subsidiaries and other operational units
Other cash paid for investment activities	475,000,000.00	1,530,015,275.20
Sub-total of cash outflow due to investment activities	477,247,719.06	1,536,099,322.13
Net cash flow generated by investment	11,870,473.23	98,514,079.91
III. Cash flow generated by financing

Cash received as investment
Cash received as loans
Other financing –related ash received		6,545,900.00
Sub-total of cash inflow from financing activities		6,545,900.00
Cash to repay debts
Cash paid as dividend, profit, or interests	15,176,281.23	11,231.64
Other cash paid for financing activities	7,820,298.30	14,344,136.30
Sub-total of cash outflow due to financing activities	22,996,579.53	14,355,367.94
Net cash flow generated by financing	-22,996,579.53	-7,809,467.94
IV. Influence of exchange rate alternation on cash and cash equivalents
V.Net increase of cash and cash equivalents	16,676,013.77	85,580,988.84
Add: balance of cash and cash equivalents at the beginning of term	113,560,327.21	27,979,338.37
VI ..Balance of cash and cash equivalents at the end of term	130,236,340.98	113,560,327.21

Legal Representative: Person-in-charge of the accounting work： Person-in -charge of the accountingorgan：

Consolidated Statement on Change in Owners’ Equity

Amount in this period

In RMB

Items

Year 2021

Owner’s equity Attributable to the Parent Company

Minor shareholders’ equity

Total of owners’ equity

Share Capital

Other Equity instrument

Capital reserves

Less: Shares in stock

Other Comprehensive Income

Specialized reserve

Surplus reserves

Common risk provision

Retained profit

Other

Subtotal

Preferred stock

Sustainable debt

Other

I .Balance at the end of last year

507,772,279.00

1,967,514,358.53

7,525,438.20

116,605,932.42

94,954,652.14

86,912,390.50

2,766,234,174.39

1,133,081,075.23

3,899,315,249.62

Add: Change of accounting policy

Correcting of previous errors

Merger of entities under common control

Other

II. Balance at the beginning of current year	507,772,279.00				1,967,514,358.53	7,525,438.20	116,605,932.42		94,954,652.14		86,912,390.50		2,766,234,174.39	1,133,081,075.23	3,899,315,249.62
III .Changed in the current year	-1,250,430.00				-5,914,533.90	-7,525,438.20	3,076,186.63		3,291,193.33		43,833,861.24		50,561,715.50	13,952,281.95	64,513,997.45
（1）Total comprehensive income							4,234,512.42				61,162,384.25		65,396,896.67	13,952,281.95	79,349,178.62
（II）Investment or decreasing of capital by owners	-1,250,430.00				-5,914,533.90	-7,525,438.20							360,474.30		360,474.30
1．Ordinary Shares invested by shareholders
2．Holders of other equity instruments invested capital
3．Amount of shares paid and accounted as owners’ equity
4．Other	-1,250,430.00				-5,914,533.90	-7,525,438.20							360,474.30		360,474.30
（III）Profit allotment									3,175,360.75		-18,371,016.22		-15,195,655.47		-15,195,655.47
1.Providing of surplus reserves									3,175,360.75		-3,175,360.75
2.Providing of common risk provisions

3．Allotment to the owners (or shareholders)											-15,195,655.47		-15,195,655.47		-15,195,655.47
4．Other
(IV) Internal transferring of owners’ equity							-1,158,325.79		115,832.58		1,042,493.21
1. Capitalizing of capital reserves (or to capital shares)
2. Capitalizing of surplus reserves (or to capital shares)
3．Making up losses by surplus reserves.
4.Change amount of defined benefit plans that carry forward Retained earnings
5．Other comprehensive income carry-over retained earnings							-1,158,325.79		115,832.58		1,042,493.21
6．Other
(V). Special reserves
1. Provided this year
2．Used this term
（VI）Other
IV. Balance at the end of this term	506,521,849.00				1,961,599,824.63		119,682,119.05		98,245,845.47		130,746,251.74		2,816,795,889.89	1,147,033,357.18	3,963,829,247.07

Legal Representative: Person-in-charge of the accounting work： Person-in -charge of the accountingorgan：

Amount in last year

In RMB

Items	Year 2020
	Owner’s equity Attributable to the Parent Company													Minor shareholders’ equity	Total of owners’ equity
	Share Capital	Other Equity instrument			Capital reserves	Less: Shares in stock	Other Comprehensive Income	Specialized reserve	Surplus reserves	Common risk provision	Retained profit	Other	Subtotal
		Preferred stock	Sustainable debt	Other
I .Balance at the end of last year	509,338,429.00				1,974,922,248.03	16,139,003.40	119,737,783.31		90,596,923.39		49,307,764.03		2,727,764,144.36	1,126,851,425.82	3,854,615,570.18
Add: Change of accounting policy
Correcting of previous errors
Merger of entities under common control
Other
II.Balance at the beginning of current year	509,338,429.00				1,974,922,248.03	16,139,003.40	119,737,783.31		90,596,923.39		49,307,764.03		2,727,764,144.36	1,126,851,425.82	3,854,615,570.18
III .Changed in the current year	-1,566,150.00				-7,407,889.50	-8,613,565.20	-3,131,850.89		4,357,728.75		37,604,626.47		38,470,030.03	6,229,649.41	44,699,679.44
（1）Total comprehens							1,562,50				37,267,9		38,830,5	6,229,64	45,060,1

ive income							8.59				95.74		04.33	9.41	53.74
（II）Investment or decreasing of capital by owners	-1,566,150.00				-7,407,889.50	-8,613,565.20							-360,474.30		-360,474.30
1．Ordinary Shares invested by shareholders
2．Holders of other equity instruments invested capital
3．Amount of shares paid and accounted as owners’ equity
4．Other	-1,566,150.00				-7,407,889.50	-8,613,565.20							-360,474.30		-360,474.30
（III）Profit allotment									3,888,292.80		-3,888,292.80
1.Providing of surplus reserves									3,888,292.80		-3,888,292.80
2.Providing of common risk provisions
3．Allotment to the owners (or shareholders)
4．Other
(IV) Internal transferring							-4,694,359.4		469,435.95		4,224,923.53

of owners’ equity							8
1. Capitalizing of capital reserves (or to capital shares)
2. Capitalizing of surplus reserves (or to capital shares)
3．Making up losses by surplus reserves.
4.Change amount of defined benefit plans that carry forward Retained earnings
5．Other comprehensive income carry-over retained earnings							-4,694,359.48		469,435.95		4,224,923.53
6．Other
(V). Special reserves
1. Provided this year
2．Used this term
（VI）Other
IV. Balance at the end of this term	507,772,279.00				1,967,514,358.53	7,525,438.20	116,605,932.42		94,954,652.14		86,912,390.50		2,766,234,174.39	1,133,081,075.23	3,899,315,249.62

Legal Representative: Person-in-charge of the accounting work： Person-in -charge of the accountingorgan：

Statement of change in owner’s Equity of the Parent Company

Amount in this period

In RMB

Items	Year 2021
	Share capital	Other Equity instrument			Capital reserves	Less: Shares in stock	Other Comprehensive Income	Specialized reserve	Surplus reserves	Retained profit	Other	Total of owners’ equity
		Preferred stock	Sustainable debt	Other
I.Balance at the end of last year	507,772,279.00				1,583,307,509.86	7,525,438.20	107,632,186.85		94,954,652.14	676,454,033.89		2,962,595,223.54
Add: Change of accounting policy
Correcting of previous errors
Other
II. Balance at the beginning of current year	507,772,279.00				1,583,307,509.86	7,525,438.20	107,632,186.85		94,954,652.14	676,454,033.89		2,962,595,223.54
III .Changed in the current year	-1,250,430.00				-5,914,533.90	-7,525,438.20	1,130,351.54		3,291,193.33	14,425,084.51		19,207,103.68
（I）Total comprehensive income							2,288,677.33			31,753,607.52		34,042,284.85
(II) Investment or decreasing of capital by owners	-1,250,430.00				-5,914,533.90	-7,525,438.20						360,474.30
1．Ordinary Shares invested by shareholders
2．Holders of other equity instruments inv

ested capital
3.Amount of shares paid and accounted as owners’ equity
4．Other	-1,250,430.00				-5,914,533.90	-7,525,438.20						360,474.30
（III）Profit allotment									3,175,360.75	-18,371,016.22		-15,195,655.47
1.Providing of surplus reserves									3,175,360.75	-3,175,360.75
2．Allotment to the owners (or shareholders)										-15,195,655.47		-15,195,655.47
3．Other
(IV) Internal transferring of owners’ equity							-1,158,325.79		115,832.58	1,042,493.21
1. Capitalizing of capital reserves (or to capital shares)
2. Capitalizing of surplus reserves (or to capital shares)
3．Making up losses by surplus reserves.
4.Change amount of defined benefit plans that carry forward Retained earnings
5．Other comprehensive income							-1,158,325.79		115,832.58	1,042,493.21

carry-over retained earnings
6．Other
(V) Special reserves
1. Provided this year
2．Used this term
（VI）Other
IV. Balance at the end of this term	506,521,849.00				1,577,392,975.96		108,762,538.39		98,245,845.47	690,879,118.40		2,981,802,327.22

Legal Representative: Person-in-charge of the accounting work： Person-in -charge of the accountingorgan：

Amount in last year

Items	Year 2020
	Share Capital	Other Equity instrument			Capital reserves	Less: Shares in stock	Other Comprehensive Income	Specialized reserve	Surplus reserves	Retained profit	Other	Total of owners’ equity
		Preferred stock	Sustainable debt	Other
I.Balance at the end of last year	509,338,429.00				1,589,869,499.36	16,139,003.40	110,764,037.74		90,596,923.39	637,234,475.15		2,921,664,361.24
Add: Change of accounting policy
Correcting of previous errors
Other
II. Balance at the beginning of current year	509,338,429.00				1,589,869,499.36	16,139,003.40	110,764,037.74		90,596,923.39	637,234,475.15		2,921,664,361.24
III. Changed	-1,5				-6,56	-8,61	-3,13		4,35	39,219		40,930,8

in the current year	66,150.00				1,989.50	3,565.20	1,850.89		7,728.75	,558.74		62.30
（I）Total comprehensive income							1,562,508.59			38,882,928.01		40,445,436.60
(II) Investment or decreasing of capital by owners	-1,566,150.00				-7,407,889.50	-8,613,565.20						-360,474.30
1．Ordinary Shares invested by shareholders
2．Holders of other equity instruments invested capital
3.Amount of shares paid and accounted as owners’ equity
4．Other	-1,566,150.00				-7,407,889.50	-8,613,565.20						-360,474.30
（III）Profit allotment									3,888,292.80	-3,888,292.80
1.Providing of surplus reserves									3,888,292.80	-3,888,292.80
2．Allotment to the owners (or shareholders)
3．Other
(IV) Internal transferring of owners’ equity							-4,694,359.48		469,435.95	4,224,923.53
1. Capitalizing of capital

In RMB

reserves (or to capital shares)
2. Capitalizing of surplus reserves (or to capital shares)
3．Making up losses by surplus reserves.
4.Change amount of defined benefit plans that carry forward Retained earnings
5．Other comprehensive income carry-over retained earnings							-4,694,359.48		469,435.95	4,224,923.53
6．Other
(V) Special reserves
1. Provided this year
2．Used this term
（VI）Other					845,900.00							845,900.00
IV. Balance at the end of this term	507,772,279.00				1,583,307,509.86	7,525,438.20	107,632,186.85		94,954,652.14	676,454,033.89		2,962,595,223.54

Notes to financial statementsI. Basic Information of the CompanyShenzhen Textile (Group) Co., Ltd. (hereinafter referred to as "Company" or "the Company") is ajoint-stock company registered in Guangdong Province with a registered capital of RMB

511.274149 million and a unified social credit code of 91440300192173749Y. The Company haspublicly issued RMB common shares (A shares) and domestic listed foreign shares (B shares) to thepublic at home and abroad, and listed and traded them. The Company is headquartered address are6/F,Shenfang Building, No.3 Huaqiang Road. North, Futian District, Shenzhen.The company was previously the Shenzhen Textile Industry Company, on April 13, 1994, approvedby the Letter(1994)No.15 issued by Shenzhen Municipal People's Government, the Company wasrestructured and named as Shenzhen Textile (Group) Co., Ltd. ，As of December 31, 2020, theCompany has issued a total of 507,772,279.00 shares.

The Company has established the corporate governance structure of General Meeting ofShareholders, Board of Directors and Board of Supervisors, and currently has the Board Office,Office, Strategic Development Department, Operation and Management Department, FinanceDepartment, Audit Department, Human Resources Department and other departments.the Company is mainly engaged in high-tech industry focusing on R&D, production and marketingof polarizers for liquid crystal display, management of properties in bustling business districts ofShenzhen and reserved high-class textile and garment business.The financial statements have been authorized for issuance of the 11st meeting of the 8th Board ofDirectors of the Group on March 15, 2022.As of December 31, 2021, A total of 8 subsidiaries of the Company are included in the scope ofconsolidation. For details, please refer to Section X Financial Report ,IX "Rights and Interests inOther Subjects".II. Basis for the preparation of financial statements

（1）Basis for the preparation

The financial statements are prepared in accordance with the Accounting Standards for BusinessEnterprises promulgated by the Ministry of Finance and its application guidelines, interpretationsand other relevant provisions (collectively referred to as the "Accounting Standards for BusinessEnterprises"). In addition, the Company also disclosed relevant financial information in accordancewith the Rules No.15 for the Information Disclosure and Compilation of Companies OfferingSecurities Public Issuance - General Provisions on Financial Report (revised in 2014) issued byChina Securities Regulatory Commission.

The accounting of the Company is based on accrual basis. Except for some financialinstruments, the financial statements are based on historical costs. In case of asset impairment,impairment provision shall be made in accordance with relevant regulations.

(2)Continuation

This financial statement is presented on the basis of going concern.III. Important accounting policies and estimationsSpecific accounting policies and accounting estimates tips:

According to its own production and operation characteristics, the Company determines the policiesof depreciation of fixed assets, amortization of intangible assets and revenue recognition. See NoteIII. 16, ,Note III,19 and Note III. 26 for specific accounting policies.

1. Statement on complying with corporate accounting standards

This financial statement conforms to the requirements of Accounting Standards for BusinessEnterprises, and truly and completely reflects the combination and financial status of the Companyon December 31, 2021, as well as the combination and operating results and cash flow of theCompany.

2.Fiscal Year

The Company adopts the Gregorian calendar year commencing on January 1 and ending onDecember 31 as the fiscal year.

3. Operating cycle

The operating cycle of the Company is 12 months.

4. Accounting standard money

The Company and its domestic subsidiaries use RMB as their bookkeeping base currency. Theoverseas subsidiaries of the Company determine RMB as their bookkeeping base currency accordingto the currency in the main economic environment in which they operate. The currency used by theCompany in preparing the financial statements is RMB.

5. Accounting process method of enterprise consolidation under same and different controlling.

（1）Enterprise merger under same control：

For business combination under the same control, the assets and liabilities of the combinedparty acquired by the merging party during the combination shall be measured according to the bookvalue of the combined party in the consolidated financial statements of the final controlling party onthe combination date, except for the adjustment due to different accounting policies. The differencebetween the book value of the combination consideration and the book value of the net assetsobtained in the combination adjusts the capital reserve. If the capital reserve is insufficient to offset,the retained earnings will be adjusted.Business combination under the same control shall be achieved step by step through multipletransactionsIn individual financial statements, the share of the book value of the net assets of the combinedparty in the consolidated financial statements of the ultimate controlling party shall be taken as theinitial investment cost of the investment on the combination day calculated by the shareholding ratioon the combination day; Adjust the capital reserve for the difference between the initial investmentcost and the book value of the investment held before the combination plus the book value of theconsideration paid on the new day of the combination. If the capital reserve is insufficient to offset,adjust the retained earnings.In the consolidated financial statements, the assets and liabilities of the combined partyacquired by the merging party in the combination shall be measured according to the book value inthe consolidated financial statements of the ultimate controlling party on the combination date,except for the adjustment due to different accounting policies; The difference between the bookvalue of the investment held before the combination plus the book value of the consideration paid onthe new day of the combination and the book value of the net assets obtained during the combinationwill be adjusted for capital reserve. If the capital reserve is insufficient to offset, the retainedearnings will be adjusted. For the long-term equity investment held by the merging party beforeobtaining the control right of the combined party, the relevant profits and losses, othercomprehensive income and other changes in owner's equity have been recognized from the date ofobtaining the original equity and the date when the merging party and the combined party are underthe same final control to the combination date, and the initial retained earnings or current profits andlosses during the comparative report period shall be offset respectively.

(2) Business combination involving entities not under common control

For business combination not under the same control, the combination cost refers to the assetspaid, liabilities incurred or assumed, and fair value of the issued equity securities in order to gain

control over the acquiree on the acquisition date. On the acquisition date, the acquired assets,liabilities and contingent liabilities of the acquiree are recognized at fair value.The difference between the combination cost and the fair value share of identifiable net assetsacquired in the combination is recognized as goodwill, and the accumulated impairment provision isdeducted by cost for subsequent measurement; The difference between the combination cost and thefair value share of identifiable net assets acquired by the acquiree in the combination shall berecorded into the current profits and losses after review.Business combination under the same control shall be achieved step by step through multipletransactionsIn individual financial statements, the sum of the book value of the equity investment held by theacquiree before the acquisition date and the new investment cost on the acquisition date is taken asthe initial investment cost of the investment. Other comprehensive income recognized by the equityinvestment held before the acquisition date due to accounting by the equity method is not treated onthe acquisition date, and accounting treatment is carried out on the same basis as that of theinvestee's direct disposal of related assets or liabilities; The owner's equity recognized due to thechange of owner's equity of the investee except net profit and loss, other comprehensive income andprofit distribution shall be transferred to the current profit and loss during the disposal period whenthe investment is disposed. If the equity investment held before the acquisition date is measured byfair value, the accumulated changes in fair value originally included in other comprehensive incomewill be transferred to the current profits and losses when accounting by cost method.In the consolidated financial statements, the consolidated cost is the sum of the consideration paidon the acquisition date and the fair value of the equity of the acquiree held before the acquisitiondate on the acquisition date. The equity of the acquiree held before the acquisition date shall bere-measured according to the fair value of the equity on the acquisition date, and the differencebetween the fair value and its book value shall be included in the current income; Equity of theacquiree held before the acquisition date involves other comprehensive income, and other changes inowner's equity are converted into current income on the acquisition date, except for othercomprehensive income arising from the remeasurement of net liabilities or changes in net assets ofthe set income plan by the investee.

(3) Treatment of transaction costs in business combination

Intermediary expenses such as auditing, legal services, evaluation and consultation, and otherrelated management expenses incurred for business combination are included in the current profitsand losses when they occur. Transaction costs of equity securities or debt securities issued ascombination consideration are included in the initial recognition amount of equity securities or debtsecurities.6 Compilation method of consolidated financial statements

(1)The scope of consolidation

The consolidation scope of consolidated financial statements is determined on the basis of control.Control refers to that the company has the power over the investee, enjoys variable returns byparticipating in the related activities of the investee, and has the ability to use the power over theinvestee to affect its return amount. Subsidiaries refer to subjects controlled by the Company(including enterprises, divisible parts of investee, structured subjects, etc.).The consolidation scope of consolidated financial statements is determined on the basis of control.Control refers to that the company has the power over the investee, enjoys variable returns byparticipating in the related activities of the investee, and has the ability to use the power over theinvestee to affect its return amount. Subsidiaries refer to subjects controlled by the Company(including enterprises, divisible parts of investee, structured subjects, etc.).

(2) Compilation method of consolidated financial statements

The consolidated financial statements are based on the financial statements of the Company and itssubsidiaries, and are prepared by the Company according to other relevant information. Whenpreparing the consolidated financial statements, the accounting policies and accounting periodrequirements of the Company and its subsidiaries are consistent, and major transactions and currentbalances between companies are offset.During the reporting period, the subsidiaries and businesses increased due to the businesscombination under the same control shall be deemed to be included in the consolidation scope of theCompany from the date when they are controlled by the ultimate controller, and their operatingresults and cash flows from the date when they are controlled by the ultimate controller shall beincluded in the consolidated income statement and the consolidated cash flow statementrespectively.

During the reporting period, the income, expenses and profits of subsidiaries and businessesincreased from the acquisition date to the end of the reporting period due to business combinationnot under the same control during the reporting period are included in the consolidated incomestatement, and their cash flows are included in the consolidated cash flow statement.

The part of shareholders' equity of subsidiaries that is not owned by the Company is listedseparately as minority shareholders' equity in the consolidated balance sheet; The share of minorityshareholders' equity in the current net profit and loss of subsidiaries is listed as "minorityshareholders' profit and loss" under the net profit item in the consolidated income statement. If theloss of subsidiary shared by minority shareholders exceeds the share enjoyed by minorityshareholders in the initial owner's equity of such subsidiary, the balance still offsets minorityshareholders' equity.

(3) Acquisition of minority shareholders' equity of subsidiaries

The capital reserve in the consolidated balance sheet shall be adjusted for the difference between thenewly acquired long-term equity investment cost due to the acquisition of minority shares and theshare of net assets continuously calculated by subsidiaries from the acquisition date or combinationdate, and the difference between the disposal price obtained from partial disposal of equityinvestment in subsidiaries without losing control and the share of net assets continuously calculatedby subsidiaries from the acquisition date or combination date corresponding to the disposal oflong-term equity investment. If the capital reserve is insufficient to offset, the retained earnings shallbe adjusted.

(4) Treatment of losing control over subsidiaries

If the control over the original subsidiary is lost due to the disposal of part of the equity investmentor other reasons, the remaining equity shall be re-measured according to its fair value on the date ofloss of control; The sum of the consideration obtained from the disposal of equity and the fair valueof remaining equity, minus the sum of the share of the original subsidiary's book value of net assetscalculated continuously from the acquisition date and goodwill calculated according to the originalshareholding ratio, and the difference formed is included in the investment income of the currentperiod of loss of control.

Other comprehensive income related to the original subsidiary's equity investment will betransferred to the current profits and losses when the control right is lost, except for othercomprehensive income generated by the investee's remeasurement of the net liabilities or changes innet assets of the set income plan.

7.Joint venture arrangements classification and Co-operation accounting treatment

Joint venture arrangement refers to an arrangement under the joint control of two or moreparticipants. The joint venture arrangement of the Company is divided into joint operation and jointventure.

(1) Joint operation

Joint operation refers to the joint venture arrangement in which the Company is entitled to theassets related to the arrangement and bears the liabilities related to the arrangement.The Company recognizes the following items related to the share of interests in joint operation, andcarries out accounting treatment in accordance with the relevant accounting standards for businessenterprises:

A. Recognize assets held separately and assets held jointly according to their shares;B. Recognize the liabilities undertaken separately, and recognize the liabilities jointlyundertaken according to their shares;

C. Recognize the income generated from the sale of its share of joint operating output;D. Recognize the income generated by the sale of output from joint operation according to theirshares;E. Recognize the expenses incurred separately, and recognize the expenses incurred in jointoperation according to their shares.

(2) Joint venture

A joint venture refers to a joint venture arrangement in which the Company only has rights tothe net assets of the arrangement.

The Company shall carry out accounting treatment on the investment of the joint venture inaccordance with the provisions on accounting of long-term equity investment by the equity method.

8.Recognition Standard of Cash & Cash Equivalents

Cash refers to cash on hand and deposits that can be used for payment at any time. Cashequivalents refer to investments held by the Company with short term, strong liquidity, easyconversion into known cash and little risk of value change.

9.Foreign currency transaction

In case of foreign currency business of the Company, the exchange rate determined by a systematicand reasonable method which is similar to the spot exchange rate on the transaction date shall beused to convert it into the bookkeeping base currency amount.Balance sheet date: foreign currency monetary items shall be converted at the spot exchange rate onthe balance sheet date. Exchange differences arising from the difference between the spot exchangerate on the balance sheet date and the spot exchange rate at the time of initial recognition or theprevious balance sheet date are included in the current profits and losses; For foreign currencynon-monetary items measured at historical cost, the spot exchange rate on the transaction date is stilladopted; Foreign currency non-monetary items measured at fair value are converted at the spotexchange rate on the fair value determination date, and the difference between the convertedbookkeeping base currency amount and the original bookkeeping , According to the nature ofnon-monetary items, it is included in current profits and losses or other comprehensive income.

10.Financial instruments

Financial instruments refer to contracts that form financial assets of one party and financialliabilities or equity instruments of other parties.

(1) Recognition and derecognition of financial instruments

When the Company becomes a party to a financial instrument contract, a financial asset orfinancial liability is recognized.

Financial assets that meet one of the following conditions shall be derecognized:

① Termination of the contractual right to receive cash flow from the financial asset;

② The financial asset has been transferred and the following conditions for derecognition offinancial asset transfer are met.If all or part of the current obligations of a financial liability have been discharged, the financialliability or part of it shall be derecognized. If the Company (debtor) signs an agreement with thecreditor to replace the existing financial liabilities by assuming new financial liabilities, and the

contract terms of the new financial liabilities are substantially different from those of the existingfinancial liabilities, the existing financial liabilities shall be derecognized and the new financialliabilities shall be recognized at the same time.When trading the financial assets in a conventional way, accounting recognition and derecognitionshall be carried out according to the trading day.

(2) Classification and measurement of financial assets

According to the business model of managing financial assets and the contractual cash flowcharacteristics of financial assets, the Company divides financial assets into the following threecategories: financial assets measured at amortized cost, financial assets measured at fair value withchanges included in other comprehensive income, and financial assets measured at fair value withchanges included in current profits and losses.Financial assets measured at amortized cost

The Company classifies the financial assets that meet the following conditions and are notdesignated to be measured at fair value with changes included in current profits and losses asfinancial assets measured at amortized cost:

? The Company's business model of managing such financial assets is to collect contract cash

flow as the goal;? According to the contract terms of the financial asset, the cash flow generated on a specific date

is only the payment of principal and interest based on the unpaid principal amount.? After initial recognition, such financial assets are measured in amortized cost by the effective

interest rate method. Gains or losses arising from financial assets measured in amortized cost

that are not part of any hedging relationship are included in current profits and losses when

derecognition, amortization according to the effective interest rate method, or impairment

recognition.

Financial assets measured at fair value and changes included in other comprehensive income

The Company classifies financial assets that meet the following conditions and are notdesignated to be measured at fair value with changes included in current profits and losses asfinancial assets measured at fair value with changes included in other comprehensive income:

? The company's business model of managing the financial assets aims at both collecting contract

cash flow and selling the financial assets;? According to the contract terms of the financial asset, the cash flow generated on a specific date

is only the payment of principal and interest based on the unpaid principal amount.

After initial recognition, the fair value of such financial assets is subsequently measured.

Interest, impairment losses or gains and exchange gains and losses calculated by the effective

interest rate method are included in the current profits and losses, while other gains or losses are

included in other comprehensive income. Upon termination of recognition, the accumulated

gains or losses previously included in other comprehensive income shall be transferred out of

other comprehensive income and included in current profits and losses.

Financial assets measured at fair value with changes included in current profits and losses

Except for the above financial assets measured at amortized cost and at fair value with changesincluded in other comprehensive income, the Company classifies all other financial assets asfinancial assets measured at fair value with changes included in current profits and losses. At thetime of initial recognition, in order to eliminate or significantly reduce accounting mismatch, theCompany irrevocably designated some financial assets that should have been measured at amortizedcost or at fair value with changes included in other comprehensive income as financial assetsmeasured at fair value with changes included in current profits and losses.After initial recognition, the financial assets are subsequently measured at fair value, and theresulting gains or losses (including interest and dividend income) are included in the current profitsand losses, unless the financial assets are part of the hedging relationship.

However, for non-trading equity instrument investments, the Company can irrevocably designatethem as financial assets measured at fair value with changes included in other comprehensiveincome upon initial recognition. The designation is made on the basis of a single investment, and therelevant investment conforms to the definition of equity instruments from the perspective of theissuer.

After initial recognition, the fair value of such financial assets is subsequently measured. Dividendincome that meets the requirements is included in profit or loss, and other gains or losses andchanges in fair value are included in other comprehensive income. Upon termination of recognition,the accumulated gains or losses previously included in other comprehensive income shall betransferred out of other comprehensive income and included in retained income.

The business model of managing financial asset refers to how the Company manages financialassets to generate cash flow. The business model determines whether the cash flow of financialassets managed by the Company comes from contract cash flow, sale of financial assets or both. TheCompany determines the business model of managing financial assets based on objective facts andspecific business objectives of managing financial assets decided by key management personnel.

The Company evaluates the contractual cash flow characteristics of financial assets to determinewhether the contractual cash flow generated by related financial assets on a specific date is only thepayment of principal and interest based on the unpaid principal amount. Where, the principal refersto the fair value of financial assets at initial recognition; Interest includes consideration for the timevalue of money, credit risk related to the unpaid principal amount in a specific period, and otherbasic borrowing risks, costs and profits. In addition, the Company evaluates the contract clauses thatmay cause changes in the time distribution or amount of cash flow of financial assets contracts todetermine whether they meet the requirements of the above-mentioned contract cash flowcharacteristics.

Only when the Company changes its business model for managing financial assets, all affectedfinancial assets shall be reclassified on the first day of the first reporting period after the businessmodel changes, otherwise, financial assets shall not be reclassified after initial recognition.Financial assets are measured at fair value upon initial recognition. For financial assets measured atfair value, whose changes are included in current profits and losses, relevant transaction costs aredirectly included in current profits and losses; For other types of financial assets, relevant transactioncosts are included in the initial recognition amount. Accounts receivable arising from the sale ofproducts or the provision of labor services that do not include or take into account significantfinancing components are initially recognized by the Company in accordance with the amount ofconsideration that the Company is expected to be entitled to receive.

(3) Classification and measurement of financial liabilities

At initial recognition, the financial liabilities of the Company are classified into: financial liabilitiesmeasured at fair value with changes included in current profits and losses, and financial liabilitiesmeasured at amortized cost. For financial liabilities that are not classified as measured at fair valuewith changes included in current profits and losses, relevant transaction costs are included in theirinitial recognition amount.Financial liabilities measured at fair value with changes included in the current profits and losses

Financial liabilities measured at fair value with changes included in current profits and lossesinclude transactional financial liabilities and financial liabilities designated at fair value at initialrecognition with changes included in current profits and losses. Such financial liabilities aresubsequently measured according to fair value, and the gains or losses caused by changes in fairvalue and dividends and interest expenses related to such financial liabilities are included in currentprofits and losses..Financial liabilities measured in amortized costOther financial liabilities are subsequently measured according to the amortized cost by the effectiveinterest rate method, and the gains or losses arising from derecognition or amortization are includedin the current profits and losses.

Distinction between financial liabilities and equity instrumentsFinancial liabilities refer to liabilities that meet one of the following conditions:

① Contract obligation to deliver cash or other financial assets to other parties.

② The contractual obligation to exchange financial assets or financial liabilities with otherparties under potential unfavorable conditions.

③ Non-derivative contracts that need to be settled or can be settled by the enterprise's ownequity instruments in the future, for which the enterprise will deliver a variable number of its ownequity instruments according to this contract.

④ Derivative contracts that need to be settled or can be settled by the enterprise's own equityinstruments in the future, except for derivative contracts that exchange a fixed amount of its ownequity instruments for a fixed amount of cash or other financial assets.

Equity instruments refer to contracts that can prove ownership of an enterprise's residual equityin assets after deducting all liabilities.

If the Company can't unconditionally avoid delivering cash or other financial assets to fulfill acontractual obligation, the contractual obligation meets the definition of financial liabilities.

If a financial instrument needs to be settled or can be settled by the Company's own equityinstrument, it shall be considered whether its own equity instrument used to settle the instrument is asubstitute for cash or other financial assets, or it is to enable the holder of such instrument to beentitled to the remaining equity in the assets after all liabilities are deducted by the issuer. In theformer case, the instrument is the financial liability of the Company; In the latter case, the instrumentis the equity instrument of the Company.

(4) Derivative financial instruments and embedded derivative instruments

Initially, it is measured at the fair value on the day when the derivative transaction contract issigned, and then measured at its fair value. Derivative financial instruments with positive fair valueare recognized as an asset, while those with negative fair value are regarded as an liability. Anygains or losses arising from changes in fair value that do not meet the requirements of hedgeaccounting are directly included in the current profits and losses.

For mixed instruments including embedded derivative, if the main contract is financial assets, therelevant provisions of financial asset classification shall apply to the mixed instruments as a whole.If the main contract is not a financial asset, and the mixed instrument is not measured at fair valuewith changes included in the current profits and losses for accounting treatment, the embeddedderivative is not closely related to the main contract in terms of economic characteristics and risks,and has the same conditions as the embedded derivative, and if the independent instrument meets thedefinition of derivative, the embedded derivative is split from the mixed instrument and treated as aseparate derivative financial instrument. If the embedded derivative cannot be separately measuredat the time of acquisition or on the subsequent balance sheet date, the mixed instruments as a wholeare designated as financial assets or financial liabilities measured at fair value with changes includedin the current profits and losses.

(5) Fair value of financial instruments

See Note III. 11 for the determination method of the fair value of financial assets and financialliabilities.

(6) Impairment of financial assets

Based on the expected credit loss, the Company will carry out impairment accounting treatmenton the following items and recognize the loss reserve:

① Financial assets measured at amortized cost;

② Receivables and debt investments measured at fair value and included in othercomprehensive income;

③ Lease receivables;

④ Financial guarantee contracts (except those which are measured at fair value with changesincluded in current profits and losses, in which the transfer of financial assets does not meet the

conditions for derecognition, or those formed by continuing to involve the transferred financialassets).Measurement of expected credit lossExpected credit loss refers to the weighted average of the credit losses of financial instrumentsweighted by the risk of default. Credit loss refers to the difference between the cash flow of allcontracts discounted according to the original real interest rate and the expected cash flow of allcontracts receivable according to the contract, that is, the present value of all cash shortages.The Company takes into account reasonable and reliable information on historical events, currentsituation and future economic situation forecasts, and uses the risk of default as the weight tocalculate the probability weighted amount of the present value of the difference between the cashflow receivable from the contract and the cash flow expected to be received to recognize theexpected credit loss.

The Company separately measures the expected credit losses of financial instruments at differentstages. If the credit risk of financial instruments has not increased significantly since the initialrecognition, it is in the first stage. The Company measures the loss reserve according to the expectedcredit loss in the next 12 months; If the credit risk of a financial instrument has increasedsignificantly since its initial recognition but no credit impairment has occurred, it is in the secondstage. The Company measures the loss reserve according to the expected credit loss of theinstrument throughout the duration; If a financial instrument has suffered credit impairment since itsinitial recognition, it is in the third stage. The Company measures the loss reserve according to theexpected credit loss of the instrument throughout the duration.For financial instruments with low credit risk on the balance sheet date, the Company assumes thattheir credit risk has not increased significantly since the initial recognition, and measures the lossreserve according to the expected credit loss in the next 12 months.The expected credit loss in the whole duration refers to the expected credit loss caused by allpossible default events in the whole expected duration of financial instruments. The expected creditloss in the next 12 months refers to the expected credit loss caused by the financial instrumentdefault event that may occur within 12 months after the balance sheet date (or within the expectedduration if the expected duration of the financial instrument is less than 12 months), which is a partof the expected credit loss in the whole duration.When measuring the expected credit loss, the longest period that the Company needs to consider isthe longest contract period during which the enterprise is subject to credit risk (including the optionto renew the contract).For financial instruments in the first and second stages and with low credit risk, the Companycalculates interest income based on the book balance before deducting impairment provisions andthe actual interest rate. For financial instruments in the third stage, the interest income shall becalculated according to their book balance minus the amortized cost after impairment provision andthe actual interest rate.For notes receivable and accounts receivable, regardless of whether there is significant financingcomponent, the Company always measures the loss reserve according to the amount equivalent tothe expected credit loss in the whole duration.When a single financial asset cannot evaluate the expected credit loss information at a reasonablecost, the Company divides the notes receivable and accounts receivable into portfolios according tothe credit risk characteristics, calculates the expected credit loss on the basis of the combinations,and determines the combination on the following basis:

A. Notes receivableNotes receivable portfolio 1: bank acceptance billNotes receivable portfolio 2: commercial acceptance billB. Accounts receivableAccounts receivable portfolio 1: polarizer sales receivableAccounts receivable portfolio 2: textile and garment sales receivable

Accounts receivable portfolio 3: operating funds receivable from self-own propertyAccounts receivable portfolio 4: other receivablesFor notes receivable divided into portfolios, the Company refers to the historical credit lossexperience, and calculates the expected credit loss through the default risk exposure and theexpected credit loss rate of the whole duration based on the current situation and forecasts the futureeconomic situation.For accounts receivable divided into combinations, the Company refers to the historical credit lossexperience, combines the current situation with the forecast of future economic situation, compiles acomparison table of aging/overdue days of accounts receivable and the expected credit loss rate forthe whole duration, and calculates the expected credit loss.Other receivablesThe Company classifies other receivables into several combinations according to the credit riskcharacteristics, and calculates the expected credit losses based on the portfolios. The basis fordetermining the portfolio is as follows:

Other receivables portfolio: aging portfolioFor other receivables classified as portfolios, the Company calculates the expected credit lossthrough the default risk exposure and the expected credit loss rate in the next 12 months or the wholeduration.Debt investment and other debt investmentFor creditor's rights investment and other creditor's rights investment, the Company calculates theexpected credit loss according to the nature of the investment, the counterparty and various types ofrisk exposure and based on the expected credit loss rate in the next 12 months or the whole duration.Evaluation of significant increase in credit riskBy comparing the risk of default of financial instruments on the balance sheet date with the risk ofdefault on the initial recognition date, the Company determines the relative change of default risk offinancial instruments in the expected duration, and evaluates whether the credit risk of financialinstruments has increased significantly since initial recognition.When determining whether the credit risk has increased significantly since the initial recognition,the company considers to obtain reasonable and reliable information without unnecessary extra costsor efforts, including forward-looking information. Information considered by the Company includes:

? The debtor fails to pay the principal and interest according to the expiration date of the contract;? Serious deterioration of external or internal credit rating (if any) of financial instruments thathas occurred or is expected;? Serious deterioration of the debtor's operating results that has occurred or is expected;? Changes in existing or expected technology, market, economic or legal environment, andsignificant adverse effects on the debtor's repayment ability of the Company.According to the nature of financial instruments, the Company assesses whether credit riskshave increased significantly on the basis of individual financial instruments or financialinstrument portfolios. When evaluating on the basis of financial instrument portfolio, theCompany can classify financial instruments based on common credit risk characteristics, suchas overdue information and credit risk rating.Financial assets with credit impairment

On the balance sheet date, the Company evaluates whether the financial assets measured atamortized cost and the creditor's rights investments measured at fair value with changes included inother comprehensive income have suffered credit impairment. When one or more events thatadversely affect the expected future cash flow of a financial asset occur, the financial asset becomesa financial asset with credit impairment. Evidence of credit impairment of financial assets includesthe following observable information:

? The issuer or debtor has major financial difficulties;? The debtor violates the contract, such as default or overdue payment of interest or principal;

? The Company gives concessions that the debtor will not make under any other circumstancesdue to economic or contractual considerations related to the debtor's financial difficulties;? The debtor is likely to go bankrupt or undergo other financial restructuring;? The financial difficulties of the issuer or debtor cause the active market of the financial assets todisappear.Presentation of expected credit loss provisionIn order to reflect the change of credit risk of financial instruments after initial recognition, theCompany re-measures the expected credit loss on each balance sheet date, and the resulting increaseor reversal amount of loss reserve shall be included in the current profits and losses as impairmentlosses or gains. For financial assets measured in amortized cost, the loss reserve shall be offsetagainst the book value of the financial assets listed in the balance sheet; For creditor's rightsinvestments measured at fair value with changes included in other comprehensive income, theCompany recognizes its loss reserve in other comprehensive income, which does not offset the bookvalue of the financial asset.Cancel after verificationIf the Company no longer reasonably expects the contract cash flow of financial assets to be fullyor partially recovered, it will directly write down the book balance of the financial assets. Thiswrite-down constitutes the derecognition of related financial assets. It usually happens when theCompany determines that the debtor has no assets or income sources to generate enough cash flow torepay the amount to be written down. However, according to the Company's procedures forrecovering the due amount, the written-down financial assets may still be affected by theimplementation activities.If the written-down financial assets are recovered later, they will be included in profits and lossesof the current recovery period as the reversal of impairment losses.

(7) Transfer of financial assets

Transfer of financial assets refers to the transfer or delivery of financial assets to another party(transferee) other than the issuer of the financial assets.If the company has transferred almost all risks and rewards in the ownership of the financial assetto the transferee, the recognition of the financial asset shall be terminated; If almost all risks andrewards on the ownership of a financial asset are retained, the financial asset shall not bederecognized.

If the Company has neither transferred nor retained almost all risks and rewards in the ownershipof financial assets, it shall be dealt with as follows: if the control of the financial assets is abandoned,the financial assets shall be derecognized and the resulting assets and liabilities shall be recognized;If the control of the financial assets is not abandoned, the relevant financial assets shall berecognized according to the extent of their continued involvement in the transferred financial assets,and the relevant liabilities shall be recognized accordingly.

(8) Offset of financial assets and financial liabilities

When the Company has the legal right to offset the recognized financial assets and financialliabilities, which can be enforced at present, and the Company plans to settle by net amount or at thesame time realize such financial assets and pay off such financial liabilities, the financial assets andfinancial liabilities are listed in the balance sheet with the amount after offset. In addition, financialassets and financial liabilities are listed separately in the balance sheet and will not be offset againsteach other.

11. Notes receivable

For notes receivable and accounts receivable, regardless of whether there is significant financingcomponent, the Company always measures the loss reserve according to the amount equivalent tothe expected credit loss in the whole duration.

When a single financial asset cannot evaluate the expected credit loss information at a reasonablecost, the Company divides the notes receivable and accounts receivable into portfolios according tothe credit risk characteristics, calculates the expected credit loss on the basis of the combinations,and determines the combination on the following basis:

Notes receivable portfolio 1: bank acceptance bill

Notes receivable portfolio 2: commercial acceptance bill

For notes receivable divided into portfolios, the Company refers to the historical credit lossexperience, and calculates the expected credit loss through the default risk exposure and theexpected credit loss rate of the whole duration based on the current situation and forecasts the futureeconomic situation.

12. Accounts receivable

For notes receivable and accounts receivable, regardless of whether there is significant financingcomponent, the Company always measures the loss reserve according to the amount equivalent tothe expected credit loss in the whole duration.

When a single financial asset cannot evaluate the expected credit loss information at a reasonablecost, the Company divides the notes receivable and accounts receivable into portfolios according tothe credit risk characteristics, calculates the expected credit loss on the basis of the combinations,and determines the combination on the following basis:

Accounts receivable portfolio 1: polarizer sales receivableAccounts receivable portfolio 2: textile and garment sales receivableAccounts receivable portfolio 3: operating funds receivable from self-own propertyAccounts receivable portfolio 4: other receivablesFor accounts receivable divided into combinations, the Company refers to the historical credit lossexperience, combines the current situation with the forecast of future economic situation, compiles acomparison table of aging/overdue days of accounts receivable and the expected credit loss rate forthe whole duration, and calculates the expected credit loss.

13. Receivable financing

For bills receivable and accounts receivable classified as those measured at fair value and whosechanges are included in other comprehensive income, the portion with self-financing period withinone year (including one year) is listed as receivables financing; If the period of self-acceptance ismore than one year, it shall be listed as other creditor's rights investment. For relevant accountingpolicies, please refer to Note V, (10) "Financial Instruments" and Note V, (10) "Impairment ofFinancial instruments ".

14.Other account receivable

Determination method and accounting treatment method of expected credit loss of otherreceivables

The Company divides the other receivables into several portfolio according to the credit riskcharacteristics, and calculates the expected credit losses on the basis of determining the portfolio asfollows:

Other receivables portfolio: age portfolio:

For accounts receivable divided into combinations, the Company refers to the historical credit lossexperience, combines the current situation with the forecast of future economic situation, compiles acomparison table of aging/overdue days of accounts receivable and the expected credit loss rate forthe whole duration, and calculates the expected credit loss.

15.Inventory

1.Investories class

The Company's inventory includes raw materials, in-process products, low-value consumables,packaging materials, inventory goods, and issued goods.

(2) Pricing method of issued inventory

The Company's inventory is priced at the actual cost when it is acquired. The weighted averagemethod is adopted when raw materials and inventory goods are issued.

(3) Determination basis of net realizable value of inventory and accrual method of inventorydepreciation reserve

The net realizable value of inventory is the estimated selling price of inventory minus the estimatedcosts to be incurred upon completion, estimated sales expenses and related taxes. For determinationof the net realizable value of inventories, the solid evidence shall serve as the basis, and the purposeof holding inventories and the influence of events after the balance sheet date shall be considered.On the balance sheet date, if the inventory cost is higher than its net realizable value, inventorydepreciation reserve shall be made. The Company usually accrues the inventory depreciation reserveaccording to individual inventory items. On the balance sheet date, if the influencing factors ofprevious inventory value written down have disappeared, the inventory depreciation reserve will bereturned within the originally accrued amount.

(4) Inventory system of inventory

Perpetual inventory system is adopted for the Company's inventory system.

(5) Amortization method of low-value consumables and packaging materials

Low-value consumables and packaging materials of the Company are amortized by one-timewrite-off method.

16.Contract assets

The Company lists the customer's unpaid contract consideration for which the Company has fulfilledits performance obligations according to the contract, and which is not the right to collect moneyfrom customers unconditionally (that is, only depending on the passage of time) as a contract asset inthe balance sheet. Contract assets and liabilities under the same contract are listed in net amount,while contract assets and liabilities under different contracts are not offset.

17.Contract Costs

Contract costs include incremental costs incurred for obtaining contracts and contract performancecosts.The incremental cost incurred for obtaining the contract refers to the cost that the Company willnot incur without obtaining the contract (such as sales commission, etc.). If the cost is expected to berecovered, the Company will recognize it as the contract acquisition cost as an asset. Other expensesincurred by the Company to obtain the contract except the incremental cost expected to be recoveredare included in the current profits and losses when incurred.If the cost incurred for the performance of the contract does not fall within the scope of otheraccounting standards for enterprises such as inventory and meets the following conditions at thesame time, the Company will recognize it as the contract performance cost as an asset:

① Such cost is directly related to a current or expected contract, including direct labor, directmaterials, manufacturing expenses (or similar expenses), costs clearly borne by the customer, andother costs incurred only due to this contract;

② Such cost increases the resources of the Company for fulfilling its performance obligationsin the future;

③ The cost is expected to be recovered.

Assets recognized by contract acquisition cost and assets recognized by contract performancecost (hereinafter referred to as "Assets Related to Contract Cost") shall be amortized on the samebasis as the revenue recognition of goods or services related to the assets, and shall be included incurrent profits and losses.When the book value of the assets related to the contract cost is higher than the differencebetween the following two items, the Company will accrue impairment provision of the excess andrecognize it as the asset impairment loss:

① The remaining consideration expected to be obtained by the Company due to the transfer ofgoods or services related to the asset;

② The estimated cost to be incurred for transferring the related goods or services.

The contract performance cost recognized as an asset shall be amortized for no more than oneyear or one normal business cycle at the time of initial recognition, which shall be listed in"Inventory", and the amortization period for more than one year or one normal business cycle at thetime of initial recognition shall be listed in "Other Non-current Assets".

The contract acquisition cost recognized as an asset shall be amortized for no more than oneyear or one normal business cycle at initial recognition, and shall be listed in "Other Current Assets".The amortization period for initial recognition shall exceed one year or one normal business cycle,and shall be listed in "Other Non-current Assets".

18.Held-for-sale assets

(1) Classification and measurement of non-current assets or disposal groups held for sale

When the book value of a non-current asset or disposal group is recovered by the Companymainly by selling it (including the exchange of non-monetary assets with commercial nation) ratherthan continuously using it, the non-current asset or disposal group is classified as held for sale.

The above-mentioned non-current assets do not include investment real estate measured by fairvalue model, biological assets measured by net amount of fair value minus selling expenses, assetsformed by employee compensation, financial assets, deferred income tax assets and rights arisingfrom insurance contracts.

The disposal group refers to a group of assets disposed of together by sale or other means in atransaction as a whole, and liabilities directly related to these assets transferred in the transaction.Under certain circumstances, the disposal group includes goodwill obtained in business combination,etc.

Meanwhile, non-current assets or disposal groups that meet the following conditions areclassified as held-for-sale: according to the practice of selling such assets or disposal groups insimilar transactions, the non-current assets or disposal groups can be sold immediately under thecurrent situation; The sale is very likely to happen, that is, a resolution has been made on a sale planand a certain purchase commitment has been obtained, and it is expected that the sale will becompleted within one year. If the control over subsidiaries is lost due to the sale of investments insubsidiaries, whether or not the Company retains part of the equity investments after the sale, whenthe investment in subsidiaries to be sold meets the classification conditions of holding for sale, theinvestment in subsidiaries will be classified as held-for-sale as a whole in individual financialstatements, and all assets and liabilities of subsidiaries will be classified as held-for-sale inconsolidated financial statements.

When the non-current assets or disposal groups held for sale are initially measured orre-measured on the balance sheet date, the difference between the book value and the net amountafter deduction of the sales expenses from the fair value is recognized as the asset impairment loss.For the amount of asset impairment loss recognized by the disposal group held for sale, the bookvalue of goodwill in the disposal group is offset first, and then the book value of non-current assetsin the disposal group is offset proportionally.

If the net amount of non-current assets held for sale or disposal group's fair value minus salesexpenses increases on the subsequent balance sheet date, the previously written-down amount will

be restored and reversed within the amount of asset impairment loss recognized after being classifiedas held-for-sale, and the reversed amount will be included in the current profits and losses. The bookvalue of offset goodwill shall not be reversed.Non-current assets held for sale and assets in disposal group held for sale are not depreciated oramortized; Interest and other expenses of liabilities in disposal group held for sale continue to berecognized. All or part of the investments of associated enterprises or joint ventures classified asheld for sale shall be accounted for by the equity method for those classified as held for sale, whilethose retained (not classified as held for sale) shall continue to be accounted for by the equitymethod; When the Company loses significant influence on the associated enterprises and jointventures due to the sale, it shall stop using the equity method.If a certain non-current asset or disposal group is classified as held-for-sale, but theclassification conditions of held-for-sale are no longer met, the Company will stop classifying it asheld-for-sale and measure it according to the lower of the following two amounts:

① The book value of the asset or disposal group before it is classified as held-for-sale, and theamount adjusted according to the depreciation, amortization or impairment that should have beenrecognized without being classified as held-for-sale;

② Recoverable amount.

19.Creditor's rights investment

Creditor's rights investment mainly accounts for bond investment measured by amortized cost,etc. The Company has measured the impairment loss based on the amount of expected credit lossesin the next 12 months or the entire duration, based on whether the credit risk has increasedsignificantly since the initial recognition.

20.Other Creditor's rights investment

For creditor's rights investment and other creditor's rights investment, the Company calculatesthe expected credit loss according to the nature of the investment, the counterparty and various typesof risk exposure and based on the expected credit loss rate in the next 12 months or the wholeduration.

21.Long-term account receivable

None

22.Long-term equity investments

Long-term equity investment includes equity investment in subsidiaries, joint ventures andassociated enterprises. If the Company can exert significant influence on the investee, it is anassociated enterprise of the Company.

(1) Determination of initial investment cost

Long-term equity investment forming business combination: the long-term equity investmentobtained by business combination under the same control shall be taken as the investment costaccording to the book value share of the owner's equity of the combined party in the consolidatedfinancial statements of the final controlling party on the combination date; Long-term equityinvestment obtained by business combination not under the same control shall be regarded as theinvestment cost of long-term equity investment according to the combination cost.

For long-term equity investment obtained by other means: For long-term equity investmentobtained by payment in cash, the actual purchase price is taken as the initial investment cost; Forlong-term equity investment obtained by issuing equity securities, the fair value of issuing equitysecurities is taken as the initial investment cost.

(2) Subsequent measurement and profit and loss recognition method

Investment in subsidiaries shall be accounted by cost method, unless the investment meets theconditions of holding for sale; Investment in associated enterprises and joint ventures shall beaccounted for by equity method.

For the long-term equity investment calculated by the cost method, except for the cashdividends or profits that have been declared but not yet issued and that included in the actualpayment or consideration, the cash dividends or profits declared and distributed by the investee arerecognized as investment income and included in the current profits and losses.

If the initial investment cost of long-term equity investment accounted by equity method isgreater than the fair value share of identifiable net assets of the investee, the investment cost oflong-term equity investment shall not be adjusted; If the initial investment cost is less than the fairvalue share of the identifiable net assets of the investee at the time of investment, the book value ofthe long-term equity investment shall be adjusted, and the difference shall be included in the profitand loss of the current investment period.

In case of accounting by equity method, the investment income and other comprehensiveincome are recognized respectively according to the share of net profits and losses and othercomprehensive income realized by the investee, and the book value of long-term equity investmentis adjusted at the same time; According to the profit or cash dividend declared and distributed by theinvestee, the part to be entitled to shall be calculated, and the book value of long-term equityinvestment shall be reduced correspondingly; The investee adjusts the book value of long-termequity investment for other changes in owner's equity except net profits and losses, othercomprehensive income and profit distribution and includes them in capital reserve (other capitalreserve). When recognizing the share of the net profit and loss of the investee, the fair value ofidentifiable assets of the investee at the time of investment is taken as the basis, and the net profit ofthe investee is recognized after adjustment according to the accounting policies and accountingperiods of the Company.

If it can exert significant influence on the investee due to additional investment or implementjoint control but does not constitute control, on the conversion date, the sum of the fair value of theoriginal equity plus the new investment cost shall be taken as the initial investment cost calculatedby the equity method instead. The difference between the fair value and book value of the originalequity on the conversion date, as well as the accumulated fair value changes originally included inother comprehensive income, are transferred to the current profits and losses accounted for by theequity method.

If the joint control or significant influence on the investee is lost due to the disposal of someequity investments, the remaining equity after disposal shall be accounted for according toAccounting Standards for Business Enterprises No.22-Recognition and Measurement of FinancialInstruments on the date of loss of joint control or significant influence, and the difference betweenfair value and book value shall be included in the current profits and losses. Other comprehensiveincome recognized by the original equity investment due to the adoption of the equity method shallbe accounted for on the same basis as the direct disposal of related assets or liabilities by the investeewhen the equity method is terminated; Changes in other owners' equity related to the original equityinvestment are transferred into current profits and losses.

If the control over the investee is lost due to the disposal of part of equity investment, and theremaining equity after disposal can jointly control or exert significant influence on the investee, itshall be accounted for according to the equity method instead, and the remaining equity shall beregarded as being adjusted by the equity method when it is acquired; If the remaining equity afterdisposal cannot exercise joint control or exert significant influence on the investee, it shall beaccounted for according to the relevant provisions of Accounting Standards for Business EnterprisesNo.22-Recognition and Measurement of Financial Instruments, and the difference between its fairvalue and book value on the date of loss of control shall be included in the current profits and losses.

If the Company's shareholding ratio decreases due to capital increase of other investors, causingloss of control, but it can exercise joint control or exert significant influence on the investee, the

share of net assets increased by the investee due to capital increase and share expansion shall berecognized according to the new shareholding ratio, and the difference between the original bookvalue of long-term equity investment corresponding to the decreased shareholding ratio shall beincluded in the current profits and losses; Then, according to the new shareholding ratio, it isregarded as being adjusted by the equity method when the investment is obtained.

For unrealized internal transaction gains and losses between the Company and its associatedenterprises and joint ventures, the portion attributable to the Company shall be calculated accordingto the shareholding ratio, and investment gains and losses shall be recognized on the basis of offset.However, if the unrealized internal transaction losses between the Company and the investee are theimpairment losses of the transferred assets, they will not be offset.

(3) Basis for determination of joint control and significant influence on the investee

Joint control refers to the common control of an arrangement in accordance with the relevantagreement, and the relevant activities of such arrangement must be unanimously agreed by theparticipants who share the control rights before any decision is made. When judging whether there iscommon control, firstly, judge whether all participants or a combination of participants collectivelycontrol the arrangement, and secondly, judge whether the decision-making of activities related to thearrangement must be unanimously agreed by the participants who collectively control thearrangement. If all participants or a group of participants must act in concert to decide the relevantactivities of an arrangement, it is considered that all participants or a group of participantscollectively control the arrangement; If two or more participants can collectively control anarrangement, it does not constitute joint control. When judging whether it is joint control, theprotective rights entitled to are not considered.

Significant influence means that the investor has the right to participate in the decision-makingon the financial and operating policies of the investee, but cannot control or jointly control theformulation of these policies with other parties. When determining whether it can exert significantinfluence on the investee, the influence of the voting shares of the investee directly or indirectly heldby the investor and the current executable potential voting rights held by the investor and otherparties shall be considered, including the influence of the current convertible warrants, share optionsand convertible corporate bonds issued by the investee.

When the Company directly or indirectly owns more than 20% (including 20%) but less than50% of the voting shares of the investee, it is generally considered to have a significant influence onthe investee, unless there is clear evidence that it cannot participate in the production and operationdecisions of the investee under such circumstances, in which case it does not have a significantinfluence; When the Company owns less than 20% (excluding) of the voting shares of the investee,it is generally not considered to have a significant influence on the investee, unless there is clearevidence that it can participate in the production and operation decisions of the investee under suchcircumstances, in which case it has a significant influence.

(4) Equity investment held for sale

If all or part of the equity investment in an associated enterprise or joint venture is classified asassets held for sale, please refer to Note III. 13 for relevant accounting treatment.

For the remaining equity investments that are not classified as assets held for sale, the equitymethod is adopted for accounting treatment.

If the equity investment in an associated enterprise or joint venture that has been classified asheld for sale no longer meets the classification conditions of assets held for sale, the equity methodshall be used for retrospective adjustment from the date that it is classified as assets held for sale.

(5) Test method for impairment and accrual method for impairment provision

For investment in subsidiaries, associated enterprises and joint ventures, please refer to Note III.21 for the accrual method for impairment provision.

23.Investment real estate

The measurement mode of investment property

The company shall adopt the cost mode to measure the investment property.Depreciation or Amortization Method

Investment real estate refers to real estate held for rent or capital appreciation, or both. TheCompany's investment real estate includes leased land use rights, land use rights transferred afterholding and preparing for appreciation, and leased buildings.The Company's investment real estate is initially measured according to the cost at the time ofacquisition, and depreciation or amortization is accrued on schedule according to the relevantprovisions of fixed assets or intangible assets.For investment real estate that is subsequently measured by cost model, please refer to Note III.21 for the accrual method of asset impairment.The difference between the disposal income from the sale, transfer, scrapping or damage ofinvestment real estate after deduction of its book value and related taxes shall be included in thecurrent profits and losses.

24.Fixed assets

(1) Recognition conditions of fixed assets

The Company's fixed assets refer to tangible assets held for the production of commodities, provision oflabor services, leasing or operation and management, with a service life exceeding one fiscal year.Only when the economic benefits related to the fixed assets are likely to flow into the enterprise and thecost of the fixed assets can be measured reliably, can the fixed assets be recognized.

The fixed assets of the Company are initially measured according to the actual cost at the time ofacquisition.Subsequent expenditures related to fixed assets are included in the cost of fixed assets when the economicbenefits related to them are likely to flow into the Company and the cost can be measured reliably; Dailyrepair expenses of fixed assets that do not meet the requirements for subsequent expenditures ofcapitalization of fixed assets are included in the current profits and losses or the cost of related assetsaccording to the beneficiaries when they occur. For the replaced part, the book value is derecognized.

(2) The method for depreciation

Category	The method for depreciation	Expected useful life（Year）	Estimated residual value	Depreciation
House and Building- Production	Straight-line method	35	4.00%	2.74%
House and Building-Non- Production	Straight-line method	40	4.00%	2.40%
Decoration of Fixed assets	Straight-line method	10		10.00%
Machinery and	Straight-line method	10-14	4.00%	9.60%-6.86%

equipment
Transportation equipment	Straight-line method	8	4.00%	12.00%
Electronic equipment	Straight-line method	8	4.00%	12.00%
Other equipment	Straight-line method	8	4.00%	12.00%

For the fixed assets with the impairment provision withdrawn, the accumulative amount of thewithdrawn fixed assets impairment provision shall be also deducted to calculate and determine therate of depreciation.

（3） Identification basis, valuation method and depreciation method of fixed assets leased byfinancingNone

25.Construction in progress

The cost of construction in progress of the Company is determined according to the actualproject expenditure, including all necessary project expenditures incurred during the constructionperiod, borrowing costs that should be capitalized before the project reaches the intended usablestate, and other related expenses.

Construction in progress is transferred to fixed assets when it reaches the scheduled usablestate.

See Note III. 21 for the method of depreciation of assets in construction in progress.

26.Borrowing costs

(1) Recognition principle of capitalization of borrowing costs

If the borrowing costs incurred by the Company can be directly attributed to the purchase,construction or production of assets that meet the capitalization conditions, they will be capitalizedand included in the relevant asset costs; Other borrowing costs, when incurred, are recognized asexpenses according to the amount incurred, and included in current profits and losses. Borrowingcosts shall be capitalized if they meet the following conditions at the same time:

① Asset expenditure has already occurred, including the expenditure incurred in the form ofpayment in cash, transfer of non-cash assets or assumption of interest-bearing debts for the purchase,construction or production of assets that meet the capitalization conditions;

② Borrowing costs have already occurred;

③ The purchase, construction or production activities necessary to make the assets reach theintended usable or saleable state have started.

(2) Capitalization period of borrowing costs

Capitalization of borrowing costs shall be stopped when assets eligible for capitalizationacquired, constructed or produced by the Company reach the intended usable or saleable state.Borrowing costs incurred after the assets in line with the capitalization conditions reach the intendedusable or saleable state shall be recognized as expenses according to the amount incurred when theyoccur, and shall be included in current profits and losses.

If the assets that meet the capitalization conditions are abnormally interrupted in the process ofpurchase, construction or production, and the interruption lasts exceeds 3 months, the capitalizationof borrowing costs shall be suspended; Borrowing costs during normal interruption period continueto be capitalized.

(3) Capitalization rate of borrowing costs and calculation method of capitalization amount

The interest expenses actually incurred in the current period of special borrowing shall becapitalized after deducting the interest income from the unused borrowing funds deposited in thebank or the investment income from temporary investment; The capitalization amount of generalborrowings is determined by multiplying the weighted average of the accumulated asset expenditureover the special loan by the capitalization rate of the occupied general borrowings. Capitalizationrate is calculated and determined according to the weighted average interest rate of generalborrowings.

During the capitalization period, all the exchange differences of special borrowings in foreigncurrency are capitalized; Exchange differences of general borrowings in foreign currency areincluded in current profits and losses.

27.Biological Assets

None

28.Oil & Gas assets

None

29. Right to use assets

(1) Conditions for recognizing the right-to-use assets

The Company's right-to-use assets refers to the right of the Company as the lessee to use the leasedassets during the lease term.On the start date of the lease term, the right-to-use assets is initially measured at cost. The cost includes:

the initial measurement amount of lease liabilities; The lease payment amount issued on or before thestart date of the lease term, where if there is a lease incentive, the amount related to the entitled leaseincentive shall be deducted; The initial direct expenses incurred by the Company as the lessee; Thecost expected to be incurred by the Company as the lessee to dismantle and remove the leased assets,restore the site where the leased assets are located or restore the leased assets to the state agreed in thelease terms. The Company, as the lessee, recognizes and measures the demolition and restoration costsin accordance with the Accounting Standards for Business Enterprises No.13-Contingencies.Subsequent adjustments shall be made to any remeasurement of lease liabilities.

(2) Depreciation method of right-to-use assets

The Company adopts the straight-line method to accrue depreciation. If the Company, as the lessee,can reasonably determine that the ownership of the leased assets is acquired at the expiration of thelease term, depreciation shall be accrued within the remaining service life of the leased assets. If itcannot be reasonably determined that the ownership of the leased assets can be obtained at theexpiration of the lease term, depreciation shall be accrued during the lease term or the remainingservice life of the leased assets, whichever is shorter.See Note V. 21 for the impairment test method of the right-to-use assets and the provision method forimpairment.

30.Intangible assets

(1) Valuation method, service life and impairment test

The intangible assets of the Company include land use rights, proprietary technology andsoftware.

Intangible assets are initially measured at cost, and their service life is analyzed and judgedwhen they are acquired. If the service life is limited, the intangible assets shall be amortized withinthe expected service life by the amortization method that can reflect the expected realization mode ofthe economic benefits related to the assets from the time when they are available for use; If it isimpossible to reliably determine the expected realization mode, they shall be amortized bystraight-line method; Intangible asset\s with uncertain service life are not amortized.Amortization methods of intangible assets with limited service life are as follows:

Items	Useful life（year）	Amortization method	Notes
Land use right	50	Straight
Special technology	15	Straight
Software	5	Straight

At the end of each year, the Company rechecks the service life and amortization method ofintangible assets with limited service life, adjusts the original estimate if it is different from theprevious estimate, and handles the change according to the accounting estimate.

See Note V. 21 for the method of depreciation of assets for Intangible assets

（2）Accounting Policy of Internal Research and Development Expenditure

The Company divides the expenditure of internal research and development projects intoexpenditures in research stage and expenditures in development stage.

Expenditures in research stage are included in current profits and losses when they occurs.

Expenditures in development stage can only be capitalized if they meet the followingconditions: it is technically feasible to complete the intangible assets so that they can be used or sold;There is the intention to complete the intangible assets and use or sell them; The ways in whichintangible assets generate economic benefits, including those that can prove the existence of marketfor products produced by the intangible assets or the existence of market for the intangible assetsthemselves, and that for the intangible assets that will be used internally, their usefulness can beproved; There are sufficient technical, financial and other resources to complete the development ofthe intangible assets and the ability to use or sell the intangible assets; Expenditures attributable tothe development stage of the intangible assets can be measured reliably. Development expendituresthat do not meet the above conditions are included in current profits and losses.

The research and development project of the Company will enter the development stage afterthe above conditions are met and a project is approved through technical feasibility and economicfeasibility study.

Capitalized expenditures in development stage are listed as development expenditures on thebalance sheet, and are converted into intangible assets from the date when the project reaches theintended purpose.

31.Long-term Assets Impairment

The asset impairment of long-term equity investment of subsidiaries, associated enterprises andjoint ventures, investment real estate, fixed assets, construction in progress, intangible assets,goodwill, etc. (except inventory, investment real estate measured according to fair value model,deferred income tax assets and financial assets) shall be determined according to the followingmethods:

On the balance sheet date, judge whether there is any sign of possible impairment of assets. Ifthere is any sign of impairment, the Company will estimate its recoverable amount and conductimpairment test. The goodwill formed by business combination, intangible assets with uncertainservice life and intangible assets that have not yet reached the usable state are tested for impairmentevery year regardless of whether there is any sign of impairment.

The recoverable amount is determined according to the higher of the net amount of the fairvalue of the asset minus the disposal expenses and the present value of the estimated future cashflow of the asset. The Company estimates its recoverable amount on the basis of individual assets; Ifit is difficult to estimate the recoverable amount of a single asset, the recoverable amount of the assetgroup shall be determined based on the asset group to which the asset belongs. The identification ofasset group is based on whether the main cash inflow generated by asset group is independent ofcash inflow of other assets or asset groups.When the recoverable amount of an asset or asset group is lower than its book value, theCompany will write down its book value to the recoverable amount, and the written-down amountwill be included in the current profits and losses, and the corresponding asset impairment provisionwill be accrued at the same time.As far as the impairment test of goodwill is concerned, the book value of goodwill formed bybusiness combination is amortized to relevant asset groups according to a reasonable method fromthe acquisition date; If it is difficult to amortize to the related asset group, it shall be amortized to therelated asset group portfolio. The related asset group or asset group portfolio is one that can benefitfrom the synergy effect of business combination, and is not larger than the reporting segmentdetermined by the Company.In the impairment test, if there are signs of impairment in the asset group or asset groupportfolio related to goodwill, firstly, the asset group or asset group portfolio without goodwill shallbe tested for impairment, the recoverable amount shall be calculated, and the correspondingimpairment loss shall be recognized. Then impairment test shall be carried out on the asset group orasset group portfolio containing goodwill, and its book value shall be compared with the recoverableamount. If the recoverable amount is lower than the book value, the impairment loss of goodwillshall be recognized.Once the asset impairment loss is recognized, it will not be reversed in future accountingperiods.

32.Long-term deferred expenses

The long-term deferred expenses incurred by the Company are priced at actual cost andamortized equally according to the expected benefit period. For long-term deferred expense itemsthat cannot benefit future accounting periods, all their amortized values are included in currentprofits and losses.

33.Contract liabilities

Contract liabilities refer to the obligation of the Company to transfer goods to customers for thereceived or receivable consideration from customers. If the customer has paid the contractconsideration or the Company has obtained the unconditional collection right before the Companytransfers the goods to the customer, the Company will list the received or receivable amount as thecontract liability at the earlier of the actual payment made by the customer and the due date forpayment. Contract assets and liabilities under the same contract are listed in net amount, whilecontract assets and liabilities under different contracts are not offset.

34.Remuneration

1. Accounting Treatment Method of Short-term Compensation

During the accounting period when employees provide services, the Company recognizes theactual wages, bonuses, social insurance premiums such as medical insurance premiums,work-related injury insurance premiums and maternity insurance premiums paid for employees andhousing provident funds as liabilities, and includes them in current profits and losses or related assetcosts. If the liability is not expected to be fully paid within twelve months after the end of the annualreporting period when employees provide relevant services, and the financial impact is significant,the liability will be measured at the discounted amount.

2. Accounting Treatment Method of Severance Benefit Plans

After-service benefit plan includes defined contribution plan and defined benefit plans. Wherethe set deposit plan refers to the post-employment benefits plan in which the enterprise no longerundertakes further payment obligations after paying fixed fees to independent funds; Set benefit planrefers to the post-employment benefits plan except the set deposit plan.

Set deposit plan

The set deposit plan includes basic old-age insurance, unemployment insurance and enterpriseannuity plan, etc.

In addition to the basic old-age insurance, the Company establishes an enterprise annuity plan

("annuity plan") according to the relevant policies of the national enterprise annuity system, and

employees can voluntarily participate in the annuity plan. Moreover, the Company has no other

significant social security commitments for employees.

During the accounting period when employees provide services, the amount that should be paidaccording to the set deposit plan is recognized as a liability and included in the current profits andlosses or related asset costs.

Set benefit plan

For set benefit plans, an actuarial valuation is conducted by an independent actuary on theannual balance sheet date, and the cost of benefit provision is determined by the expected cumulativebenefit unit method. The employee remuneration cost caused by set benefit plans of the Companyincludes the following components:

① Service cost, including current service cost, past service cost and settlement gain or loss.Where: the current service cost refers to the increase of the present value of set benefit planobligations caused by the employees providing services in the current period; Past service cost refersto the increase or decrease of the present value of set benefit plan obligations related to employeeservice in previous period caused by the modification of set benefit plans.

② The net interest of set benefit plan's net liabilities or net assets, including interest income ofplanned assets, interest expense of set benefit plan obligations and interest affected by asset ceiling.

③ Changes arising from remeasurement of net liabilities or net assets of set benefit plans.

Unless other accounting standards require or allow employee benefit costs to be included inasset costs, the Company will include the above items ① and ② in current profits and losses;Include item ③ in other comprehensive income and such item will not be transferred back to profitor loss in the subsequent accounting period. When the original set benefit plan is terminated, all theparts originally included in other comprehensive income will be carried forward to undistributedprofits within the scope of equity.

3. Accounting Treatment Method of Demission Welfare

If the Company provides dismissal benefits to employees, the employee remuneration liabilitiesarising from the dismissal benefits shall be recognized and included in the current profits and losseson the earlier of the following dates: When the Company cannot unilaterally withdraw the dismissalbenefits provided by the termination of labor relations plan or layoff proposal; When the Companyrecognizes the costs or expenses related to the reorganization involving the payment of dismissalbenefits.

If the employee's internal retirement plan is implemented, the economic compensation beforethe official retirement date is the dismissal benefit. From the day when the employee stops providingservices to the normal retirement date, the wages of the retired employees and the social insurancepremiums paid will be included in the current profits and losses at one time. Economic compensationafter the official retirement date (such as normal pension) shall be treated as post-employmentbenefits.

4. Accounting Treatment Method of Other Long-term Employee Benefits

If other long-term employee benefits provided by the Company to employees meet theconditions for the set deposit plan, they shall be handled in accordance with the above-mentionedrelevant provisions on the set deposit plan. If it meets the set benefit plans, it shall be handled inaccordance with the above-mentioned relevant regulations on set benefit plans, but the part of therelated employee remuneration cost, which is "the change caused by remeasurement of set benefitplan's net liabilities or net assets", shall be included in the current profits and losses or related assetcosts.

35.Lease liabilities

None

36. Estimated Liabilities

If the obligation related to contingencies meets the following conditions at the same time, theCompany will recognize it as estimated liabilities:

(1) Such obligation is the current obligation undertaken by the Company;

(2) The performance of such obligation is likely to lead to the outflow of economic benefitsfrom the Company;

(3) The amount of such obligation can be measured reliably.

Estimated liabilities are initially measured according to the best estimate of expenditurerequired to fulfill relevant current obligations, and factors such as risks, uncertainties and time valueof money related to contingencies are comprehensively considered. If the time value of money hasgreat influence, the best estimate is determined by discounting the related future cash outflow. TheCompany rechecks the book value of the estimated liabilities on the balance sheet date, and adjuststhe book value to reflect the current best estimate.

If all or part of the expenses required to pay off the recognized estimated liabilities are expectedto be compensated by a third party or other parties, the compensation amount can only be recognizedas an asset when it is basically confirmed that it can be received. The recognized compensationamount shall not exceed the book value of the recognized liabilities.

37. Share payment

(1) Types of share-based payment

The share-based payment of the Company is divided into equity-settled share-based paymentand cash-settled share-based payment.

(2) Method for determining fair value of equity instruments

The fair value of equity instruments such as options granted by the Company with activemarket is determined according to the quoted price in the active market. The fair value of grantedequity instruments such as options without active market is determined by option pricing model. Theselected option pricing model considers the following factors: A. The exercise price of options; B.The validity period of the option; C. The current price of the underlying shares; D. Estimatedvolatility of share price; E. Expected dividend of shares; F. Risk-free interest rate within the validityperiod of the option.

(3) Basis for determining the best estimation of feasible equity instruments

On each balance sheet date during the waiting period, the Company makes the best estimatebased on the latest available follow-up information such as changes in the number of employees withfeasible rights, and revises the estimated number of equity instruments with feasible rights. On thevesting date, the final estimated number of vesting rights and interests instruments shall beconsistent with the actual number of vesting rights.

(4) Accounting treatment related to implementation, modification and termination of share-basedpayment plan

Equity-settled share-based payment is measured at the fair value of equity instruments grantedto employees. If the right is exercised immediately after the grant, the relevant costs or expensesshall be included in the fair value of equity instruments on the grant date, and the capital reserveshall be increased accordingly. If the rights can be exercised only after the services within thewaiting period are completed or the specified performance conditions are met, on each balance sheetdate within the waiting period, based on the best estimate of the number of equity instrumentsavailable, the services obtained in the current period shall be included in the relevant costs orexpenses and capital reserve according to the fair value on the grant date of equity instruments. Afterthe vesting date, the recognized related costs or expenses and the total owner's equity will not beadjusted.Equity-settled share-based payment shall be measured according to the fair value of liabilitiescalculated and determined on the basis of shares or other equity instruments undertaken by theCompany. If the right is exercised immediately after the grant, the fair value of the liabilitiesassumed by the Company shall be included in the relevant costs or expenses on the grant date, andthe liabilities shall be increased accordingly. For cash-settled share-based payment that is feasibleonly after the service within the waiting period is completed or the specified performance conditionsare met, on each balance sheet date within the waiting period, based on the best estimation of thefeasibility and according to the fair value of the liabilities assumed by the Company, the servicesobtained in the current period are included in the costs or expenses and corresponding liabilities. Oneach balance sheet date and settlement date before the settlement of related liabilities, the fair valueof liabilities shall be re-measured, and the changes shall be included in the current profits and losses.When the Company modifies the share-based payment plan, if the fair value of the grantedequity instruments is increased by modification, the increase of the services obtained shall berecognized according to the increase of the fair value of the equity instruments; If the number ofgranted equity instruments is increased by modification, the fair value of the increased equityinstruments will be recognized as the increase in services obtained accordingly. The increase of fairvalue of equity instruments refers to the difference between the fair values of equity instrumentsbefore and after modification on the modification date. If the total fair value of share-based paymentis reduced by modification or the terms and conditions of the share-based payment plan are modifiedin other ways that are unfavorable to employees, the accounting treatment of the obtained serviceswill continue, as if with no changes unless the Company cancels some or all of the granted equityinstruments.During the waiting period, if the granted equity instruments are cancelled (except thosecancelled due to non-market conditions that do not meet the feasible rights conditions), the Companywill treat the cancellation of the granted equity instruments as an accelerated exercise, andimmediately record the amount to be recognized in the remaining waiting period into the currentprofits and losses, and recognize the capital reserve at the same time. If the employee or other partycan choose to meet the non-feasible right condition but fails to meet it during the waiting period, theCompany will treat it as a cancellation for granting equity instruments.

38. Other financial instruments such as preferred stocks and perpetual bonds

None

39. Revenue

Accounting policies adopted for income recognition and measurement

(1) General principles

The Company has fulfilled the performance obligation in the contract, that is, to recognize therevenue when the customer obtains the control right of related goods or services.

If the contract contains two or more performance obligations, the Company will amortize thetransaction price to each individual performance obligation according to the relative proportion ofthe individual selling price of the goods or services promised by each individual performance

obligation on the contract start date, and measure the income according to the transaction priceamortized to each individual performance obligation.When one of the following conditions is met, the Company will fulfill its performanceobligations within a certain period of time; Otherwise, it performs the performance obligation at acertain time:

① The customer obtains and consumes the economic benefits brought by the Company'sperformance at the same time of the its performance.

② Customers can control the goods under construction during the performance of theCompany.

③ The commodities produced during the performance of the Company have irreplaceable uses,and the Company has the right to collect payment for the performance part accumulated so farduring the whole contract period.

For the performance obligations performed within a certain period of time, the Companyrecognizes the income according to the performance progress within that period. If the performanceprogress cannot be reasonably determined, and the cost incurred of the Company is expected to becompensated, the income shall be recognized according to the amount of the cost incurred until theperformance progress can be reasonably determined.

For obligations performed at a certain time, the Company shall recognize the income at the timewhen the customer obtains control of the relevant goods or services. When judging whether acustomer has obtained control of goods or services, the Company will consider the following signs:

① The Company has the current right to receive payment for the goods or services, that is, thecustomer has the current payment obligation for the goods or services.

② The Company has transferred the legal ownership of the goods to the customer, that is, thecustomer has the legal ownership of the goods.

③ The Company has transferred the physical goods to the customer, that is, the customer hasphysically taken possession of the goods.

④ The Company has transferred the main risks and rewards on the ownership of the goods tothe customer, that is, the customer has obtained the main risks and rewards on the ownership of thegoods.

⑤ The customer has accepted the goods.

⑥ Other signs that the customer has obtained control of the goods.

The Company has transferred goods or services to customers and has the right to receiveconsideration (and the right depends on other factors except the passage of time) as contract assets,and the contract assets are depreciated on the basis of expected credit losses. The right of theCompany to collect consideration from customers unconditionally (only depending on the passage oftime) is listed as receivables. The obligation of the Company to transfer goods or services tocustomers for received or receivable consideration from customers shall be regarded as a contractualliability.Contract assets and contract liabilities under the same contract are listed in net amount. If the netamount is debit balance, they are listed in "Contract Assets" or "Other Non-current Assets"according to their liquidity; If the net amount is the credit balance, it shall be listed in "ContractLiabilities" or "Other Non-current Liabilities" according to its liquidity.

(2) Specific method

The specific method of revenue recognition of the Company is as follows:

Polarizer/Textile and garment sales contract:

Domestic sales: When the goods are delivered to the customer and the customer has acceptedthe goods, the customer obtains the control of the goods, and the Company recognizes the revenue.

Export: A. When the customer receives goods in China, the revenue recognition is the same as"Revenue Recognition for Domestic Sales"; B. When the delivery place of customer is outside the

country, the Company mainly adopts FOB. When the goods are delivered from the warehouse andhave been exported for customs declaration, the Company recognizes the revenue.Revenue from property/accommodation services:

In the process of property/accommodation service provision, the Company recognizes revenueby stages.The adoption of different business models in similar businesses leads to differences in accountingpolicies for income recognitionNone

40.Government subsidy

Government subsidies are recognized when they meet the conditions attached to governmentsubsidies and can be received.

Government subsidies for monetary assets shall be measured according to the amount receivedor receivable. Government subsidies for non-monetary assets are measured at fair value; If the fairvalue cannot be obtained reliably, it shall be measured according to the nominal amount RMB 1.

Government subsidies related to assets refer to government subsidies obtained by the Companyfor purchasing and building or forming long-term assets in other ways; In addition, as a governmentsubsidy related to income.

Where the government documents do not specify the object of the subsidy, and the subsidy canform long-term assets, the part of the government subsidies corresponding to the value of the assetsshall be regarded as the government subsidy related to the assets, and the rest shall be regarded asthe government subsidies related to the income; where it is difficult to be distinguished, governmentsubsidies as a whole are treated as income-related government subsidies.

Government subsidies related to assets offset the book value of related assets, or are recognizedas deferred income and included in profits and losses by stages according to a reasonable andsystematic method within the service life of related assets. Government subsidies related to income,which are used to compensate related costs or losses that have occurred, are included in currentprofits and losses or offset related costs; If used to compensate related costs or losses in later periods,they will be included in the deferred income, and included in the current profits and losses or offsetrelated costs during the recognition period of related costs or losses. Government subsidies measuredin nominal amount are directly included in current profits and losses. The Company adopts aconsistent approach to the same or similar government subsidy business.

Government subsidies related to daily activities are included in other income or offset relatedcosts according to the nature of economic business. Government subsidies irrelevant to routineactivities shall be included into the non-operating receipt and disbursement.

When the recognized government subsidy needs to be returned, if the book value of relatedassets is offset during initial recognition, the book value of assets will be adjusted; If there is arelevant deferred income balance, the book balance of the relevant deferred income will be offset,and the excess will be included in the current profits and losses; In other cases, it is directly includedin the current profits and losses.

For the discount interest of preferential policy loans, if the finance allocates the discountinterest funds to the lending bank, the actually received loan amount is taken as the recorded value ofthe loan, and the borrowing costs are calculated according to the loan principal and preferentialpolicy interest rate. If the finance directly allocates the discount interest funds to the Company, thediscount interest will offset the borrowing costs.

41.The Deferred Tax Assets / The deferred Tax Liabilities

Income tax includes current income tax and deferred income tax. Except for adjusted goodwillarising from business combination or deferred income tax related to transactions or matters directlyincluded in owner's equity, they are all included in current profits and losses as income tax expenses.

According to the temporary difference between the book value of assets and liabilities and thetax basis on the balance sheet date, the Company adopts the balance sheet liability method toconfirm deferred income tax.

All taxable temporary differences are recognized as related deferred income tax liabilities,unless the taxable temporary differences are generated in the following transactions:

(1) Initial recognition of goodwill, or the initial recognition of assets or liabilities arising fromtransactions with the following characteristics: the transaction is not a business combination, and thetransaction does not affect accounting profits or taxable income when it occurs;

(2) For taxable temporary differences related to investments of subsidiaries, joint ventures andassociated enterprises, the time for the temporary differences to be reversed can be controlled andthe temporary differences will probably not be reversed in the foreseeable future.

For deductible temporary differences, deductible losses and tax deductions that can be carriedforward to later years, the Company shall recognize the deferred income tax assets arising therefromto the extent that it is likely to obtain the future taxable income used to offset the deductibletemporary differences, deductible losses and tax deductions, unless the deductible temporarydifferences are generated in the following transactions:

(1) The transaction is not a business combination, and it does not affect accounting profit ortaxable income when the transaction occurs;

(2) For deductible temporary differences related to investments of subsidiaries, joint venturesand associated enterprises, corresponding deferred income tax assets are recognized if the followingconditions are met at the same time: temporary differences are likely to be reversed in theforeseeable future, and taxable income used to offset the deductible temporary differences is likelyto be obtained in the future.

On the balance sheet date, the Company measures deferred income tax assets and deferredincome tax liabilities according to the applicable tax rate during the expected period of recoveringthe assets or paying off the liabilities, and reflects the income tax impact of the expected way ofrecovering the assets or paying off the liabilities on the balance sheet date.

On the balance sheet date, the Company rechecks the book value of deferred income tax assets.If it is unlikely that sufficient taxable income will be obtained in the future period to offset thebenefits of deferred income tax assets, the book value of deferred income tax assets will be writtendown. When sufficient taxable income is likely to be obtained, the written-down amount shall bereversed.

42.Lease

(1) Accounting treatment method of operating lease

For rent in operating lease, the Company shall recognize the current profits and losses according to thestraight-line method in each period of the lease term. The initial direct expenses related to theoperating lease shall be capitalized, apportioned on the same basis as the rental income during thelease term, and included in the current profits and losses by stages. The variable lease payment relatedto operating lease, which is not included in the lease collection amount, shall be included in the currentprofits and losses when actually incurred.

(2) Accounting treatment method of financial lease

In financial lease, at the beginning date of the lease term, the Company takes the net lease investmentas the recorded value of the financial lease receivable, and the net lease investment is the sum of theunsecured residual value and the present value of the lease receipts that have not yet been received onthe start date of the lease term discounted according to the interest rate of the lease. As the lessor, theCompany calculates and recognizes the interest income of each period in the lease term according tothe fixed periodic interest rate. The variable lease payments obtained by the Company as the lessor

that are not included in the measurement of net lease investment are included in the current profits andlosses when actually incurred.The derecognition and impairment of financial lease receivables shall be treated according to theprovisions of Accounting Standards for Business Enterprises No.22-Recognition and Measurement ofFinancial Instruments and Accounting Standards for Business Enterprises No.23-Transfer of FinancialAssets.

43. Other important accounting policies and accounting estimates

(1)Change of main accounting policies

Accounting policy changes caused by implementation of new financial instrument standards

（2） Changes in accounting estimates

No significant changes in accounting estimates have occurred in the current period.

44.Change of main accounting policies and estimations

(1)Change of main accounting policies

√ Applicable □Not applicable

The content and reason for change of accounting policy	Approval process	Remarks
In order to adapt to the development of market economy, it standardizes the accounting treatment of related economic business and improves the quality of accounting information. On December 7, 2018, the Ministry of Finance issued the Notice on Revision and Issuance of Accounting Standards for Business Enterprises No.21-Leasing (CS [2018] No.35) (hereinafter referred to as the "New Leasing Standards"). According to the regulations, the Company will implement the New Leasing Standards from January 1, 2021 and adjust the relevant contents of accounting policies.	The examined and Adopted at the 2nd meeting of the 8th Board of Directors	http://www.cninfo.com.cn On March 12,2021(Announcement No.:2021-12)

①New Leasing Standards

In 2018, the Ministry of Finance issued the revised Accounting Standards for Business EnterprisesNo.21-Leasing (hereinafter referred to as "New Leasing Standards"), which shall come into effect onJanuary 1, 2019 for enterprises listed at home and abroad and those listed overseas and usinginternational financial reporting standards or accounting standards for business enterprises to preparefinancial statement, and on January 1, 2021 for other enterprises that implement accounting standardsfor business enterprises. The Company has implemented the New Leasing Standards since January 1,2021. According to the relevant provisions of the New Leasing Standards, the Company held thesecond meeting of the Eighth Board of Directors on March 10, 2021, approved the implementation ofthe New Leasing Standards from January 1, 2021, and adjusted the relevant contents of the accountingpolicy. See Notes III. 30 and 31 for the changed accounting policies.For the contracts existing before the first implementation date, the Company chooses not tore-evaluate whether they are leases or include leases on the first implementation date. For contracts

signed or changed after the first implementation date, the Company evaluates whether the contract is alease or includes a lease according to the definition of lease in the New Leasing Standards.The definition of lease in the New Leasing Standards does not have any significant impact on thescope of contracts in which the Company meets the definition of lease.As lesseeThe New Leasing Standards require the lessee to recognize the right-to-use assets and lease liabilitiesfor all leases, except for short-term leases and low-value asset leases that are simplified, and torecognize depreciation and interest expenses respectively.The New Leasing Standards allow the lessee to choose one of the following methods to performconnection accounting treatment on the lease:

According to the Accounting Standards for Business Enterprises No.28-Accounting Policies, Changes

in Accounting Estimates and Error Correction, retrospective adjustment method is adopted.According to the cumulative impact of the first implementation of these standards, the amount ofretained earnings and other related items in the financial statements at the beginning of the firstimplementation of these standards are adjusted, and the information of comparable period is notadjusted.According to the New Leasing Standards, the Company has retroactively adjusted the differencebetween the first implementation date of New Leasing Standards and the current lease standards intothe retained earnings at the beginning of 2021. At the same time, the Company has not adjusted thedata of comparative financial statements.For the financial lease before the first implementation date, the Company measures the right-to-useassets and lease liabilities respectively according to the original book value of the financial leaseassets and the financial lease payments payable;For the operating lease before the first implementation date, the Company measures the lease

liabilities according to the present value of the remaining lease payment discounted at the

incremental borrowing rate on the first implementation date, and for the lease of houses and

buildings, it measures the right-to-use assets according to the amount equal to the lease liabilities,

and makes necessary adjustments according to the prepaid rent.On the first implementation date, the Company conducts impairment test on the right-to-use assets and

conducts corresponding accounting treatment according to Notes III. 31.The Company adopts simplified treatment for the operating lease whose leased assets are low-valueassets before the first implementation date or the operating lease that will be completed within 12months, without recognizing the right-to-use assets and lease liabilities.The Company adopts the following simplified treatment for the operating lease before the firstimplementation date:

When measuring lease liabilities, the same discount rate can be adopted for leases with similar

characteristics; The measurement of the right-to-use assets may not include the initial direct cost;

If there is an option to renew or terminate the lease, the Company will determine the lease termaccording to the actual exercise of the option before the first implementation date and other latestinformation;As a substitute for the impairment test of the right-to-use assets, the Company evaluates whether thecontract including leases is an onerous contract before the first implementation date, and adjuststhe right-to-use assets according to the loss reserve amount included in the balance sheet beforethe first implementation date;For the lease change before the first implementation date, the Company makes accounting treatmentaccording to the final arrangement of the lease change.The impact of the implementation of the New Leasing Standards on the items of consolidated balancesheet as of January 1, 2021 is as follows:

Items	Book balance before adjustment（December 31,2020）	Re classification	Re-measurement	Book balance after adjustment（January 1, 2021）
Assets：
Right to use assets	--	--	13,762,176.74	13,762,176.74
Total of assets	--	--	13,762,176.74	13,762,176.74
Liabilities
Non-current liabilities due within 1 year	--	--	4,342,927.51	4,342,927.51
Lease liabilities	--	--	9,419,249.23	9,419,249.23
Total of liabilities	--	--	13,762,176.74	13,762,176.74

For the unpaid minimum lease payment of major operating leases disclosed in the 2020 financial statements,the Company adjusted the unpaid minimum operating lease payment disclosed under the original leasestandards to the lease liabilities recognized under the New Leasing Standards according to the incrementalloan interest rate of the lessee on January 1, 2021, as follows:

Minimum lease payment for major operating lease on December 31, 2020	A	14,740,264.72
Less: Short-term lease with simplified treatment	B	42,452.83
Less: Lease of low-value assets with simplified treatment	C	--

Plus: Re-evaluated adjustment of the minimum lease payment in the leaseterm

Plus: Re-evaluated adjustment of the minimum lease payment in the lease term	D	--
Plus: Variable lease payment adjustment depending on index or ratio	E	--
Subtotal	F=A-B-C+/-D+/-)E	14,697,811.89
Less：VAT	G	--
Adjusted operating lease commitment	H=F-G	14,697,811.89
Present value of operating lease payment on January 1, 2021	I	13,762,176.74
Plus: Financial lease payable on December 31, 2020	J	--
Lease liabilities on January 1st, 2021	K=I+J	13,762,176.74
Including: non-current liabilities due within one year		4,342,927.51

The book value of the right-to-use assets on January 1, 2021 is as follows:

Items	2021.01.01
Right-to-use assets
For the right-to-use assets recognized by the operating lease before	13,762,176.74

the first implementation date
Financing leased assets recognized under the original lease standards	--
Total：	13,762,176.74

The impact of the implementation of the New Leasing Standards on the items of 2021 financialstatement is as follows:

Items of consolidated balance sheet	Number of statements as of December 31, 2021	Assuming that according to the original lease standards	Increase/decrease (-)
Assets：
Construction in process	71,482,031.08	71,510,678.35	-28,647.27
Right to use assets	9,221,189.37	--	9,221,189.37
Total of assets	80,703,220.45	71,510,678.35	9,192,542.10

Liabilities

Liabilities
Non-current liabilities due within 1 year	5,175,393.52	--	5,175,393.52
Lease liabilities	4,243,855.71	--	4,243,855.71
Total of liabilities	9,419,249.23	--	9,419,249.23

Items of consolidated income statement	Number of statements in 2021	Assuming that according to the original lease standards	Increase/decrease (-)
Business costs	1,908,519,413.28	1,908,686,016.10	-166,602.82
Administration expenses	122,088,830.15	122,170,567.39	-81,737.24

Financial expenses

Financial expenses

-130,344.09

-605,391.28

475,047.19

As lessorAccording to the New Leasing Standards, the Company does not need to adjust its lease as a lessoraccording to the connection regulations, but it needs to make accounting treatment according to theNew Leasing Standards from the date when the New Leasing Standards are first implemented.

（2）Change of main accounting estimations

□ Applicable √Not applicable

（3）Adjustments to the Financial Statements at the Beginning of the First Execution Year of anyNew Standards Governing Financial Instruments, Revenue or Leases from year 2021

√ Applicable □ Not applicable

Whether need to adjust the balance sheet account at the beginning of the year

□ Yes √ No

No reason for adjusting the balance sheet account at the beginning of the yearNo related business.

（4）Retrospective Restatement of Previous Comparative Data due to the First Execution of anyNew Standards Governing Financial Instruments or Leases from year 2021

□ Applicable √ Not applicable

45.Other

NoneIII. Taxes of the Company

1. Main taxes categories and tax rate

Taxes	Tax references	Applicable tax rates
VAT	The taxable turnover	13%,6%,5%
City construction tax	Turnover tax to be paid allowances	7%
Business income tax	Turnover tax to be paid allowances	25%,20%,16.5%,15%
Education surcharge	Turnover tax to be paid allowances	3%
Local education surcharge	Turnover tax to be paid allowances	2%

In case there exist any taxpayer paying corporate income tax at different tax rates, disclose theinformation

Name of taxpayer

Income tax rates

2. Tax preference

.In accordance with relevant provisions of the Notice of Ministry of Finance, General Administration of Customs and State Taxation Administration Regarding Tax Preference Policies for Further Supporting the Development of New-type Display Device Industry (Cai Guan Shui (2021) No. 19),TheCompany manufactured key materials and parts for the upstream industry of new-type displaydevices including colorful light filter coating and polarizersheet that comply with the planning for independent development of domestic industries may enjoy the preferential policies of exemption from import tariff for the import of raw materials and consumables for the purpose of self use and production that can not be produced domestically from January 1, 2021 and December 31, 2030.SAPO Photoelectric Co., Ltd. the subsidiary company of our company, has been qualified asnational high-tech enterprise since 2019 ,High-tech and enterprise certificate No.:

GR201944205666 ,The certificate is valid for three years, The enterprise income tax rate of this yearis 15%.

Shenzhen Beauty Century Garment Co., Ltd., Shenzhen Huaqiang Hotel Garment Co., Ltd. andShenzhen Lisi Industrial Development Co., Ltd., subsidiaries of the Company, are all small andlow-profit enterprises as stipulated in the Notice of the Ministry of Finance and the StateAdministration of Taxation on Implementing Inclusive Tax Concession Policy for Small and MicroEnterprises (CS [2019] No.13). For the part of the taxable income of this year that does not exceedRMB 1 million, the taxable income is reduced to 12.5%, and the enterprise income tax is paid at arate of 20%; For the taxable income of this year that exceeds RMB 1 million but does not exceedRMB 3 million, the taxable income is reduced to 50% and the enterprise income tax is paid at a rateof 20%.

3.Other

NoneIV. Notes of consolidated financial statement

1.Monetary Capital

In RMB

Items	Year-end balance	Year-beginning balance
Cash at hand	792.64	4,127.10
Bank deposit	302,472,035.96	271,085,025.10
Other monetary funds	--	7,998,084.75
Total	302,472,828.60	279,087,236.95
Including : The total amount of deposit abroad	6,009,898.07	7,829,822.78

Other noteAt the end of the period, there is no mortgage, pledge or freezing, or money deposited abroad withrestricted repatriation.

2. Transactional financial assets

In RMB

Items	Year-end balance	Year-beginning balance
Financial assets measured at their fair values and with the variation included in the current profits and losses	586,540,735.16	684,617,260.06
Including：
Structure deposit	0.00	200,536,575.34
Monetary fund	586,540,735.16	484,080,684.72
Including
Total	586,540,735.16	684,617,260.06

Other note：

3. Derivative financial assets

单位：元

Items

Year-end balance

Year-beginning balance

Other note：

4. Notes receivable

(1) Notes receivable listed by category

In RMB

Items	Year-end balance	Year-beginning balance
Bank acceptance	77,296,787.26	0.00
Commercial acceptance	72,646,093.02	16,813,657.28

Total

149,942,880.28

16,813,657.28

In RMB

Category	Amount in year-end					Balance Year-beginning
	Book Balance		Bad debt provision		Book value	Book Balance		Bad debt provision		Book value
	Amount	Proportion(%)	Amount	Proportion(%)		Amount	Proportion(%)	Amount	Proportion(%)
Of which：
Accrual of bad debt provision by portfolio	138,110,166.17	100.00%	365,055.74	0.26%	137,745,110.43	16,898,148.02	100.00%	84,490.74	0.50%	16,813,657.28
Of which：
Commercial acceptance	73,011,148.76	52.86%	365,055.74	0.50%	72,646,093.02	16,898,148.02	100.00%	84,490.74	0.50%	16,813,657.28
Bank acceptance	65,099,017.41	47.14%	0.00	0.00%	65,099,017.41	0.00	0.00%	0.00	0.00%	0.00
Total	138,110,166.17	100.00%	365,055.74	0.26%	137,745,110.43	16,898,148.02	100.00%	84,490.74	0.50%	16,813,657.28

Accrual of bad debt provision by single item:

In RMB

Name	Amount in year-end
	Book Balance	Bad debt provision	Proportion(%)	Reason

Accrual of bad debt provision by portfolio: Commercial acceptance

In RMB

Name	Amount in year-end
	Book balance	Bad debt provision	Proportion(%)
Commercial acceptance	73,011,148.76	365,055.74	0.50%

Note：

Accrual of bad debt provision by portfolio:

In RMB

Name	Amount in year-end
	Book balance	Bad debt provision	Proportion(%)

Note：

Relevant information of the provision for bad debts will be disclosed with reference to the disclosuremethod of other receivables if the provision for bad debts of bills receivable is accrued according tothe general model of expected credit loss:

√ Applicable □ Not applicable

None

(2) Accounts receivable withdraw, reversed or collected during the reporting periodThe withdrawal amount of the bad debt provision：

In RMB

Category	Opening balance	Amount of change in the current period				Closing balance
		Accrual	Reversed or collected amount	Write-off	Other

	84,490.74	280,565.00				365,055.74
Total	84,490.74	280,565.00				365,055.74

Of which the significant amount of the reversed or collected part during the reporting period

□ Applicable √ Not applicable

（3）Notes receivable pledged by the company at the end of the period

In RMB

Items

Amount

（4）Accounts receivable financing endorsed or discounted by the Company at the end of the periodand not expired yet on the date of balance sheet

In RMB

Items	Amount derecognized at the end of the period	Amount not yet derecognized at the end of the period
Bank acceptance		65,099,017.41
Total		65,099,017.41

（5）Accounts receivable financing transferred to accounts receivable by the Company at the end ofthe period due to failure of the drawer to perform

In RMB

Items

Amount

Other note

At the end of the term, the Company has no notes to transfer the drawer to the receivables.

（6）The Company had no accounts receivable financing actually written off in the period

In RMB

Items

Amount

5. Account receivable

(1)Classification account receivables.

In RMB

Category	Amount in year-end					Amount in year-begin
	Book balance		Bad debt provision		Book value	Book balance		Bad debt provision		Book value
	Amount	Proportion(%)	Amount	Proportion(%)		Amount	Proportion(%)	Amount	Proportion(%)
Accrual of bad debt provision by single item	13,260,307.34	2.56%	13,260,307.34	100.00%		20,641,002.24	3.52%	13,552,865.25	65.66%	7,088,136.99
Including：
Accrual of bad debt provision by	502,848,54	97.43%	22,849,841.	4.54%	479,998,708.	565,279,517.	96.48%	25,057,436.5	4.43%	540,222,080.91

portfolio	9.97		40		57	47		6
Including：
Total	516,108,857.31	100.00%	36,110,148.74	7.00%	479,998,708.57	585,920,519.71	100.00%	38,610,301.81	6.59%	547,310,217.90

Accrual of bad debt provision by single item:

In RMB

Name	Closing balance
	Book balance	Bad debt provision	Proportion	Reason
Dongguan Yaxing Semiconductor Co., Ltd.	2,797,016.81	2,797,016.81	100.00%	Beyond the credit period for a long time, uncertain recovered.
Dongguan Fair LCD Co., Ltd.	1,697,122.75	1,697,122.75	100.00%	Beyond the credit period for a long time, uncertain recovered.
Guangdong Ruili Baolai Technology Co., Ltd.	1,298,965.36	1,298,965.36	100.00%	Beyond the credit period for a long time, uncertain recovered.
Huangshan Zhongxianwei Electric Co., Ltd.	902,031.00	902,031.00	100.00%	Beyond the credit period for a long time, uncertain recovered.
Shenzhen Gulida Microelectronics Co., Ltd.	422,178.00	422,178.00	100.00%	Beyond the credit period for a long time, uncertain recovered.
Other	6,142,993.42	6,142,993.42	100.00%	Beyond the credit period for a long time, uncertain recovered.
Total	13,260,307.34	13,260,307.34	--	--

Accrual of bad debt provision by single item:

In RMB

Name	Closing balance
	Book balance	Bad debt provision	Proportion	Reason

Accrual of bad debt provision by portfolio:

In RMB

Name	Closing balance
	Book balance	Bad debt provision	Proportion
Within 1 year	502,848,447.18	22,849,816.11	4.55%
1-2 years	102.79	25.29	24.60%
Total	502,848,549.97	22,849,841.40	--

Note：

Accrual of bad debt provision by portfolio:

In RMB

Name	Closing balance
	Book balance	Bad debt provision	Proportion

Note：

Relevant information of the provision for bad debts will be disclosed with reference to the disclosuremethod of other receivables if the provision for bad debts of bills receivable is accrued according tothe general model of expected credit loss:

□ Applicable √ Not applicable

Disclosure by aging

In RMB

Aging	Closing balance
Within 1 year（Including 1 year）	502,894,801.73
1-2 years	5,702.29
2-3 years	676,153.40
Over 3 years	12,532,199.89
3-4 years	103,011.28
4-5 years	389.73
Over 5 years	12,428,798.88
Total	516,108,857.31

(2) Accounts receivable withdraw, reversed or collected during the reporting periodThe withdrawal amount of the bad debt provision：

In RMB

Category	Opening balance	Amount of change in the current period				Closing balance
		Accrual	Reversed or collected amount	Write-off	Other
	38,610,301.81	-1,531,351.49	968,801.58			36,110,148.74
Total	38,610,301.81	-1,531,351.49	968,801.58			36,110,148.74

Of which the significant amount of the reversed or collected part during the reporting period :

In RMB

Name

Amount

Way

(3) The actual write-off accounts receivable

In RMB

Items

Amount

Of which the significant amount of the reversed or collected part during the reporting period :

In RMB

Name

Nature

Amount

Reason

Verification procedures performed

Whether the money is generated by related party transactions

Note：

None

(4) Top 5 of the closing balance of the accounts receivable collected according to the arrears party

In RMB

Name	Balance in year-end	Proportion(%)	Bad debt provision
TCL CSOT	81,678,407.05	15.83%	3,700,031.84

CSOT	64,415,196.86	12.48%	2,918,008.42
Huijin（Shenzhen）Technology Co., Ltd.	49,476,257.03	9.59%	2,241,274.45
LG Display（China）Co., Ltd.	36,387,596.37	7.05%	1,648,358.12
LG Display（Guangzhou) Co., Ltd.	35,275,590.17	6.83%	1,597,984.24
Total	267,233,047.48	51.78%

（5）Account receivable which terminate the recognition owning to the transfer of the financialassetsNone

(6)The amount of the assets and liabilities formed by the transfer and the continues involvement of

accounts receivable

None

6.Receivable financing

In RMB

Items	Closing balance	Opening balance
Note receivable	21,474,101.07	102,051,314.08
Total	21,474,101.07	102,051,314.08

Changes in current period and fair value of receivables financing

√Applicable □Not applicable

None

Relevant information of the provision for bad debts will be disclosed with reference to the disclosure

method of other receivables if the provision for bad debts of bills receivable is accrued according to

the general model of expected credit loss:

√Applicable □Not applicable

None

Other note：

Some subsidiaries of the Company discount and endorse some bank acceptance bills according

to the needs of their daily fund management, therefore the bank acceptance bills of the subsidiaries

are classified as financial assets measured at fair value with changes included in other

comprehensive income.There is no single bank acceptance bill with impairment provision of the Company. On

December 31, 2021, the Company considered that there was no significant credit risk in the bank

acceptance bills held by it, and there would be no significant loss due to bank default.

7.Prepayments

(1) List by aging analysis:

In RMB

Aging	Closing balance		Opening balance
	Amount	Proportion %	Amount	Proportion %
Within 1 year	15,157,623.27	98.38%	14,934,263.03	88.35%
1-2 years	248,996.26	1.62%	557,043.06	3.30%
2-3 years			540,748.42	3.20%
Over 3 years			870,461.88	5.15%
Total	15,406,619.53	--	16,902,516.39	--

Notes of the reasons of the prepayment ages over 1 year with significant amount but failed settled intimeOn December 31, 2021, there was no large prepayment with an accounting age of more than oneyear in the balance of prepayment .

（2）The ending balance of Prepayments owed by the imputation of the top five partiesThe top five ending balances of prepayments collected according to prepaid objects totaledRMB 7,270,639.80, accounting for 47.20 % of the total closing balances of prepayments.Other note：None

8.Other receivable

In RMB

Items	Closing balance	Opening balance
Other accounts receivable	140,185,750.40	5,265,002.71
Total	140,185,750.40	5,265,002.71

（1）Interest receivable

1) Category of interest receivable

单位：元

Items	Closing balance	Opening balance
Fixed deposit	0.00	0.00
Entrusted loan	0.00	0.00
Bond investment	0.00	0.00

2) Significant overdue interest

In RMB

Items

Balance in year-end

Aging

Reasons for non-recovery

Whether with impairment and the judgment basis

Other note：

3）The bad debt provision

□ Applicable √ Not applicable

（2）Dividend receivable

1)Dividend receivable

In RMB

Items

Balance in year-end

Balance Year-beginning

2）Significant dividend receivable aged over 1 year

In RMB

Items

Balance in year-end

Aging

Reasons for non-recovery

Whether with impairment and the judgment basis

3）The bad debt provision

□ Applicable √ Not applicable

Other note：

（3） Other accounts receivable

1) Other accounts receivable classified

In RMB

Nature	Closing book balance	Opening book balance
Reserve Funds and Employee Loans	293,128.97	379,477.97
Deposit and security deposit	144,954,822.31	2,585,585.87
Export tax rebate	1,698,919.82	1,658,146.29
Unit exchanges	16,402,902.33	16,369,395.10
Other	1,834,489.23	2,069,761.14
Total	165,184,262.66	23,062,366.37

2）Bad-debt provision

In RMB

Bad Debt Reserves	Stage 1	Stage 2	Stage 3	Total
	Expected credit losses over the next 12 months	Expected credit loss over life (no credit impairment)	Expected credit losses for the entire duration (credit impairment occurred)
Balance as at January 1, 2021	573,597.01		17,223,766.65	17,797,363.66
Balance as at January 1, 2021in current	——	——	——	——
Provision in the current period	7,221,660.06			7,221,660.06
Balance as at December 31,2021	7,795,257.07		17,203,255.19	24,998,512.26

Loss provision changes in current period, change in book balance with significant amount

√ Applicable □Not applicable

Disclosure by aging

In RMB

Aging	Closing balance
Within 1 year(Including 1 year）	146,289,172.36

1-2 years	931,075.99
2-3 years	411,482.57
Over 3 years	17,552,531.74
3-4 years	546,382.79
4-5 years	537,717.29
Over 5 years	16,468,431.66
Total	165,184,262.66

3) Accounts receivable withdraw, reversed or collected during the reporting periodThe withdrawal amount of the bad debt provision：

In RMB

Category	Opening balance	Amount of change in the current period				Closing balance
		Accrual	Reversed or collected amount	Write-off	Other
	17,797,363.66	7,221,660.06	20,511.46			24,998,512.26
Total	17,797,363.66	7,221,660.06	20,511.46			24,998,512.26

NoteWhere the current bad debts back or recover significant amounts:

In RMB

Name

Amount

Mode

4) Other account receivables actually cancel after write-off

In RMB

Items

Amount

Of which the significant amount of the reversed or collected part during the reporting period :

In RMB

Name

Nature

Amount

Reason

Verification procedures performed

Whether the money is generated by related party transactions

Other note

5)Top 5 of the closing balance of the other accounts receivable collected according to the arrearsparty

In RMB

Name	Nature	Year-end balance	Aging	Portion in total other receivables(%)	Bad debt provision of year-end balance
Shenzhen Beauty Century Garment Co., Ltd.	Internal current account	143,101,258.40	1-3 years	86.63%	7,155,062.92
Jiangxi Xuanli Thread Co., Ltd.	Unit account	11,389,044.60	Over 5 years	6.89%	11,389,044.60
Anhui Huapeng	Unit account	1,800,000.00	Over 5 years	1.09%	1,800,000.00

Textile Company
Shenzhen Dailisi Underwear Co., Ltd	Unit account	1,100,000.00	Within 1 year	0.67%	55,000.00
Shenzhen Xieli Automobile Repair Plant	Unit account	1,018,295.37	2-5 years	0.62%	1,018,295.37
Total	--	158,408,598.37	--	95.90%	21,417,402.89

6) Accounts receivable involved with government subsidies

In RMB

Name

Name of the government subsidy project

Year-end balance

Aging

Time, amount and basis of the expected collection

The company has no government subsidies receivable.

7) Other account receivable which terminate the recognition owning to the transfer of the financialassetsNone

8) The amount of the assets and liabilities formed by the transfer and the continues involvement ofother accounts receivableNoneOther note：

9. Inventories

Whether the company need to comply with the disclosure requirements of the real estate industry

No

（1）Category of Inventory

In RMB

Items	Closing book balance			Opening book balance
	Book balance	Provision for inventory impairment	Book value	Book balance	Provision for inventory impairment	Book value
Raw materials	349,978,870.87	26,335,509.94	323,643,360.93	258,191,196.82	13,788,646.60	244,402,550.22
Processing products	10,992,072.59		10,992,072.59	2,715,845.96		2,715,845.96
Good in stock	118,034,342.61	36,750,396.02	81,283,946.59	132,780,479.72	43,914,789.90	88,865,689.82
Goods in transit	7,910,629.62	30,573.89	7,880,055.73	524,698.46		524,698.46
Semi-finished	270,743,032.26	34,298,745.28	236,444,286.98	131,069,647.77	14,613,640.62	116,456,007.15
Commissioned materials	7,838,404.74	620,680.53	7,217,724.21	31,040,280.45	3,157,490.62	27,882,789.83

Total

765,497,352.69

98,035,905.66

667,461,447.03

556,322,149.18

75,474,567.74

480,847,581.44

（2）Inventory falling price reserves and reserves for impairment of contract performance costs

In RMB

Items	Opening balance	Increased in current period		Decreased in current period		Closing balance
		Accrual	Reversed or collected amount	Write-off	Other
Raw materials	13,788,646.60	19,526,328.72		6,979,465.38		26,335,509.94
Good in stock	43,914,789.90	25,646,269.75		32,810,663.63		36,750,396.02
Semi-finished	14,613,640.62	37,652,098.22		17,966,993.56		34,298,745.28
Goods in transit		30,573.89				30,573.89
Commissioned materials	3,157,490.62	620,680.53		3,157,490.62		620,680.53
Total	75,474,567.74	83,475,951.11		60,914,613.19		98,035,905.66

(3)Description of The closing balance of inventories contain the amount of borrowing costs capitalized

（4）Description of amortization amount of contract performance cost in the current period

10.Contract assets

Relevant information of the provision for bad debts will be disclosed with reference to the disclosuremethod of other receivables if the provision for bad debts of contract assets is accrued according tothe general model of expected credit loss:

□ Applicable √Not applicable

Provision for impairment of contract assets in the current periodOther note

11. Assets divided as held-to-sold

Not applicableOther note：

12. Non-current assets due within 1 year

Not applicableOther note

13. Other current assets

In RMB

Items	Year-end balance	Year-beginning balance
After the deduction of input VAT	860,153.70	77,482,083.47
Advance payment of income tax	57,448.91

Returns receivable costs	28,585,749.81
Total	29,503,352.42	77,482,083.47

Other note：

14.Creditor's right investment

In RMB

Items	Year-end balance			Year-beginning balance
	Book balance	Bad debt provision	Book value	Book balance	Bad debt provision	Book value

Not applicableLoss provision changes in current period, change in book balance with significant amount

□ Applicable √ Not applicable

Other note：

15.Other creditor's rights investment

Not applicableLoss provision changes in current period, change in book balance with significant amount

□ Applicable √ Not applicable

Other note

16. Long-term accounts receivable

(1) List of long-term accounts receivable

Not applicableLoss provision changes in current period, change in book balance with significant amount

□ Applicable √ Not applicable

Other note

(2) Long-term accounts receivable which terminate the recognition owning to the transfer of thefinancial assets

(3) The amount of the assets and liabilities formed by the transfer and the continues involvement oflong-term accounts receivableOther note

17. Long-term equity investment

In RMB

Investees	Opening balanc	Increase /decrease								Closing balanc	Closing balanc
		Additional	Decrease in	Profits and	Other compr	Changes in	Cash bonus	Withdrawal	Other

	e	investment	investment	losses on investments Recognized under the equity method	ehensive income	other equity	or profits announced to issue	of impairment provision		e	e of impairment provision
I. Joint ventures
Anhui Huapeng Textile Co.,Ltd.	10,797,023.14		10,797,023.14
Shenzhen Guanhua Printing & Dyeing Co., Ltd.	127,906,165.17			308,060.37						128,214,225.54
Subtotal	138,703,188.31		10,797,023.14	308,060.37						128,214,225.54
2. Affiliated Company
Shenzhen Changlianfa Printing & dyeing Company	2,706,262.38			265,940.59						2,972,202.97
Hongkong Yehui International Co., Ltd.	6,519,686.54			-540,016.30	-199,063.73		3,944,709.25			1,835,897.26
Subtot	9,225,			-274,0	-199,0		3,944,			4,808,

al	948.92			75.71	63.73		709.25			100.23
Total	147,929,137.23		10,797,023.14	33,984.66	-199,063.73		3,944,709.25			133,022,325.77

Other note

18. Other equity instruments investment

In RMB

Items	Year-end balance	Year-beginning balance
Fuao auto parts Co., Ltd.（000030）		10,129,390.84
Shenzhen Dailishi Underwear Co., Ltd.	23,637,000.00	12,315,939.61
Union Development Group Co., Ltd.	144,109,485.84	152,469,200.00
Jintian Industry（Group）Co., Ltd.
Shenzhen Xinfang Knitting Co., Ltd.	2,227,903.00	2,227,903.00
Shenzhen South Textile Co., Ltd.	16,059,440.88	13,464,994.09
Total	186,033,829.72	190,607,427.54

Itemized disclosure of the current non - trading equity instrument investment

In RMB

Name	Recognized dividend income	Accumulating income	Accumulating losses	Amount of other comprehensive income transferred to retained earnings	Reasons for being measured at fair value and whose changes are included in other comprehensive income	Reasons for other comprehensive income transferred to retained earning
Fuao auto parts Co., Ltd.（000030）	414,007.80	1,158,325.79		1,158,325.79	Disposal
Shenzhen Dailishi Underwear Co., Ltd.	1,037,735.85	21,077,143.74
Union Development Group Co., Ltd.	208,000.00	141,509,485.84
Shenzhen Xinfang Knitting Co., Ltd.		1,703,903.00
Jintian Industry（Group）Co., Ltd.			14,831,681.50
Shenzhen South Textile	892,152.37	14,559,440.88

Other note：

Note: The amount of the Company's investment in Jintian Industrial (Group) Co., Ltd. is all impaired.

As the above items are investments that the Company plans to hold for a long time for strategicpurposes, the Company designates them as financial assets measured at fair value with changesincluded in other comprehensive income.

19.Other non-current financial assets

In RMB

Co., Ltd.

Items

Items	Year-end balance	Year-beginning balance
Financial assets measured at fair value with changes included in current profits and losses	30,650,943.40	30,650,943.40
Total	30,650,943.40	30,650,943.40

Other note：

20. Investment real estate

(1) Investment real estate adopted the cost measurement mode

√Applicable □ Not applicable

In RMB

Items	House, Building	Land use right	Construction in process	Total
I. Original price
1. Balance at period-beginning	261,742,940.53			261,742,940.53
2.Increase in the current period	3,028,785.00			3,028,785.00
(1) Purchase	3,028,785.00			3,028,785.00
（2）Inventory\Fixed assets\ Transferred from construction in progress
(3)Increased of Enterprise Combination
3.Decreased amount of the period	1,127,850.60			1,127,850.60
（1）Dispose	1,127,850.60			1,127,850.60
（2）Other out
4. Balance at period-end	263,643,874.93			263,643,874.93
II.Accumulated

amortization
1.Opening balance	151,170,468.61			151,170,468.61
2.Increased amount of the period	6,986,473.75			6,986,473.75
(1) Withdrawal	6,986,473.75			6,986,473.75
3.Decreased amount of the period	730,847.19			730,847.19
（1）Dispose	730,847.19			730,847.19
（2）Other out
4. Balance at period-end	157,426,095.17			157,426,095.17
III. Impairment provision
1. Balance at period-beginning
2.Increased amount of the period
(1) Withdrawal
3.Decreased amount of the period
（1）Dispose
（2）Other out
4. Balance at period-end
IV. Book value
1.Book value at period -end	106,217,779.76			106,217,779.76
2.Book value at period-beginning	110,572,471.92			110,572,471.92

(2) Investment property adopted fair value measurement mode

□Applicable√ Not applicable

(3) Investment real estate without certificate of ownership

In RMB

Items	Book balance	Reason
Houses and Building	10,658,816.07	Unable to apply for warrants due to historical reasons

Other note

21. Fixed assets

In RMB

Items

Year-end balance

Year-beginning balance

Fixed assets	2,424,741,252.86	790,183,905.38
Total	2,424,741,252.86	790,183,905.38

(1) List of fixed assets

In RMB

Items	Houses & buildings	Machinery equipment	Transportations	Other equipment	Total
I. Original price
1.Opening balance	545,896,931.25	1,017,693,432.96	11,379,729.08	42,420,673.14	1,617,390,766.43
2.Increased amount of the period	258,765,257.28	1,535,123,033.22	3,899,262.59	12,891,530.11	1,810,679,083.20
(1) Purchase	1,569,521.47	29,933,637.96	1,151,689.53	2,588,556.40	35,243,405.36
(2) Transferred from construction in progress	257,195,735.81	1,505,189,395.26	2,747,573.06	10,302,973.71	1,775,435,677.84
(3)Increased of Enterprise Combination
3.Decreased amount of the period		2,149,210.94		4,933,091.35	7,082,302.29
（1）Disposal		2,149,210.94		4,933,091.35	7,082,302.29
4. Balance at period-end	804,662,188.53	2,550,667,255.24	15,278,991.67	50,379,111.90	3,420,987,547.34
II. Accumulated depreciation
1.Opening balance	159,918,391.99	630,517,504.87	3,217,030.86	27,084,284.60	820,737,212.32
2.Increased amount of the period	23,052,994.89	147,538,129.77	1,144,752.53	3,394,343.06	175,130,220.25
(1) Withdrawal	23,052,994.89	147,538,129.77	1,144,752.53	3,394,343.06	175,130,220.25
3.Decrease in the reporting period		1,608,147.10		4,407,313.58	6,015,460.68
（1）Disposal		1,608,147.10		4,407,313.58	6,015,460.68
4.Closing balance	182,971,386.88	776,447,487.54	4,361,783.39	26,071,314.08	989,851,971.89
III. Impairment provision
1.Opening balance		6,373,080.81		96,567.92	6,469,648.73

2.Increase in the reporting period				32,769.22	32,769.22
（1）Withdrawal				32,769.22	32,769.22
3.Decrease in the reporting period		11,527.44		96,567.92	108,095.36
（1）Disposal		11,527.44		96,567.92	108,095.36
（2）Other decrease
4. Closing balance		6,361,553.37		32,769.22	6,394,322.59
IV. Book value
1.Book value of the period-end	621,690,801.65	1,767,858,214.33	10,917,208.28	24,275,028.60	2,424,741,252.86
2.Book value of the period-begin	385,978,539.26	380,802,847.28	8,162,698.22	15,239,820.62	790,183,905.38

(2) Fixed assets temporarily idled

In RMB

Items

Original price

Accumulated depreciation

Impairment provision

Book value

Remark

⑶Fixed assets leased out through operating leases

In RMB

Items

Book value

(4) Fixed assets without certificate of title completed

In RMB

Items	Book Value	Reason
Houses and Building	275,225,966.28	Unable to apply for warrants due to historical reasons

Other note

（5）Liquidation of fixed assets

In RMB

Items

Year-end balance

Year-beginning balance

Other note

22. Construction in progress

In RMB

Items	Year-end balance	Year-beginning balance
Construction in progress	71,482,031.08	1,301,750,141.12
Total	71,482,031.08	1,301,750,141.12

(1) List of construction in progress

In RMB

Items	Year-end balance			Year-beginning balance
	Book balance	Provision for devaluation	Book value	Book balance	Provision for devaluation	Book value
Industrialization project of polaroid for super large size TV (Line 7)				1,301,693,689.12		1,301,693,689.12
Other				56,452.00		56,452.00
Installation of machines and equipment	71,482,031.08		71,482,031.08
Total	71,482,031.08		71,482,031.08	1,301,750,141.12		1,301,750,141.12

（2）Changes of significant construction in progress

In RMB

Name

Budget

Amount at year beginning

Increase at this period

Transferred to fixed assets

Other decrease

Balance in year-end

Proportion(%)

Progress of work

Capitalisation of interest accumulated balance

Including：Current amount of capitalization of interest

Capitalisation of interest ratio（%)

Source of funds

Industrialization project of Polar

2,088,865,400.00

1,301,693,689.12

468,844,861.20

1,770,538,550.32

99.26%

Investment in fixed assets has

13,747,732.55

9,807,167.26

4.41%

Other

oid for super large size TV (Line 7)								been transferred
Total	2,088,865,400.00	1,301,693,689.12	468,844,861.20	1,770,538,550.32			--	--	13,747,732.55	9,807,167.26	4.41%	--

（3）Impairment provision of construction projects

Not applicableOther note

（4）Engineering material

In RMB

Items	Year-end balance			Year-beginning balance
	Book balance	Provision for devaluation	Book value	Book balance	Provision for devaluation	Book value

Other note：

23. Productive biological assets

(1) Productive biological assets measured at cost methods

□ Applicable √ Not applicable

(2) Productive biological assets measured at fair value

□ Applicable √ Not applicable

24. Oil and gas assets

□ Applicable √ Not applicable

25. Right to use assets

In RMB

Items		Total
1. Balance at year beginning	13,762,176.74	13,762,176.74
4. Year-end balance	13,762,176.74	13,762,176.74
2. Increase at this period	4,540,987.37	4,540,987.37
4. Year-end balance	4,540,987.37	4,540,987.37
1.Book value	9,221,189.37	9,221,189.37

Other note：

None

26. Intangible assets

(1) Information

In RMB

Items	Land use right	Patent right	Non-proprietary technology	Software	Total
I. Original price
1. Balance at period-beginning	48,258,239.00	11,825,200.00		4,079,953.70	64,163,392.70
2.Increase in the current period				17,616,287.32	17,616,287.32
(1) Purchase				17,616,287.32	17,616,287.32
（2）Internal R & D
（3）Increased of Enterprise Combination
3.Decreased amount of the period
（1）Disposal
4. Balance at period-end	48,258,239.00	11,825,200.00		21,696,241.02	81,779,680.02
II.Accumulated amortization
1. Balance at period-beginning	13,487,191.27	11,825,200.00		2,802,022.52	28,114,413.79
2. Increase in the current period	895,391.76			4,134,714.47	5,030,106.23
(1) Withdrawal	895,391.76			4,134,714.47	5,030,106.23
3.Decreased amount of the period
（1）Disposal
4. Balance at period-end	14,382,583.03	11,825,200.00		6,936,736.99	33,144,520.02
III. Impairment provision
1. Balance at period-beginning
2. Increase in the current period
(1) Withdrawal
3.Decreased

amount of the period
（1）Disposal
4. Balance at period-end
4. Book value
1.Book value at period -end	33,875,655.97	0.00		14,759,504.03	48,635,160.00
2.Book value at period-beginning	34,771,047.73	0.00		1,277,931.18	36,048,978.91

The proportion the intangible assets formed from the internal R&D through the Company amountthe balance of the intangible assets at the period-end.

(2) Details of fixed assets failed to accomplish certification of land use right

In RMB

Items

Book value

Reason

Other note：

For intangible assets mortgaged by bank loans, please refer to VII Notes to consolidated financialstatements "81. Assets with restricted ownership or use rights".

27. .Development expenses

In RMB

Items	Balance in year-begin	Increase in this period			Decrease in this period			Balance in year-end
		Internal development expenditure	Other		Recognized as intangible assets	Transfer to current profit and loss
Total

Other note

28. Goodwill

(1) Original book value of goodwill

In RMB

Name of the investees or the events formed goodwill	Opening balance	Increase		Decrease		Closing balance
		The merger of enterprises		disposition
SAPO Photoelectric	9,614,758.55					9,614,758.55
Shenzhen Beauty Century	2,167,341.21					2,167,341.21

Garment Co., Ltd.
Total	11,782,099.76					11,782,099.76

（2）Impairment of goodwill

In RMB

Investee	Balance in year-begin	Increased at this period		.Decreased at this period		Closing balance
		Provision		disposition
SAPO Photoelectric	9,614,758.55					9,614,758.55
Shenzhen Beauty Century Garment Co., Ltd.	2,167,341.21					2,167,341.21
Total	11,782,099.76					11,782,099.76

Information about an asset group or asset group portfolioExplain the goodwill impairment test process, key parameters (such as forecast period growth rate atexpected future cash flow, stable period growth rate, profit margin, discount rate, forecast period,etc.) and the confirmation method of goodwill impairment lossImpact of the goodwill impairment testOther note

29. Long term amortize expenses

In RMB

Items	Balance in year-begin	Increase in this period	Amortized expenses	Other loss	Balance in year-end
Decoration fee	111,541.85	409,932.91	188,830.66		332,644.10
Renovation fee	1,264,954.74	3,224,534.02	714,221.68		3,775,267.08
Other	1,500,064.94	47,430.80	268,110.98		1,279,384.76
Total	2,876,561.53	3,681,897.73	1,171,163.32		5,387,295.94

Other noteNone

30. Deferred income tax assets/deferred income tax liabilities

（1）Details of the un-recognized deferred income tax assets

In RMB

Items

Balance in year-end

Balance in year-begin

	Deductible temporary difference	Deferred income tax assets	Deductible temporary difference	Deferred income tax assets
Assets depreciation reserves	5,766,782.71	1,440,192.90	18,865,669.84	4,709,761.70
Unattained internal sales profits	2,324,192.50	348,628.88	2,413,307.05	361,996.06
Restricted stock repurchase interest			686,670.00	171,667.50
Salary payable to staff	7,679,100.00	1,919,775.00
Total	15,770,075.21	3,708,596.78	21,965,646.89	5,243,425.26

(2)Details of the un-recognized deferred income tax liabilities

In RMB

Items	Closing balance		Opening balance
	Deductible temporary difference	Deferred income tax liabilities	Deductible temporary difference	Deferred income tax liabilities
Changes in fair value of investments in other equity instruments	178,849,973.46	44,712,493.37	174,482,972.97	43,620,743.24
The difference between the initial recognition cost and tax base of long-term equity investment of Guanhua Company	62,083,693.36	15,520,923.34	62,083,693.36	15,520,923.34
Difference in rent receivable	5,636,976.78	1,409,244.20
Total	246,570,643.60	61,642,660.91	236,566,666.33	59,141,666.58

(3) Deferred income tax assets or liabilities listed by net amount after off-set

In RMB

Items	Trade-off between the deferred income tax assets and liabilities	End balance of deferred income tax assets or liabilities after off-set	Trade-off between the deferred income tax assets and liabilities at period-begin	Opening balance of deferred income tax assets or liabilities after off-set
Deferred income tax assets		3,708,596.78		5,243,425.26
Deferred income tax liabilities		61,642,660.91		59,141,666.58

(4)Details of income tax assets not recognized

In RMB

Items	Balance in year-end	Balance in year-begin
Deductible temporary difference	151,099,673.68	122,887,462.20

Deductible loss	733,029,237.95	682,013,840.25
Total	884,128,911.63	804,901,302.45

(5)Deductible losses of the un-recognized deferred income tax asset will expire in the followingyears

In RMB

Year	Balance in year-end	Balance in year-begin	Remark
2023	129,226,944.33	129,226,944.33
2024	148,095,898.11	148,095,898.11
2025	83,287,153.64	83,287,153.64
2026	120,820,767.06	120,820,767.06
2028	22,594,586.97	22,594,586.97
2029	100,351,965.47	100,351,965.47
2030	77,636,524.67	77,636,524.67
2031	51,043,562.99
Total	733,057,403.24	682,013,840.25	--

Other note：

None

31 .Other non-current assets

In RMB

Items	Balance in year-end			Balance in year-begin
	Book balance	Provision for devaluation	Book value	Book balance	Provision for devaluation	Book value
Advance payment for equipment fund	28,769,782.86	0.00	28,769,782.86	47,483,219.83	0.00	47,483,219.83
Certificate of deposit for more than 1 year	30,030,410.96	0.00	30,030,410.96	70,064,383.56	0.00	70,064,383.56
Shenzhen Xieli Automobile Co., ltd.	25,760,086.27	0.00	25,760,086.27	25,760,086.27	0.00	25,760,086.27
Total	84,560,280.09	0.00	84,560,280.09	143,307,689.66	0.00	143,307,689.66

Other note：

None

32. Short-term borrowings

（1）Categories of short-term loans

In RMB

Items

Balance in year-end

Balance Year-beginning

Note：

(2) Situation of Overdue Outstanding Short-Term Borrowing

Not applicableOther note：

33. Transactional financial liabilities

In RMB

Items	Balance in year-end	Balance year-beginning
Including：
Including：

Other note：

34. Derivative financial liability

In RMB

Items

Balance in year-end

Balance year-beginning

Other note：

35.Notes payable

In RMB

Type	Balance in year-end	Balance in year-begin
Bank acceptance Bill	16,682,324.12	0.00
Total	16,682,324.12

The total note payable not due at the end of the period is 0.00 yuan.

36. Accounts payable

(1) List of accounts payable

In RMB

Items	Balance in year-end	Balance in year-begin
Within 1 year	280,210,281.65	325,354,275.46
1-2 years	1,122,451.76	1,912,000.86
2-3 years	496,309.68	96,543.25
3-4 years	44,629.53	1,093,369.87
4-5 years	983,598.33	37,402.40
Over 5 years	786,571.28	975,010.06
Total	283,643,842.23	329,468,601.90

(2) Significant advance from customers aging over one year

In RMB

Items

Balance in year-end

Reason

Other note：

None

37.Advance account

(1) List of Advance account

In RMB

Items	Balance in year-end	Balance in year-begin
Within 1 year	968,394.67	666,457.75
1-2 years	197,892.32	2,236,912.00
2-3 years
Over 3 years	639,024.58	639,024.58
Total	1,805,311.57	3,542,394.33

(2) Significant advance from customers aging over one year

In RMB

Items

Balance in year-end

Reason

38.Contract liabilities

In RMB

Items	Balance in year-end	Balance in year-begin
Good	68,955.21	279,631.27
Less：Contractual liabilities charged to other non-current liabilities
Total	68,955.21	279,631.27

Amount and reasons for the significant change in the book value during the reporting period

In RMB

Items

Amount

Reason

39.Payable Employee wage

(1) List of Payroll payable

In RMB

Items	Balance in year-begin	Increase in this period	Payable in this period	Balance in year-end
I. Short-term compensation	55,642,549.53	235,951,646.92	231,874,336.21	59,719,860.24
II.Post-employment benefits - defined contribution plans		15,705,799.59	15,705,799.59
III. Dismissal benefits		2,636,463.20	2,636,463.20
Total	55,642,549.53	254,293,909.71	250,216,599.00	59,719,860.24

（2）Short-term remuneration

In RMB

Items	Balance in year-begin	Increase in this period	Decrease in this period	Balance in year-end
1.Wages, bonuses,	53,293,551.94	211,994,691.05	208,173,934.97	57,114,308.03

allowances and subsidies
2.Employee welfare	41,093.20	8,393,472.90	8,434,566.10
3. Social insurance premiums		2,723,153.85	2,723,153.85
Including：Medical insurance		2,254,940.97	2,254,940.97
Work injury insurance		175,636.12	175,636.12
Maternity insurance		292,576.76	292,576.76
4. Public reserves for housing		7,339,217.34	7,339,217.34
5.Union funds and staff education fee	2,307,904.39	5,501,111.78	5,203,463.95	2,605,552.21
Total	55,642,549.53	235,951,646.92	231,874,336.21	59,719,860.24

（3）Defined contribution plans listed

In RMB

Items	Balance in year-begin	Increase in this period	Decrease in this period	Balance in year-end
1. Basic old-age insurance premiums		13,082,445.90	13,082,445.90
2.Unemployment insurance		278,249.09	278,249.09
3. Annuity payment		2,345,104.60	2,345,104.60
Total		15,705,799.59	15,705,799.59

Other note：

None

40.Tax Payable

In RMB

Items	Balance in year-end	Balance in year-begin
VAT	6,334,093.50	286,928.75
Enterprise Income tax	1,804,277.95	11,219,726.43
Individual Income tax	866,274.38	469,169.71
City Construction tax	43,259.90	48,751.30
House property tax	102,146.02	102,146.02
Education surcharge	31,608.85	33,386.49
Stamp tax	18,966.49	36,370.02
Land use tax	0.00	2,043.30
Total	9,200,627.09	12,198,522.02

Other note：

None

41.Other payable

In RMB

Items	Balance in year-end	Balance in year-begin
Other payable	201,317,421.35	156,118,440.42
Total	201,317,421.35	156,118,440.42

（1）Interest payable

Not applicableOther note：

（2）Dividends payable

In RMB

Items

Balance in year-end

Balance Year-beginning

(3) Other accounts payable

(1) Other accounts payable listed by nature of the account

In RMB

Items	Balance in year-end	Balance in year-begin
Engineering Equipment fund	91,213,156.89	32,713,413.76
Unit account	51,681,042.57	48,394,939.72
Deposit	43,277,481.38	36,130,306.12
Restrictive stock repurchase obligation	0.00	7,844,373.00
Other	15,145,740.51	31,035,407.82
Total	201,317,421.35	156,118,440.42

(2) Other significant accounts payable with aging over one year

In RMB

Items

Balance in year-end

Reason

Other noteNone

42. Liabilities classified as holding for sale

In RMB

Items

Balance in year-end

Balance in year-begin

Other note：

43. Non-current liabilities due within 1 year

In RMB

Items	Balance in year-end	Balance in year-begin
Lease liabilities due within one year	5,175,393.52	0.00
Total	5,175,393.52

Other note：

None

44.Other current liabilities

In RMB

Items	Balance in year-end	Balance in year-begin
Did not terminate the confirmation bill endorsement, discount	27,523,903.58	0.00
Total	27,523,903.58

Other note：

None

45. Long-term borrowing

(1) List of Long-term borrowing

In RMB

Items	Balance in year-end	Balance in year-begin
Mortgage-guaranteed loan	683,016,243.25	343,100,174.35
Less：Long-term borrowings due within 1 year	0.00	0.00
Total	683,016,243.25	343,100,174.35

Description of the long-term loan classificationOther note,

46.Bond payable

（1）Bond payable

In RMB

Items

Balance year-end

Year-beginning balance

（2）Changes of bonds payable(Not including the other financial instrument of preferred stock andperpetual capital securities that classify as financial liability

In RMB

Name of the bond

Book value

Issue date

Period

Issue amount

Opening balance

The current issue

Withdraw interest at par

Overflow discount amoun

Pay in current period

Closing balance

								t
Total	--	--	--

(3) Note to conditions and time of share transfer of convertible bonds

（4）Other financial instruments that are classified as financial liabilities

Basic situation of other financial instruments outstanding at the period-end such preferred shares andperpetual bondsChanges in financial instruments outstanding at the period-end such preferred shares and perpetualliabilitiesOther note

47. Lease liabilities

In RMB

Items	Balance year-end	Year-beginning balance
lease liabilities	9,419,249.23
Less：Lease liabilities due within 1 year	-5,175,393.52
Total	4,243,855.71

Other noteThe accrued interest expense of lease liabilities in 2021 is RMB 475,000, which is included in thefinancial expense-interest expense.

48. Long-term payable

In RMB

Items

Balance year-end

Year-beginning balance

（1）Statement of long-term payroll payable

In RMB

Items

Balance year-end

Year-beginning balance

Other note：

（2）Special payable

In RMB

Items

Year-beginning balance

Increase

Decrease

Balance year-end

Reason

Other note：

49. Long term payroll payable

（1）Statement of long-term payroll payable

Not applicable

（2）Change of defined benefit plans

Not applicableOther note：

50.Estimated liabilities

In RMB

Items	Balance in year-end	Balance in year-begin	Reason
Repayment payable	30,741,055.00
Total	30,741,055.00		--

Other note：

51.Deferred income

In RMB

Items	Beginning of term	Increased this term	Decreased this term	End of term	Reason
Government Subsidy	110,740,322.21	13,660,000.00	13,939,029.06	110,461,293.15
Total	110,740,322.21	13,660,000.00	13,939,029.06	110,461,293.15	--

Details of government subsidies：

In RMB

Items

Beginning of term

New subsidy in current period

Amount transferred to non-operational income

Other income recorded in the current period

Amount of cost deducted in the current period

Other changes

End of term

Asset-related or income-related

Other note：

For details of government subsidies included in deferred revenue, please refer to Note XIV. 2.Government subsidies.

52. . Other non-current liabilities

In RMB

Items

Balance year-end

Year-beginning balance

Other note：

53.Stock capital

In RMB

	Year-beginning balance	Changed（+，-）					Balance in year-end
		Issuance of new share	Bonus shares	Capitalization of public reserve	Other	Subtotal
Total of capital shares	507,772,279.00				-1,250,430.00	-1,250,430.00	506,521,849.00

Other note：

Note: This year, 1,250,430.00 restricted shares that have been granted but not yet unlocked wererepurchased and cancelled, with a reduction of RMB 1,250,430.00, which has been verified by PekingCertified Public Accountants (special general partnership), and the capital verification report (QXY Zi(2021) No.0013) was issued on April 27, 2021.

54. Other equity instruments

(1) Basic information on the outstanding other financial instruments, including preferred shares,perpetual bonds, etc. at the end of the reporting period

(2)Movement of the outstanding other financial instruments, including preferred shares, perpetualbonds, etc. at the end of the reporting period

Other note：

55. Capital reserves

In RMB

Items	Year-beginning balance	Increase in the current period	Decrease in the current period	Year-end balance
Share premium	1,832,397,142.44		5,914,533.90	1,826,482,608.54
Other capital reserves	135,117,216.09			135,117,216.09
Total	1,967,514,358.53		5,914,533.90	1,961,599,824.63

Other notes, including the note to its increase/decrease and the cause(s) of its movement in thereporting period:

The change of capital stock premium in the current period is from the repurchase and cancellation ofsome restricted stocks granted by the Company's restricted stock incentive plan in 2017.

56.Treasury stock

In RMB

Items

Year-beginning

Increase in the

Decrease in the

Year-end balance

	balance	current	current period
Treasury stock	7,525,438.20		7,525,438.20	0.00
Total	7,525,438.20		7,525,438.20

Other notes, including the note to its increase/decrease and the cause(s) of its movement in thereporting period:

The change of capital stock premium in the current period is from the repurchase and cancellation ofsome restricted stocks granted by the Company's restricted stock incentive plan in 2017.

57. Other comprehensive income

In RMB

Items	Year-beginning balance	Amount of current period						Year-end balance
		Amount incurred before income tax	Less：Amount transferred into profit and loss in the current period that recognied into other comprehensive income in prior period	Less：Prior period included in other composite income transfer to retained income in the current period	Less：Income tax expenses	After-tax attribute to the parent company	After-tax attribute to minority shareholder
1. Other comprehensive income that cannot be reclassified in the loss and gain in the future	115,367,833.87	3,237,349.34		-847,238.36	809,337.34	3,275,250.36		118,643,084.23
Changes in fair value of investments in other equity instruments	115,367,833.87	3,237,349.34		-847,238.36	809,337.34	3,275,250.36		118,643,084.23
2.Other comprehensive income reclassifiable to profit or loss in subsequent periods	1,238,098.55	-199,063.73				-199,063.73		1,039,034.82
Translation differences of financial statements denominated	1,238,098.55	-199,063.73				-199,063.73		1,039,034.82
Total of other comprehensive income	116,605,932.42	3,038,285.61		-847,238.36	809,337.34	3,076,186.63		119,682,119.05

Other notes include the valid part of gain and loss of a cash-flow hedge converted into initial amountof arbitraged items for adjustment: None

58. Special reserves

In RMB

Items

Year-beginning balance

Increase in the current period

Decrease in the current period

Year-end balance

59. Surplus reserves

In RMB

Items	Year-beginning balance	Increase in the current period	Decrease in the current period	Year-end balance
Statutory surplus reserve	94,954,652.14	3,291,193.33		98,245,845.47
Total	94,954,652.14	3,291,193.33		98,245,845.47

Note to surplus reserve, including the note to its increase/decrease and the cause(s) of its movementin the reporting period:

Note: The increase amount in the current period is RMB 3,291,193.33, including RMB 3,175,360.75accrued according to 10% of the current net profit and RMB 115,832.57 accrued from othercomprehensive income carry-over retained earnings.

60. Retained profits

In RMB

Items	Amount of current period	Amount of previous period
Retained earnings before adjustments at the year beginning	86,912,390.50	49,307,764.03
Retained earnings after adjustments at the year end	86,912,390.50	49,307,764.03
Add: Net profit attributable to owners of the Company for the period	61,162,384.25	37,267,995.74
Less: Appropriation to statutory surplus reserve	3,175,360.75	3,888,292.80
Common stock dividend payable	15,195,655.47
Add：Other comprehensive earnings are carried forward to retained earnings	1,042,493.21	4,224,923.53
Retained profits at the period end	130,746,251.74	86,912,390.50

As regards the details of adjusted the beginning undistributed profits

(1)As the retroactive adjustment on Enterprise Accounting Standards and its related new regulations,the affected beginning undistributed profits are RMB 0.00.

(2) As the change of the accounting policy, the affected beginning undistributed profits are RMB

0.00.

(3) As the correction of significant accounting error, the affected beginning undistributed profits areRMB 0.00 .

(4) As the change of consolidation scope caused by the same control, the affected beginningundistributed profits are RMB 0.00.

(5) Other adjustment of the total affected beginning undistributed profits are RMB 0.00 .

61. Business income, Business cost

In RMB

Items	Amount of current period		Amount of previous period
	Income	Cost	Income	Cost
Main business	2,265,990,629.90	1,900,247,328.79	2,097,432,885.06	1,808,092,705.48
Other business	27,757,262.16	8,272,084.49	11,531,802.74	6,205,689.54
Total	2,293,747,892.06	1,908,519,413.28	2,108,964,687.80	1,814,298,395.02

Whether the net profit before and after deducting non-recurring gains and losses is negative afteraudit

□ Yes √ No

Income-related information:

In RMB

Type	Division 1	Division 2		Total
Of which
Property lease management and others	139,325,762.71			139,325,762.71
Textile		54,932,578.58		54,932,578.58
Polarizer			2,099,489,550.77	2,099,489,550.77
Of which
Domestic	2,039,625,757.16			2,039,625,757.16
Overseas		254,122,134.90		254,122,134.90
Of which
Of which
Of which
Of which
Of which

Information related to performance obligations: NoneInformation related to the transaction price apportioned to the residual performance obligation:

The income corresponding to the performance obligations that have not been performed or havebeen performed incompletely but the contract has been signed at the end of the reporting period isRMB 0.00, of which RMB 0.00 is expected to be recognized as income in the year, RMB 0.00 isexpected to be recognized as income in the year, and RMB 0.00 is expected to be recognized asincome in the year.Other note:

62.Taxes and surcharges

In RMB

Items	Amount of current period	Amount of previous period
Urban construction tax	1,625,005.70	718,695.23
Education surcharge	1,169,628.61	517,483.70
Property tax	5,826,834.91	4,338,584.18

Other	1,902,078.87	1,772,362.54
Total	10,523,548.09	7,347,125.65

Other note：

63.Sales expenses

In RMB

Items	Amount of current period	Amount of previous period
Wage	18,266,837.81	12,958,215.67
Business expenses	1,256,926.46	668,407.23
Sales service	12,684,139.28	12,697,476.62
Property insurance	2,716,981.13
Other	3,048,451.71	2,320,131.35
Total	37,973,336.39	28,644,230.87

Other note：

None

64. Administrative expenses

In RMB

Items	Amount of current period	Amount of previous period
Wage	80,805,949.97	74,790,949.11
Depreciation of fixed assets	10,728,532.58	9,794,203.66
Water and electricity	2,123,594.28	2,576,447.96
Intermediary organ	8,120,482.28	3,271,775.61
Intangible assets amortization	5,030,106.23	1,612,363.59
Travel expenses	468,553.20	408,221.21
Office expenses	1,192,408.92	946,055.89
Business entertainment	1,754,789.06	615,454.09
Lawsuit expenses	914,353.81	144,161.32
Repair charge	2,057,702.25	1,366,609.60
Property insurance	648,821.25	380,689.81
Other	8,243,536.32	9,188,002.51
Total	122,088,830.15	105,094,934.36

Other note：

None

65.R & D costs

In RMB

Items

Amount of current period

Amount of previous period

Wage	15,697,764.59	13,177,489.03
Material	83,197,051.56	49,679,847.18
Depreciation	3,326,098.79	2,984,978.79
Fuel & Power	976,547.62	1,017,795.21
Travel expenses	177,340.24	226,949.44
Other	133,961.73	73,904.57
Total	103,508,764.53	67,160,964.22

Other note:

None

66.Financial Expenses

In RMB

Items	Amount of current period	Amount of previous period
Interest expenses	24,113,442.39	4,175,380.96
Less：Interest capitalized	9,807,167.26	3,940,565.29
Interest income	-1,655,853.59	-3,702,735.59
Exchange loss	-20,976,430.83	8,108,404.80
Discount interest on acceptance bill	1,390,467.41	0.00
Fees and other	6,805,197.79	3,647,403.40
Total	-130,344.09	8,287,888.28

Other note：

None

67.Other income

In RMB

Items	Amount of current period	Amount of previous period
Amortization for subsidies for new production lines and purchase of equipment for the Phase II project of polarizers for TFT-LCD	3,000,000.00	3,000,000.00
Amortization of funds for the pilot project of regional agglomeration development of strategic emerging industries in Guangdong Province	2,500,000.08	2,500,000.00
Amortization of local matching funds for the second phase of TFT-LCD polarizer project (Line 6)	1,500,000.00	1,500,000.00
Amortization of subsidy funds for industrialization project of polarizers for TFT-LCD	1,299,999.96	1,300,000.00
Shenzhen Municipal Finance	1,250,000.00	0.00

Committee’s polarizer industrialization project for super-sized TVs
Amortization of national subsidy for TFT-LCD polarizer phase II project (Line 6)	1,000,000.00	1,000,000.00
Amortization of subsidy funds for the narrow line (Line 5) of the first-phase project of polarizer for TFT-LCD	500,000.04	500,000.00
Amortization of Shenzhen Polarizing Materials and Technology Engineering Laboratory	500,000.00	500,000.00
Amortization of subsidy funds for R&D equipment for key technologies of optical compensation films for polarizers	500,000.04	500,000.00
Shenzhen Municipal Air Environment Quality Improvement Special Fund Subsidy	494,931.57	468,931.57
2021 Special Major Project Award and Subsidy Support Plan for Technological Transformation and Doubling	367,666.68	0.00
Amortization of funding for technology center construction	300,000.00	300,000.00
Amortization of subsidies for purchase of imported equipment and technology	175,090.20	175,090.20
Amortization of special funds for textiles	142,857.16	142,857.16
Amortization of capital subsidy for change & renovation of old elevators	142,255.72	142,255.72
Amortization of innovative and entrepreneurial funds for the first phase of the TFT-LCD polarizer project	50,000.04	50,000.00
Amortization of innovation and entrepreneurship funds of Shenzhen Polarizing Materials and Technology Engineering Laboratory	50,000.04	50,000.00
Amortization of innovative and entrepreneurial funds for the second phase of the TFT-LCD polarizer project (Line 6)	50,000.04	50,000.00
Dyeing project technical transformation subsidy	39,000.00	0.00
Amortization of energy-saving renovation subsidy funds	27,172.70	29,642.93
Subsidies for investment projects in special technological transformation and doubling for technological transformation in 2020	19,000.00	11,083.33

Funding for key technology research and development of polarizers for ultra-thin IPS smartphone terminals	16,666.67	0.00
Amortization of Funds for Introducing Advanced Technology	14,388.12	14,388.10
Shenzhen Bureau of Industry and Information Technology's 2021 Industrial Enterprises Expansion Capacity Incentive Project Subsidy	2,590,000.00	0.00
Shenzhen Science and Technology Innovation Committee 2020 Enterprise R&D Subsidy	1,018,000.00	0.00
Headquarters Economic Comprehensive Economic Contribution Award (Futian District Enterprise Development Center)	500,000.00	0.00
Shenzhen Pingshan District Finance Bureau 2019 Pingshan District Harmonious Labor Relations Enterprise Award Fund	500,000.00	0.00
The second batch of funding of the 2020 Science and Technology Innovation Special Fund of Shenzhen Pingshan District Finance Bureau (standardized funding)	360,000.00	0.00
The second batch of special funds of scientific and technological innovation in 2020 of Shenzhen Pingshan District Finance Bureau (High-tech Enterprise Recognition Award)	300,000.00	0.00
Stable Job Subsidy	118,832.69	160,712.86
Municipal Ecological Environment Bureau Cleaner Production Incentive Support Subsidy	100,000.00	0.00
The sixth batch of pre-job training subsidies by Longgang District of Human Resources Bureau	68,000.00	0.00
Shenzhen Pingshan District Human Resources Bureau’s one-time subsidy for enterprises to absorb and file poor laborers	60,000.00	0.00
Received subsidy from Longgang District Human Resources Bureau for work-for-training	27,000.00	0.00
Subsidy from Shenzhen Futian District Human Resources Bureau for work-for-work training	16,500.00	0.00
Subsidy from Luohu district for work-for-work training	15,500.00	0.00
Employee maternity benefits returned by Social Security Administration	10,592.53	32,609.51

Unpaid VAT (input plus deduction)	9,899.54	0.00
The second batch of special funds for scientific and technological innovation by Shenzhen Pingshan District Finance Bureau in 2020 (Intellectual Property Award)	4,800.00	0.00
Tax office fee refund	5,225.51	24,898.73
Sewage fee refund	0.00	597,362.55
Shenzhen Industrial and Commercial Electricity Cost Reduction Subsidy	0.00	6,952,943.71
Social Security Administration premium refund	0.00	1,815.00
Pingshan District Finance Bureau's Second Batch of Epidemic Subsidies		759.00
2019 Water-saving Carrier Award Fund of Shenzhen Water Affairs Bureau		374,102.00
Shenzhen Pingshan District Finance Bureau 2018 Harmonious Labor Relations Enterprise Award Fund		1,000,000.00
Shenzhen Science and Technology Innovation Committee 2018 Enterprise R&D Subsidy		1,278,000.00
Pingshan District Science and Technology Innovation Bureau's 2019 High-tech Enterprise Recognition Award		50,000.00
Pingshan District Subsidy for Work-for-Training		1,645,500.00
Shenzhen Pingshan District Human Resources Bureau trial training subsidy		111,600.00
Shenzhen Pingshan District Finance Bureau subsidy support for the steady growth of foreign trade in Pingshan District in 2020		1,200,000.00
Received refund of unemployment benefits for companies affected by the epidemic from the Social Security Bureau		2,709,874.84
Market Supervision Administration's Second Batch of Patent Subsidies in 2018		9,000.00
Government subsidizes for epidemic protective supplies		10,000.00
Cultural Tourism Stabilization Support Subsidy		100,000.00
The first batch of special funds for scientific and technological innovation in 2019		966,000.00
Received subsidies from the Public Employment Service Center for stabilizing jobs		1,425.20

Received the reward for the epidemic prevention effect from the Bureau of Industry and Information Technology		20,000.00
Received subsidy for housing epidemic prevention at 145# Fenghuang Road from Shenzhen Luohu District Housing and Construction Bureau		5,638.00
Received the epidemic prevention subsidy for Shenzhen No. 52 Textile Compound, Tianbei 2nd Road from the Housing and Construction Bureau of Luohu District Shenzhen		8,531.45
Urban construction tax and surcharges halved		1,047.51
Stamp duty halved		183.32
Luohu District Epidemic Prevention Subsidy		10,000.00

68. Investment income

In RMB

Items	Amount of this period	Amount of last period
Long-term equity investment returns accounted for by equity method	33,984.66	-3,446,613.86
Investment income from the disposal of long-term equity investment	20,779.93	0.00
Dividend income earned during investment holdings in other equity instruments	2,551,896.02	2,946,592.79
Structured deposit interest	2,749,600.18	18,231,107.84
Interest income on term deposits over 1 year	2,350,000.00	853,205.47
Net monetary gains	14,956,752.27	4,015,378.50
Total	22,663,013.06	22,599,670.74

Other note：

None

69.Net exposure hedging income

In RMB

Items

Amount of this period

Amount of last period

Other note：

70. Gains on the changes in the fair value

In RMB

Source

Amount of this period

Amount of last period

Transaction financial assets		536,575.34
Other non-current financial assets	2,150,943.40	2,150,943.40
Total	2,150,943.40	2,687,518.74

Other note：

None

71. Credit impairment loss

In RMB

Items	Amount of this period	Amount of last period
Loss of bad debts in other receivables	-7,201,148.60	-1,828,410.68
Loss of bad note receivable	-280,565.00	-84,490.74
Loss of bad accounts receivable	2,500,153.07	-8,481,632.23
Total	-4,981,560.53	-10,394,533.65

Other note：

72. Losses from asset impairment

In RMB

Items	Amount of current period	Amount of previous period
II. Loss of inventory price and Impairment of contract performance costs	-83,475,951.11	-65,942,828.90
V. Impairment loss of fixed assets	-32,769.22	-6,469,648.73
Total	-83,508,720.33	-72,412,477.63

Other note：

73. Asset disposal income

In RMB

Items	Amount of current period	Amount of previous period
I. Gains & losses on foreign investment in fixed assets	-597,458.77	276,544.73

74. Non-Operation income

In RMB

Items	Amount of current period	Amount of previous period	Recorded in the amount of the non-recurring gains and losses
Insurance compensation	3,477,438.60		3,477,438.60
Payable without payment		1,371,678.99
Liquidation profit and loss	17,140,459.60		17,140,459.60
Other	667,888.44	73,983.39	667,888.44
Total	21,285,786.64	1,445,662.38

Government subsidies recorded into current profits and losses：

In RMB

Items

Issuing body

Issuing reason

Nature

Whether the impact of

Whether special

Amount of current

Amount of previous

Assets-related/income-r

subsidies on the current profit and loss

subsidies

period

period

elated

Other note：

75.Non-current expenses

In RMB

Items	Amount of current period	Amount of previous period	The amount of non-operating gains & lossed
Non-current asset Disposition loss	369,187.12	3,315.15	369,187.12
Fine expenses	1,309,172.27	115,314.20	1,309,172.27
Other	7,903.96	19,791.92	7,903.96
Total	1,686,263.35	138,421.27

Other note：

76.Income tax expenses

(1)Income tax expenses

In RMB

Items	Amount of current period	Amount of previous period
Current income tax expense	8,174,724.28	8,422,038.43
Deferred income tax expense	2,944,072.68	-218,317.45
Total	11,118,796.96	8,203,720.98

(2)Reconciliation of account profit and income tax expenses

In RMB

Items	Amount of current period
Total profits	86,233,463.16
Current income tax expense accounted by tax and relevant regulations	21,558,365.79
Influence of different tax rates applied by some subsidiaries	-7,491,633.67
Non-deductible costs, expenses and losses	4,571,839.81
Tax impact by the unrecognized deductible losses and deductible temporary differences in previous years	8,059,643.49
Profit and loss of joint venture and associated enterprises accounted for by equity method	-53,103.78
Tax impact of research and development fee plus deduction	-15,526,314.68
Income tax fee	11,118,796.96

Other note

77. Other comprehensive income

Refer to the notes 57

78. Supplementary information to cash flow statement

(1) Other cash received relevant to operating activities

In RMB

Items	Amount of current period	Amount of previous period
Letter of Credit Deposit	35,875,977.74	95,971,397.61
Interest income	1,655,853.59	3,702,735.59
Government Subsidy	19,363,739.42	12,029,059.97
Current account	31,729,758.78	11,704,807.26
Total	88,625,329.53	123,408,000.43

Note to other cash received in connection with operating activities: None

(2)Other cash paid related to operating activities

In RMB

Items	Amount of current period	Amount of previous period
Payment of credit deposit	164,509,022.41	50,257,183.69
Cash	48,012,370.68	37,855,834.17
Current account and other	12,867,319.88	9,104,639.66
Total	225,388,712.97	97,217,657.52

Note to other cash paid in connection with operating activities: None

(3)Cash received related to other investment activities

In RMB

Items	Amount of current period	Amount of previous period
Structured deposits, financial products, principal and income	1,128,309,484.61	3,112,161,370.37
L/C margin for purchase of line 7 equipment		126,799,633.00
Credit deposit for non-Line 7 equipment		1,900,000.00
Total	1,128,309,484.61	3,240,861,003.37

Note to other cash received related to other investment activities：None

(4).Cash paid related to other investment activities

In RMB

Items	Amount of current period	Amount of previous period
Structured deposits, financial products, principal and income	965,000,000.00	3,004,000,000.00
L/C margin for purchase of line 7 equipment		2,150,000.00
Credit deposit for non-Line 7 equipment		1,900,000.00
Equity transaction expenses		15,275.20
Total	965,000,000.00	3,008,065,275.20

Note to other Cash paid related to other investment activities

（5）Other cash received in relation to financing activities

In RMB

Items

Amount of current period

Amount of previous period

（6）Cash paid related with financing activities

In RMB

Items	Amount of current period	Amount of previous period
Restricted stock of stock repurchase incentive object	7,820,298.30	9,344,136.30
Lease payment	4,817,974.70
Total	12,638,273.00	9,344,136.30

Note to other Cash paid related with financing activities：

79. Supplement Information for cash flow statement

（1）Supplement Information for cash flow statement

In RMB

Items	Amount of current period	Amount of previous period
I. Adjusting net profit to cash flow from operating activities	--	--
Net profit	75,114,666.20	43,497,645.15
Add: Impairment loss provision of assets	83,508,720.33	82,807,011.28
Depreciation of fixed assets, oil and gas assets and consumable biological assets	182,116,694.00	117,440,111.32
Depreciation of Use right assets	4,540,987.37
Amortization of intangible assets	5,030,106.23	1,612,363.59
Amortization of Long-term deferred expenses	1,171,163.32	582,518.72
Loss on disposal of fixed assets, intangible assets and other long-term deferred assets	-597,458.77	-276,544.73
Fixed assets scrap loss	369,187.12	3,315.15
Loss on fair value changes	-2,150,943.40	-2,687,518.74
Financial cost	14,306,275.13	455,850.38
Loss on investment	-22,663,013.06	-22,599,670.74
Decrease of deferred income tax	1,534,828.48	374,601.17

assets
Increased of deferred income tax liabilities	2,500,994.33	-10,802,679.08
Decrease of inventories	-270,089,816.70	-39,880,044.30
Decease of operating receivables	-58,547,894.61	-184,426,504.09
Increased of operating Payable	-25,563,036.85	15,830,477.68
Other	4,981,560.53
Net cash flows arising from operating activities	-4,436,980.35	1,930,932.76
II. Significant investment and financing activities that without cash flows:	--
Conversion of debt into capital
Convertible loan due within 1 year
Financing of fixed assets leased
3.Movement of cash and cash equivalents：	--	--
Ending balance of cash	302,408,433.72	278,337,236.95
Less: Beginning balance of cash equivalents	278,337,236.95	268,646,588.18
Add：End balance of cash equivalents
Less: Beginning balance of cash equivalents
Net increase of cash and cash equivalent	24,071,196.77	9,690,648.77

(2) Net Cash paid of obtaining the subsidiary

In RMB

	Amount
Of which：	--
Of which：	--
Of which：	--

Other note：

(3) Net Cash receive of disposal of the subsidiary

In RMB

	Amount
Of which：	--
Of which：	--
Of which：	--

Other note：

(4) Component of cash and cash equivalents

In RMB

Items	Year-end balance	Year-beginning balance
I. Cash	302,438,856.00	278,337,236.95
Including：Cash at hand	792.64	4,127.10
Demand bank deposit	302,407,641.08	271,085,025.10
Demand other monetary funds		7,248,084.75
III. Balance of cash and cash equivalents at the period end	302,408,433.72	278,337,236.95

Other note：

80. Note of statement of changes in the owner's equity

Specify the description of the item "others" and the adjusted amount of the balance at the end of lastyear:

81. The assets with the ownership or use right restricted

In RMB

Items	Book value at the end of the reporting period	Cause of restriction
Fixed assets	243,106,926.00	Mortgage
Intangible assets	33,875,655.97	Mortgage
Total	276,982,581.97	--

Other note：

82. Foreign currency monetary items

(1) Foreign currency monetary items

In RMB

Items	Closing foreign currency balance	Exchange rate	Closing convert to RMB balance
Monetary funds	--	--
Including：USD	3,396,814.97	6.3757	21,657,073.20
Euro
HKD	806,319.92	0.8176	659,247.17
Yen	15,363,481.00	0.0554	851,136.85
Account payable	--	--
Including：USD	9,987,772.57	6.3757	63,679,041.57
Euro
HKD
Prepayments
Including：USD	588,809.23	6.3757	3,754,071.01
Yen	30,197,869.00	0.0554	1,673,414.91
Other receivables
Including：USD	37,399.02	6.3757	238,444.93
accounts payable
Including：USD	4,122,038.21	6.3757	26,280,879.02
Yen	3,043,388,138.00	0.0554	168,649,353.67
Other payables
Including：USD	676,686.00	6.3757	4,314,346.93
Yen	3,381,984.00	0.0554	187,361.91
Euro	22,500.00	7.2197	162,443.25

Other note：

(2) Note to overseas operating entities, including important overseas operating entities, witch shouldbe disclosed about its principal business place, function currency for bookkeeping and basis for thechoice. In case of any change in function currency, the cause should be disclosed.

□ Applicable √ Not applicable

83. Hedging

Arbitrage According to arbitrage category to disclose arbitrage item, relevant arbitrage tools and thearbitraged risk qualitative and quantitative information:

84. Government subsidies

（1）Government subsidies confirmed in current period

In RMB

Items	Amount	Project	Amount included in current profit and loss
Funding subsidy for change and renovation of old elevators	720,241.51	Other income	142,255.72
Textile special funds	142,857.09	Other income	142,857.16
Shenzhen Special Fund Subsidy for Atmospheric Environment Quality Improvement- Shenzhen Beauty Century	442,000.00	Other income	52,000.00
Subsidy for the technical transformation project of dyeing equipment by the Bureau of Industry and Information Technology	91,000.00	Other income	39,000.00
Subsidy funds for industrialization project of polarizers for TFT-LCD	433,333.39	Other income	1,299,999.96
Subsidy funds for the narrow line (Line 5) of the first-phase project of polarizer for TFT-LCD	499,999.96	Other income	500,000.04
Amortization of subsidies for purchase of imported equipment and technology	151,746.19	Other income	175,090.20
Innovative and entrepreneurial funds for the first phase of the TFT-LCD polarizer project	49,999.94	Other income	50,000.04
Introducing advanced technology funding	14,388.09	Other income	14,388.12
Innovation and	162,499.96	Other income	50,000.04

entrepreneurship funds of Shenzhen Polarizing Materials and Technology Engineering Laboratory
Funding for technology center construction	975,000.00	Other income	300,000.00
Shenzhen Polarizing Materials and Technology Engineering Laboratory	1,625,000.00	Other income	500,000.00
Subsidy fund for R&D equipment of key technology of optical compensation film for polarizer	2,624,999.96	Other income	500,000.04
Local matching funds for the second phase of TFT-LCD polarizer project (Line 6)	9,750,000.00	Other income	1,500,000.00
Funds for the pilot project of regional agglomeration development of strategic emerging industries in Guangdong Province	16,249,999.92	Other income	2,500,000.08
Local matching funds for the second phase of TFT-LCD polarizer project (Line 6)	6,500,000.00	Other income	1,000,000.00
Subsidies for new production lines and purchase of equipment for the Phase II project of polarizers for TFT-LCD	19,500,000.00	Other income	3,000,000.00
Innovative and entrepreneurial funds for the second phase of the TFT-LCD polarizer project (Line 6)	324,999.96	Other income	50,000.04
Investment funds within the central budget of the polarizer industrialization project for super-large TVs (Line 7)	28,750,000.00	Other income	1,250,000.00
Funding for key technology research and development of polarizers for ultra-thin IPS smartphone terminals	1,983,333.33	Other income	16,666.67
Shenzhen Municipal Finance Committee (2018N007 Major Research and development of key technologies for high-performance	6,000,000.00	Other income

polarizers for large-size display panels)
Shenzhen Special Fund Subsidy for Atmospheric Environment Quality Improvement- SAPO Photoelectric	147,643.86	Other income	442,931.57
Subsidies for investment projects in special technological transformation for technological transformation and doubling in 2020	159,916.67	Other income	19,000.00
Funding by Shenzhen Municipal Bureau of Finance 2020N028 Key technology research and development project of low-color polarized circular polarizer for fixed-curvature AMOLED	2,500,000.00	Other income
Awards support by 2021 special major projects of technological transformation and doubling	10,662,333.32	Other income	367,666.68
Subsidy funds for energy-saving renovation		Other income	27,172.70

（2）Government subsidy return

□ Applicable √ Not applicable

Other note：

85.Other

(1) Arbitration matters between the Company and Jinjiang Group

At the end of 2016, the Company introduced Jinjiang Group as a strategic investor for the capitalincrease and share expansion of SAPO Photoelectric. The Company, SAPO Photoelectric, JinjiangGroup and Hangzhou Jinhang Equity Investment Fund Partnership (Limited Partnership), a limitedpartnership established by the former Jinjiang Group as the actual controller, jointly signed theCooperation Agreement. Jinjiang Group made a commitment to the performance of SAPOPhotoelectric from 2017 to 2019, and Jinjiang Group promised that if the promised income and netprofit were not fulfilled, it would make a difference between the promised net profit and the actualprofit. In 2018 and 2019, Jinjiang Group failed to fulfill its performance commitments as agreed, andthe performance compensation in 2018 was received by the Company in 2019 as agreed, totaling RMB197,268,700; For the performance compensation in 2019, Jinjiang Group believes that it can't lead theoperation and management of SAPO Photoelectric, which leads to the failure to realize the contractual

purpose of the Cooperation Agreement, and applies to Shenzhen Court of International Arbitration forarbitration.On March 25, 2021, the arbitration tribunal made the following ruling on this case: (I) The applicant isexempted from the performance compensation obligation in 2019 agreed in Article 3.1 of theCooperation Agreement, and does not need to pay SAPO Photoelectric the compensation for theperformance difference in 2019 of RMB 244,783,800; (II) The arbitration fee of RMB 2,682,011 andthe actual expenses of the arbitrator of RMB 8,000 in this case shall be borne by the applicant; (III)Other arbitration claims of the applicant are not supported. This award shall be final and take legaleffect from the date it is made.

(2) Shenzhen Xieli Automobile Enterprise Co., Ltd. (property not yet disposed of)Shenzhen Xieli AutomobilCo., Ltd. is a Sino-foreign joint venture invested by the Company and HongKong Xieli Maintenance Co. Ltd. in 1981, with a registered capital of RMB 3.12 million, 50% ofwhose equity is held the Company. The operating period of the Company ended in 2008, and itsbusiness license was revoked in 2014. The main assets of the Company are real estate. The industrialand commercial license of Shenzhen Xieli was cancelled in March 2020, but there are still threeproperties under its name, the disposal of which is required to be resolved after further consultationbetween the shareholders of both parties.On July 26, 2021, the Company filed a lawsuit with Yantian District People's Court in Shenzhen City,Guangdong Province to revoke the cancellation of Shenzhen Xieli Automobile Enterprise Co., Ltd.approved by Shenzhen Administration for Market Regulation on March 9, 2020, on which the courtgave a judgment on November 21, 2021 to revoke the cancellation of Shenzhen Xieli AutomobileEnterprise Co., Ltd. approved by Shenzhen Administration for Market Regulation.

V. Changes of merge scope

1. Business merger not under same control

(1) Business merger not under same control in reporting period

In RMB

Name

Time and place of gaining the stock right

Cost gaining the stock rights

Proportion of stock rights

Way to gain the stock rights

Purchase date

Recognition basis of purchase date

Income of acquiree during the purchase date to period-end

Net profits of acquiree during the purchase date to period-end

Other note：

（2）Combined cost and Goodwill

In RMB

Combined cost

Other note

(3) The identifiable assets and liabilities of acquiree at purchase date In RMB

In RMB

	Fair value of the purchase date	Book value of the purchase date

Other note

(4) The profit or loss from equity held by the date before acquisition in accordance with the fairvalue measured again、Whether there is a transaction that through multiple transaction step by step to realize enterprisesmerger and gaining the control during the reporting period

□ Yes √ No

(5) Note to merger could not be determined reasonable consideration or Identifiable assets, Fairvalue of liabilities of the acquiree at acquisition date or closing period of the merge

（6）Other note

2. Business combination under the same control

(1) Business combination under the same control during the reporting period

Not applicableOther note：

(2) Combination cost

Not applicable

Other note：

(3) The book value of the assets and liabilities of the merged party on the date of consolidationNot applicableOther note：

3. Counter purchase

Basic information of trading, the basis of transactions constitute counter purchase, the retain assets ,liabilities of the listed companies whether constituted a business and its basis, the determination ofthe combination costs, the amount and calculation of adjusted rights and interests in accordance withthe equity transaction process.Not applicable

4. The disposal of subsidiary

Whether there is a single disposal of the investment to subsidiary and lost control

□ Yes √No

Whether there are multiple transactions step by step dispose the investment to subsidiary and lostcontrol in reporting period

□ Yes √ No

5. Other reasons for the changes in combination scope

Note to the change in the consolidation scope (e.g. new subsidiaries, liquidation subsidiaries, etc.)caused by other reasons and relevant information:

6.Other

VI. Equity in other entities

1. Equity in subsidiary

(1) The structure of the enterprise group

Subsidiary	Main operation	Registered place	Business nature	Share-holding ratio		Acquired way
				Directly	Indirectly
Shenzhen Lishi Industry Development Co., Ltd	Shenzhen	Shenzhen	Domestic trade, Property Management	100.00%		Establish
Shenzhen Huaqiang Hotel	Shenzhen	Shenzhen	Accommodation, restaurants, business center;	100.00%		Establish
Shenzhen Shenfang Real Estate Management Co., Ltd.	Shenzhen	Shenzhen	Property Management	100.00%		Establish
Shenzhen Beauty Century Garment Co., Ltd.	Shenzhen	Shenzhen	Production of fully electronic jacquard knitting whole shape	100.00%		Establish
Shenzhen Shenfang Sungang Real Estate Management Co., Ltd.	Shenzhen	Shenzhen	Property Management	100.00%		Establish

SAPO Photoelectric	Shenzhen	Shenzhen	Polarizer production and sales	60.00%
Shenzhen Shengjinlian Technology Co., Ltd.	Shenzhen	Shenzhen	Polarizer production and sales		100.00%	Establish
Shengtou (Hongkong) Co.,Ltd.	Hongkong	Hongkong	Sales of polarizer		100.00%	Establish

Explanation that the shareholding ratio in subsidiaries is different from the voting right ratio: NoneBasis for holding half or less voting rights but still controlling the investee, and holding more thanhalf voting rights but not controlling the investee: NoneFor the important structured subjects included in the scope of consolidation, the control basis is:

NoneBasis for determining whether the company is an agent or a principal: NoneOther note：Note

（2）Significant not wholly-owned subsidiaries

In RMB

Name	Holding proportion of non-controlling interest	Profit or loss attributable to non-controlling interest	Dividend declared to non-controlling interest	Closing balance of non-controlling interest
SAPO Photoelectric	40.00%	15,173,715.28		1,142,495,431.83

Other note：

None

（3）Main financial information of significant not wholly-owned subsidiaries

In RMB

Subsidiaries	Closing balance						Beginning 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 Liabilities	Total liabilities
SAPO Photoelectric	1,622,715,947.38	2,581,716,148.26	4,204,432,095.64	521,127,167.55	827,066,348.51	1,348,193,516.06	1,493,320,590.48	2,177,130,756.68	3,670,451,347.16	399,975,943.39	452,171,112.38	852,147,055.77

In RMB

Subsidiaries	Amount of current period				Amount of previous period
	Operating revenue	Net profit	Total comprehensive income	Cash flow from operating activities	Operating revenue	Net profit	Total comprehensive income	Cash flow from operating activities
SAPO	2,126,851,	37,934,288	37,934,288	-11,450,77	1,961,577,	16,768,253	16,768,253	-1,921,942.

Photoelectric

011.63

.19

.19

1.90

740.37

.29

.29

93

Other note：

None

(4) Significant restrictions of using enterprise group assets and pay off enterprise group debtNone

(5) Provide financial support or other support for structure entities incorporate into the scope ofconsolidated financial statementsNone

Other note：

None

2. The transaction of the Company with its owner’s equity share changed but still controlling thesubsidiary

(1) Note to owner’s equity share changed in subsidiary

None

(2) The transaction’s influence to equity of minority shareholders and attributable to the owner'sequity of the parent companyOther noteNone

3. Equity in joint venture arrangement or associated enterprise

(1) Significant joint venture arrangement or associated enterprise

Name of Subsidiary	Main Places of Operation	Registration Place	Nature of Business	Shareholding Ratio (%)		The accounting treatment of investment in associates
				direct	indirect
Joint venture：
Shenzhen Guanhua Printing & Dyeing Co.,Ltd.	Shenzhen	Shenzhen	Property leasing	50.16%		Equity method
Anhui Huapeng Textile Co., Ltd.	Anhui	Anhui	Manufacturing	50.00%		Equity method

Associated enterprise
Shenzhen Changlianfa Printing and dyeing Company	Shenzhen	Shenzhen	Property leasing	40.25%		Equity method
Jordan Garment Factory	Jordan	Jordan	Manufacturing	35.00%		Equity method
Yehui International Co., Ltd.	Hongkong	Hongkong	Manufacturing	22.75%		Equity method

Explanation that the shareholding ratio in the joint venture or associated enterprise is different fromthe voting right ratio:

Basis for holding less than 20% of voting rights but with significant influence, or holding 20% ormore of voting rights but without significant influence:

（2）The Summarized Financial Information of Joint Ventures

In RMB

	Year-end balance/ Amount of current period	Year-beginning balance/ Amount of previous period
	Shenzhen Guanhua Printing & Dyeing Co.,Ltd.
Current assets	37,787,147.72	19,854,144.21
Non-current assets	228,639,403.03	241,137,964.49
Total assets	266,426,550.75	260,992,108.70
Current liabilities	18,194,214.40	12,261,343.60
Non-current liabilities	35,190,853.69	37,356,444.69
Total liabilities	53,385,068.09	49,617,788.29
Attributable to shareholders of the parent company	213,041,482.67	211,374,320.41
Share of net assets calculated by stake	106,861,607.70	106,025,359.12
--Goodwill	21,595,462.44	21,595,462.44
--Other	285,343.61	285,343.61
Operating income	21,404,639.29	14,623,800.97
Financial expenses	-174,304.72	-39,339.28
Income tax expenses	499,490.10	-2,118,023.83
Net profit	614,155.44	-3,422,861.88
Total comprehensive income	614,155.44	-3,422,861.88

Other note

(3) Main financial information of significant associated enterprise

In RMB

Year-end balance/ Amount of current period

Year-beginning balance/ Amount of previous period

Other note

(4) Summary financial information of insignificant joint venture or associated enterprise

In RMB

	Year-end balance/ Amount of current period	Year-beginning balance/ Amount of previous period
Joint venture：	--	--
Total amount of the pro rata calculation of the following items	--	--
Associated enterprise：	--	--
Total amount of the pro rata calculation of the following items	--	--

Other note

(5) Note to the significant restrictions of the ability of joint venture or associated enterprise transferfunds to the Company

(6) The excess loss of joint venture or associated enterprise

Other note

(7) The unrecognized commitment related to joint venture investment

(8) Contingent liabilities related to joint venture or associated enterprise investment

4. Significant common operation

5. Equity of structure entity not including in the scope of consolidated financial statementsRelated notes to structure entity not including in the scope of consolidated financial statements

6.Other

VII. Risks Related to Financial InstrumentsVIII. The disclosure of the fair value

1. Closing fair value of assets and liabilities calculated by fair value

In RMB

Items	Closing fair value
	Fir value measurement items at level 1	Fir value measurement items at level 2	Fir value measurement items at level 3	Total
I. Consistent fair value measurement	--	--	--	--
II Inconsistent fair value measurement	--	--	--	--

IX. Related parties and related-party transactions

1.Parent company information of the enterprise

Name	Registered address	Nature	Registered capital	The parent company of the Company's shareholding ratio	The parent company of the Company’s vote ratio
Shenzhen Investment Holdings Co.,Ltd.	18/F, Investment Building, Shennan Road, Futian District, Shenzhen	Equity investment , Real-estate Development and Guarantee	2,800,900.00	46.21%	46.21%

Note to the parent company:

The company is authorized and approved to be state-owned independent company by ShenzhenGovernment, and it Executes financial contributor function on state-owned enterprise withinauthorization scope.Therefore, the Company’s ultimate controller is Shenzhen Investment Holdings Co., Ltd.Other note：None

2.Subsidiaries of the Company

For details of the subsidiary of the Company, see "Section X Financial Report IX. Interests inother subjects

3. Information on the joint ventures and associated enterprises of the Company

For important joint ventures or joint ventures of the Company, see the notes to the joint ventureand joint ventures of the Company. See " Section X Financial Report IX. Interests in otherentities.Other note

4.Other Related parties information

Other related party	Relationship to the Company
Shenzhen Tianma Microelectronics Co., Ltd.	Chairman of the Board Is the Vice Chairman of the Company
Suzhou Advantage Ford Investment Center (Limited partnership)	The controlling party of SAPO Shareholder
Shengto (HK) Co., Ltd.	The Company Executives are Director of the company
Hengmei Photoelectric Co., Ltd.	Sharing Company of Suzhou Advantage Ford Investment Center (Limited partnership)
Shenzhen Xinfang Knitting Co., Ltd.	Sharing Company

Shenzhen Dailishi Underwear Co., Ltd.

Sharing Company

Other noteNone

5. Related transactions.

（1）Related transactions on purchasing goods and receiving services

Acquisition of goods and reception of labor service

In RMB

Related parties	Content of related transaction	Amount of current period	Amount of previous period	Over the trading limit or not?	Amount of last period
Hengmei Photoelectric Co., Ltd.	Technical service	0.00	0.00	No	1,415,263.58
Hengmei Photoelectric Co., Ltd.	Polarized	0.00	0.00	No	204,282,036.36

Related transactions on sale goods and receiving services

In RMB

Related party	Content	Amount of current period	Amount of previous period
Shenzhen Tianma Microelectronics Co., Ltd.	Polarized	1,441,975.42	1,485,995.60
Hengmei Photoelectric Co., Ltd.	Polarized	0.00	110,545,214.28

NoteNone

(2) Related trusteeship/contract

Not applicable

(3) Information of related lease

Not applicable

(4) Related-party guarantee

Related guarantee

In RMB

Guaranteed party	Amount	Guarantee start date	Guarantee end date	Whether the guarantee has been fulfilled
SAPO photoelectric	409,127,400.00	September 8,2020		No

The Company is the secured party

Not applicable

(5) Inter-bank lending of capital of related parties：

In RMB

Related party	Amount	Start date	Expiring date	Note
Borrowing fund：
Shenzhen Guanhua Printing & Dyeing Co., Ltd.	3,806,454.17	July 30,2019		The annual lending interest rate is 0.30%
Loaned

(6) Related party asset transfer and debt restructuring

(7) Rewards for the key management personnel

In RMB

Items	Amount of current period	Amount of previous period
Rewards for the key management personnel	1,152,800.00	9,175,000.00

(8) Other related transactions

6. Receivables and payables of related parties

（1）Receivables

In RMB

Name	Related party	Amount at year end		Amount at year beginning
		Balance of Book	Balance of Book	Balance of Book	Bad debt Provision
Account receivable	Shenzhen Tianma Microelectronics Co., Ltd.	412,495.18	18,686.03	581,696.96	25,652.84
Account receivable	Hengmei Photoelectric Co., Ltd.	0.00	0.00	20,879,229.37	920,774.02
Other Account receivable	Anhui Huapeng Textile Company	0.00	0.00	1,800,000.00	1,800,000.00
Other Account receivable	Shenzhen Dailishi Underwear Co., Ltd.	1,100,000.00	55,000.00	0.00	0.00

（2）Payables

In RMB

Name	Related party	Amount at year end	Amount at year beginning
Account payable	Hengmei Photoelectric Co., Ltd.	170,977.53	35,787,643.44
Other payable	Shenzhen Xinfang Knitting Co., Ltd.	244,789.85	244,789.85
Other payable	Shenzhen Changlianfa Printing & dyeing Co., Ltd.	2,023,699.95	1,580,949.95
Other payable	Yehui International Co.,Ltd.	1,124,656.60	1,143,127.81
Other payable	Shengtou （Hongkong）Co., Ltd.	315,000.00	315,000.00
Other payable	Shenzhen Guanhua Printing & dyeing Co., Ltd.	3,806,454.17	3,811,240.92

7. Related party commitment

None

8.Other

NoneX. Share payment

1. Overall situation of share payment

√ Applicable □Not applicable

In RMB

Total amount of various equity instruments granted by the company during the current period	0.00
Total amount of various equity instruments that the company exercises during the period	0.00
Total amount of various equity instruments that have expired in the current period	1,250,430.00
The scope of executive price of the company’s outstanding share options at the end of the period and the remaining term of the contract	0 yuan，0 year
The scope of executive price of the company’s other equity instruments at the end of the period and the remaining term of the contract	5.73 /yuan/share，1 year

Other noteNote :On December 14, 2017, the company's 3rd Extraordinary General Meeting of Shareholders in2017 passed the Proposal on ‘Shenzhen Textile (Group) Co., Ltd. 2017 Restricted Stock IncentivePlan (Draft) and Abstract’; on December 14, 2017, the board of directors of the company reviewedand passed the Proposal on Adjusting the List of Incentive Objects of Restricted Stock IncentivePlans and the Number of Equity Granted of 2017, and the Proposal on Granting Restrictive Shares toIncentive Objects. On December 14, 2017, the company granted 4,752,300 restricted shares to the

incentive object, the grant price was 5.73 yuan/share. Restrictions shall be lifted at the rate of 40%,30%, and 30% respectively after 12 months, 24 months, and 36 months after the first transactiondate of 24 months after the completion of the registration. The company's performance assessmentfor the restricted shares granted each period is as follows:

Restriction lifting period	Performance assessment goals
The first restriction lifting period	In 2018, the earnings per share shall be no less than 0.07 yuan, and shall not be lower than the 75 fractiles level of the comparable listed companies in the same industry; the growth rate of operating revenue in 2018 compared with 2016 is not less than 70%, and is not lower than the 75 fractiles level of comparable listed companies in the same industry; in 2018, the proportion of optical film business such as polarizers to operating revenue is no less than 70%.
The second restriction lifting period	In 2019, earnings per share shall be no less than 0.08 yuan, and shall not be lower than the 75 fractiles level of the comparable listed companies in the same industry; the growth rate of operating revenue in 2019 compared with 2016 is not less than 130%, and is not lower than the 75 fractiles level of comparable listed companies in the same industry; in 2019, the proportion of optical film business such as polarizers to operating revenue is not less than 75%.
The third restriction lifting period	In 2020, the earnings per share shall be no less than 0.20 yuan, and shall not be lower than the 75 fractiles level of comparable listed companies in the same industry; the growth rate of operating revenue in 2020 is not less than 200% compared to 2016, and is not lower than the 75 fractiles level of comparable listed companies in the same industry. In 2020, the proportion of optical film business such as polarizers to operating revenue will be no less than 80%.

Note: Earnings per share=net profit/total capital stock attributable to common shareholders ofthe Company upon deduction of non-recurring profit and loss.On February 2, 2021, the company held the first extraordinary general meeting of shareholders in2021 to consider and pass the "Proposal on Repurchase and Cancellation of Certain RestrictedStocks", agreeing to the company's total holdings of 1 original incentive object who resigned due topersonal reasons 7,950 restricted stocks were repurchased and cancelled at a repurchase price of 5.73yuan/share; It was agreed that the Company repurchase and cancel 6,000 restricted shares held by oneoriginal incentive object who had failed to meet the incentive conditions due to retirement at 6.23yuan/share.On April 7, 2021, the company held the 2020 Annual General Meeting of Shareholders toreview and approve the Proposal on Repurchase and Cancellation of Some Restricted Stocks, andagreed that the company would repurchase and cancel 1,236,480 restricted stocks held by 102incentive objects in the third issue that did not meet the conditions for lifting the restrictions on sales,and the repurchase price was RMB 6.26 per share.

2. Equity-settled share-based payment

√ Applicable □Not applicable

In RMB

Determination method of the fair value of equity instruments on the grant date	The closing price of the company's stock on grant date - grant price
Determination basis of the number of vesting equity instruments	On each balance sheet date of the waiting period, it is determined based on the latest information such as the change in the number of people that can be released

	from restrictions and the completion of performance indicators
Reasons for the significant difference between the current period estimate and the previous period estimate	None
Equity-settled share-based payment is included in the accumulated amount of capital reserve	0.00
Total amount of fees confirmed by equity-settled share-based payments in the current period	0.00

Other noteNone

3. The Stock payment settled by cash

□ Applicable √ Not applicable

4. Modification and termination of the stock payment

None

5.Other

NoneXI. Commitments

1. Significant commitments

Significant commitments at balance sheet dateAs of December 31,2021,The company does not disclose the pension plan undisclosed matter shouldexist.

2. Contingency

(1) Significant contingency at balance sheet date

As of December 31,2021,The company does not disclose the pension plan undisclosed matter shouldexist.

(2) The Company have no significant contingency to disclose, also should be statedNone

3.Other

None

XII. Events after balance sheet date

1. Significant events had not adjusted

Not applicable

2. Profit distribution

Not applicable

3. Sales return

None

4. Notes of other significant events

As of December 31,2021,The company does not disclose the pension plan undisclosed matter shouldexist.XIII. Other significant events

1. Correction of the accounting errors in the previous period

(1) Retroactive restatement

(2) Prospective application

2. Liabilities restructuring

None

3. Replacement of assets

(1) Non-monetary assets exchange

None

(2) Other assets exchange

None

4. Pension plan

None

5. Discontinuing operation

None

6. Segment information

(1) Basis for determining the reporting segments and accounting policy

The Company determines its operating divisions based on its internal organizational structure,management requirements and internal reporting system. Based on the operating divisions, theCompany confirms four reporting divisions, namely textiles, polarizer, trade and property leasing.Divisional reporting information is disclosed in accordance with the accounting policies andmeasurement standards adopted by each division when reporting to the management. Thesemeasurement basis are consistent with the accounting and measurement basis for financial statementpreparation.

（2）Financial information of the report division

In RMB

Items	Polarizer	Property lease and other	Textile	Trade	Offset between divisions	Total
Operating income	2,117,717,019.48	129,445,842.10	55,169,650.79		-8,584,620.31	2,293,747,892.06
Including: revenue from foreign transaction	2,117,717,019.48	121,098,294.00	54,932,578.58		0.00	2,293,747,892.06
Revenue from inter-segment transactions	0.00	8,347,548.10	237,072.21		-8,584,620.31	-8,584,620.31
Including: revenue from main business	2,099,489,550.77	114,363,911.23	55,169,650.79		-3,032,482.89	2,265,990,629.90
Operating cost	1,828,378,235.90	38,998,238.06	48,686,874.43		-7,543,935.11	1,908,519,413.28
Including: main business cost	1,828,378,235.90	26,709,964.52	48,686,874.43		-3,527,746.06	1,900,247,328.79
Operating profit	28,041,538.58	53,280,168.22	815,378.80	-15,576,656.93	73,511.20	66,633,939.87
Total assets	4,204,357,864.87	3,296,896,012.57	46,233,785.98		-2,050,840,555.59	5,496,647,107.83
Total indebtedness	1,380,985,834.98	211,828,635.06	27,995,367.47		-87,991,976.75	1,532,817,860.76

(3) In case there is no reporting segment or the total assets and liabilities of the reporting segmentscannot be disclosed, explain the reasonNone

（4）Other note

None

7. Other significant transactions and matters that may affect investors' decision makingNone

8.Other

NoneXIV. Notes of main items in the financial statements of the Parent Company

1. Accounts receivable

(1) Accounts receivable classified by category

In RMB

Category	Amount in year-end					Amount in year-beginning
	Book balance		Bad debt provision		Book value	Book balance		Bad debt provision		Book value
	Amount	Proportion(%)	Amount	Proportion(%)		Amount	Proportion(%)	Amount	Proportion(%)
Including：
Accrual of bad debt provision by portfolio	8,353,590.78	100.00%	417,679.54	5.00%	7,935,911.24	1,538,316.00	100.00%	76,915.80	5.00%	1,461,400.20
Including：
Total	8,353,590.78	100.00%	417,679.54	5.00%	7,935,911.24	1,538,316.00	100.00%	76,915.80	5.00%	1,461,400.20

Accrual of bad debt provision by single item

In RMB

Name	Closing balance
	Book balance	Bad debt provision	Proportion

Accrual of bad debt provision by portfolio: 417,679.54 yuan

In RMB

Name	Closing balance
	Book balance	Bad debt provision	Proportion
Within 1 year	6,815,274.78	340,763.74	5.00%
1-2 years	1,538,316.00	76,915.80	5.00%
Total	8,353,590.78	417,679.54	--

Accrual of bad debt provision by portfolio

In RMBRMB

Name	Closing balance
	Book balance	Bad debt provision	Proportion

Relevant information of the provision for bad debts will be disclosed with reference to the disclosuremethod of other receivables if the provision for bad debts of bills receivable is accrued according tothe general model of expected credit loss:

□ Applicable √ Not applicable

Disclosure by aging

In RMB

Aging	Closing balance
Within 1 year（Including 1 year）	6,815,274.78
1-2 years	1,538,316.00
2-3 years	0.00
Over 3 years	0.00
3-4 years	0.00
Total	8,353,590.78

(2) Accounts receivable withdraw, reversed or collected during the reporting periodThe withdrawal amount of the bad debt provision：

In RMB

Category	Opening balance	Amount of change in the current period				Closing balance
		Accrual	Reversed or collected amount	Write-off	Other
	76,915.80	340,763.74				417,679.54
Total	76,915.80	340,763.74				417,679.54
Total	76,915.80	66,116.12				143,031.92

Where the significant amount of the reserve for bad debt recovered or reversed:

In RMB

Name

Amount

Mode

None

(3) The actual write-off accounts receivable

In RMB

Items

Amount

（4）The ending balance of other receivables owed by the imputation of the top five parties

In RMB

Name	Closing balance	Proportion %	Balance of Bad debt provision
Shenzhen Guangsheng Development Industry Co., Ltd.	5,610,352.81	67.16%	280,517.64
Shenzhen Beauty Century Garment Co., Ltd.	2,485,076.00	29.75%	124,253.80
Shenzhen Yuehao Hotel Management Co., Ltd.	245,621.97	2.94%	12,281.10
Cao Cheng	9,300.00	0.11%	465.00
Ma Yue	3,240.00	0.04%	162.00
Total	8,353,590.78	100.00%	--

(5) Account receivable which terminate the recognition owning to the transfer of the financial assetsNone

(6) The amount of the assets and liabilities formed by the transfer and the continues involvement ofaccounts receivableNone

2. Other accounts receivable

In RMB

Items	Closing balance	Opening balance
Other accounts receivable	14,383,631.68	7,450,934.40
Total	14,383,631.68	7,450,934.40

（1）Interest receivable

1）Category of interest receivable

In RMB

Items

Closing balance

Opening balance

2) Significant overdue interest

I n RMB

Items)

Balance in year-end

Aging

Reasons for non-recovery

Whether or not the impairment and the basis for its determination

Other note：

3）Bad-debt provision

√Applicable □ Not applicable

In RMB

Bad debt provision	Stage 1	Stage 2	Stage 3	Total
	Expected credit losses over the next 12 months	Expected credit loss over life (no credit impairment)	Expected credit losses for the entire duration (credit impairment occurred)
Balance as at January 1,2021 In current	——	——	——	——

Loss provision changes in current period, change in book balance with significant amount

□ Applicable √ Not applicable

(2)Dividend receivable

1) Category of Dividend receivable

(2)Dividend receivable

1) Category of Dividend receivable

In RMB

Items

Closing balance

Opening balance

2) Significant dividends receivable with age exceeding 1 year

I n RMB

Items)

Balance in year-end

Aging

Reasons for non-recovery

Whether or not the impairment and the basis for its determination

3）Bad-debt provision

√Applicable □ Not applicable

In RMB

Bad debt provision	Stage 1	Stage 2	Stage 3	Total
	Expected credit losses over the next 12 months	Expected credit loss over life (no credit impairment)	Expected credit losses for the entire duration (credit impairment occurred)
Balance as at January 1,2021	1,018,014.39		15,111,246.32	16,129,260.71
Balance as at January 1,2021 In current	——	——	——	——
Provision in the current period	369,750.00			369,750.00
Balance as at December 31,2021	1,387,764.39		15,111,246.32	16,499,010.71

Loss provision changes in current period, change in book balance with significant amount

□ Applicable √ Not applicable

Other note：

（3） Other accounts receivable

1) Other accounts receivable classified by the nature of accounts

In RMB

Nature	Closing book balance	Opening book balance
Other receivable	14,383,631.68	7,450,934.40
Total	14,383,631.68	7,450,934.40

2）Bad-debt provision

In RMB

Bad Debt Reserves	Stage 1	Stage 2	Stage 3	Total
	Expected credit losses over the next 12 months	Expected credit loss over life (no credit impairment)	Expected credit losses for the entire duration (credit impairment occurred)
Balance as at January 1,2021	1,018,014.40		15,111,246.32	16,129,260.71
Balance as at January 1,2021 In current	——	——	——	——
Provision in the current period	369,750.00			369,750.00
Balance as at December 31,2021	1,387,764.39		15,111,246.32	16,499,010.71

Loss provision changes in current period, change in book balance with significant amount

□ Applicable √ Not applicable

Disclosure by aging

In RMB

Aging	Closing balance
Within 1 year(Including 1 year）	15,603,247.29
1-2 years	0.00
2-3 years	234,716.25
Over 3 years	15,044,678.85
3-4 years	328,819.35
4-5 years	454,759.77
Over 5 years	14,261,099.73
Total	30,882,642.39

3) Accounts receivable withdraw, reversed or collected during the reporting periodThe withdrawal amount of the bad debt provision：

In RMB

Category	Opening balance	Amount of change in the current period				Closing balance
		Accrual	Reversed or collected amount	Write-off	Other
Internal current account	877,680.00	365,000.00				1,242,680.00
Deposit	5,000.00					5,000.00
Other	1,260.00	122.36				1,382.36
Unit account	15,245,320.71	4,627.64				15,249,948.35
Total	16,129,260.71	369,750.00				16,499,010.71

Where the significant amount of the provision for bad debt recovered or reversed

In RMB

Name

Amount

Mode

4) Accounts receivable actually written off in the reporting period

In RMB

Items

Amount

Of which the significant amount of the reversed or collected part during the reporting period :

In RMB

Name

Nature

Amount

Reason

Verification procedures performed

Whether the money is generated by related party transactions

(5)Top 5 of the closing balance of the other accounts receivable collected according to the arrearsparty

In RMB

Name	Nature	Year-end balance	Age	Portion in total other receivables(%)	Bad debt provision of year-end balance
Shenzhen Beauty Century Garment Co., Ltd.	Internal current account	14,475,600.00	1-3 years	46.87%	1,242,680.00
Jiangxi Xuanli Thread Co., Ltd.	Unit account	11,389,044.60	Over 5 years	36.88%	11,389,044.60
Anhui Huapeng Textile Company	Unit account	1,800,000.00	Over 5 years	5.83%	1,800,000.00
Shenzhen Dailisi Underwear Co., Ltd	Unit account	1,100,000.00	Within 1 year	3.56%	55,000.00
Shenzhen Xieli Automobile Repair Plant	Unit account	1,018,295.37	2-5 years	3.30%	1,018,295.37
Total	--	29,782,939.97	--	96.44%	15,505,019.97

6) Accounts receivable involved with government subsidies

In RMB

Name

Name of the government subsidy project

Year-end balance

Aging

Time, amount and basis of the expected collection

The company has no government subsidies receivable.

7) Other account receivable which terminate the recognition owning to the transfer of the financialassets

(8) The amount of the assets and liabilities formed by the transfer and the continues involvement ofother accounts receivable

Other note：

3. Long-term equity investment

In RMB

Items	Closing balance			Opening balance
	Book balance	Provision for impairment	Book value	Book balance	Provision for impairment	Book value
Investments in subsidiaries	1,972,630,835.39	16,582,629.30	1,956,048,206.09	1,972,630,835.39	16,582,629.30	1,956,048,206.09
Investments in associates and joint ventures	133,022,325.77	0.00	133,022,325.77	147,929,137.23	0.00	147,929,137.23
Total	2,105,653,161.16	16,582,629.30	2,089,070,531.86	2,120,559,972.62	16,582,629.30	2,103,977,343.32

（1）Investment to the subsidiary

In RMB

Name	Opening balance	Increase /decrease in reporting period				Closing balance	Closing balance of impairment provision
		Add investment	Decreased investment	Withdrawn impairment provision	Other
SAPO Photoelectric	1,910,247,781.94					1,910,247,781.94	14,415,288.09
Shenzhen Lisi Industrial Development Co., Ltd.	8,073,388.25					8,073,388.25
Shenzhen Beauty Century Garment Co., Ltd.	14,696,874.34					14,696,874.34	2,167,341.21
Shenzhen Huaqiang Hotel	15,489,351.08					15,489,351.08
Shenzhen Shenfang Real Estate Management Co., Ltd.	1,713,186.55					1,713,186.55
Shenzhen Shenfang Sungang Real Estate Management Co., Ltd.	5,827,623.93					5,827,623.93
Total	1,956,048,206.09					1,956,048,206.09	16,582,629.30

（2）Investment to joint ventures and associated enterprises

In RMB

Name	Opening balance	Increase /decrease in reporting period								Closing balance	Closing balance of impairment provision
		Add investment	Decreased investment	Gain/loss of Investment	Adjustment of other comprehensive income	Other equity changes	Declaration of cash dividends or profit	Withdrawn impairment provision	Other
I. Joint ventures
Anhui Huapeng Textile Co.,Ltd.	10,797,023.14		10,797,023.14
Shenzhen Guanhua Printing & Dyeing Co., Ltd.	127,906,165.17			308,060.37						128,214,225.54
Subtotal	138,703,188.31		10,797,023.14	308,060.37						128,214,225.54
II. Associated enterprises
Shenzhen Changlianfa Printing and dyeing Company	2,706,262.38			265,940.59						2,972,202.97
Jordan Garnent Factory
Yehui International Co., Ltd.	6,519,686.54			-540,016.30	-199,063.73		3,944,709.25			1,835,897.26
Subtotal	9,225,948.92			-274,075.71	-199,063.73		3,944,709.25			4,808,100.23

Total

147,929,137.23

133,022,325.77

0.00

（3）Other note

4.Business income and Business cost

In RMB

Items	Amount of current period		Amount of previous period
	Business income	Business cost	Business income	Business cost
Income from Main Business	74,272,555.42	7,660,814.11	57,649,817.53	7,019,203.76
Other Business income	3,887,130.77	3,887,130.77	3,647,070.68	3,647,070.68
Total	78,159,686.19	11,547,944.88	61,296,888.21	10,666,274.44

Income-related information:

In RMB

Type	Division 1	Division 2		Total
Of which：
Of which：
Of which：
Of which：
Of which：
Of which：
Of which：

Information related to performance obligations: NoneInformation related to the transaction price apportioned to the residual performance obligation: NoneAt the end of the reporting period, the income amount corresponding to the performance obligationsthat have been signed but not fulfilled or completed is 0.00 yuan. Among them, RMB 0.00 isexpected to be recognized as revenue in 0 year, RMB 0.00 is expected to be recognized as revenue in0 year, and RMB 0.00 is expected to be recognized as revenue in 0 year.Other note: None

5.Investment income

In RMB

Items	Amount of current period	Amount of previous period
Income from long-term equity investment measured by adopting the Cost method		18,304,138.91
Income from long-term equity investment measured by adopting the equity method	33,984.66	-3,446,613.86
Investment income from the disposal of long-term equity investment	20,779.93
Dividend income earned during investment holdings in other equity instruments	1,659,743.65	1,995,042.32
Structured deposit interest	4,036,968.43	14,919,678.58
Net monetary gains	14,657,621.81	3,884,233.70

Total

20,409,098.48

35,656,479.65

6.Other

XV. Supplement information

1. Particulars about current non-recurring gains and loss

√ Applicable □Not applicable

In RMB

Items	Amount	Notes
Non-current asset disposal gain/loss	-961,982.35
Government subsidy recognized in current gain and loss(excluding those closely related to the Company’s business and granted under the state’s policies)	19,643,379.33	Other benefits of government subsidies that are confirmed related to the main business.
Switch back of provision for depreciation of account receivable which was singly taken depreciation test.	989,313.04
Other non-business income and expenditures other than the above	19,964,046.87
Less :Influenced amount of income tax	6,025,891.12
Influenced amount of minor shareholders’ equity (after tax)	13,096,494.74
Total	20,512,371.03	--

Details of other profit and loss items that meet the non-recurring profit and loss definition

□ Applicable√ Not applicable

Explain the reasons if the Company classifies an item as an extraordinary gain/loss according to thedefinition in the Explanatory Announcement No.1 on Information Disclosure for CompaniesOffering Their Securities to the Public-Extraordinary Gains and Losses, or classifies anyextraordinary gain/loss item mentioned in the said explanatory announcement as a recurrentgain/loss item.

□ Applicable √Not applicable

2. Return on net asset and earnings per share

Profit of report period	Weighted average returns equity(%)	Earnings per share
		Basic earnings per share(RMB/share）	Diluted earnings per share(RMB/share)
Net profit attributable to the Common stock shareholders of Company.	2.24%	0.12	0.12
Net profit attributable to the Common stock shareholders of Company after deducting of non-recurring gain/loss.	1.46%	0.08	0.08

3. Differences between accounting data under domestic and overseas accounting standards

（1）Simultaneously pursuant to both Chinese accounting standards and international accountingstandards disclosed in the financial reports of differences in net income and net assets.

□ Applicable□√ Not applicable

（2）Differences of net profit and net assets disclosed in financial reports prepared under overseasand Chinese accounting standards.

□ Applicable□√ Not applicable

(3)Explanation of the reasons for the differences in accounting data under domestic and foreign accounting standards. If the data that has been audited by an overseas audit institution is adjusted for differences, the name of the overseas institution should be indicatedNone

4.Other

None

Shenzhen Textile (Holdings) Co., Ltd.

March 15, 2022