China Fangda Group Co., Ltd.
2018 Interim Report
August 2018
Chapter 1 Important Statement, Table of Contents and DefinitionsThe members of the Board and the Company guarantee that the interim report is free from any false information,
misleading statement or material omission and are jointly and severally liable for the information’s truthfulness, accuracy
and integrity.
Mr. Xiong Jianming, the Chairman of Board, Mr. Lin Kebin, the Chief Financial Officer, and Mr. Wu Bohua, themanager of accounting department declare: the Financial Report carried in this report is authentic and completed.
All the Directors have attended the meeting of the board meeting at which this report was examined.Forward-looking statements involved in this report including future plans do not make any material promise to investors.Investors should pay attention to investment risks.
The Company has specified market, management and production and operation risks in this report. Please review the 10.Risks Facing the Company and Measures in Chapter 4 Operation Discussion and Analysis.
The Company will distribute no cash dividends or bonus shares and has no reserve capitalization plan.
Table of Contents
Chapter 1 Important Statement, Table of Contents and Definitions ...... 2
Chapter 2 About the Company and Financial Highlights ...... 6
Chapter 3 Business Introduction ...... 9
Chapter 4 Operation Discussion and Analysis ...... 14
Chapter 5 Significant Events ...... 24
Chapter 6 Changes in Share Capital and Shareholders ...... 32
Chapter 7 Preferred Shares ...... 37
Chapter 8 Particulars about the Directors, Supervisors, and Senior Management ...... 38
Chapter 9 Information about the Company’s Securities ...... 39
Chapter 10 Financial Statements ...... 40
Chapter 11 Documents for Reference ...... 145
Definitions
Terms | Refers to | Description |
Fangda Group, company, the Company | Refers to | China Fangda Group Co., Ltd. |
Articles of Association | Refers to | Articles of Association of China Fangda Group Co., Ltd. |
Meeting of shareholders | Refers to | Meetings of shareholders of China Fangda Group Co., Ltd. |
Board of Directors | Refers to | Board of Directors of China Fangda Group Co., Ltd. |
Supervisory Committee | Refers to | Supervisory Committee of China Fangda Group Co., Ltd. |
Banglin Co. | Refers to | Shenzhen Banglin Technologies Development Co., Ltd. |
Shilihe Co. | Refers to | Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise (limited partner) |
Shengjiu Co. | Refers to | Shengjiu Investment Ltd. |
Fangda Jianke | Refers to | Shenzhen Fangda Jianke Group Co., Ltd. |
Fangda Automatic | Refers to | Shenzhen Fangda Automation System Co., Ltd. |
Fangda New Material | Refers to | Fangda New Materials (Jiangxi) Co., Ltd. |
Fangda New Resource | Refers to | Shenzhen Fangda New Energy Co., Ltd. |
Fangda Property | Refers to | Shenzhen Fangda Property Development Co., Ltd. |
Chengdu Fangda Jianke | Refers to | Chengda Fangda Construction Technology Co., Ltd. |
Dongguan Fangda New Material | Refers to | Dongguan Fangda New Material Co., Ltd. |
Kechuangyuan Software | Refers to | Shenzhen Qianhai Kechuangyuan Software Co., Ltd. |
Kexunda Co. | Refers to | Shenzhen Kexunda Software Co., Ltd. |
Fangda Property | Refers to | Shenzhen Fangda Property Management Co., Ltd. |
Jiangxi Property | Refers to | Fangda (Jiangxi) Property Development Co., Ltd. |
Hongjun Investment Company | Refers to | Shenzhen Hongjun Investment Co., Ltd. |
Jianke Australia | Refers to | Fangda Australia Pty Ltd |
Automatic Hong Kong | Refers to | Fangda Automation (Hong Kong) Co., Ltd. |
Shihui International | Refers to | Shihui International Holding Co., Ltd. |
Shenyang Decoration | Refers to | Fangda Decoration Engineering (Shenyang) Co., Ltd. |
Shenyang Fangda | Refers to | Shenyang Fangda Semi-conductor Lighting Co., Ltd. |
Shenzhen Woke | Refers to | Shenzhen Woke Semi-conductor Lighting Co., Ltd. |
Fangda Cloud Rail | Refers to | Shenzhen Fangda Could Rail Technology Co., Ltd. |
CSRC | Refers to | China Securities Regulatory Commission |
SZSE | Refers to | Shenzhen Stock Exchange |
Chapter 2 About the Company and Financial Highlights1. Company Profile
Stock ID | Fangda Group, Fangda B | Stock code | 000055、200055 |
Modified stock ID (if any) | None | ||
Stock Exchange | Shenzhen Stock Exchange | ||
Chinese name | China Fangda Group Co., Ltd. | ||
English name (if any) | Fangda Group | ||
English name (if any) | CHINA FANGDA GROUP CO., LTD. | ||
English abbreviation (if any) | CFGC | ||
Legal representative | Xiong Jianming |
2. Contacts and liaisons
Secretary of the Board | Representative of Stock Affairs | |
Name | Zhou Zhigang | Guo Linchen |
Address | 20F, Fangda Technology Building, Kejinan 12th Avenue, High-tech Zone, Hi-tech Park South Zone, Shenzhen, PR China. | 20F, Fangda Technology Building, Kejinan 12th Avenue, High-tech Zone, Hi-tech Park South Zone, Shenzhen, PR China. |
Tel. | 86(755) 26788571 ext. 6622 | 86(755) 26788571 ext. 6622 |
Fax | 86(755)26788353 | 86(755)26788353 |
zqb@fangda.com | zqb@fangda.com |
3. Other Information1. Liaison
Changes to the Company’s registration address, office address, post code, website or email during the report period□ Applicable √ InapplicableCompany’s registration address, office address, post code, website or email have not changed during the report period. See Annual
Report 2017 for details.2. Information disclosure and inquiringChanges to the information disclosure and inquiring place
□ Applicable √ InapplicablePlease refer to the 2017 annual report for the newspapers and websites where the Company’s information is disclosed. The inquiry
address of the interim report has remained unchanged during the report period.4. Financial HighlightWhether the Company needs to make retroactive adjustment or restatement of financial data of previous years
□ Yes √ No
This report period | Same period last year | Year-on-year change (%) | |
Turnover (yuan) | 1,442,050,896.53 | 1,399,710,941.29 | 3.02% |
Net profit attributable to shareholders of the listed company (yuan) | 230,131,663.19 | 228,003,319.43 | 0.93% |
Net profit attributable to the shareholders of the listed company and after deducting of non-recurring gain/loss (RMB) | 209,705,118.34 | 218,498,976.52 | -4.02% |
Net cash flow generated by business operation (RMB) | -31,426,267.64 | 215,263,207.38 | -114.60% |
Basic earnings per share (yuan/share) | 0.1944 | 0.1926 | 0.93% |
Diluted Earnings per share (yuan/share) | 0.1944 | 0.1926 | 0.93% |
Weighted average net income/asset ratio | 6.99% | 9.37% | -2.38% |
End of the report period | End of last year | Year-on-year change | |
Total asset (RMB) | 7,892,969,369.92 | 7,625,422,688.63 | 3.51% |
Net profit attributable to the shareholders of the listed company (RMB) | 3,289,644,771.10 | 3,238,939,202.18 | 1.57% |
5. Differences in accounting data under domestic and foreign accounting standards1. Differences in net profits and assets in financial statements disclosed according to the international and Chinese account
standards
□ Applicable √ Inapplicable
There is no difference in net profits and assets in financial statements disclosed according to the international and Chinese accountstandards during the report period.
2. Differences in net profits and assets in financial statements disclosed according to the overseas and Chinese accountstandards
□ Applicable √ Inapplicable
There is no difference in net profits and assets in financial statements disclosed according to the international and Chinese accountstandards during the report period.
6. Accidental gain/loss item and amount
√ Applicable □ Inapplicable
In RMB
Item | Amount | Notes |
Non-current asset disposal gain/loss (including the write-off part for which assets impairment provision is made) | -1,565,317.62 | |
Subsidies accounted into the current income account (except the government subsidy closely related to the enterprise’s business and based on unified national standard quota) | 2,185,580.79 | |
Gain from entrusted investment or assets management | 9,615,882.62 | |
Gain generated by contingencies irrelevant to the Company’s business | 8,939,594.68 | |
Gain/loss from change of fair value of transactional financial asset and liabilities, and investment gains from disposal of transactional financial assets and liabilities and sellable financial assets, other than valid period value instruments related to the Company’s common businesses | 187,445.30 | |
Gain/loss from change of fair value of investment property measured at fair value in follow-up measurement | -323,794.00 | |
Other non-business income and expenditures other than the above | 6,110,628.97 | |
Other gain/loss items satisfying the definition of non-recurring gain/loss account | 0.40 | |
Less: Influenced amount of income tax | 4,723,476.29 | |
Total | 20,426,544.85 | -- |
Explanation statement should be made for accidental gain/loss items defined and accidental gain/loss items defined as regulargain/loss items according to the Explanation Announcement of Information Disclosure No. 1 - Non-recurring gain/loss mentioned.
□ Applicable √ Inapplicable
No circumstance that should be defined as recurrent profit and loss according to Explanation Announcement of InformationDisclosure No. 1 - Non-recurring gain/loss occurs in the report period.
Chapter 3 Business IntroductionI. Major businesses of the Company during the report period
Whether the Company needs to comply with disclosure requirements of special industriesYesDecoration
The Company is headquartered in Nanshan District of Shenzhen and became listed in Shenzhen Stock Exchange on November29, 1995. Currently, five major business subsidiaries of the Company are national high-tech enterprises with modern productionbases in Shenzhen, Shanghai, Chengdu, Nanchang, Dongguan and Foshan. The Company was engaged in the following businesses inthe report period.
1. Curtain wall system and material industry(1) Main products and purposes
The Company’s main products include energy-saving curtain walls, photo-electricity curtain walls, LED color-display curtain
walls and aluminum plate materials. Construction curtain walls are mainly used on high-level buildings, large-area public venuessuch as airports, stations, cultural centers and exhibition centers, daylighting roof, shaped construction (ball-shaped and clock-shapedbuildings) with external retaining and decoration functions.
(2) Main business modes, specific risks and changes;The projects implemented by the Company are mainly through the bidding method to obtain contract orders. Project design,material procurement, production and processing, and the construction and installation and after-sales service model are based on thecontract orders. The main risk of this mode is that it takes a long period of time from the completion of the order to the completion ofthe project, and it is highly dependent on raw materials and labor costs. It is greatly affected by the national industrial policy, raw
material prices, and labor market fluctuations. The Company’s curtain wall products are engineered by itself. The operation mode
remained unchanged in the report period.
(3) Main business driveSee 3. Core competitiveness analysis in this chapter.(4) Development stage of the industry, circle and industry positionIn the first half of the year, the country has continued to decrease leverage and reinforce environmental protection policy. Theinfluence of Sino-US trade friction continued to deepen and the fluctuations in the prices of major raw materials increased. Themarket competition in the curtain wall industry became fiercer and the concentration of enterprises became higher and higher.However, with the further development of Guangdong Hong Kong and Macao Dawan District, Xiong'an New District and HainanFree Trade Zone, it has also brought many opportunities to the industry. Urban commercial space such as commercial officebuildings, urban commercial complexes, star-rated hotels and urban public spaces such as airports, stations rail transit, museums,libraries, stadiums, schools, hospitals etc. demand for building curtain walls systems and materials industry still has a goodfoundation. In recent years, the state has strongly promoted a series of industrial policies for building energy conservation, providinga good development opportunity for the energy-saving curtain wall and materials business. First- and second-tier cities have bettereconomic development and have continuous demand for building curtain walls. Therefore, the market capacity is large and it is alsothe main area for competition in the curtain wall market. There is no obvious periodicity in the curtain wall industry
The Company is a pioneer and first listed company in this industry. Over the past more than 20 years, the Company hasundertaken hundreds of large projects and received the highest award in the industry China Construction Luban Award and ZhanTianyou Civil Engineering Award for many times. The Company has also received nearly 100 provincial and above awards. The
Company has been in the top 10 of ―China's top 100 building curtain wall industry‖ for many years, and has already had strong brand
advantages and competitiveness in the industry. The Company has a strong technology lead in the industry with 422 patents,including 36 intention patents and one software copyright. The Company also took part in the preparation of more than 10 national orindustry standards including the Public Construction Energy Saving Design Standard, making 9 records among Chinese enterprises.The Company has a Class A qualification for building curtain wall engineering contracting and class A qualification for buildingcurtain wall engineering design. It is the highest level for curtain wall design and construction companies in China.
2. Rail transport equipment business
The Company’s main products in this sector are rail transport screen door systems, which are a necessary part of modern
subway system. It is installed at the edge of the subway platform and separates trains from the platform. The Company seeks to winorders through tenders and purchase raw materials and arrange production based on orders. The Company has built a completeindustry chain that integrates designing, production, engineering, after-sales services and technical services. The operation moderemained unchanged in the report period.The Company has developed rail transport screen door systems with independentintellectual property rights. The Company also prepared the first Rail Transport Station Screen Door Standard. At present, theCompany's subway screen doors have covered more than 60% of metropolitan-operated cities in China. More than 60 metro andcloud rails of over 30 cities around the world have adopted the Fangda screen door systems, making the Company the world's largestsupplier of screen doors.
3. New energy industrySolar PV power generation industry is largely supported by the Chinese government. The Company is one of the firstcompanies that possess intellectual property rights in the designing, production and integration of solar PV systems. In the first halfof 2018, the three photovoltaic power plants that have been connected to the grid have been operating smoothly and the powergeneration sales revenue and operating profit have all reached the Company's expectations. Among them, the 20MW distributedphotovoltaic power generation project of Chayu Village, Xuanfeng Town, Luxi County, Jiangxi Province and the distributedphotovoltaic power generation project of, Songshan Lake in Dongguan have been included in the Renewable Issue issued by theMinistry of Finance the National Development and Reform Commission and the National Energy Administration. The list ofenergy and electricity price additional funds subsidies can be subsidized by electricity prices.
4. Real estateThe Company is currently developing three projects: the Fangda Town in Shenzhen Nanshan District, the Fangda Bangshenproject in Bao'an District, and the Phoenix Valley Fangda Center in Honggutan, Nanchang. In addition, several key update projects inShenzhen are underway. It is expected that the real estate sales and property leasing will continue to contribute profits to theCompany in the future.
For a detailed discussion of the Company’s business, please refer to “III. Analysis of Core Competencies” in this sectionof the report and Chapter VI “Operation Discussion and Analysis”.
II. Major assets change1. Major assets change
Main assets | Major change |
Equity assets | None |
Fixed assets | None |
Intangible assets | Intangible assets increased by 36.18% year-on-year mainly due to the acquisition of land use rights by Shanghai Fangda Qingling Technology Co. Ltd. with a book value of |
RMB21.75 million. | |
Construction in process | None |
2. Major foreign assets
□ Applicable √ Inapplicable
III. Core Competitiveness AnalysisWhether the Company needs to comply with disclosure requirements of special industries
YesDecoration
(1) Curtain wall system and material1. Expertise and brand competitivenessThe Company actively responded to the national supply-side reforms and revitalized real economic policies, persisted ininnovation-driven development, and actively developed low-carbon energy-conserving curtain walls, solar photovoltaic curtain walls,and fabricated curtain walls. The number of patents for the curtain wall systems and materials industry reached 422 (including 36invention patents) with one software copyright and active innovation, leading to its brand advantages. It is one of the top end brandsof the domestic curtain wall system and material industry. FANGDA is a nationwide well-known trademark in China. TheCompany's four subsidiaries engaged in curtain wall systems and materials production are state-level high-tech enterprises.
2. Focusing on the high-end market to edge out competitorsIn the fierce market competition, the Company accurately positions the market in the field of high-end energy-saving curtainwall systems with high requirements for technology and management, and focuses its resources on high-end curtain wall projects.Theconstruction of a number of curtain wall projects won the national "Luban Award", "Zhan Tianyou Civil Engineering Award","National Quality Engineering Award", "China Construction Engineering Decoration Award", "Magnolia" Award and "CustomerSatisfaction Project" awards, and won the title of "China's curtain wall industry's most competitive top 10" and so on. The Companyhas built a leading brand and created a clear edge in the high-end curtain wall market.
3. Well-developed industry base landscapeAfter years of accumulation and continuous investment in hardware facilities, the Company's curtain wall system and materialsindustry are formed with Shenzhen as the headquarters South China with Dongguan Songshan Lake and Foshan as the baseSouthwest China with Chengdu as the base East China with Shanghai and Central China with Nanchang. As the base of thenational industrial layout, it provides an important guarantee for improving market share and comprehensive competitiveness.
4. General solutionsThe Company has integrated the design, production, management and engineering of curtain wall systems to enjoytechnological, cost, quality and service advantages.
(2) Rail transport equipment business1. National development strategyWith the implementation of major national strategies such as the Guangdong, Hong Kong, and Macao Bay District, Xiong'an
New District, and the ―Belt and Road‖ Initiative, the region has radiated into Southeast Asia, South Asia, Central Asia, and West
Asia, and has extended to Eastern Europe and North Africa with strong demand for infrastructure construction and interconnection.As the world's largest supplier of rail transit shielding door systems, the Company will also make full use of its advantages intechnology, brand, and service to further consolidate and increase its domestic market share, and actively participate in rail transit
construction in Guangdong, Hong Kong, Macau BayDistrict and Xiong'an New District. The Company will vigorously expand
overseas markets, especially the ―Belt and Road‖ Initiative, maintain the continuity and stability of overseas orders, balance thedevelopment of domestic and foreign markets, and continue to ―lead‖ the rail transit industry.
2. Technical advantageThrough continued independent innovation, the Company has developed the global leading metro screen door system with fullintellectual property right and broken the monopoly of overseas competitors. The Company has also compiled the Rail TransportStation Screen Door Standard, which is the first of its kind in China. The standard was approved in April 2006 and was implementedon March 1, 2007. As the first standard in the industry in China, the standard has played a key role in guiding the development of
China’s rail transport screen door industry and enabled the Company a dominant lead in the industry. Currently, the Company has
226 metro screen door patents, including 47 invention patents. The Company also has seven computer software copyrights.
3. Brand equityUp to now, the Company has undertaken the construction of shielded door projects for more than 30 metro and cloud rail linesin more than 30 cities including Hong Kong, Singapore, Malaysia Kuala Lumpur, Noida India and Ahmedabad India.The Fangdasubway screen door system has grasped a leading market share and established incomparable brand influence thanks to its patents,standard and maintenance services. The Company has become the largest railway screen door supplier in the world.
4. Industry chain advantageAs the first company to enter the subway screen door industry in China, the Company's subway screen doors have reached tomore than 60% of the subway cities in China, and many domestic subway screen doors have entered the maintenance period. TheCompany actively expands its industrial chain and takes the lead in the domestic market to provide metro maintenance services. TheCompany has a natural advantage in this high-end service industry. Our screen door system are independently developed by us, thusenabling us to provide prompt, overall, effective and standard maintenance services for our customers without other third parties. Asmore and more subways are opened, the business volume will continue to increase. The Company has once again realized theexpansion of the industrial chain through the cloud-rail screen door project of 8 cities that have signed up last year, opening up a newdevelopment space for the Company.
(3) New energy industryThe new energy business mainly comprises solar power PV application, PV construction and LED industry.1. Technical advantage
With more than ten years’ experience in developing solar energy PV power generating curtain wall technology, the Company is
the earliest company that masters the intelligent property right in the designing, production and integration of solar energy PV curtainwall systems and is a pioneer in the application of PV curtain wall technology.
2. Relation with other industries
Distributed solar power PV power generation is closely related to the Company’s existing businesses. Most distributed solar
power PV systems are closely related to construction. Moreover, the Company has more than 10 years' experience in electrical
product integration. The Company also has more than 20 years’ experience in construction management and has the level-1
construction curtain wall engineering qualification and electrical installation engineering qualification.
(4) Real Estate1. Shenzhen is located in the core area of Guangdong, Hong Kong and Macau Bay District, and the economy continuesgrowing. In recent years, Shenzhen has introduced a series of measures to limit house purchase. However, due to the limited supplyof land for development, it is still difficult to stop the rise in prices. Benefited from the rapid economic development of Shenzhen in
the core area of Guangdong, Hong Kong, and Macau Bay, during the reporting period, the sales price of the Company’s Fangda
Town project has increased over the previous period. It is expected that the real estate sales and property leasing will continue tocontribute profits to the Company in the future.
2. The Company is currently developing three projects: the Fangda Town in Shenzhen Nanshan District, the Fangda Bangshenproject in Bao'an District, and the Phoenix Valley Fangda Center in Honggutan, Nanchang. The Fangda Town project and FangdaBangshen project are located in Shenzhen, the core region of Guangdong, Hong Kong and Macau Bay District. The projects havesignificant geographical advantages and great regional development potential. The Nanchang Fangda Center project is located in thePhoenix Valley district of Honggutan New District, Nanchang with an outstanding river view. Phoenix Valley is an important part ofHonggutan New District in Nanchang. It is a business and office gathering place in Nanchang. The location of the project enjoyssignificant advantages. There are fewer office and business apartments with first-class river view in the region. The project hasobvious competitive advantages.
Chapter 4 Operation Discussion and Analysis1. Summary
In the first half of 2018, the country has continued to decrease its leverage and reinforce the environmental protection policy.The influence of Sino-US trade friction continued to deepen and the price fluctuations of major raw materials increased. TheCompany overcame many unfavorable factors and maintained a good development trend. During the reporting period, the Companyachieved operating income of RMB1,442,500,900, a year-on-year increase of 3.02% and the net profit attributable to owners of theparent company was RMB231,131,700, an increase of 0.93%. As of the end of the reporting period, the company had a reserve of4.476 billion yuan (excluding real estate sales).
1. High-end curtain wall system and material businessIn the first half of the year the company took advantage of its location in the core area of Dawan District of Guangdong HongKong and Macao and continued to use Guangdong Hong Kong and Macau Dawan District as the main area for market expansion.The market development has achieved remarkable results and the number of new orders and quality has improved significantly.In thefirst half of the year, it signed the Shenzhen International Convention and Exhibition Center, Shenzhen Qianhai Hengchang Building,Shenzhen Hualian City Business Center, Shenzhen Longguang Jiuzuan, Shenzhen Hongrongyuan Yicheng Center Garden, ZhuhaiYoute Square, Zhongshan Jiangbolong Science and Technology Park, Shanghai Pudong Shipyard Phase II, Nanchang BusinessAlliance Center, Hefei Vanke Forest Park, Hangzhou Alibaba Xixi Park Phase IV, Wuhan Rongchuang Center Phase III, SuzhouHuawei R&D Center and many other high-end curtain wall and materials projects totaling RMB1.232 billion. The year-on-yeargrowth was 9.47%. Among them, the orders in the Guangdong Hong Kong and Macao Dawan District amount to RMB905million.The Company has abundant orders busy construction and sales of curtain wall system and material industry. Shenzhen VankeYuncheng Project, Shenzhen Bay Innovation and Technology Center Project, Guangzhou Kaidal Hub International Plaza Tower,Zhuhai Hengqin Star Art Wenchuang, Wuxi Wanda Mao, Hangzhou Huanglong Vanke Center and other projects are progressingsmoothly. In the first half of the year, the Company's curtain wall system and materials industry achieved operating income ofRMB813,932,200 with a year-on-year increase of 10.40%. The final order reserve reached RMB 310,292,700, which was 381.23%of the curtain wall system and material industry operating income in the first half of the year, paving the way for the continuousdevelopment of the Company's high-end curtain wall and material business.
In order to meet the Company's growing demand for orders, the Company continues to invest in hardware such as productionbase construction. In June this year, the Fangda Western Headquarters Base in Chengdu Xinjin started construction. The base coversan area of 45,000 square meters and has a total construction area of about 21,000 square meters. It will become the most modernenergy-saving and environmental protection curtain wall research and development and production base in western China. TheCompany's production base in Songjiang Shanghai will start construction in September this year covering an area of 23,800 squaremeters and a total construction area of about 43,000 square meters. After the completion of the two bases, the national industriallayout of the upgrade company will be improved and the production capacity of the Company's energy-saving and environmentalprotection curtain wall will be enhanced to provide guarantee for the Company's sustained and rapid development.
In the first half of the year, the Company thoroughly implemented the ―contract-centric‖ business management model, further
optimized resources, optimized business processes, strengthened management and control effectively, reduced costs comprehensively,improved contract execution efficiency and enabled orders to be converted into sales revenue and profits as soon as possible.
2. Rail transport equipment business
With the ―Belt and Road‖ Initiative of the country and the development strategy of Guangdong Hong Kong and Macau's Dawan
District continued to deepen during the reporting period, the Company's subway screen door industry has achieved fruitful expansion
at home and abroad and has successively obtained the first phase of the Ahmedabad Metro in India Shijiazhuang for the screen doorsystem of Metro Line 3, Wuhan Metro Line 8 and Phase 3, Chengdu Metro Line 3 Phase 2 and Phase 3 and Nanchang Metro Line 1,Nanning Subway Line 1, Nanjing Metro Line 1 and Wuhan Intercity Railway and other projects screened the door maintenanceorders with a total amount of RMB317 million. Among them, the India Ahmedabad Metro Project is the second project of theCompany in the Indian market after the Noida Metro project in India. The Company will seize the opportunity of rapid development
of the Indian subway construction and take the ―Belt and Road‖ express train to accelerate the overseas market. The layout has
enabled the Company's rail transit business to go hand in hand at the domestic and overseas markets, further consolidating theCompany's leading position in the industry.
In the first half of the year, in addition to Lanzhou Metro Line 1, Nanchang Subway Line 2, Wuhan Metro Line 11, ZhengzhouMetro Line 5, BYD Cloud Trail and other domestic projects under construction, Hong Kong Subway Shazhong Line, India NoidaMetro, Malaysia subway screen doors such as the Kuala Lumpur Metro are also under construction. A total of 13 screen doorproducts are under construction. The subway screen door order reserve reached RMB1.373 billion at the end of the period laid a solidfoundation for the future quality and profitable growth of the Company's subway screen door industry.
In recent years, the Company's rail transit screen door has also achieved remarkable results in the maintenance of professionalservices. As an extension of the industrial chain of the screen door project, it has become a new profit growth point for the Company.During the reporting period, the Company's rail transit screen door maintenance service revenue reached RMB 12,328,600, anincrease of 24.92% over the previous year. As more and more subways are opened and operated, the weight of technical services forsubway screen doors will continue to increase. In the future, the Company will further innovate existing technologies and businessmodels, vigorously expand industry extensions, make full use of advanced technologies such as cloud data Internet and face
recognition and vigorously develop new products with the model of ―technical and service‖ to further improve shielding. The
integration level of door system components will enhance the comprehensive competitiveness of the Company's rail transit business.
3. New energy industryDuring the reporting period, the three solar photovoltaic power plants that the Company had connected to the grid wereoperating safely and steadily. In the first half of the year, the total power generation was 10,095,900 kWh, the sales revenue wasRMB11.0426 million and the operating profit was RMB6,914,100, which reached the expected target. Among them, the 20MWdistributed photovoltaic power generation project of Chayu Village, Xuanfeng Town, Luxi County, Jiangxi Province and thedistributed photovoltaic power generation project of, Songshan Lake in Dongguan have been included in the Renewable Issue issuedby the Ministry of Finance the National Development and Reform Commission and the National Energy Administration. TheCompany's solar photovoltaic power station will continue to bring long-term stable income and profits to the Company.
4. Real estateIn the reporting period, the Company focused on real estate and urban renewal projects in the core areas of Guangdong, HongKong, and Macau Bay, and continued to grow and strengthen the Company's real estate business. In the first half of the year, theFangda Town project achieved a sales area of 8,751.56 square meters with a cumulative sales of 79,312.64 square meters; thecommercial signing rate reached 75%,while Huayi Brothers Cinema Fangda Town Store has opened.It is planned that before the endof this year, Fangda Town will start the commercial operation and the second phase of the project will be completed and accepted. Inaddition to the Company's own use, the 1# floor is about 70,000 square meters to earn rentals and capital appreciation. The part of theproperty will be measured at fair value. According to current accounting standards and the Company's accounting policies, this willincrease the company's profit and net assets in 2018.
The Nanchang Honggutan Fenghuangzhou Fangda Center project started construction in May this year. The project covers anarea of about 17,000 square meters with a total construction area of about 93,000 square meters. The total construction area is 66,000square meters. The commercial complex of hotels, apartments and office buildings is planned to be completed and pre-sold at the endof 2019.The urban renewal project and major project declaration of the signed Shenzhen Fangda Bangshen project are being activelypromoted. The project covers an area of 20,714.9 square meters. In addition there are several key renovation projects in Shenzhenbeing pushed forward by the Company. The land area of these projects is about 200,000 square meters.It is expected that the real
estate sales and property leasing will continue to contribute profits to the Company in the future.
5. InnovationThe Company has been adhering to the "echnology-based, innovation as the source" business philosophy, independentinnovation ability and technical level have remained the industry leader. During the reporting period, the Company applied for 27new patents including 9 invention patents and 18 utility model patents. As of the end of the reporting period, the Company obtained atotal of 785 patents (of which 109 were invention patents), 4 international PCT patents, 8 software copyrights, and the total numberof patents ranked first in the nation's industry.
Scientific and technological innovation is an indispensable element in the long-term stable development of the Company. TheCompany invests heavily in research and development every year. In the first half of the year, it invested RMB42.08 million inresearch and development and completed the establishment of 21 science and technology projects including 18 new productdevelopment projects, three technical transformation projects; completed 10 government science and technology project awardapplications. The Company's research and development of "blue and white porcelain aluminum veneer" "free-form aluminum alloysun visor" have won the Jiangxi Province outstanding new product award. In the future, the Company will vigorously promote theapplication and promotion of big data, new technologies, automation artificial intelligence and modern manufacturing technologiesand strive to achieve new improvements in technological innovation, system innovation and management innovation.
6. AwardsDuring the reporting period, the Company was awarded the honorary title of Shenzhen Outstanding Social ResponsibilityEnterprise, China's Best Employer Enterprise Award, Guangdong Province Honesty Model Enterprise, Best Board of Directors andthe 2017 Information Disclosure Appraisal. Mr. Xiong Jianming was elected as the representative of the 13th National People'sCongress.
Fangda Automation Co. Ltd. a wholly-owned subsidiary was awarded the honorary title of ―Excellent Contractor‖ issued byNanjing Metro Operation Company and Tianjin Metro Operation Company and ―Excellent Contractor‖ issued by MTR Rail Transit
Co. Ltd.
Fangda Real Estate Co. Ltd., a wholly-owned subsidiary, was awarded the ―Shenzhen Real Estate Development Industry BrandValue Enterprise‖.
Xu Weihua, an employee of Fangda Jiangxi New Materials Co. Ltd., a wholly-owned subsidiary, won the ―Nanchang May 1stLabor Medal‖ Fang Hongjian staff, Li Honglin and Wei Zhengpei were awarded the title of ―Star Craftsman‖ in Shenzhen
Decoration Industry.2. Main business analysis
For details see Management Discussion and Analysis – 1. Profile
Year-on-year changes in major financial data
In RMB
This report period | Same period last year | YOY change (% ) | Cause of change | |
Turnover | 1,442,050,896.53 | 1,399,710,941.29 | 3.02% | |
Operation cost | 935,486,175.73 | 903,397,926.97 | 3.55% | |
Sales expense | 27,060,141.24 | 23,137,281.77 | 16.95% | Mainly due to the subsidiary the increased commission paid to the agencies by Fangda Real Estate |
Co. Ltd. for development of a variety of sales channels | ||||
Administrative expense | 74,534,585.80 | 71,006,728.79 | 4.97% | |
Financial expenses | 33,772,321.68 | 25,897,314.89 | 30.41% | Mainly due to the increase in total borrowings resulting in interest expenses |
Income tax expenses | 63,046,179.95 | 67,768,104.52 | -6.97% | |
R&D investment | 42,082,922.04 | 56,202,159.95 | -25.12% | |
Cash flow generated by business operations, net | -31,426,267.64 | 215,263,207.38 | -114.60% | |
Cash flow generated by investment activities, net | -43,736,732.77 | -144,406,688.71 | 69.71% | Mainly due to the increase in income from wealth management products |
Net cash flow generated by financing activities | 94,383,606.69 | -213,486,321.35 | 144.21% | Mainly to increase long-term borrowing |
Net increase in cash and cash equivalents | 20,226,410.15 | -143,734,270.91 | 114.07% | Mainly to increase long-term borrowing |
Major changes in profit composition or sources during the report period
□ Applicable √ Inapplicable
The profit composition or sources of the Company have remained largely unchanged during the report period.3. Business composition
In RMB
Turnover | Operation cost | Gross margin | Year-on-year change in operating revenue | Year-on-year change in operating costs | Year-on-year change in gross margin | |
Industry | ||||||
Metal production | 813,931,956.56 | 700,957,914.39 | 13.88% | 10.40% | 11.06% | -0.51% |
Railroad industry | 131,268,676.36 | 100,640,757.68 | 23.33% | -15.10% | -15.99% | 0.81% |
New energy industry | 11,042,648.38 | 3,604,459.58 | 67.36% | 6.00% | -1.48% | 2.48% |
Real estate | 476,482,925.03 | 126,847,465.83 | 73.38% | -0.29% | -9.87% | 2.83% |
Others | 9,324,690.20 | 3,435,578.25 | 63.16% | -52.34% | -57.37% | 4.35% |
Product | ||||||
Curtain wall | 813,931,956.56 | 700,957,914.39 | 13.88% | 10.40% | 11.06% | -0.51% |
system and materials | ||||||
Subway screen door and service | 131,268,676.36 | 100,640,757.68 | 23.33% | -15.10% | -15.99% | 0.81% |
PV power generation products | 11,042,648.38 | 3,604,459.58 | 67.36% | 6.00% | -1.48% | 2.48% |
Real estate sales | 476,482,925.03 | 126,847,465.83 | 73.38% | -0.29% | -9.87% | 2.83% |
Others | 9,324,690.20 | 3,435,578.25 | 63.16% | -52.34% | -57.37% | 4.35% |
District | ||||||
In China | 1,402,603,038.50 | 907,013,907.61 | 35.33% | 1.71% | 1.89% | -0.11% |
Out of China | 39,447,858.03 | 28,472,268.12 | 27.82% | 90.37% | 116.09% | -8.59% |
3. Non-core business analysis
□ Applicable √ Inapplicable
4. Assets and liabilities1. Major changes in assets composition
In RMB
End of the report period | Same period last year | Change (% ) | Notes | |||
Amount | Proportion in total assets | Amount | Proportion in total assets | |||
Monetary capital | 1,199,195,175.72 | 15.19% | 896,180,195.84 | 14.23% | 0.96% | |
Account receivable | 2,77,617,891.78 | 26.32% | 1,998,836,618.75 | 31.75% | -5.43% | |
Inventory | 726,389,203.30 | 9.2% | 1,917,899,065.58 | 30.46% | -21.26% | Mainly due to that the Fangda Town project will achieve sales carryover in the current period and the property used for renting in Fangda Town will be included in the investment real estate according to the actual construction cost when it is ready for its intended use. |
Investment real estate | 2,332,213,399.66 | 29.55% | 332,975,019.31 | 5.29% | 24.26% | Mainly due to that the property used for renting in Fangda Town is |
included in the investment real estate according to the actual construction cost when it is ready for its intended use and is subsequently measured by fair value. | ||||||
Long-term share equity investment | 69,871,054.85 | 0.89% | 11,478,399.06 | 0.18% | 0.71% | |
Fixed assets | 474,159,833.94 | 6.01% | 494,499,271.59 | 7.85% | -1.84% | |
Construction in process | 2,820,259.75 | 0.04% | 2,537,725.36 | 0.04% | 0.00% | |
Short-term loans | 524,000,000.00 | 6.64% | 551,000,000.00 | 8.75% | -2.11% | |
Long-term loans | 1,293,978,153.39 | 16.39% | 965,178,626.29 | 15.33% | 1.06% |
2. Assets and liabilities measured at fair value
√ Applicable □ Inapplicable
In RMB
Item | Opening amount | Gain/loss caused by changes in fair value | Accumulative changes in fair value accounting into the income account | Impairment provided in the period | Amount purchased in the period | Amount sold in the period | Closing amount |
Financial assets | |||||||
1. Financial assets measured at fair value with variations accounted into current income account (excluding derivative financial assets) | -8,572,843.25 | 279,998,000.00 | 80,000,000.00 | 191,425,156.75 | |||
Subtotal | -8,572,843.25 | 279,998,000.00 | 80,000,000.00 | 191,425,156.75 |
Investment real estate | 1,492,278,859.69 | 83,046,894.38 | 5,343,905.00 | 1,569,981,849.57 | |||
Total | 1,492,278,859.69 | -8,572,843.25 | 363,044,894.38 | 85,343,905.00 | 1,761,407,006.32 | ||
Financial liabilities | 159,000.00 | 2,050,625.00 |
Major changes in the assets measurement property of the Company in the report period
□ Yes √ No
3. Right restriction of assets at the end of the period
Item | Closing book value (RMB) | Reason |
Monetary capital | 247,683,230.02 | Deposit and special account deposit |
Fixed assets | 52,068,945.34 | Loan by pledge |
Investment real estate | 307,321,568.00 | Loan by pledge |
100% stake in Fangda Property Development held by the Company | 200,000,000.00 | Loan by pledge |
Total | 807,073,743.36 |
VI. Investment1. General situation
□ Applicable √ Inapplicable
2. Major equity investment in the report period
□ Applicable √ Inapplicable
3. Major nonequity investment in the report period
□ Applicable √ Inapplicable
4. Financial assets investment(1) Securities investment
□ Applicable √ Inapplicable
The Company made no investment in securities in the report period
(2) Derivative investment
√ Applicable □ Inapplicable
In RMB10,000
Derivative investment operator | Relationship | Related transaction | Type | Initial amount | Start date | End date | Initial investment amount | Amount in this period | Amount sold in this period | Impairment provision (if any) | Closing investment amount | Proportion of closing investment amount in the closing net assets in the report period | Actual gain/loss in the report period |
Shanghai Futures Exchange | No | No | Shanghai aluminum | 151.25 | 26.09.17 | 31.01.19 | 151.25 | 13,010.5 | 6,110.13 | 6,105.12 | 1.87% | -198.51 | |
Total | 151.25 | -- | -- | 151.25 | 13,010.5 | 6,110.13 | 6,105.12 | 1.87% | -198.51 | ||||
Capital source | Self-owned fund | ||||||||||||
Lawsuit (if any) | None | ||||||||||||
Disclosure date of derivative investment approval by the Board of Directors (if any) | 31.10.17 | ||||||||||||
Disclosure date of derivative investment approval by the Shareholders’ Meeting (if any) | None | ||||||||||||
Risk analysis and control measures for the derivative holding in the report period (including without limitation market, liquidity, credit, operation and legal risks) | To prevent the risk of fluctuation of raw material prices, the Company adopted the aluminum futures exchanged at the domestic futures exchange to provide hedging for aluminum as a raw material for the Company. The Company has set up and implemented the Provincial Regulations on China Fangda Group Domestic Futures Hedging to prevent risks. | ||||||||||||
Changes in the market price or fair value of the derivative in the report period, the analysis of the derivative’s fair value should disclose the method used and related | Fair value of derivatives are measured at open prices in the futures market |
assumptions and parameters. | |
Material changes in the accounting policies and rules related to the derivative in the report period compared to last period | None |
Opinions of independent directors on the Company’s derivative investment and risk controlling | None |
VI. Major assets and equity sales1. Major assets sales
□ Applicable √ Inapplicable
The Company sold no assets in the report period.2. Major equity sales
□ Applicable √ Inapplicable
VII. Analysis of major joint stock companies
√ Applicable □ InapplicableMajor subsidiaries and joint stock companies affecting more than 10% of the Company’s net profit
In RMB
Company | Type | Main business | Registered capital | Total assets | Net assets | Turnover | Operation profit | Net profit |
Fangda Jianke | Subsidiary | Curtain wall design and installation | 500,000,000.00 | 2,923,826,826.51 | 854,912,009.10 | 728,375,835.42 | 30,420,058.94 | 32,941,158.58 |
Fangda Property | Subsidiary | Real estate development | 200,000,000.00 | 3,525,867,451.76 | 1,283,872,802.04 | 469,663,006.95 | 213,995,017.56 | 161,805,496.27 |
Acquisition and disposal of subsidiaries in the report period
√ Applicable □ Inapplicable
Company | Acquisition and disposal of subsidiaries in the report period | Impacts on overall production, operation and performance |
Shanghai Fangda Jingling Technology Co., Ltd. | Newly established | None |
Shenzhen Fangda Could Rail Technology Co., Ltd. | Newly established | None |
Major joint-stock companies
VIII. Structural entities controlled by the Company
□ Applicable √ Inapplicable
IX. Forecast of operating performance between January and September in 2018Warning and reasons of possible net loss or substantial change from the last period between the beginning of the year and the end of
the next report period
□ Applicable √ Inapplicable
X. Risks facing the company and measures
1. Market risks and measuresAs the overall designing and engineering quality continues improving in the domestic construction curtain wall industry,curtain wall products will become increasingly standard, intensifying the market competition. In addition, the market concentrationof first- and second-tier cities will increase, and regional competition will become more intense. The Company will continue to adopta prudent management policy, refined management, and technological innovations to reduce management costs and accelerate thereturn of funds. Through new technologies and processes, we will improve product quality, lower costs and elevate earnings. Whileconsolidating the domestic market, the Company will step up the efforts in exploring overseas markets, thus elevating ourcompetitiveness in global markets and improving our resistance to risks.
2. Management risks and measuresWith an increase in orders in recent years and operation of five industry bases, the Company has continued expanding rapidlyin terms of capitalization, business and teams. The organizational structure and management system have become more complicated,leading to management risks in industry expansion. The Company will continue to improve the management mode, integratebusiness management, optimize the business flow, seeking to build a high-efficient and solid management team. We will introducehigh-quality, professional technical and management talents in different fields to strengthen the Company's core competitiveness. Wewill create a sound environment for innovation and development encourage product innovation technological innovation andmanagement innovation and further enhance the Company's business competitiveness.
3. Production and operation risks and measuresThe trade fight between China and the U.S., macro-economy and market demand have added to the fluctuation in prices of
main raw materials such as aluminum and steel and labor, affecting the Company’s profitability and creating additional production
and operation risks for the Company. The Company has sought to lower the purchase and production costs, accelerate inventoryturnover, pay attention to technical R&D, reduce consumption of raw materials, introduce automatic and intelligent productionequipment, strengthen staff training to improve working efficiency.
4. Solar PV power plant risks and measuresThe industry is closely related to policies of the local government. Changes in policies will have large impacts on the industry. TheCompany will continue paying attentions to the development of the industry. The Company will conduct adequate verification onproject feasibility, control costs, quality and schedules strictly, and improve its development, construction and maintenancecapabilities.
Chapter 5 Significant EventsI. Annual and extraordinary shareholder meetings held during the report period
1. Annual shareholder meeting during the report period
Meeting | Type | Participation of investors | Date | Date of disclosure | Index for information disclosure |
2017 Annual Shareholder Meeting | Annual shareholders’ meeting | 19.68% | 15.05.18 | 16.05.18 | Notice on Resolutions of the Annual Shareholders’ Meeting (2017) released on www.cninfo.com.cn |
2. Shareholders of preference shares of which voting right resume convening an extraordinary shareholders’ meeting□ Applicable √ Inapplicable
II. Profit Distribution and Reserve Capitalization Plan in the Report Period
□ Applicable √ Inapplicable
The Company distributed no cash dividends or bonus shares and has no reserve capitalization plan.III. Commitments that have been fulfilled and not fulfilled by actual controller, shareholders, related parties, acquirers of the
Company
□ Applicable √ Inapplicable
There is no commitment that has not been fulfilled by actual controller, shareholders, related parties, acquirers of the CompanyIV. Engaging and dismissing of CPAWhether the interim financial report is audited
□ Yes √ No
The interim report for H1 2015 has not been audited.
V. Statement of the Board on the “non-standard auditors’ report” issued by the CPA on the current report period□ Applicable √ Inapplicable
VI. Statement of the Board of Directors on the Non-standard Auditor’s Report for H1 2014□ Applicable √ Inapplicable
VII. Bankruptcy and capital reorganizing
□ Applicable √ Inapplicable
The Company has no bankruptcy or reorganization events in the report period.VIII. LawsuitSignificant lawsuit and arbitration
□ Applicable √ Inapplicable
The Company has no significant lawsuit or arbitration affair in the report period.Other lawsuit
□ Applicable √ Inapplicable
IX. Punishment and rectification
□ Applicable √ Inapplicable
The Company received no penalty and made no correction in the report period.X. Credibility of the Company, controlling shareholder and actual controller
□ Applicable √ Inapplicable
XI. Share incentive schemes, staff shareholding program or other incentive plans
□ Applicable √ Inapplicable
There is no share incentive schemes, staff shareholding program or other incentive plans in the report periodXII. Material related transactions1. Related transactions related to routine operation
□ Applicable √ Inapplicable
The Company made no related transaction related to daily operating in the report period.2. Related transactions related to assets transactions
□ Applicable √ Inapplicable
The Company made no related transaction of assets or equity requisition and sales in the report period.
3. Related transactions related to joint external investment
□ Applicable √ Inapplicable
The Company made no related transaction of joint external investment in the report period.4. Related credits and debts
□ Applicable √ Inapplicable
The Company had no related debt in the report period.5. Other major related transactions
□ Applicable √ Inapplicable
The Company has no other significant related transaction in the report period.XIII. Non-operating capital use by the controlling shareholder or related parties in the reporting term
□ Applicable √ Inapplicable
The controlling shareholder and its affiliates occupied no capital for non-operating purpose of the Company during the report period.XIV. Significant contracts and performance1. Asset entrusting, leasing, contracting(1) Asset entrusting
□ Applicable √ Inapplicable
The Company made no custody in the report period.(2) Contracting
□ Applicable √ Inapplicable
The Company made no contract in the report period(3) Leasing
√ Applicable □ Inapplicable
LeasingThe half-year lease income of investment real estate is RMB14,009,216.71.
Projects that create gains accounting for over 10% of the Company’s total profit in the report period□ Applicable √ InapplicableThe Company leased no projects that create gains accounting for over 10% of the Company’s total profit in the report period.
2. Significant guarantee
√ Applicable □ Inapplicable
(1) Guarantee
In RMB10,000
External guarantees made by the Company (exclude those made for subsidiaries) | ||||||||
Guarantee provided to | Date of disclosure | Guarantee amount | Actual date of occurring (signing date of agreements) | Actual amount of guarantee | Type of guarantee | Term | Completed or not | Related party |
None | ||||||||
Guarantee provided to subsidiaries | ||||||||
Guarantee provided to | Date of disclosure | Guarantee amount | Actual date of occurring (signing date of agreements) | Actual amount of guarantee | Type of guarantee | Term | Completed or not | Related party |
Fangda Jianke | 26.04.16 | 48,000 | 06.07.16 | 14,392.28 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
Fangda Jianke | 21.03.17 | 40,000 | 06.12.17 | 14,753.86 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
Fangda Jianke | 21.03.17 | 30,000 | 23.08.17 | 15,000 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
Fangda Jianke | 24.04.18 | 20,000 | 10.04.18 | 23,601.57 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
Fangda Jianke | 21.03.17 | 40,000 | 01.11.17 | 5,882.44 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
Fangda Automatic | 26.04.16 | 21,600 | 06.07.16 | 1,600 | Joint liability | since engage of contract to 2 years upon | No | Yes |
due of debt | |||||||||
Fangda Automatic | 21.03.17 | 15,000 | 31.10.17 | 1,254.34 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes | |
Fangda Automatic | 21.03.17 | 20,000 | 23.08.17 | 0 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes | |
Fangda Automatic | 24.04.18 | 15,000 | 08.03.18 | 1,419.41 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes | |
Fangda New Material | 21.03.17 | 8,000 | 27.05.17 | 1,677.21 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes | |
Fangda New Material | 24.04.18 | 6,500 | 01.06.18 | 0 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes | |
Fangda Property | 23.03.13 | 130,000 | 03.02.15 | 99,397.82 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes | |
Total of guarantee to subsidiaries approved in the report term (B1) | 394,100 | Total of guarantee to subsidiaries actually occurred in the report term (B2) | 35,237.81 | ||||||
Total of guarantee to subsidiaries approved as of the report term (B3) | 394,100 | Total of balance of guarantee actually provided to the subsidiaries as of end of report term (B4) | 178,978.93 | ||||||
Guarantee provided to subsidiaries | |||||||||
Guarantee provided to | Date of disclosure | Guarantee amount | Actual date of occurring (signing date of agreements) | Actual amount of guarantee | Type of guarantee | Term | Completed or not | Related party | |
Total of guarantee provided by the Company (total of the above three) | |||||||||
Total of guarantee approved in the report term (A1+B1+C1) | 394,100 | Total of guarantee occurred in the report term (A2+B2+C2) | 35,237.81 |
Total of guarantee approved as of end of report term (A3+B3+C3) | 394,100 | Total of guarantee occurred as of the end of report term (A4+B4+C4) | 178,978.93 |
Percentage of the total guarantee occurred (A4+B4+C4) on net asset of the Company | 54.41% | ||
Including: | |||
Amount of guarantee over 50% of the net asset (F) | 14,496.69 | ||
Total of the above 3 (D+E+F) | 14,496.69 | ||
Statement on the possible joint liabilities on the guarantees not due yet (if any) | None | ||
Statement of external guarantees violating the procedure (if any) | None |
Note of compound guarantee(2) Incompliant external guarantee
□ Applicable √ Inapplicable
The Company made no incompliant external guarantee in the report period.3. Other significant contract
□ Applicable √ Inapplicable
The Company entered into no other significant contract in the report.XV. Social responsibilities1. Environmental protectionWhether the Company and its subsidiaries are key polluting companies disclosed by the environmental protection authority
NoWhether the Company and its subsidiaries are key polluting companies disclosed by the environmental protection authority
The Company and its subsidiaries have earnestly implemented the Environmental Protection Law of the People'sRepublic of China, the Law of the People's Republic of China on Water Pollution Prevention and Control, the Law ofthe People's Republic of China on the Prevention and Control of Air Pollution, and the Law of the People's Republic ofChina on the Prevention and Control of Solid Waste Pollution. In the environmental protection laws and regulations,there were no penalties for violations of laws and regulations during the reporting period.
2. Performance of poverty relieving responsibilities(1) Half-year poverty relieving summaryIn H1 2018, the Company donated a photovoltaic poverty alleviation power station to the Dongshui Villagers Committee of Xishan
Town Lianping County Guangdong Province with a value of about RMB150,000.(2) Result of targeted poverty alleviation
Item | Unit | Qty/Description |
I. General situation | —— | —— |
2. Value of materials | (in RMB10,000) | 15 |
II. Investment | —— | —— |
1. Industry development poverty relief | —— | —— |
Including: 1.1 Industry development projects | —— | Capital earning |
1.2 Number of industry development projects | Item | 1 |
1.3 Amount of industry development fund | (in RMB10,000) | 15 |
2. Employment transfer | —— | —— |
3. Relocation | —— | —— |
4. Education | —— | —— |
5. Health care support | —— | —— |
6. Eco-protection support | —— | —— |
7. Last-line guarantee | —— | —— |
8. Social poverty relieving | —— | —— |
9. Others | —— | —— |
III. Prizes | —— | —— |
(3) Further property relief plansThe Company donated totally RMB2,030,000 for targeted poverty in H1 2018:
1. Donated 1 million yuan to Shenzhen Nanshan District Charity Association.2. Donated 1 million yuan to Lianhua County Pingxiang City Jiangxi Province.3. Donated RMB30,000 to two students at Jiangxi Ganzhou Zhanggong district Shahe Longcun village.The Company will continue to fulfill its social responsibility for precision poverty alleviation, and make donations from time to timebased on business development.
XVI. Other material events
√ Applicable □ Inapplicable
The Company reviewed and approved the Resolution on the Repurchase of Domestically Listed Foreign Shares (B Shares) of the
Company at the 8
th
meeting of the 8
th
Board of Directors and the 2017 Annual General Meeting of Shareholders on April 24 2018and May 15 2018 respectively.Due to the Company's repurchase of B shares, it is necessary to open a special foreign exchangeaccount and make foreign exchange funds to obtain the consent of the relevant departments of the State Administration of ForeignExchange. As of the disclosure date of this report, the Company is still in the process of handling relevant procedures and has notrepurchased B share.
XVII. Material events of subsidiaries
□ Applicable √ Inapplicable
Chapter 6 Changes in Share Capital and ShareholdersI. Changes in shares
1. Changes in shares
In share
Before the change | Change (+,-) | After the change | |||||||
Amount | Proportion | Issued new shares | Bonus shares | Transferred from reserves | Others | Subtotal | Amount | Proportion | |
I. Shares with trade restriction conditions | 1,417,243 | 0.12% | 1,417,243 | 0.12% | |||||
3. Other domestic shares | 1,417,243 | 0.12% | 1,417,243 | 0.12% | |||||
Domestic natural person shares | 1,417,243 | 0.12% | 1,417,243 | 0.12% | |||||
II. Shares without trading limited conditions | 1,182,225,011 | 99.88% | 1,182,225,011 | 99.88% | |||||
1. Common shares in RMB | 678,298,229 | 57.31% | 678,298,229 | 57.31% | |||||
2. Foreign shares in domestic market | 503,926,782 | 42.57% | 503,926,782 | 42.57% | |||||
III. Total of capital shares | 1,183,642,254 | 100.00% | 1,183,642,254 | 100.00% |
Reasons
□ Applicable √ Inapplicable
Approval of the change
□ Applicable √ Inapplicable
Share transfer
□ Applicable √ Inapplicable
Impacts on financial indicators including basic and diluted earnings per share, net assets per share attributable to commonshareholders of the company in the most recent year and period
□ Applicable √ Inapplicable
Others that need to be disclosed as required by the securities supervisor
□ Applicable √ Inapplicable
2. Changes in conditional shares
□ Applicable √ Inapplicable
2. Share placing and listing
□ Applicable √ Inapplicable
III. Shareholders and shareholding
In share
Number of shareholders of common shares at the end of the report period | 67,440 | Number of shareholders of preferred stocks of which voting rights recovered in the report period (if any) (note 8) | 0 | |||||||
Shareholders holding 5% of the Company's common shares or top-10 shareholders | ||||||||||
Shareholder | Nature of shareholder | Shareholding percentage | Number of common shares held at the end of the report period | Change in the reporting period | Conditional common shares | Unconditional common shares | Pledging or freezing | |||
Share status | Amount | |||||||||
Shenzhen Banglin Technologies Development Co., Ltd. | Domestic non-state legal person | 8.72% | 103,161,409 | 0 | 103,161,409 | Pledged | 31,540,000 | |||
Shengjiu Investment Ltd. | Foreign legal person | 7.76% | 91,820,182 | 1,122,300 | 91,820,182 | |||||
GUOTAI JUNAN SECURITIES(HONGKONG) LIMITED | Foreign legal person | 3.39% | 40,168,375 | -8,355,852 | 40,168,375 | |||||
Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise | Domestic non-state legal person | 2.26% | 26,791,488 | 0 | 26,791,488 |
(limited partner) | ||||||||
CITIC Securities Brokerage (Hong Kong) Co., Ltd. | Foreign legal person | 2.20% | 26,034,425 | -1,186,300 | 26,034,425 | |||
Shenwan Hongyuan Securities (Hong Kong) Co., Ltd. | Foreign legal person | 1.58% | 18,737,379 | 2,438,942 | 18,737,379 | |||
China Resource SZITIC Trust – China Resource Trust No.13 Collective Trust Program | Others | 1.30% | 15,383,404 | 0 | 15,383,404 | |||
Yunnan International Trust CO., Ltd. – Juxin No.5 Collective Fund Trust Program | Others | 1.12% | 13,229,635 | 0 | 13,229,635 | |||
Yunnan International Trust CO., Ltd. – Yunxia No.3 Collective Fund Trust Program | Others | 0.73% | 8,635,314 | 0 | 8,635,314 | |||
VANGUARD EMERGING MARKETS STOCK INDEX FUND | Foreign legal person | 0.67% | 7,946,483 | Unknown | 7,946,483 | |||
A strategic investor or ordinary legal person becomes the Top10 common share shareholder due a stock issue (see note 3) | None | |||||||
Notes to top ten shareholder relationship or "action in concert" | Among the shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu Investment Co., Ltd. are parties action-in-concert. Shenzhen Banglin Technology Development Co., Ltd. and Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise are related parties. The Company is not notified of other action-in-concert or |
related parties among the other holders of current shares. | |||
Top 10 shareholders of unconditional common shares | |||
Shareholder | Amount of common shares without sales restriction | Category of shares | |
Category of shares | Amount | ||
Shenzhen Banglin Technologies Development Co., Ltd. | 103,161,409 | RMB common shares | 103,161,409 |
Shengjiu Investment Ltd. | 91,820,182 | Foreign shares listed in domestic exchanges | 91,820,182 |
GUOTAI JUNAN SECURITIES(HONGKONG) LIMITED | 40,168,375 | Foreign shares listed in domestic exchanges | 40,168,375 |
Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise (limited partner) | 26,791,488 | RMB common shares | 26,791,488 |
CITIC Securities Brokerage (Hong Kong) Co., Ltd. | 26,034,425 | Foreign shares listed in domestic exchanges | 26,034,425 |
Shenwan Hongyuan Securities (Hong Kong) Co., Ltd. | 18,737,379 | Foreign shares listed in domestic exchanges | 18,737,379 |
China Resource SZITIC Trust – China Resource Trust No.13 Collective Trust Program | 15,383,404 | RMB common shares | 15,383,404 |
Yunnan International Trust CO., Ltd. – Juxin No.5 Collective Fund Trust Program | 13,229,635 | RMB common shares | 13,229,635 |
Yunnan International Trust CO., Ltd. – Yunxia No.3 Collective Fund Trust Program | 8,635,314 | RMB common shares | 8,635,314 |
VANGUARD EMERGING MARKETS STOCK INDEX FUND | 7,946,483 | Foreign shares listed in domestic exchanges | 7,946,483 |
No action-in-concert or related parties among the top10 unconditional common share shareholders and between the top10 unconditional common share | Among the shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu Investment Co., Ltd. are parties action-in-concert. Shenzhen Banglin Technology Development Co., Ltd. and Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise are related parties. The Company is not notified of other action-in-concert or related parties among the other holders of current shares. |
shareholders and the top10 common share shareholders | |
Top-10 common share shareholders participating in margin trade (if any) (see note 4) | None |
Agreed re-purchasing by the Company’s top 10 shareholders of common shares and top 10 shareholders of unconditional common
shares in the report period
□ Yes √ NoNo agreed re-purchasing by the Company’s top 10 shareholders of common shares and top 10 shareholders of unconditional common
shares in the report periodIV. Changes in controlling shareholder or actual controllerChanges in the controlling shareholder in the reporting period
□ Applicable √ Inapplicable
No change in the controlling shareholder in the report periodChange in the actual controller in the report period
□ Applicable √ Inapplicable
No change in the actual shareholder in the report period
Chapter 7 Preferred Shares
□ Applicable √ Inapplicable
The Company had no preferred share in the report period.
Chapter 8 Particulars about the Directors, Supervisors, and Senior ManagementI. Changes in shareholding of Directors, Supervisors and Senior Management
□ Applicable √ InapplicableThe Company’s Directors, supervisors and senior management shareholding has remained unchanged during the report period. For
details, please refer to the 2017 annual report.2. Changes in the Directors, Supervisors and Senior Executives
□ Applicable √ InapplicableThe Company’s Directors, supervisors and senior management have remained unchanged during the report period. For details, please
refer to the 2017 annual report.
Chapter 9 Information about the Company’s Securities
Bonds publicly issued and listed in a securities exchange, immature or not fully paid by the approval date of the annual reportNo
Chapter 10 Financial Statements
I. Auditor’s report
Whether the interim report is audited
□ Yes √ No
The financial statements for H1 2014 have not been audited.II. Financial statementsUnit for statements in notes to financial statements: RMB yuan1. Consolidated Balance SheetPrepared by: China Fangda Group Co., Ltd.
30.06.18
In RMB
Item | Closing balance | Opening balance |
Current asset: | ||
Monetary capital | 1,199,195,175.72 | 1,180,398,479.51 |
Settlement provision | ||
Outgoing call loan | ||
Financial assets measured at fair value with variations accounted into current income account | 191,425,156.75 | |
Derivative financial assets | ||
Notes receivable | 61,196,071.50 | 39,636,437.20 |
Account receivable | 2,077,617,891.78 | 1,920,372,426.16 |
Prepayment | 43,871,514.09 | 54,680,269.84 |
Insurance receivable | ||
Reinsurance receivable | ||
Provisions of Reinsurance contracts receivable | ||
Interest receivable | 2,374,520.56 | 3,829,315.07 |
Dividend receivable | ||
Other receivables | 83,295,634.69 | 57,075,357.62 |
Repurchasing of financial assets | ||
Inventory | 726,389,203.30 | 819,610,960.67 |
Assets held for sales | ||
Non-current assets due in 1 year | ||
Other current assets | 270,720,575.33 | 439,890,493.06 |
Total current assets | 4,656,085,743.72 | 4,515,493,739.13 |
Non-current assets: | ||
Loan and advancement provided | ||
Sellable financial assets | 28,562,575.67 | 28,562,575.67 |
Investment held until mature | ||
Long-term receivable | ||
Long-term share equity investment | 69,871,054.85 | 34,142,055.62 |
Investment real estate | 2,332,213,399.66 | 2,253,794,404.55 |
Fixed assets | 474,159,833.94 | 468,118,279.18 |
Construction in process | 2,820,259.75 | 2,668,198.62 |
Engineering materials | ||
Disposal of fixed assets | ||
Productive biological assets | ||
Gas & petrol | ||
Intangible assets | 80,168,033.16 | 58,869,444.53 |
R&D expense | ||
Goodwill | ||
Long-term amortizable expenses | 1,658,790.79 | 2,046,202.29 |
Deferred income tax assets | 245,982,195.38 | 230,597,590.58 |
Other non-current assets | 1,447,483.00 | 31,130,198.46 |
Total of non-current assets | 3,236,883,626.20 | 3,109,928,949.50 |
Total of assets | 7,892,969,369.92 | 7,625,422,688.63 |
Current liabilities | ||
Short-term loans | 524,000,000.00 | 616,000,000.00 |
Loans from Central Bank | ||
Deposit received and held for others | ||
Call loan received | ||
Financial liabilities measured at fair value with variations accounted into |
current income account | ||
Derivative financial liabilities | 2,050,625.00 | 159,000.00 |
Notes payable | 491,358,271.55 | 532,921,025.48 |
Account payable | 862,659,220.78 | 946,392,258.92 |
Prepayment received | 193,425,255.96 | 175,351,686.45 |
Selling of repurchased financial assets | ||
Fees and commissions payable | ||
Employees’ wage payable | 19,873,819.40 | 40,399,130.75 |
Taxes payable | 55,074,133.40 | 136,955,516.44 |
Interest payable | 2,412,315.60 | 2,425,311.97 |
Dividend payable | ||
Other payables | 587,168,313.71 | 501,189,510.69 |
Reinsurance fee payable | ||
Insurance contract provision | ||
Entrusted trading of securities | ||
Entrusted selling of securities | ||
Liabilities held for sales | ||
Non-current liabilities due in 1 year | 200,000,000.00 | 200,000,000.00 |
Other current liabilities | 12,076,092.33 | 9,531,014.81 |
Total current liabilities | 2,950,098,047.73 | 3,161,324,455.51 |
Non-current liabilities: | ||
Long-term loans | 1,293,978,153.39 | 893,978,153.39 |
Bond payable | ||
Including: preferred stock | ||
Perpetual bond | ||
Long-term payable | ||
Long-term employees’ wage payable | ||
Special payables | ||
Anticipated liabilities | 4,427,700.40 | 6,368,353.05 |
Deferred earning | 10,365,629.03 | 10,489,483.94 |
Deferred income tax liabilities | 344,455,068.27 | 314,323,040.56 |
Other non-current liabilities |
Total of non-current liabilities | 1,653,226,551.09 | 1,225,159,030.94 |
Total liabilities | 4,603,324,598.82 | 4,386,483,486.45 |
Owner’s equity: | ||
Share capital | 1,183,642,254.00 | 1,183,642,254.00 |
Other equity tools | ||
Including: preferred stock | ||
Perpetual bond | ||
Capital reserves | 72,829,484.96 | 72,829,484.96 |
Less: Shares in stock | ||
Other miscellaneous income | 6,706,091.82 | 8,585,847.99 |
Special reserves | ||
Surplus reserves | 110,690,396.65 | 110,690,396.65 |
Common risk provisions | ||
Retained profit | 1,915,776,543.67 | 1,863,191,218.58 |
Total of owner’s equity belong to the parent company | 3,289,644,771.10 | 3,238,939,202.18 |
Minor shareholders’ equity | ||
Total of owners’ equity | 3,289,644,771.10 | 3,238,939,202.18 |
Total of liabilities and owner’s interest | 7,892,969,369.92 | 7,625,422,688.63 |
Legal representative: Xiong Jianming CFO: Lin Kebing Accounting Manager: Wu Bohua2. Balance Sheet of the Parent Company
In RMB
Item | Closing balance | Opening balance |
Current asset: | ||
Monetary capital | 340,242,138.19 | 310,299,329.68 |
Financial assets measured at fair value with variations accounted into current income account | ||
Derivative financial assets | 76,569,871.27 | |
Notes receivable | ||
Account receivable | 408,154.54 | |
Prepayment | 118,131.74 | 349,740.31 |
Interest receivable | 1,020,000.00 |
Dividend receivable | 150,000,000.00 | 150,000,000.00 |
Other receivables | 942,840,178.57 | 672,773,780.45 |
Inventory | ||
Assets held for sales | ||
Non-current assets due in 1 year | ||
Other current assets | 360,181.65 | 100,176,058.36 |
Total current assets | 1,510,130,501.42 | 1,235,027,063.34 |
Non-current assets: | ||
Sellable financial assets | 28,562,575.67 | 28,562,575.67 |
Investment held until mature | ||
Long-term receivable | ||
Long-term share equity investment | 983,339,494.35 | 925,349,494.35 |
Investment real estate | 307,321,568.00 | 307,321,568.00 |
Fixed assets | 54,987,574.85 | 55,816,611.77 |
Construction in process | ||
Engineering materials | ||
Disposal of fixed assets | ||
Productive biological assets | ||
Gas & petrol | ||
Intangible assets | 2,172,846.41 | 2,293,133.59 |
R&D expense | ||
Goodwill | ||
Long-term amortizable expenses | 394,999.90 | 460,000.00 |
Deferred income tax assets | 23,434,245.40 | 23,409,576.18 |
Other non-current assets | ||
Total of non-current assets | 1,400,213,304.58 | 1,343,212,959.56 |
Total of assets | 2,910,343,806.00 | 2,578,240,022.90 |
Current liabilities | ||
Short-term loans | 250,000,000.00 | 250,000,000.00 |
Financial liabilities measured at fair value with variations accounted into current income account | ||
Derivative financial liabilities | ||
Notes payable | ||
Account payable | 606,941.85 | 606,941.85 |
Prepayment received | 693,045.60 | 721,888.86 |
Employees’ wage payable | 943,281.35 | 2,151,237.91 |
Taxes payable | 4,284,613.67 | 11,721,681.36 |
Interest payable | 789,875.00 | 365,520.83 |
Dividend payable | ||
Other payables | 306,095,876.47 | 287,607,287.54 |
Liabilities held for sales | ||
Non-current liabilities due in 1 year | ||
Other current liabilities | ||
Total current liabilities | 563,413,633.94 | 553,174,558.35 |
Non-current liabilities: | ||
Long-term loans | 500,000,000.00 | |
Bond payable | ||
Including: preferred stock | ||
Perpetual bond | ||
Long-term payable | ||
Long-term employees’ wage payable | ||
Special payables | ||
Anticipated liabilities | ||
Deferred earning | ||
Deferred income tax liabilities | 63,769,081.63 | 63,864,007.22 |
Other non-current liabilities | ||
Total of non-current liabilities | 563,769,081.63 | 63,864,007.22 |
Total liabilities | 1,127,182,715.57 | 617,038,565.57 |
Owner’s equity: | ||
Share capital | 1,183,642,254.00 | 1,183,642,254.00 |
Other equity tools | ||
Including: preferred stock | ||
Perpetual bond | ||
Capital reserves | 71,736,128.89 | 71,736,128.89 |
Less: Shares in stock | ||
Other miscellaneous income | 8,756,553.46 | 8,756,553.46 |
Special reserves |
Surplus reserves | 110,690,396.65 | 110,690,396.65 |
Retained profit | 408,335,757.43 | 586,376,124.33 |
Total of owners’ equity | 1,783,161,090.43 | 1,961,201,457.33 |
Total of liabilities and owner’s interest | 2,910,343,806.00 | 2,578,240,022.90 |
3. Consolidated Income Statement
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
1. Total revenue | 1,442,050,896.53 | 1,399,710,941.29 |
Incl. Business income | 1,442,050,896.53 | 1,399,710,941.29 |
Interest income | ||
Insurance fee earned | ||
Fee and commission received | ||
2. Total business cost | 1,173,912,382.53 | 1,117,603,395.86 |
Incl. Business cost | 935,486,175.73 | 903,397,926.97 |
Interest expense | ||
Fee and commission paid | ||
Insurance discharge payment | ||
Net claim amount paid | ||
Net insurance policy reserves provided | ||
Insurance policy dividend paid | ||
Reinsurance expenses | ||
Taxes and surcharges | 101,204,195.03 | 104,072,276.80 |
Sales expense | 27,060,141.24 | 23,137,281.77 |
Administrative expense | 74,534,585.80 | 71,006,728.79 |
Financial expenses | 33,772,321.68 | 25,897,314.89 |
Asset impairment loss | 1,854,963.05 | -9,908,133.36 |
Plus: gains from change of fair value (―-― for loss) | -8,896,637.25 | 698,811.63 |
Investment gains (―-― for loss) | 26,244,762.41 | 6,880,596.27 |
Incl. Investment gains from affiliates and joint ventures | -626,631.62 |
Exchange gains (―-― for loss) | ||
Investment gains ("-" for loss) | -1,551,865.58 | -87,244.32 |
Other gains | 2,699,191.58 | 1,408,451.00 |
3. Operational profit (―-― for loss) | 286,633,965.16 | 291,008,160.01 |
Plus: non-operational income | 7,066,038.41 | 4,507,515.09 |
Less: non-operational expenditure | 522,160.43 | 229,327.22 |
4. Gross profit (―-― for loss) | 293,177,843.14 | 295,286,347.88 |
Less: Income tax expenses | 63,046,179.95 | 67,768,104.52 |
5. Net profit (―-― for net loss) | 230,131,663.19 | 227,518,243.36 |
(1) Net profit from continuous operation ("-" for net loss) | 230,131,663.19 | 227,518,243.36 |
(2) Net profit from discontinuous operation ("-" for net loss) | ||
Net profit attributable to the owners of parent company | 230,131,663.19 | 228,003,319.43 |
Minor shareholders’ equity | -485,076.07 | |
6. After-tax net amount of other misc. incomes | -1,879,756.17 | -1,782,230.15 |
After-tax net amount of other misc. incomes attributed to parent's owner | -1,879,756.17 | -1,782,230.15 |
(1) Other misc. incomes that cannot be re-classified into gain and loss | ||
1. Change in net liabilities or assets due to re-measurement set benefit program | ||
2. Shares enjoyed in other misc. incomes that cannot be reclassified into gain and loss by the invested entity under the equity law | ||
(2) Other misc. incomes that will be re-classified into gain and loss | -1,879,756.17 | -1,782,230.15 |
1. Shares enjoyed in other misc. incomes that cannot be reclassified into gain and loss by the invested entity under the equity law | ||
2.Change in the fair value of financial asset for sale | ||
3 Held-to-mature investment |
reclassified as gain and loss in the financial assets for sales | ||
4. Effective part in the gain and loss of arbitrage of cash flow | -1,839,001.25 | -1,782,230.15 |
5. Translation difference of foreign exchange statement | -40,754.92 | |
6. Others | ||
After-tax net of other misc. income attributed to minority shareholders | ||
7. Total of misc. incomes | 228,251,907.02 | 225,736,013.21 |
Total of misc. incomes attributable to the owners of the parent company | 228,251,907.02 | 226,221,089.28 |
Total misc gains attributable to the minor shareholders | -485,076.07 | |
8. Earnings per share: | ||
(1) Basic earnings per share | 0.1944 | 0.1926 |
(2) Diluted earnings per share | 0.1944 | 0.1926 |
Net profit contributed by entities merged under common control in the report period was RMB0.00, net profit realized by partiesmerged during the previous period is RMB0.00.
Legal representative: Xiong Jianming CFO: Lin Kebing Accounting Manager: Wu Bohua4. Income Statement of the Parent Company
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
1. Turnover | 15,112,290.20 | 13,854,120.29 |
Less: Operation cost | 673,578.25 | 803,595.88 |
Taxes and surcharges | 650,802.82 | 653,338.66 |
Sales expense | ||
Administrative expense | 10,133,470.85 | 12,556,952.25 |
Financial expenses | 7,548,692.03 | -1,445,023.38 |
Asset impairment loss | 98,676.88 | 37,911.33 |
Plus: gains from change of fair value (―-― for loss) | -3,429,128.73 | |
Investment gains (―-― for loss) | 8,138,483.22 | 1,014,671.43 |
Incl. Investment gains from affiliates and joint ventures | -626,631.62 |
Investment gains ("-" for loss) | -574.06 | -31,271.82 |
Other gains | 114,556.59 | |
2. Operational profit (―-― for loss) | 830,406.39 | 2,230,745.16 |
Plus: non-operational income | 258,644.66 | 3,614,153.51 |
Less: non-operational expenditure | 738.00 | |
3. Gross profit (―-― for loss) | 1,088,313.05 | 5,844,898.67 |
Less: Income tax expenses | 1,582,341.85 | 1,301,047.38 |
4. Net profit (―-― for net loss) | -494,028.80 | 4,543,851.29 |
(1) Net profit from continuous operation ("-" for net loss) | -494,028.80 | 4,543,851.29 |
(2) Net profit from discontinuous operation ("-" for net loss) | ||
5. After-tax net amount of other misc. incomes | ||
(1) Other misc. incomes that cannot be re-classified into gain and loss | ||
1. Change in net liabilities or assets due to re-measurement set benefit program | ||
2. Shares enjoyed in other misc. incomes that cannot be reclassified into gain and loss by the invested entity under the equity law | ||
(2) Other misc. incomes that will be re-classified into gain and loss | ||
1. Shares enjoyed in other misc. incomes that cannot be reclassified into gain and loss by the invested entity under the equity law | ||
2.Change in the fair value of financial asset for sale | ||
3 Held-to-mature investment reclassified as gain and loss in the financial assets for sales | ||
4. Effective part in the gain and loss of arbitrage of cash flow | ||
5. Translation difference of |
foreign exchange statement | ||
6. Others | ||
6. Total of misc. incomes | -494,028.80 | 4,543,851.29 |
7. Earnings per share: | ||
(1) Basic earnings per share | ||
(2) Diluted earnings per share |
5. Consolidated Cash Flow Statement
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
1. Net cash flow from business operations: | ||
Cash received from sales of products and providing of services | 1,344,633,305.24 | 1,707,815,692.38 |
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 | ||
Increase in proposal of financial assets measured at fair value with variations accounted into current income account | ||
Cash received as interest, processing fee, and commission | ||
Net increase of inter-bank fund received | ||
Net increase of repurchasing business | ||
Tax refunded | 876,405.15 | 32,965,303.99 |
Other cash received from business operation | 243,292,723.31 | 91,715,380.92 |
Sub-total of cash inflow from business operations | 1,588,802,433.70 | 1,832,496,377.29 |
Cash paid for purchasing products and services | 956,677,112.92 | 1,062,204,721.25 |
Net increase of client trade and advance | ||
Net increase of savings in central bank and brother company | ||
Cash paid for original contract claim | ||
Cash paid for interest, processing fee and commission | ||
Cash paid for policy dividend | ||
Cash paid to and for the staff | 141,086,415.75 | 133,690,986.71 |
Taxes paid | 208,947,437.06 | 320,067,254.32 |
Other cash paid for business activities | 313,517,735.61 | 101,270,207.63 |
Sub-total of cash outflow from business operations | 1,620,228,701.34 | 1,617,233,169.91 |
Cash flow generated by business operations, net | -31,426,267.64 | 215,263,207.38 |
2. Cash flow generated by investment: | ||
Cash received from investment recovery | 4,675,800,000.00 | 4,330,200,000.00 |
Cash received as investment profit | 28,989,224.36 | 7,834,655.67 |
Net cash retrieved from disposal of fixed assets, intangible assets, and other long-term assets | 9,501,692.00 | 3,539,281.00 |
Net cash received from disposal of subsidiaries or other operational units | ||
Other investment-related cash received | ||
Sub-total of cash inflow generated from investment | 4,714,290,916.36 | 4,341,573,936.67 |
Cash paid for construction of fixed assets, intangible assets and other | 45,443,864.13 | 30,780,625.38 |
long-term assets | ||
Cash paid as investment | 4,712,583,785.00 | 4,455,200,000.00 |
Net increase of loan against pledge | ||
Net cash paid for acquiring subsidiaries and other operational units | ||
Other cash paid for investment | ||
Subtotal of cash outflows | 4,758,027,649.13 | 4,485,980,625.38 |
Cash flow generated by investment activities, net | -43,736,732.77 | -144,406,688.71 |
3. Cash flow generated by financing activities: | ||
Cash received from investment | ||
Incl. Cash received from investment attracted by subsidiaries from minority shareholders | ||
Cash received from borrowed loans | 508,000,000.00 | 393,009,058.05 |
Cash received from bond placing | ||
Other cash received from financing activities | ||
Subtotal of cash inflow from financing activities | 508,000,000.00 | 393,009,058.05 |
Cash paid to repay debts | 200,000,000.00 | 290,000,000.00 |
Cash paid as dividend, profit, or interests | 213,616,393.31 | 316,495,379.40 |
Incl. Dividend and profit paid by subsidiaries to minority shareholders | ||
Other cash paid for financing activities | ||
Subtotal of cash outflow from financing activities | 413,616,393.31 | 606,495,379.40 |
Net cash flow generated by financing activities | 94,383,606.69 | -213,486,321.35 |
4. Influence of exchange rate changes on cash and cash equivalents | 1,005,803.87 | -1,104,468.23 |
5. Net increase in cash and cash equivalents | 20,226,410.15 | -143,734,270.91 |
Plus: Balance of cash and cash | 931,285,535.55 | 935,824,575.40 |
equivalents at the beginning of term | ||
6. Balance of cash and cash equivalents at the end of the period | 951,511,945.70 | 792,090,304.49 |
6. Cash Flow Statement of the Parent Company
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
1. Net cash flow from business operations: | ||
Cash received from sales of products and providing of services | 147,110,597.39 | 12,095,764.44 |
Tax refunded | ||
Other cash received from business operation | 882,838,625.05 | 520,946,233.20 |
Sub-total of cash inflow from business operations | 1,029,949,222.44 | 533,041,997.64 |
Cash paid for purchasing products and services | 409,933.49 | 27,852,746.78 |
Cash paid to and for the staff | 7,664,913.27 | 9,265,037.35 |
Taxes paid | 14,786,626.11 | 1,405,482.25 |
Other cash paid for business activities | 1,276,945,197.63 | 402,671,567.73 |
Sub-total of cash outflow from business operations | 1,299,806,670.50 | 441,194,834.11 |
Cash flow generated by business operations, net | -269,857,448.06 | 91,847,163.53 |
2. Cash flow generated by investment: | ||
Cash received from investment recovery | 1,879,880,000.00 | 1,272,000,000.00 |
Cash received as investment profit | 9,159,483.22 | 435,352,305.75 |
Net cash retrieved from disposal of fixed assets, intangible assets, and other long-term assets | ||
Net cash received from disposal of subsidiaries or other operational units | 10,000,000.00 | |
Other investment-related cash received |
Sub-total of cash inflow generated from investment | 1,899,039,483.22 | 1,707,352,305.75 |
Cash paid for construction of fixed assets, intangible assets and other long-term assets | 421,910.00 | 655,772.35 |
Cash paid as investment | 1,917,870,000.00 | 1,272,000,000.00 |
Net cash paid for acquiring subsidiaries and other operational units | ||
Other cash paid for investment | ||
Subtotal of cash outflows | 1,918,291,910.00 | 1,272,655,772.35 |
Cash flow generated by investment activities, net | -19,252,426.78 | 434,696,533.40 |
3. Cash flow generated by financing activities: | ||
Cash received from investment | ||
Cash received from borrowed loans | 500,000,000.00 | |
Cash received from bond placing | ||
Other cash received from financing activities | ||
Subtotal of cash inflow from financing activities | 500,000,000.00 | |
Cash paid to repay debts | 100,000,000.00 | |
Cash paid as dividend, profit, or interests | 180,947,316.65 | 279,409,832.29 |
Other cash paid for financing activities | ||
Subtotal of cash outflow from financing activities | 180,947,316.65 | 379,409,832.29 |
Net cash flow generated by financing activities | 319,052,683.35 | -379,409,832.29 |
4. Influence of exchange rate changes on cash and cash equivalents | -2.88 | |
5. Net increase in cash and cash equivalents | 29,942,808.51 | 147,133,861.76 |
Plus: Balance of cash and cash equivalents at the beginning of term | 310,049,329.68 | 74,159,732.87 |
6. Balance of cash and cash equivalents | 339,992,138.19 | 221,293,594.63 |
7. Statement of Change in Owners’ Equity (Consolidated)
Amount of the Current Term
In RMB
at the end of the period
Item
Item | Current period | ||||||||||||
Owners’ Equity Attributable to the Parent Company | Minor shareholders’ equity | Total of owners’ equity | |||||||||||
Share capital | Other equity tools | Capital reserves | Less: Shares in stock | Other miscellaneous income | Special reserves | Surplus reserves | Common risk provisions | Retained profit | |||||
Preferred share | Perpetual bond | Others | |||||||||||
1. Balance at the end of last year | 1,183,642,254.00 | 72,829,484.96 | 8,585,847.99 | 110,690,396.65 | 1,863,191,218.58 | 3,238,939,202.18 | |||||||
Plus: Changes in accounting policies | |||||||||||||
Correction of previous errors | |||||||||||||
Consolidation of entities under common control | |||||||||||||
Others | |||||||||||||
2. Balance at the beginning of current year | 1,183,642,254.00 | 72,829,484.96 | 8,585,847.99 | 110,690,396.65 | 1,863,191,218.58 | 3,238,939,202.18 | |||||||
3. Amount of change in current term (―-― for decrease) | -1,879,756.17 | 52,585,325.09 | 50,705,568.92 | ||||||||||
(1) Total of misc. incomes | -1,879,756.17 | 230,131,663.19 | 228,251,907.02 | ||||||||||
(2) Investment or decreasing of capital by owners | |||||||||||||
1. Common shares |
contributed by shareholders | |||||||||||||
2. Capital contributed by other equity instrument helders | |||||||||||||
3. Amount of shares paid and accounted as owners’ equity | |||||||||||||
4. Others | |||||||||||||
(3) Profit allotment | -177,546,338.10 | -177,546,338.10 | |||||||||||
1. Providing of surplus reserves | |||||||||||||
2. Common risk provision | |||||||||||||
3. Allotment to the owners (or shareholders) | -177,546,338.10 | -177,546,338.10 | |||||||||||
4. Others | |||||||||||||
(4) Internal transferring of owners’ equity | |||||||||||||
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. Others | |||||||||||||
(5) Special reserves | |||||||||||||
1. Provided this year |
2. Used this term | |||||||||||||
(6) Others | |||||||||||||
4. Balance at the end of this period | 1,183,642,254.00 | 72,829,484.96 | 6,706,091.82 | 110,690,396.65 | 1,915,776,543.67 | 3,289,644,771.10 |
Amount of Last Year
In RMB
Item | Last period | ||||||||||||
Owners’ Equity Attributable to the Parent Company | Minor shareholders’ equity | Total of owners’ equity | |||||||||||
Share capital | Other equity tools | Capital reserves | Less: Shares in stock | Other miscellaneous income | Special reserves | Surplus reserves | Common risk provisions | Retained profit | |||||
Preferred share | Perpetual bond | Others | |||||||||||
1. Balance at the end of last year | 756,909,905.00 | 79,099,619.14 | 91,831.63 | 51,123,554.51 | 432,271,424.56 | 14,546,750.03 | 1,334,043,084.87 | ||||||
Plus: Changes in accounting policies | |||||||||||||
Correction of previous errors | |||||||||||||
Consolidation of entities under common control | |||||||||||||
Others | |||||||||||||
2. Balance at the beginning of current year | 756,909,905.00 | 79,099,619.14 | 91,831.63 | 51,123,554.51 | 432,271,424.56 | 14,546,750.03 | 1,334,043,084.87 | ||||||
3. Amount of change in current term (―-― for decrease) | 94.24 | 1,045,861.25 | -22,534,585.14 | -4,528,143.94 | -26,016,773.59 | ||||||||
(1) Total of misc. incomes | 1,045,861.25 | 53,156,405.36 | -4,528,143.94 | 49,674,122.67 | |||||||||
(2) Investment or decreasing of | 94.24 | 94.24 |
capital by owners | |||||||||||||
1. Common shares contributed by shareholders | |||||||||||||
2. Capital contributed by other equity instrument helders | |||||||||||||
3. Amount of shares paid and accounted as owners’ equity | |||||||||||||
4. Others | 94.24 | 94.24 | |||||||||||
(3) Profit allotment | -75,690,990.50 | -75,690,990.50 | |||||||||||
1. Providing of surplus reserves | |||||||||||||
2. Common risk provision | |||||||||||||
3. Allotment to the owners (or shareholders) | -75,690,990.50 | -75,690,990.50 | |||||||||||
4. Others | |||||||||||||
(4) Internal transferring of owners’ equity | |||||||||||||
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. Others | |||||||||||||
(5) Special reserves |
1. Provided this year | |||||||||||||
2. Used this term | |||||||||||||
(6) Others | |||||||||||||
4. Balance at the end of this period | 756,909,905.00 | 79,099,713.38 | 1,137,692.88 | 51,123,554.51 | 409,736,839.42 | 10,018,606.09 | 1,308,026,311.28 |
8. Statement of Change in Owners’ Equity (Parent Company)
Amount of the Current Term
In RMB
Item | Current period | ||||||||||
Share capital | Other equity tools | Capital reserves | Less: Shares in stock | Other miscellaneous income | Special reserves | Surplus reserves | Retained profit | Total of owners’ equity | |||
Preferred share | Perpetual bond | Others | |||||||||
1. Balance at the end of last year | 1,183,642,254.00 | 71,736,128.89 | 8,756,553.46 | 110,690,396.65 | 586,376,124.33 | 1,961,201,457.33 | |||||
Plus: Changes in accounting policies | |||||||||||
Correction of previous errors | |||||||||||
Others | |||||||||||
2. Balance at the beginning of current year | 1,183,642,254.00 | 71,736,128.89 | 8,756,553.46 | 110,690,396.65 | 586,376,124.33 | 1,961,201,457.33 | |||||
3. Amount of change in current term (―-― for decrease) | -178,040,366.90 | -178,040,366.90 | |||||||||
(1) Total of misc. incomes | -494,028.80 | -494,028.80 | |||||||||
(2) Investment or decreasing of capital by owners | |||||||||||
1. Common shares |
contributed by shareholders | |||||||||||
2. Capital contributed by other equity instrument helders | |||||||||||
3. Amount of shares paid and accounted as owners’ equity | |||||||||||
4. Others | |||||||||||
(3) Profit allotment | -177,546,338.10 | -177,546,338.10 | |||||||||
1. Providing of surplus reserves | |||||||||||
2. Allotment to the owners (or shareholders) | -177,546,338.10 | -177,546,338.10 | |||||||||
3. Others | |||||||||||
(4) Internal transferring of owners’ equity | |||||||||||
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. Others | |||||||||||
(5) Special reserves | |||||||||||
1. Provided this year | |||||||||||
2. Used this term |
(6) Others | |||||||||||
4. Balance at the end of this period | 1,183,642,254.00 | 71,736,128.89 | 8,756,553.46 | 110,690,396.65 | 408,335,757.43 | 1,783,161,090.43 |
Amount of Last Year
In RMB
Item | Last period | ||||||||||
Share capital | Other equity tools | Capital reserves | Less: Shares in stock | Other miscellaneous income | Special reserves | Surplus reserves | Retained profit | Total of owners’ equity | |||
Preferred share | Perpetual bond | Others | |||||||||
1. Balance at the end of last year | 789,094,836.00 | 466,283,546.89 | 91,831.63 | 88,839,790.50 | 665,903,861.54 | 2,010,213,866.56 | |||||
Plus: Changes in accounting policies | |||||||||||
Correction of previous errors | |||||||||||
Others | |||||||||||
2. Balance at the beginning of current year | 789,094,836.00 | 466,283,546.89 | 91,831.63 | 88,839,790.50 | 665,903,861.54 | 2,010,213,866.56 | |||||
3. Amount of change in current term (―-― for decrease) | 394,547,418.00 | -394,547,418.00 | -271,639,341.31 | -271,639,341.31 | |||||||
(1) Total of misc. incomes | 4,543,851.29 | 4,543,851.29 | |||||||||
(2) Investment or decreasing of capital by owners | |||||||||||
1. Common shares contributed by shareholders | |||||||||||
2. Capital contributed by other equity instrument helders |
3. Amount of shares paid and accounted as owners’ equity | |||||||||||
4. Others | |||||||||||
(3) Profit allotment | -276,183,192.60 | -276,183,192.60 | |||||||||
1. Providing of surplus reserves | |||||||||||
2. Allotment to the owners (or shareholders) | -276,183,192.60 | -276,183,192.60 | |||||||||
3. Others | |||||||||||
(4) Internal transferring of owners’ equity | 394,547,418.00 | -394,547,418.00 | |||||||||
1. Capitalizing of capital reserves (or to capital shares) | 394,547,418.00 | -394,547,418.00 | |||||||||
2. Capitalizing of surplus reserves (or to capital shares) | |||||||||||
3. Making up losses by surplus reserves | |||||||||||
4. Others | |||||||||||
(5) Special reserves | |||||||||||
1. Provided this year | |||||||||||
2. Used this term | |||||||||||
(6) Others | |||||||||||
4. Balance at the end of this period | 1,183,642,254.00 | 71,736,128.89 | 91,831.63 | 88,839,790.50 | 394,264,520.23 | 1,738,574,525.25 |
III. General Information
China Fangda Group Co., Ltd. (the ―Company‖ or the ―Group‖) is a joint stock company registered in Shenzhen, Guangdong and
was approved by the Government of Shenzhen with Document 深府办函 (1995) 194号, and was founded, on the basis of Shenzhen
Fangda Construction Material Co., Ltd., by way of share issuing in October 1995. The unified social credit code is:
91440300192448589C; registered address: Fangda Building, Kejinan Road 12, High-tech Zone, Shenzhen. Mr. Xiong Jianming isthe legal representative.The Company issued foreign currency shares (B shares) and local currency shares (A shares) and listed in November 1995 and April1996 respectively in Shenzhen Stock Exchange.
The Company has established a corporate governance structure that comprises shareholders’ meeting, board of directors and
supervisory committee. Currently, the Company sets up the President Office, Administrative Department, HR Department, EnterpriseManagement Department, Financial Department, Audit and Supervisory Department, Securities Department, Technology InnovationDepartment and IT Department and has established subsidiaries including Fangda Decoration, Fangda Automatic, Fangda NewMaterial, Fangda Property and Fangda New Energy.
The business nature and main business operations of the Company and subsidiaries (―the Group‖) include (1) production and sales of
curtain wall materials, design, production and installation of construction curtain walls; (2) assembly and production of subwayscreen doors; (3) development and operation of real estate projects on land, of which rights have been obtained lawfully; (4) R&D,installation and sales of PV devices, design and installation of PV power plants.The financial statements and notes are approved at the 9
th
meeting of the 8
th
term of the Board held on 03.08.18.
The consolidation scope for the consolidated financial statements includes the Company and all subsidiaries. Two subsidiaries arenewly consolidated in this period. In this period, Fangda Decoration Engineering (Shenyang) Co. Ltd. an indirectly
controlled subsidiary was cancelled and no longer controlled. Therefore, one subsidiary is moved out of the consolidation
scope in this period. See Note 8 Change to consolidation scope and Note 9 Interests in other entities.IV. Basis for the preparation of financial statements1. Preparation basisThe financial statements are prepared according to the enterprise financial standard and guidelines, interpretation and other related
regulations (―the Standard‖) issued by the Ministry of Finance. In addition, the Group also complies with the "Regulations on the
Compilation and Submission of Information Disclosures by Companies That Offer Securities to the Public No. 15 - GeneralProvisions on Financial Reporting" (revised in 2014) and the "Rules for the Compilation and Submission of Information Disclosuresto Companies That Publicly Issue Securities" No. 11 - Special Provisions on the Notes to the Financial Statements of CompaniesEngaged in Real Estate Development Disclosure of Financial Information.
The Group prepares the financial statements based on continuous operation.The Group's auditing is based on the accrual basis. Except for some financial instruments and property held for investment, the
financial statements are prepared based on historical costs. In case of any asset impairment, the impairment provision will be made asrequired.
2. Continuous operationThe Company assessed the continuing operations capability of the Company for the 12 months from the end of the reporting period.
No matters were found that would affect the Company's ability to continue as a going concern. It is reasonable for the Company to
prepare financial statements based on continuing operations.V. Significant Account Policies and EstimatesSpecific accounting policy and estimate prompt:
Whether the Company needs to comply with disclosure requirements of special industriesYesProperty development and decoration industriesSpecific accounting policy and estimate prompt:
The Group determines the accounting policies and income recognition policies for investment real estate according to the productionand business features. For details, see Note 5. 13 and Note 5. 28.
1. Statement of compliance to the Enterprise Accounting StandardThe financial report and statements are prepared with compliance to the requirement of the Enterprise Accounting Standard. They
reflect the financial position as of 30.06.18, and business performance and cash flow situation in Year 2018 of the Company franklyand completely.
2. Fiscal PeriodThe fiscal year of the Group is the solar calendar year, that is from January 1 to December 31.3. Operation periodThe operation period of the Group is 12 months.4. Bookkeeping standard moneyThe Company, domestic subsidiaries and overseas subsidiary Shihui International Holding Co., Ltd. use RMB as bookkeeping
standard money. Overseas subsidiaries Automatic System (Hong Kong) Co., Ltd. and Fangda Australia Pty Ltd use HKD and AUDas bookkeeping standard money respectively. The Group prepares financial statements in RMB.
5. Accounting treatment of the entities under common and different control(1) Consolidation of entities under common controlAssets and liabilities obtained by the merging party are calculated at their book value with the merged parties at the merger day in the
consolidated financial statement of the merging party in addition to the adjustment made given the difference in accounting policies.The differences between the book value of net assets and the book value of consideration price (or the total of face value of shareissued) are adjusted to the capital reserve (share capital premium). If the share capital premium is not enough to offset the difference,it will be adjusted to the retained gains.
Enterprise merger under common control through multiple transactions
In separate financial statements, the initial investment cost is the book value of the merged party’s net assets that can be shared by the
merging party in the consolidate financial statements of the final controlling party according to the shareholding percentage on themerging date; adjust the capital surplus (share premium) according to the difference between the initial investment cost and the bookvalue of the held investment before merger plus the book value of the consideration paid on the merger date. Where the capitalsurplus falls short, the retained income should be adjusted.
In consolidated financial statements, assets and liabilities obtained by the merging party from the merged party should be measured at
the book value in the final controlling party’s consolidated financial statements other than the adjustment made due to differences in
accounting policies; adjust the capital surplus (share premium) according to the difference between the initial investment cost and thebook value of the held investment before merger plus the book value of the consideration paid on the merger date. Where the capitalsurplus falls short, the retained income should be adjusted.Changes in recognized related profit and loss, other misc. incomes andother owner's equity between the later one of the date when the original stock equity was obtained and the date when the mergedparty and merging party become under the common control should respectively write down the retained profit in beginning of the
report period or current period’s profit or loss.
(2) Consolidation of entities under different controlFor merger of entities under different control, the merger cost is the fair value of the asset paid, liability undertaken, and equity
securities issued for exchanging of control power over the entities at the day of acquisition. On the acquisition day, the assets andliabilities (if any) acquired by the Group from the acquired party are recognized on the fair value.
If the merger costs exceed the fair value of the recognizable net assets of the acquired party in the merger, it is recognized asgoodwill and measured based the costs after the accumulative impairment provision is deducted; if the the fair value exceeds thecosts, it is included in the income statement for the period after being re-examined.
Where there is new or further evidence on the condition existing on the acquisition date 12 months later and adjustment needs to bemade, the good will should be adjusted and merged.
(3) Treatment of related transaction fee in enterprise mergerAgency expenses and other administrative expenses such as auditing, legal consulting, or appraisal services occurred relating to the
merger of entities are accounted into current income account when occurred. The transaction fees of equity certificates or liabilitycertificates issued by the purchaser for payment for the acquisition are accounted at the initial amount of the certificates.
6. Preparation of Consolidated Financial Statements(1) Consolidation scopeThe consolidate scope of consolidated financial statements is determined based on control. Control means the power possessed by the
Group on invested entities to share variable returns by participating in related activities of the invested entities and to impact theamount of the returns by using the power. Subsidiaries are enterprises controlled by the Company.
(2). Preparation of Consolidated Financial StatementsThe consolidated financial statements are prepared by the Company based on financial statements of the Company and subsidiaries
and according to other related information. During preparation of consolidated financial statements, the accounting policies and
period of the Company and subsidiaries must be the same. Major transactions and balances between companies are offset.Subsidiaries and businesses increased because of merger of enterprises under the common control during the report period are
deemed consolidated into the consolidate scope from the date of becoming controlled by the final party. The operating result andcash flows of the subsidiaries and businesses from the date of becoming controlled by the final party should be incorporated into theconsolidate income statement and consolidate cash flow statement.
For subsidiaries and businesses increased because of merger of enterprises not under the common control, their incomes, expensesand profits between the date of acquisition and end of the report period should be incorporated into the consolidated incomestatement, and the cash flows should be incorporated into the consolidated cash flow statement.
The part of the shareholders’ equity in subsidiaries not owned the Company are separately listed under the shareholders’ equity asminority shareholders’ equity in the consolidated balance sheet.The part of the subsidiaries’ net profits and losses for the currentperiod that belongs to minority shareholders is listed as minority shareholders’ profits and losses under net profit in the consolidatedincome statement. If the losses of subsidiaries shared by the minority shareholders exceed the part of the owners’ equity of thesubsudiaries at the beginning of the period, the excessive part will offset the minority shareholders’ equity.
(3) Acquisition of subsidiary minority interestsThe difference between the investment cost of the long-term equity obtained from acquisition of minority interests and the share of
net assets in the subsidiary calculated continuously based on the increased shareholding percentage, and the difference between the
disposal income obtained from the partial disposal of the subsidiary’s equity investment without losing the control power and the
share of net assets in the subsidiary calculated continuously based on the increased shareholding percentage should be adjusted andconsolidated in the capital surplus in the consolidated balance sheet. Where the capital surplus falls short, the retained income shouldbe adjusted.
(4) Treatment of loss of subsidiaries’ control power
For loss of control over subsidiaries due to disposal of partial equity investment or other reasons, the remaining equity should bere-measured at the fair value on the date of loss of the control power; the sum of the consideration obtained from the disposal of stock
equity and the fair value of the remaining equity, minus the sum of the share of the net assets’ book value calculated continuously
from the acquisition date according to the original shareholding percentage and the goodwill should be recorded in the investmentgain of the current period of the loss of control power.
Other misc. incomes related to the equity investment in the original subsidiary is transferred to the current period’s profit and loss
when the control power is losted, except for the other misc. incomes generated by remeasurement and resetting of earning plan orchange in the net assets by the invested party.
7. Recognition of cash and cash equivalentsCash refers to cash on hand and deposits that can be used at any time for payment. Cash equivalent refers to the investments with
short term, strong liquidity and small risk of value fluctuation that are held by the Group and easily converted into cash with knownamount.
8. Foreign exchange business and foreign exchange statement translation(1) Foreign currenciesTrades of the Group made in foreign currencies are translated into RMB basing on the spot exchange rate on the date when the trade
is conducted.At the balance sheet date, foreign currency items are translated on the spot exchange rate of the balance sheet date. The exchange
differences caused by the difference in exchange rates on the balance sheet date and initial recognizing date or previous balance sheetdate are included in the current profits and losses. Non-monetary items accounted in foreign currency and on historical costs areexchanged with the spot exchange rate on the transaction date. Non-monetary items accounted in foreign currency and on fair valueare exchanged with the spot exchange rate on the determination date of the fair value. The exchange difference between theaccounting standard-currency amount and the original accounting standard-currency amount are included in the current profits andlosses.
(2) Translation of foreign exchange statementOn the balance sheet date, when foreign currency financial statements of overseas subsidiaries are converted, the assets and liabilities
items in the balance sheet are converted using the spot exchange rate on the balance sheet date. The shareholders’ equity items arecalculated as ―undistributed profits‖, except for other items. The spot exchange rate on the date of occurrence is used for conversion.
The income and expense items in the income statement are translated using the exchange rate that is determined by the system’s
reasonable method and approximate to the spot exchange rate on the transaction date.All items in the cash flow statement are converted according to the exchange rate that is determined by the system's reasonable
method and approximate to the spot exchange rate on the day the cash flow occurs. The impact of changes in exchange rates on cash
is used as a reconciliation item, which is separately presented in the cash flow statement ―Items Affecting Exchange Rate Movementson Cash and Cash Equivalents‖.
The difference arising from the translation of the financial statements is reflected in the "Other comprehensive income" item underthe shareholders' equity item in the balance sheet.
When foreign operations are disposed of and the control rights are lost, the difference in foreign currency statements related to theoverseas operations that are listed in the shareholders' equity items in the balance sheet is transferred to the profit or loss for thecurrent period, either in whole or in proportion to the disposal of the foreign operations.
9. Financial instrument
Financial instrument refers to a company’s financial assets and contracts that form other units of financial liabilitie or equity
instruments.(1) Recognition and derecognition of financial instrumentThe Group recognizes a financial asset or liability when it becomes one party in the financial instrument contract.Financial asset is derecognized when:
(1) The contractual right to receive the cash flows of the financial assets is terminated;(2) The financial asset is transferred and meets the following derecognition condition.When partial or all of the current responsibilities attached to such financial liabilities, the partial or all of the financial liabilities are
derecognized. When the Group (debtor) and creditor enter into an agreement to replace the existing financial liabilities byundertaking new financial liabilities and the contract terms for the new financial liabilities are essentially different from those for theexisting one, the existing financial liabilities will be derecognized and new financial liabilities will be recognized.
Financial asset transactions in regular ways are recognized and de-recognized on the transaction date.(2) Classification and measurement of financial assetsFinancial assets of the Group are categorized as: financial assets measured at fair value with variations accounted into current income
account, receivables and financial assets available for sales.Financial assets are measured at the fair value at the initial recognition.
For financial assets measured at fair value with variations accounted into current income account,
related transaction expenses are accounted into the current income. For other financial assets, the relatedtransaction expenses are accounted into the initial recognized amounts.
Financial assets measured at fair value with variations accounted into current income accountIt includes transactional financial assets and financial assets measured by fair value and with variations accounted into current
gain/loss account at initial recognition. The financial assets are further measured by fair value with the gain/loss created by variationsin fair value and related dividends and interest accounted into the current gain/loss account.
ReceivablesReceivables refer to non-derivative financial assets without quotations but with fixed recoverable amount or can be confirmed,
including receivable accounts and other receivables (Note V. 10).Receivables adopt the effective interest method and are furthermeasured by amortized cost. Gain/loss generated at final recognition, impairment or amortization is accounted into the currentgain/loss account.
Sellable financial assetsSellable financial asset refers to those sellable non-derivate financial assets recognized initially and financial assets otherthan the
above-mentioned types of financial assets. Sellable financial assets are further measured by fair value and the premium/discount isamortized by the effective interest method and recognized as interest income. Other than the exchange difference of impairment lossand foreign exchange monetary financial assets, which is recognized as current gain and loss, the variations in fair value of sellablefinancial assets is recognized as other comprehensive gain. When it is derecognized and transferred out, it is accounted into thecurrent gain/loss account.Dividends and interest income related to sellable financial assets are accounted into the current gain/lossaccount.
Equity instrument investment without quotation in an active market and whose fair value cannot be reliably measured and derivativefinancial assets that are linked to the equity instrument and that need to be settled through delivery of the equity instruments aremeasured by costs.
(3) Classification and measurement of financial liabilities
The Group’s financial liabilities are mainly other financial liabilities
Other financial liabilities adopt the effective interest method and are further measured by amortized cost. Gain/loss generated at finalrecognition or amortization is accounted into the current gain/loss account.
Differences between financial liabilities and equity instrumentsFinancial liabilities is liabilities that meet one of the following conditions:
(1) contractual obligation to deliver cash or other financial assets to other parties.(2) under potential adverse conditions, the contractual obligation to exchange financial assets or financial liabilities with other
parties.(3) In the future, a non-derivative instrument contract that can be settled with the company's own equity instruments will be used, and
the company will deliver a variable amount of its own equity instruments based on the contract.(4) Derivatives contracts that may be settled with the company's own equity instruments or may be settled in the future, except for a
derivative contract that exchanges a fixed amount of its own equity instruments for a fixed amount of cash or other financial assets.
Equity instruments refer to contracts that prove the ownership of a company’s remaining equity in assets after deducting all
liabilities.If the Group cannot unconditionally avoid the performance of a contractual obligation by delivering cash or other financial assets, the
contractual obligation is in line with the definition of a financial liability.If a financial instrument is required to be settled with or can be settled with the Group's own equity instruments, the Group's own
equity instrument used to settle the instrument needs to be considered as a substitute for cash or other financial assets or for theholder of the instrument to enjoy the remaining equity in the assets after all liabilities are deducted. If it is the former, the instrumentis the financial liabilities of the Group; if it is the latter, the instrument is the equity instrument of the Group.
(4) Derivative financial instruments and embedded derivativesThe Group's derivative financial instruments include futures contracts. It is initially measured at the fair value at the date of signing
the derivative transaction contract and is subsequently measured at its fair value. Derivative financial instruments with a positive fairvalue are recognized as asset, and instruments with a negative fair value are recognized as liabilities. Any gains or losses arising fromchanges in fair value that do not meet the hedge accounting requirements are directly charged to profit or loss for the current period.
For hybrid instruments containing embedded derivatives, if there are no financial assets or financial liabilities that are not designatedas measured at fair value and their changes are recorded as profit or loss for the current period, there is no close relationship betweenthe embedded derivatives and the principal contract in terms of economic characteristics and risks with same conditions as embeddedderivatives, the separately existing tools are in accordance with the definition of the derivatives, the embedded derivatives are splitfrom the hybrid tools and processed as separate derivative financial instruments. If it is not possible to separately measure theembedded derivative instrument at the time of acquisition or on the subsequent balance sheet date, the entire hybrid instrument isdesignated as financial asset or financial liabilities that are measured at its fair value and whose changes are recorded as profit or lossfor the current period.
(5) Fair value of financial instrumentFair value is the price that can be obtained from selling an asset or paid for transferring liabilities in an orderly transaction on the
measurement date.
The Group measures the related assets or liabilities at fair value, assuming that the orderly sale of assets or transfer of liabilities iscarried out in the main market of the relevant assets or liabilities; if there is no major market, the Group assumes that the transactionis the most advantageous in the relevant assets or liabilities. The major market (or the most advantageous market) is the tradingmarket that the Group can enter on the measurement date. The Group uses assumptions that market participants use to maximize theireconomic benefits when pricing the asset or liability.
For financial assets or liabilities in an active market, the Group determines their fair value based on quotations in the active market. Ifthere is no active market, the Company uses evaluation techniques to determine the fair value.
For the measurement of non-financial assets at fair value, the ability of market participants to use the assets for optimal purposes togenerate economic benefits, or the ability to sell the assets to other market participants that can be used for optimal purposes togenerate economic benefits.
The Group uses valuation techniques that are applicable in the current circumstances and have sufficient available data and otherinformation to support the use of the relevant observable input values prioritized. Unobservable input values are used only when theobservable input value cannot be obtained or is not feasible.
For assets and liabilities that are measured or disclosed at fair value in the financial statements, based on the lowest level input valuethat is of significance to the overall fair value measurement, the level of fair value to which they belong is determined: The inputvalue at the first level can be calculated at the measurement date. Unadjusted quotes for the same assets or liabilities that have beenobtained in active markets; input values at the second level are input values that are directly or indirectly observable for theunderlying assets or liabilities other than those entered at the first level; Level 3 inputs are Unobservable inputs to related assets orliabilities.
At each balance sheet date, the Group reassesses the assets and liabilities that are continuously measured at fair value and confirmedin the financial statements to determine whether there is a conversion between the fair value measurement levels.
(6) Impairment of financial assetsFinancial assets measured at fair value with variations accounted into current income account. The Group checks the book value of
financial assets on the balance sheet date. Impairment provision will be made in case of objective evidence proving impairment to thefinancial assets. Objective evidence proving impairment to the financial assets refers to events actually occur after the initialrecognition of financial assets, with influence on the estimated future cash flows of the financial assets and can be reliably measuredby the Group.
Objective evidence proving impairment to the financial assets includes the following observable situations:
① Severe financial difficulties in the issuer or debtor;② The debtor violates the contract or defaults or delays the payment of the interest or principal;③ The Group makes compromise to the debtor with financial difficulties due to economic or legal consideration;④ The debtor may go bankruptcy or conduct other financial reorganization;⑤ The financial assets can no longer be traded in an active market due to material financial difficulties in the issuer;⑥ It cannot be recognized whether the cash flow of an asset in a group of financial assets has decreased. However, according to
open data, it can be evaluated that the estimated future cash flow of the group of financial assets has decreased and the decrease can
be measured, including:
- The payment capacity of the debtor of the financial assets continues weakening;- Situations that may lead to the payment failure of the financial assets happen in the country or region where the debtor is
located;
⑦ Significant adverse changes occurs to the technical, market, economic or legal environment of the debtor, leading to that the
equity instrument investor may not be able to recover the investment;
⑧ Other objective evidence that can prove the impairment of the financial assets
Financial assets measured at amortized costIf there is objective evidence proving impairment to the financial assets, the book value of the financial assets will be written down to
the present value of the estimated future cash flow (excluding undiscovered future credit loss). The write-down amount is accountedinto the current gain/loss account. The present value of the estimated future cash flow is determined by the original effective discountrate with the value of the guanrantee considered.
Conduct imparement test separately for major financial assets. If there is objective evidence suggesting impairement, determine theimpairment loss and account it into the current gain/loss account. For financial assets with insignificant single amounts, impairmenttests are conducted separately or included in the portfolio of financial assets with similar credit risk characteristics. Test financialassets without impairment separately (including major and minor financial assets) and conduct impairment test in the financial assetscombination with similar credit risk features. Conduct impairment test for financial assets separately recognized as impairedexcluding financial assets combination with similar credit risk features.
After the Group recognizes impair loss to financial assets measured by amortized cost, if there is object evidence suggesting that thevalue of the financial assets is restored objectively due to an event after the loss, the recognized impairment loss can be reversed andaccounted into the current gain/loss account. The book value after the reversal must not exceed the amortized cost of the financialassets on the reversal date assuming that no impairment provision was made.
(7) Transfer of financial assetsThe transfer of financial assets refers to transferring or delivering the financial assets to another party (receiver) other than the issuing
party of the financial assets.Recognition of the financial asset is terminated as soon as all of the risks and rewards attached to the financial asset have been
transferred to the receiver. Whereas if all of the risks and rewards attached to the financial assets are reserved, recognition of thefinancial asset shall not be terminated.
When the Group neither transfers nor reserve almost all risks and rewards attached to the financial assets, it will be handled as: Whenthe controlling power over the financial asset is given up, the financial assets will be derecognized and the generated assets andliabilities will be recognized; when the controlling power is not given up, financial asset and related liability shall be recognizedaccording to the extend the Company is involving in the financial asset.
(8) Deduction of financial assets and liabilitiesWhen the Group has the legal right to deduct recognized financial assets and liabilities, can exercise the legal right, and the Group
plans to settle them in net, liquidate and repay the financial assets and liabilities, the amount after the deduction will be presented in
the balance sheet. Exception for the deducted part, other financial assets and liabilities are separately presented in the balance sheet.
10. Receivables(1) Receivables with major individual amount and bad debt provision provided individually
Judging basis or standard of major individual amount | For the current year, the Company recognizes project receivables over RMB10 million (inclusive) as ―individual receivable with large amount‖ while recognizes product receivables over RMB2 million (included) as ―individual receivable with large amount‖ and other receivables over RMB1 million (included) as ―individual receivable with large amount‖. |
Provision method for account receivable with major individual amount and bad debt provision provided individually | The Company performs impairment examination individually on each large amount receivables, and recognizes impairment and provides bad debt provision when the impairment is recognized based on objective evidence. Those not impaired are accounted along with the minor amount receivables and recognized in risk groups. |
(2) Recognition and providing of bad debt provisions on groups
Group | Method of bad debt provision |
Account age | Aging method |
Receivables within consolidation, receivables of real estate property sold with bank mortgage and accounts between the Company and partners | Other method |
Receivables adopting the aging method in the group:
√ Applicable □ Inapplicable
Age | Providing rate for receivable account | Providing rate for other receivables | ||
Engineering | Real estate | Others | ||
Within 1 year (inclusive) | 1.00% | 1.00% | 3.00% | 3.00% |
1-2 years | 5.00% | 5.00% | 10.00% | 10.00% |
2-3 years | 20.00% | 10.00% | 30.00% | 30.00% |
3-4 years | 30.00% | 30.00% | 50.00% | 50.00% |
4-5 years | 50.00% | 50.00% | 80.00% | 80.00% |
Over 5 years | 100.00% | 100.00% | 100.00% | 100.00% |
Receivables adopting the balance percentage method in the group
□ Applicable √ Inapplicable
Receivables adopting other methods in the group
□ Applicable √ Inapplicable
(3) Receivables with not major individual amount and bad debt provision provided individually
Reasons for separate bad debt provision | Long account age or deterioration of customer creditability |
Method of bad debt provision | According to the difference between the present value of future cash flow and the book value |
The Company must comply with disclosure requirements of the Shenzhen Stock Exchange Industry Information Disclosure
Guideline No.6 – Listed Companies Engaged in Decoration Business.
11. InventoriesWhether the Company needs to comply with disclosure requirements of special industries
YesDecoration(1) Classification of inventories
The Group’s inventories include purchased materials, raw materials, low-value consumables, packing materials, OEM materials,
products in process, semi-finished goods, finished goods, inventory, development costs, development products and construction inprocess.
(2) Pricing of delivering inventoryInventories are measured at cost when procured. Raw materials, products in process, commodity stocks in transit and sel-made
semi-finished products are measured by the weighted average method.Construction contracts are measured by the effective cost, including direct and indirect expenses generated before the contracts are
fulfilled. Costs generated and recognized accumulatively by construction in process and settled payment are listed in the balancesheet as offset net amounts.The excessive part of the sum of the generated costs and recognized gross profit (loss) over the settledpayment is listed inventories; the excessive part of the settled payment over the sum of the generated costs and recognized grossprofit (loss) is listed as the prepayment received.
Travel and bidding expenses generated by execution of contracts, if they can be separated and reliably measured and it is likely toenter into contracts, are accounted as the contract cost when the contracts are entered into; or into the current gain/loss account if theconditions are not met.
The development costs include land transfer payment, infrastructure and facility costs, installation engineering costs, borrows beforecompletion of the development and other costs during the development process. The actual costs of the development product ispriced using the separate pricing method.
(3) Recognition of inventory realizable value and providing of impairment provisionThe realizable net value of inventory is the estimated sales prices of the inventory less costs to be incurred until the completion,
estimated sales expense and taxes. The realizable net value of inventory should be recognized based on solid evidence with thepurpose of the inventory and after-balance-sheet-date events taken into consideration.
If the inventory cost is higher than the realizable net value on the balance sheet date, the inventory depreciation provision should bemade. The Group makes inventory depreciation provision for separate or a type of inventory. If factors affecting the inventory valuedisappear on the balance sheet date, the depreciation provision made should be reversed to the original value.
(4) Inventory systemThe Group uses perpetual inventory system.(5) Amortizing of low-value consumables and packaging materialsLow-value consumables are amortized on on-off amortization basis at using.12. Long-term share equity investmentThe Group's long-term equity investment includes control on invested entities and significant impacts on equity investment. Invested
entities on which the Group has significant impacts are associates of the Group.(1) Recognition of initial investment costsLong-term equity investment generated by enterprise merger: for long-term equity investment obtained by merger of enterprises
under common control, the obtained share of book value of the interests of the merged party’s owner in the consolidate financial
statements on the merger date is the investment costs; for long-term equity investment obtained by merger of enterprises not undercommon control, the merger cost is the investment cost.
For long-term equity investment obtained by cash, the actually paid consideration is the initial investment cost.(2) Subsequent measurement and recognition of gain/lossInvestments by the Company in subsidiaries are calculated using the cost method; in joint ventures are calculated using the equity
method.For the long-term equity investment measured on the cost basis, except for the announced cash dividend or profit included in the
practical cost or price when the investment was made, the cash dividends or profit distributed by the invested entity are recognized asinvestment gains in the current gain/loss account.
When the equity method is used to measure long-term equity investment, the investment cost will not be adjusted if the investmentcost of the long-term equity investment is larger than the share of fair value of the recognizable assets of the invested entity. When itis smaller than the share of fair value of the recognizable assets of the invested entity, the book value will be adjusted and thedifference is included in the current gains of the investment.
When the equity method is used, the current investment gain is the share of the net gain realized in the current year that can be sharedor borne, recognized as investment gain and other misc. income. The book value of the long-term equity investment is adjustedaccordingly. The book value of the long-term equity investment should be accordingly decreased based on the share of profit or cash
dividend announced by the invested entity; according to other changes in the owner’s equity except for net profit and loss, other misc
income and profit distribution of the invested entity, adjust the book value of the long-term equity investment and record it in thecapital surplus (other capital surplus). When the share of the net gains that can be enjoyed is recognized, it is recognized after the netprofit of the invested entity is adjusted based on the fair value of the recognizeable assets of the invested entity according to theCompany's accounting policies and accounting period.
Where substantial influence on invested entities is imposed or joint control is implemented due to increase in investment, the sum ofthe fair value of the original equity and increased investment on the conversion date is the initial investment cost under the equitymethod. The difference between the fair value and book value of the original equity on the conversion date and the accumulativechange in the fair value originally accounted in other misc. income should be transferred into the profit and loss of the current periodusing the equity method.
Where joint control or substantial influence on invested entities is lost due to disposal of part of investment, the remaining equity
after the disposal should be treated according to the Enterprise Accounting Standard No.22 – Recognition and Measurement of
Financial Instruments from the date of losing the joint control or substantial influence. The difference between the fair value andbook value should be accounted the profit and loss of the current period. For other misc. incomes of original share equity investmentdetermined using the equity method, when the equity method is no longer used, it should be treated based on the same basis of thetreatment of related assets or liability of the invested entities; the other owners' interests related to the original share equityinvestment should be transferred to gain/loss of the current period.
Where the disposal of part of the equity investment leads to loss of control on the invested entity, and the remaining equity after thedisposal can impose common control or significant impacts on the invested entity, use the equity method and make adjustment as ifthe equity method was used when the remaining equity was acquired. If not, perform accounting treatment according to provisions in
the Enterprise Accounting Standard No.22 – Recognition and Measurement of Financial Tools. The difference between the fair value
and book value on the date of losing control should be transferred into the profit and loss of this period.
Where the Company’s shareholding decreases and the Company loses the control due to increased investment by another investor,
but the Company can still impose common control or significant impacts on the invested entity, the share of increased net assets ofthe invested entity that can be shared by the Company should be calculated based on the new shareholding, the difference betweenthe net assets and original book value of the original long-term equity investment should be recorded in the profit and loss of thisperiod and adjusted as if equity method was used when it was acquired according to the new shareholding proportion.
Internal transaction gain not realized between the Company and affiliates is measured according to the shareholding proportion andthe investment gains is recoginzied after deduction. The unrealized internal transaction loss between the Company and the investedentity is the impairment loss of transferred assets and should not be written off.
(3) Basis for recognition of major influence on invested entitiesMajor influence refers to the power to participate in decision-making of financial and operation policies of a company, but cannot
control or jointly control the making of the policies. When considering whether the Company can impose significant impacts on theinvested entity, impacts of conversion of shares with voting rights held directly or indirectly by the investor and voting rights that canbe executed in this period held by the investor and other party into shares of the invested entity should be considered.
When Company directly or indirectly holds 20% (inclusive) but less than 50% of the shares with voting rights of the invested entity,it is generally considered that the Company can impose significant impacts unless there is clear evidence proving that the Companyshall not participate in the production and business decision making of the company; when the Company holds less than 20% of theshares with voting rights, it is generally not considered that the Company has significant impacts on the invested entity, unless thereis clear evidence proving the contrary.
(4) Equity investment held for saleFor the remaining equity investments not classified as assets held for sale, the equity method is adopted for accounting treatment.
Equity investments classified as held for sale to associates that are no longer eligible to hold classified assets for sale areretrospectively adjusted using the equity method starting from the date that they are classified as held for sale.
(5) Impairment examination and providing of impairment provisionSee Note V. 18 for the assets impairment provision method for investment in subsidiaries and joint ventures.
13. Investment real estatesMeasuring mode of investment real estate
Measurement at fair valueBasis of choosing the measurement at fair valueFor investment real estates with an active real estate transaction market and the Group can obtain market price and other information
of same or similar real estates to reasonably estimate the investment real estates’ fair value, the Group will use the fair value mode to
measure the investment real estates subsequently. Variations in fair value are accounted into the current gain/loss account.The fair value of investment real estate is determined with reference to the current market prices of same or similar real estates in
active markets; when no such price is available, with reference to the recent transaction prices and consideration of factors includingtransaction background, date and district to reasonably estimate the fair value; or based on the estimated lease gains and present valueof related cash flows.
For investment real estate under construction (including investment real estate under construction for the first time), if the fair valuecannot be reliably determined but the expected fair value of the real estate after completion is continuously and reliably obtained, theinvestment real estate under construction is measured by cost. When the fair value can be measured reliably or after completion (theearlier one), it is measured at fair value. For an investment real estate whose fair value is proven unable to be obtained continuouslyand reliably by objective evidence, the real estate will be measured at cost basis until it is disposed and no residual value remains asassumed.
The difference of the proceeds from sales, transfer, retirement or destruction of investment real estates with book value and relatedtaxes deducted is accounted into the current gain/loss account.
Investment real estate that use the cost method for further measurement adopt the straight-line depreciation provision method. SeeNote V. 18 for the provision method.
14. Fixed assets(1) Recognition conditionsFixed assets is defined as the tangible assets which are held for the purpose of producing goods, providing services, lease or for
operation & management, and have more than one accounting year of service life.The fixed assets can only be recognized heneconomic interests related to the fixed assets are very likely to flow into the company and the costs of the fixed assets can be reliablymeasured. The Group measures fixed assets at the actual costs when the fixed assets are obtained
(2) Depreciation method
Type | (2) Depreciation method | Service year | Residual rate | Annual depreciation rate % |
Houses & buildings | Average age | 35-45 | 10% | 2%-2.57% |
Mechanical equipment | Average age | 10 | 10% | 9% |
Transportation facilities | Average age | 5 | 10% | 18% |
Electronics and other devices | Average age | 5 | 10% | 18% |
PV power plants | Average age | 20 | 5% | 4.75% |
15. Construction in processThe Group recognizes the cost of construction in process according to the actual construction expense, including necessary
engineering expenses, borrowing costs to be capitalized before the engineering reaches the preset service condition and other relatedcosts.
Construction in process will be transferred to fixed assets when it reaches the preset service condition.See Note V. 18 for the provision method for construction in process.16. Borrowing expenses(1) Recognition principles for capitalization of borrowing expensesBorrowing expenses occurred to the Group that can be accounted as purchasing or production of asset satisfying the conditions of
capitalizing, are capitalized and accounted as cost of related asset.Borrowing expenses start to be capitalized when all of thefollowings are satisfied:
(1) Asset expense has already occurred. Asset expenses include cash payment, non-cash asset transferring, or undertaking of debtwith interest done for purchasing or producing of assets;
(2) The borrowing expense has already occurred;(3) Purchasing or production activity, which is necessary for the asset to reach the useful status, has already started.(2) During borrowing expense capitalizationWhen the asset satisfying the capitalizing conditions has reached its usable or sellable status, capitalizing of borrowing expenses shall
be terminated. Borrowing expenses incurred after assets that meet capitalization conditions reach the service or sales conditions areaccounted into the current gain/loss account according to the actual amounts.
If the construction or production of assets satisfying the capitalizing conditions is suspended abnormally for over 3 months,capitalizing of borrowing expenses shall be suspended. During the normal suspension period, borrowing expenses will be capitalizedcontinuously.
(3) Calculation of the capitalization amount of borrowing expenseInterest expenses generated by special borrowings less the interests income obtained from the deposit of unused borrowings or
investment gains from temporary investment is capitalized; the capitalization amount for general borrowing is determined based onthe capitalization rate which is the exceeding part of the accumulative assets expense over weighted average of the assets expense ofthe special borrowing/used general borrowing. The capitalization ratio is the weighted average interest rate of general borrowings.
In the capitalization period, the exchange difference of special borrowings in foreign currencies should be fully capitalized. Theexchange difference should be recorded in the profit and loss of this period.
17. Intangible assets(1) Pricing method, service life and depreciation test
The Group’s intangible assets include land using rights, trademarks, patent, special technologies, and software.
Intangible assets are initially measured at costs and the useful life will be determined when obtained. Where the useful life is limited,the intangible assets will be amortized within the predicted useful life by using the amortization method that can reflect predictedrealization way of the economic benefit of the assets; whether the realization way cannot be reliably confirmed, use the straight-linemethod. If the useful life is uncertain, the intangible assets are not amortized.
Intangible assets with limited useful life are amortized as followings:
Type | Useful life | Basis of amortization |
Land using right | Beneficial age | Average age |
Trademarks and patents | 10 | Average age |
Proprietary technology | 10 | Average age |
Software | 5, 10 years | Average age |
At the end of each year, the Group will reexamine the useful life and amortization basis of intangible assets with limited useful life. Ifthey change, adjust the prediction and handle it according to accounting estimate changes.
On the balance sheet day, if the intangible assets become unlikely to bring future economic benefits for the Group, transfer all the
intangible assets’ book value into the current gain/loss account.
See Note V. 18 for the impairment provision method for intangible assets.
(2) Accounting policies for internal R&D expensesThe Group divides internal R&D project expenses into research and development expenses.The research expenses are accounted the current gain/loss account.Development expenses can only be capitalized when the following conditions are satisfied: the technology is feasible for use or sales;
there is the intention to use or sell the intangible assets; it can be proven that the product generated by the intangible assets isdemanded or the intangible assets in demanded; if the intangible is used internally, it can be proven that it is useful; with necessarytechnical and financial resources and other resources to complete the development of the intangible assets and the intangible assetscan be used or sold; the development expense can be reliably measured. If not, the development expense is accounted into the currentgain/loss account.
If a research project meets the above-mentioned conditions and passes the technical and economic feasibility study, the project willenter the development stage.
Expenses in the development stage capitalized are listed as development expense on the balance sheet and transferred to intangibleassets when the project reaches the useful condition.
18. Assets impairmentThe Group uses the cost mode to continue measuring the assets impairment to investment real estatement, fixed assets construction in
progress, intangible assets and goodwill (except for the inventories, investment real estate measured by the fair value mode, deferredincome tax assets and financial assets). The method is determined as follows:
The Group judges whether there is a sign of impairment to assets on the balance sheet day. If such sign exists, the Group estimatesthe recoverable amount and conducts the impairment test. Impairment test is conducted annually for goodwill generated by mergersand intangible assets that have not reached the useful condition no matter whether the impairment sign exists.
The recoverable amount is determined by the higher of the net of fair value minus disposal expense and the present value of thepredicted future cash flow. The Group estimates the recoverable amount on the individual asset item basis; whether it is hard toestimate the recoverable amount on the individual asset item basis, determine the recoverable amount based on the asset group thatthe assets belong to. The assets group is determined by whether the main cash flow generated by the group is independent from thosegenerated by other assets or assets groups.
When the recoverable amount of the assets or assets group is lower than its book value, the Group writes down the book value to therecoverable amount, the write-down amount is accounted into the current income account and the assets impairment provision ismade.
For goodwill impairment test, the book value of goodwill generated by mergers is amortized through reasonable measures since thepurchase day to related asset groups; those cannot be amortized to related assets groups are amortized to related combination of assetgroups. The related asset groups or combination of asset groups refer to those that can benefit from the synergistic effect of mergersand must not exceed to the reporting range determined by the Group.
When the impairment test is conducted, if there is sign of impairment to the asset group or combination of asset groups related togoodwill, first perform impair test for asset group or combination of asset groups without goodwill and calculate the recoverableamount and recognize the related impairment loss. Then conduct impairment test on those with goodwill, compare the book valuewith recoverable amount. If the recoverable amount is lower than the book value, recognize the impairment loss of the goodwill.
Once recognized, the asset impairment loss cannot be written back in subsequent accounting period.
19. Long-term amortizable expenses
The Group’s long-term amortizable expenses are measured at the actual costs and amortized averagely based on the beneficial term.
For long-term amortizable expenses that are not beneficial in the subsequent account periods, the residual value is fully accountedinto the current gain/loss account.
20. Staff remuneration(1) Accounting of operational leasing
The Group pays for the medical insurance, job injury insurance and breeding insurance and housing fund according to employees’
wages and bonus and recognizes them as liabilities, which are recorded into the profit and loss or related assets costs in the currentperiod. If the liabilities cannot be fully paid within 12 months upon the end of the report period in which the employees provideservice, and the financial impacts are substantial, the liabilities should be measured at the discounted amount.
(2) Accounting of post-employment welfareThe post-employment welfare of the Group is a defined plan, which means that the Company does not need to assume any
responsibility after making fixed contribution to an independent fund. The defined plan includes basic pension and unemploymentinsurance. The contribution of the plan is recognized as liabilities and recorded in the profit and loss of this period or related assetscosts.
(3) Accounting of dismiss welfareWhere the Group provides dismiss welfare for employees, the staff remuneration liabilities is recognized on the earlier one of the
following two date: when the Group cannot cancel the dismiss welfare provided for termination of employment or layoff; when theGroup recognizes the costs or expenses of reorganization related to the payment of dismiss welfare.
21. Anticipated liabilitiesWhen responsibilities occurred in connection to contingent issues, and all of the following conditions are satisfied, they are
recognized as expectable liability in the balance sheet:
(1) This responsibility is a current responsibility undertaken by the Group;(2) Execution of this responsibility may cause financial benefit outflow from the Group;(3) Amount of the liability can be reliably measured.Expected liabilities are initially measured at the best estimation on the expenses to exercise the current responsibility. The book value
of expected liability is revised at balance sheet day, and adjustment will be made to reflect current best estimation.
22. RevenueWhether the Company needs to comply with disclosure requirements of special industries
YesDecorationThe Company must comply with disclosure requirements of the Shenzhen Stock Exchange Industry Information Disclosure
Guideline No.6 – Listed Companies Engaged in Decoration Business.
(1) General principles1. Sales of goodsWhen all of the following conditions are satisfied, the sales of goods are recognized as sales income according to the contract amount
received or receivable from the buyer: (1) Main risks and rewards attached to the ownership of the goods have been transferred to thebuyer; (2) No succeeding power of administration or effective control is reserved which are usually attached to ownership; (3)Amount received can be reliably measured; (4) Related financial benefit may inflow to the Company; (5) Relative costs, occurred orwill occur, can be reliably measured.
2. Providing of labor serviceIf they are not in the same year, then use the estimation on percentage basis when it is possible.The completion percentage is the costs occurred on the total cost.The reliable estimation of the result of providing of labor service must meet the following conditions: A. the revenue can be reliably
measured; B. the economic benefit is very likely to flow into the company; C. the completion can be determined reliably; D. costsincurred or will be incurred can be reliably measured.
If the result cannot be reliably estimated, use the service cost amount of the compensation obtained or will be obtained to recognizethe revenue of the providing of labor service and recognize the incurred laber service cost as the current expense. If no compensationcan be obtained for incurred labor service cost, no revenue can be recognized.
3. Demising of asset using rightsThe revenue is recognized when the financial benefit in connection with the demising of asset using right was received and the
amount can be reliably measured.4. Construction contractsOn the balance sheet day, the Group recognizes the contract income and costs using the completion percentage method if the result of
the construction contract can be reliably estimated. If not, such contracts are treated differently. If the contract cost can be recovered,the revenue is recognized according to the actual contract costs that can be recovered and the contract cost is recognized as thecurrent expense; if not, the contract cost is recognized as the current expense and no revenue is recognized.
If the estimated total costs exceed the total revenue, the Group recognizes the estimated loss as the current expense.The competition percentage is determined by the share of the costs incurred in the total cost.
The reliable estimation of the result of a construction contract must meet the following conditions: A. the revenue can be reliablymeasured; B. the economic benefit is very likely to flow into the company; C. the completion cost can be clearly distinguished anddetermined reliably; D. the completion and costs that will be incurred for completion of the contract can be reliably recognized.
(2) Specific revenue recognition method
① Construction contracts
Metro screen door projects of the Company and Shenzhen Fangda Automatic System, and curtain wall project of Fangda Jianke areindividual construction contracts. They are accounted by the following means:
Construction contracts completed within a fiscal year are recognized for their income and cost upon completion.Income and expenses of the construction contracts carried over-year are recognized on percentage basis at balance sheet day when all
of the following conditions are satisfied: contract income can be reliably measured, relative financial benefit can inflow to theCompany; progress of the project and costs to complete the contract can be reliably recognized; cost occurred to complete thecontract can be clearly distinguished and reliably measured, which enables comparing of actual cost with predicted cost.
Contract costs are direct and indirect expenses occurred since the date when the contract is engaged till the completion day. Thecompetition percentage is determined by the share of the costs incurred in the total cost.
Construction contracts completed in current term are recognized for income according to the actual total income of the contract lessincome recognized in previous terms; meanwhile, the total costs of the contract less costs recognized in previous terms arerecognized as current contract costs. If the total contract cost is predicted to be greater than the predicted total income, the predictedloss shall be recognized as current cost instantly.
Parts of the curtain wall project under Fangda Jianke are outsourced, and administrative fees are collected at the agreed rate. Forthese construction contracts, income will be recognized when ongoing payment for the project is received and corresponding costsare transferred.
② Sales product
Revenue of products for domestic sales is recognized when the Group delivers the products and receives the sales payment or obtainsthe payment voucher; revenue for products for overseas sales is recognized at departure of the products.
③ Real estate sales
Income from real estate sales is recognized when the contract is signed and performed, project is developed and completed with therecord for the completion acceptance, the handover procedure is completed or property is deemed accepted by the customer as perthe property sales contract, the payment is received or it is believed that the payment can be received, and the cost can be measuredreliably.
23. Government subsidy(1) Judgment basis and accounting treatment of assets-related government subsidyGovernment subsidy is only recognized when the required conditions are met and the subsidy is received.When a government subsidy is monetary capital, it is measured at the received or receivable amount. None monetary capital are
measured at fair value; if no reliable fair value available, recognized at RMB1.Government subsidies related to assets are obtained by the Group to purchase, build or formulate in other manners long-term assets;
or subsidies related to benefits.For subsidies that can formulate long-term assets without clear government regulations, the part of the subsidies corresponding to the
asset value will be measured as assets-related government subsidies, while the rest of them will be measured as benefit-relatedgovernment subsidies. Where it is difficult to distinguish them from each them, the whole subsidies will be measured asbenefit-related government subsidies.
If the asset-related government subsidy is recognized as deferred gain, should be recorded in gain and loss in the service life.
(2) Judgment basis and accounting treatment of return-related government subsidyIf a government subsidy related to income is used to compensate for related costs or losses that have occurred, it shall be included in
the current profit or loss or write-down related costs; if it is used to compensate for the related costs or losses in the subsequentperiod, it shall be included in the deferred income. During the period in which the related cost, expense or loss is recognized, it isincluded in the current profit or loss or the relevant cost is written off. Government subsidy measured at the nominal amount isaccounted into current income account.The Group adopts a consistent approach to the same or similar government subsidies.
Government subsidy related to routine operations should be recorded in other gains or offset related cost. Government subsidy notrelated to routine operations should be recorded in non-operating income or expense.
When a confirmed government subsidy needs to be returned, the book value of the asset is adjusted against the book value of therelevant asset at initial recognition. If there is a related deferred income balance, the book balance of the related deferred income iswritten off and the excess is credited to the current profit or loss; In other cases, it is directly included in the current profit and loss.
The policy-based preferential loan obtained has interest subsidy. If the government allocates the interest-subsidy funds to the lendingbank, the loan amount actually received will be used as the entry value of the loan, and the borrowing cost will be calculated basedon the loan principal and policy-based preferential interest rate. If the government allocates the interest-bearing funds directly to theGroup, discount interest will offset the borrowing costs.
24. Differed income tax assets and differed income tax liabilitiesIncome tax includes current and deferred income taxExcept for the adjustment goodwill generated by mergers or deferred income tax
related to transactions or events directly accounted into the owners’ equity, income tax is accounted as income tax expense into the
current gain/loss account.The Group uses the temporary difference between the book value of the assets and liabilities on the balance sheet day and the tax
base and the liabilities method to recognize the deferred income tax.The taxable temporary difference recognizes the related deferred income tax liabilities, unless the taxable temporary difference is
created by the following transactions:
(1) Initial recognition of goodwill, or of assets or liabilities generated in transactions with the following features: the transaction is
not a merger and the transaction does not affect the accounting profit or taxable proceeds;(2) For taxable temporary difference related to investment in subsudiaries and affiliates, the reversal timing for the temporary
difference can be controlled and the difference is unlikely to be reversed in the foreseeable future.For deductible temporary difference, deductible loss and tax deduction that can be accounted in subsequent years, the Group
recognizes the incurred deferred income tax assets to the extent to the future income tax proceeds that is very likely to be received fordeducting deductible temporary difference, deductible loss and tax deduction, unless the deductible temporary difference is generatedin following transactions:
(1) the transaction is not a merger and the transaction does not affect the accounting profit or taxable proceeds;(2) for the taxable temporary difference related to investment in subsidiaries and affiliates, the corresponding deferred income tax
assets are recognized when the following condition is met: the temporary difference is very likely to be reversed in the foreseeablefuture and it is very likely to receive the taxable proceeds that can be used to deduct the deductible temporary difference.
On the balance sheet day, the Group measures the deferred income tax assets and liabilities with the tax rate applicable during thepredicted period during which the assets are recovered or the liabilities are paid off and reflects the income tax influence of the assetsrecovery and liabilities repayment way on the balance sheet day.
On the balance sheet day, the Group re-exmaines the book value of the deferred income tax assets. If it is unlikely to have adequate
taxable proceeds to reduct the benefits of the deferred income tax assets, less the deferred income tax assets’ book value. When there
is adequate taxable proceeds, the lessened amount will be reversed.
25. Leasing(1) Accounting of operational leasingThe Group transfers all the risks and rewards attached to the asset at substantially transferred to the lessee, it is recognized as
financial leasing, and the others are operational leasing. The Group's lease forms are mainly operating leases.(1) The Group is the leasorRentals from operational leasing are recognized as current gains on straight basis to the periods of leasing. Initial direct expenses are
recorded to current income account.(2) The Group is the leasee
Rentals in operational leasing are recorded to relative capital cost or current income account on straight basis to the periods of leasing.Initial direct expenses are recorded to current income account.
26. Other significant accounting policies and estimatesThe Group continuously reviews significant accounting judgment and estimate adopted for the reasonable forecast of future events
based on its historical experience and other factors.Significant accounting judgment and assumptions that may lead to major adjustment of the book value of assets and liabilities in the
next accounting year are listed as follows:
(1) Goodwill impairment
The Group judges whether there is impairment to goodwill at least annually. This required valuation of the use value of the assetgroups with goodwill. While estimating the use value, the Group needs to estimate the cash flow from the asset group in the futureand choose the proper discount rate to calculate the present value of the future cash flow.
(2) Estimate of fair valueThe Group uses fair value to measure investment real estate and needs to estimate the fair value of investment real estate at least
quarterly. This requires the management to reasonably estimate the fair value of the investment real estate with the helf of valuationexperts.
(3) Deferred income tax assetsIf there is adequate taxable profit to deduct the loss, the deferred income tax assets should be recognized by all the unused tax loss.
This requires the management to make a lot of judgment to forecast the time and amount of future taxable profit and determine theamount of the deferred tax assets based on the taxation strategy.
(4) Construction contractsThe Group recognizes income based on the completion of individual construction contract. The management determines the
completion percentage based on the actual cost in the total budget and forecasts the contract income. The starting and completiondates of construction contracts fall in different account periods. The Group will review and adjust contract income and costestimation in budgets (if the actual contract income is less than the estimate or actual contract cost, contract estimation loss provisionwill be made).
(5) Development costFor property that has been handed over with income recognized, but whose public facilities have not been constructed or not been
completed, the management will estimate the development cost for the part that has not been started according to the budget to reflectthe operation result of the property sales.
(6) Accounting of hedgingWhen the hedge relationship begins, the Group specifies the hedge relationship in writing to specify the follow: risks management
target and hedging strategy; nature of the hedged item and quantity; nature and quantity of hedging instruments, nature andidentification of hedged risks; evaluation of the hedging effectiveness, including the economic relationship between the hedged itemand hedging instrument, hedging ratio, analysis of the hedging ineffectiveness source; the beginning date of the specified hedging
relationship.Cash flow hedgingDuring the existence of the hedging relationship, the part of the cumulative gain or loss of the hedging instrument within the change
to the current value of the cumulative cash flow of the hedged item is included into other misc. incomes. The part that is lower orlarger than the cash flow change is included into the gain or loss of the current period.
When the hedging relationship ends and related inventory is recognized, the hedging instrument gain or loss recognized in ―Othermisc. income hedging reserve‖ will be transferred to ―Raw materials‖.
27. Major changes in accounting policies and estimates(1) Changes in accounting policies
□ Applicable √ Inapplicable
(2) Changes in major accounting estimates
□ Applicable √ Inapplicable
28. OthersVI. Taxation1. Major taxes and tax rates
Tax | Tax basis | Tax rate |
VAT | Taxable income | 3%、5%、6%、11%、13%、17% |
City maintenance and construction tax | Taxable turnover | 1%、5%、7% |
Enterprise income tax | Taxable turnover | See the following table |
Education surtax | Taxable turnover | 3% |
Local education surtax | Taxable turnover | 2% |
Tax rates applicable for different tax payers
Tax payer | Income tax rate |
The Company | 25% |
Shenzhen Fangda Jianke Co., Ltd. (hereinafter Fangda Jianke) | 15% |
Shenzhen Fangda Automatic System Co., Ltd. (hereinafter Fangda Automatic) | 15% |
Fangda New Material (Jiangxi) Co., Ltd. (hereinafter Fangda New Material) | 15% |
Dongguan Fangda New Material Co., Ltd. (hereinafter Dongguan New Material) | 15% |
Shenzhen Kexunda Software Co., Ltd. (hereinafter Kexunda) | 25% |
Chengdu Fangda Construction Technology Co., Ltd. (hereinafter Chengdu Fangda) | 15% |
Fangda Decoration Engineering (Shenyang) Co., Ltd. (hereinafter Shenyang Decoration) | 25% |
Shenzhen Fangda Property Development Co., Ltd. (hereinafter Fangda Property Development) | 25% |
Shenzhen Fangda New Energy Co., Ltd. (hereinafter Fangda New Energy) | 25% |
Shenzhen Fangda Property Development Co., Ltd. (hereinafter Fangda Property Development) | 25% |
Jiangxi Fangda Property Development Co., Ltd. (hereinafter Jiangxi Property Development) | 25% |
Pingxiang Fangda Luxin New Energy Co., Ltd. (hereinafter Luxin New Energy) | 25% |
Pingxiang Xiangdong Fangda New Energy Co., Ltd. (hereinafter Xiangdong New Energy) | 25% |
Nanchang Xinjian Fangda New Energy Co., Ltd. (hereinafter Xinjian New Energy) | 25% |
Dongguan Fangda New Energy Co., Ltd. (hereinafter Dongguan New Energy) | 25% |
Shenzhen QIanhai Kechuangyuan Software Co., Lt.d (hereinafter Kechuangyuan Software) | 15% |
Fangda Automatic (Hong Kong) Co., Ltd. (hereinafter Automation Hong Kong) | 16.50% |
Shihui International Holding Co., Ltd. (hereinafter Shihui International) | 16.50% |
Shenzhen Hongjun Investment Co., Ltd. | 25% |
Fangda Australia Pty Ltd (hereinafter Jianke Australia) | 30% |
Shanghai Fangda Jingling Technology Co., Ltd. (hereinafter Jingling Technology) | 25% |
Shenzhen Fangda Cloud Rail Technology Co., Ltd. (hereinafter Fangda Cloud Rail) | 25% |
2. Tax preference(1) According to the Certification of High-tech Enterprise issued by Shenzhen Commission of Technological Innovation, Shenzhen
Commission of Finance, Shenzhen National Tax Bureau, and Shenzhen Local Tax Bureau on 19.06.15, Fangda Jianke was entitled toenjoy a tax preference of enterprise income tax of 15% for three years (2015-2017) since the qualifications were awarded.
(2) According to the Certification of High-tech Enterprise issued by Shenzhen Commission of Technological Innovation, ShenzhenCommission of Finance, Shenzhen National Tax Bureau, and Shenzhen Local Tax Bureau on 19.06.15, Fangda Decoration wasentitled to enjoy a tax preference of enterprise income tax of 15% for three years (2015-2017) since the qualifications were awarded.
(3) According to the Certification of High-tech Enterprise issued by Jiangxi Ministry of Science and Technology, Jiangxi Ministry ofFinance, Jiangxi National Tax Bureau, and Jiangxi Local Tax Bureau on 25.09.15, Fangda New Material was entitled to enjoy a taxpreference of enterprise income tax of 15% for three years (2015-2017) since the qualifications were awarded.
(4) On December 25, 2013, Kexunda was certified by Shenzhen Nanshan National Tax Bureau as a software and integrated circuitdesigner according to the Shenzhen National Tax Reduction Registration [2013] No.739 and will enjoy exemption from theenterprise income tax for two years and 50% reduction of the same tax for another three years from the year that the company startsmaking a net profit. Kexunda started making profits in 2013 and therefore starts to enjoy the exemption. Kexunda entered thesemi-exemption period in 2015.
(5) On November 7, 2014, Chengdu Fangda was certified by Sichuan Xinjin National Tax Bureau as an encourage industry companyin the west China (Xin Jin National Tax Doc. [zzy024]) and started to enjoy a tax rate of 15%.
(6) On 02.11.15, Dongguan New Energy was certified by Dongguan National Tax Bureau Songshanhu branch as the nationalsupported public infrastructure project according to the Song Shan Hu Tax Doc [2015] 3305. The company is exempted fromenterprise income tax for three years and halfly exempted for another three years. In 2015, the company entered the exemptionperiod.
(7) On 02.03.16, according to the document issued by Luxi National Tax Bureau, the PV power generation project undertaken byPingxiang Fangda Luxin New Energy Co., Ltd, became the infrastructure project supported by the central government. The companyenjoys a three-year enterprise income tax relief and 50% reduction for another three years. In 2016, the company entered theexemption period.
(8) On 02.06.16, according to the document issued by Nanchang Xinjian District National Tax Bureau, the PV power generationproject undertaken by subsidiary Xinjian New Energy Company, became the infrastructure project supported by the centralgovernment. The company enjoys a three-year enterprise income tax relief and 50% reduction for another three years. In 2016, thecompany entered the exemption period.
(9) On 10.03.17, according to the registration to Shenzhen National Tax Bureau, subsidiary Kechuangyuan Software became a newlyestablished software and integrated circuit designing company and can enjoy the two-year full exemption and three-yearhalf-exemption of the enterprise income tax from the first year that the company records profit. Kexunda started making profits in2016 and therefore starts to enjoy the exemption.
(10) According to the Certification of High-tech Enterprise issued by Guangdong Ministry of Science and Technology, GuangdongMinistry of Finance, Guangdong National Tax Bureau, and Guangdong Local Tax Bureau on 25.09.15, Dongguan New Material wasentitled to enjoy a tax preference of enterprise income tax of 15% for three years (2016-2018) since the qualifications were awarded.
3. OthersVII. Notes to the consolidated financial statements1. Monetary capital
In RMB
Item | Closing balance | Opening balance |
Inventory cash: | 205,631.16 | 42,636.09 |
Bank deposits | 953,083,087.78 | 923,163,199.39 |
Other monetary capital | 245,906,456.78 | 257,192,644.03 |
Total | 1,199,195,175.72 | 1,180,398,479.51 |
Including: total amount deposited in overseas | 22,824,218.99 | 24,527,445.09 |
Other noteThe closing balance of the book value of the other monetary capital RMB245,906,456.78 is mainly the futures, bank acceptance billand guarantee deposit and investment, including a deposit of RMB157,258,170.83. The deposit and frozen deposit shall not betreated as cash and cash equivalent in the preparation of cash flow statements.
2. Financial assets measured at fair value with variations accounted into current income account
In RMB
Item | Closing balance | Opening balance |
Transactional financial assets | 191,425,156.75 | |
Others | 191,425,156.75 | |
Total | 191,425,156.75 |
Others:
3. Derivative financial assets
√ Applicable □ Inapplicable
In RMB
Item | Closing balance | Opening balance |
Others:
4. Notes receivable(1) Classification of notes receivable
In RMB
Item | Closing balance | Opening balance |
Bank acceptance | 7,523,015.29 | 12,376,780.96 |
Commercial acceptance | 53,673,056.21 | 27,259,656.24 |
Total | 61,196,071.50 | 39,636,437.20 |
(2) Pledged notes receivable at the end of period
In RMB
Item | Amount pledged at the end of the period |
(3) The Group has no endorsed or discounted immature receivable notes at the end of the period.
In RMB
Item | De-recognized amount | Not de-recognized amount |
Bank acceptance | 15,498,361.56 | |
Commercial acceptance | 16,605,812.05 | |
Total | 32,104,173.61 |
(4) Notes transferred to accounts receivable due to default of the issue at the end of period
In RMB
Item | Amount transferred to accounts receivable at the end of the period |
Commercial acceptance | 5,960,429.45 |
Total | 5,960,429.45 |
Other note
There is no objective evidence that the Group’s bills receivable are impaired and no provision for impairment of bills receivable has
been accrued.Bank acceptance bills used for endorsement or discounting are accepted by banks with higher credit ratings, the risk of credit risk anddeferred payment is small, and the interest rate risk related to the bills has been transferred to banks, and the main risks and rewardson the ownership of the bills can be judged Transfer, so the termination of confirmation.
5. Account receivable(1) Account receivable disclosed by categories
In RMB
Type | Closing balance | Opening balance | ||||
Remaining book | Bad debt provision | Book | Remaining book | Bad debt provision | Book value |
value | value | value | ||||||||
Amount | Proportion | Amount | Provision rate | Amount | Proportion | Amount | Provision rate | |||
Recognition and providing of bad debt provisions on groups | 2,294,287,487.96 | 100.00% | 216,669,596.18 | 9.44% | 2,077,617,891.78 | 2,123,268,342.78 | 99.38% | 202,895,916.62 | 9.56% | 1,920,372,426.16 |
Account receivable with minor individual amount and bad debt provision provided individually | 13,339,659.73 | 0.62% | 13,339,659.73 | 100.00% | ||||||
Total | 2,294,287,487.96 | 100.00% | 216,669,596.18 | 9.44% | 2,077,617,891.78 | 2,136,608,002.51 | 100.00% | 216,235,576.35 | 10.12% | 1,920,372,426.16 |
Account receivable with major individual amount and bad debt provision provided individually at the end of the period:
□ Applicable √ Inapplicable
In the group, the account receivable of which bad debt provision is made through the account aging method:
√ Applicable □ Inapplicable
In RMB
Age | Closing balance | ||
Account receivable | Bad debt provision | Provision rate | |
Sub-item of within 1 year | |||
Less than 1 year | 1,092,290,646.04 | 12,759,334.43 | 1.17% |
Subtotal for less than 1 year | 1,092,290,646.04 | 12,759,334.43 | 1.17% |
1-2 years | 586,537,239.34 | 30,369,736.28 | 5.18% |
2-3 years | 264,556,651.96 | 53,133,954.73 | 20.08% |
3-4 years | 139,874,662.96 | 42,358,884.51 | 30.28% |
4-5 years | 90,239,490.16 | 45,148,888.27 | 50.03% |
Over 5 years | 32,898,797.96 | 32,898,797.96 | 100.00% |
Total | 2,206,397,488.42 | 216,669,596.18 | 9.82% |
Group recognition basis:
The Company must comply with disclosure requirements of the Shenzhen Stock Exchange Industry Information Disclosure
Guideline No.6 – Listed Companies Engaged in Decoration Business.
Account receivable adopting the balance percentage method in the group
□ Applicable √ Inapplicable
Account receivable adopting other methods in the group:
At the end of the period, the balance of receivables from the real estate properties sold by bank mortgage payment wasRMB87,889,999.54. Because the risk of bad debts was extremely small, no provision for bad debts was made.
(2) Bad debt provision made, returned or recovered in the periodA bad debt provision of RMB434,019.83 was made in the period. RMB was recovered or reversed.
Including significant recovery or reversal:
In RMB
Entity | Written-back or recovered amount | Method |
(3) Written-off account receivable during the period
In RMB
Item | Amount |
Including significant account receivable:
In RMB
Entity | Nature | Amount | Reason | Writing-off procedure | Related transaction |
Notes to written-off account receivable(4) Balance of top 5 accounts receivable at the end of the periodThe total balance of top-five accounts receivable at the end of the period is RMB388,541,008.96, accounting for 16.94% of the total
remaining balance of all accounts receivable. The bad debt provision made at the end of the period is RMB22,169,321.40.6. Prepayment(1) Account age of prepayments
In RMB
Age | Closing balance | Opening balance | ||
Amount | Proportion | Amount | Proportion | |
Less than 1 year | 17,693,649.27 | 40.33% | 45,346,974.64 | 82.93% |
1-2 years | 24,240,634.11 | 55.25% | 7,891,890.96 | 14.43% |
2-3 years | 963,268.28 | 2.20% | 679,375.39 | 1.24% |
Over 3 years | 973,962.43 | 2.22% | 762,028.85 | 1.40% |
Total | 43,871,514.09 | -- | 54,680,269.84 | -- |
Explanation of non-settlement of significant prepayments with an accounting age of more than 1 year:
(2) Balance of top 5 prepayments at the end of the periodThe total balance of top-five prepayments at the end of the period is RMB39,226,457.29, accounting for 89.41% of the total
remaining balance of all accounts receivable. The bad debt provision made at the end of the period is RMB0.
Others:
7. Receivable interest(1) Receivable interest
In RMB
Item | Closing balance | Opening balance |
Bank financial products | 2,374,520.56 | 3,829,315.07 |
Total | 2,374,520.56 | 3,829,315.07 |
8. Other receivables(1) Other receivables disclosed by categories
In RMB
Type | Closing balance | Opening balance | ||||||||
Remaining book value | Bad debt provision | Book value | Remaining book value | Bad debt provision | Book value | |||||
Amount | Proportion | Amount | Provision rate | Amount | Proportion | Amount | Provision rate | |||
Other receivables with major individual amount and bad debt provision provided individually | 69,340,548.52 | 40.30% | 69,340,548.52 | 100.00% | 0.00 | 69,380,548.52 | 48.04% | 69,380,548.52 | 100.00% | |
(2) Recognition and providing of bad debt provisions on groups | 102,631,665.60 | 59.64% | 19,336,030.91 | 18.84% | 83,295,634.69 | 74,563,729.50 | 51.62% | 17,681,770.19 | 23.71% | 56,881,959.31 |
Other receivables with minor individual amount and bad debt provision provided individually | 108,976.00 | 0.06% | 108,976.00 | 100.00% | 0.00 | 495,772.63 | 0.34% | 302,374.32 | 60.99% | 193,398.31 |
Total | 172,081,190.12 | 100.00% | 88,785,555.43 | 51.60% | 83,295,634.69 | 144,440,050.65 | 100.00% | 87,364,693.03 | 60.49% | 57,075,357.62 |
Other receivables with major individual amount and bad debt provision provided individually at the end of the period:
√ Applicable □ Inapplicable
In RMB
Other receivables (by | Closing balance |
entity) | Other receivables | Bad debt provision | Provision rate | Reason |
Fangda SOZN | 69,340,548.52 | 69,340,548.52 | 100.00% | |
Total | 69,340,548.52 | 69,340,548.52 | -- | -- |
In the group, the other receivables of which bad debt provision are made through the account aging method:
√ Applicable □ Inapplicable
In RMB
Age | Closing balance | ||
Other receivables | Bad debt provision | Provision rate | |
Sub-item of within 1 year | |||
Less than 1 year | 67,541,688.92 | 2,026,250.69 | 3.00% |
Subtotal for less than 1 year | 67,541,688.92 | 2,026,250.69 | 3.00% |
1-2 years | 6,360,027.49 | 636,002.75 | 10.00% |
2-3 years | 14,105,836.42 | 4,231,750.93 | 30.00% |
3-4 years | 4,053,104.96 | 2,026,552.49 | 50.00% |
4-5 years | 777,668.79 | 622,135.03 | 80.00% |
Over 5 years | 9,793,339.02 | 9,793,339.02 | 100.00% |
Total | 102,631,665.60 | 19,336,030.91 | 18.85% |
Group recognition basis:
Other receivables adopting the balance percentage method in the group:
□ Applicable √ Inapplicable
Other receivables adopting other methods in the group
□ Applicable √ Inapplicable
(2) Bad debt provision made, returned or recovered in the periodA bad debt provision of RMB1,420,862.40 was made in the period. RMB was recovered or reversed.
Including significant recovery or reversal:
In RMB
Entity | Written-back or recovered amount | Method |
(3) Other receivable written off in the current period
In RMB
Item | Amount |
Including significant other receivable:
In RMB
Entity | Nature | Amount | Reason | Writing-off | Related transaction |
Notes to written-off other receivables:
(4) Other receivables are disclosed by nature
In RMB
procedureBy nature
By nature | Closing balance of book value | Opening balance of book value |
Deposit | 65,160,104.28 | 48,666,321.95 |
Construction borrowing and advanced payment | 9,090,940.56 | 8,721,385.12 |
Staff borrowing and petty cash | 5,142,003.25 | 5,532,782.96 |
Receivable refund of VAT | 709,907.14 | 445,607.69 |
Fangda SOZN | 69,340,548.52 | 69,380,548.52 |
Others | 22,637,686.37 | 11,693,404.41 |
Total | 172,081,190.12 | 144,440,050.65 |
(5) Balance of top 5 other receivables at the end of the period
In RMB
Entity | By nature | Closing balance | Age | Percentage (%) | Balance of bad debt provision at the end of the period |
Guangdong Fangda SOZN Lighting Co., Ltd. | Debt from original subsidiary | 69,340,548.52 | 3-4 years | 40.30% | 69,340,548.52 |
Shenzhen Longhua District Public Resource Trading Center | Deposit | 20,000,000.00 | Less than 1 year | 11.62% | 600,000.00 |
Wang Weihong | Advanced construction fee | 13,969,862.10 | Over 4 years | 8.12% | 5,179,934.55 |
China Merchants Futures Brokerage Co., Ltd. | Deposit | 10,245,885.00 | Less than 1 year | 5.95% | 370,404.05 |
Lanzhou Railway Transport Co., Ltd. | Deposit | 6,931,316.60 | 2-3 years | 4.03% | 2,079,394.98 |
Total | -- | 120,487,612.22 | -- | 70.02% | 77,570,282.10 |
Others:
9. Inventories(1) Classification of inventories
In RMB
Item | Closing balance | Opening balance | ||||
Remaining book value | Depreciation provision | Book value | Remaining book value | Depreciation provision | Book value | |
Raw materials | 68,287,804.67 | 55,182.86 | 68,232,621.81 | 60,999,279.59 | 55,182.86 | 60,944,096.73 |
Product in process | 56,687,516.21 | 0.00 | 56,687,516.21 | 31,718,230.82 | 31,718,230.82 | |
Finished goods in stock | 9,706,345.47 | 0.00 | 9,706,345.47 | 11,569,608.79 | 11,569,608.79 | |
Assets unsettled for finished construction contracts | 158,578,196.96 | 0.00 | 158,578,196.96 | 166,288,661.69 | 166,288,661.69 | |
Development cost | 211,569,756.50 | 211,569,756.50 | 209,395,947.66 | 209,395,947.66 | ||
Development products | 216,610,074.94 | 216,610,074.94 | 337,505,615.12 | 337,505,615.12 | ||
Low price consumable | 17,374.15 | 0.00 | 17,374.15 | 41,725.37 | 41,725.37 | |
OEM materials | 1,786,223.05 | 0.00 | 1,786,223.05 | 2,147,074.49 | 2,147,074.49 | |
Goods delivered | 3,201,094.21 | 0.00 | 3,201,094.21 | |||
Total | 726,444,386.16 | 55,182.86 | 726,389,203.30 | 819,666,143.53 | 55,182.86 | 819,610,960.67 |
Whether Company needs to comply with disclosure requirements of the Shenzhen Stock Exchange Industry Information Disclosure
Guideline No.4 – Listed Companies Engaged in Seed and Plantation Business
No(2) Inventory depreciation provision
In RMB
Item | Opening balance | Increase in this period | Decrease in this period | Closing balance | ||
Provision | Others | Recover or write-off | Others | |||
Raw materials | 55,182.86 | 55,182.86 | ||||
Product in process | 0.00 | |||||
Finished goods in | 0.00 |
stock | ||||||
Assets unsettled for finished construction contracts | 0.00 | |||||
Total | 55,182.86 | 55,182.86 |
(3) Balance at the end of the period includes capitalization of borrowing expenseThe balance at the end of the period includes capitalization of borrowing expense of Fangda Town project of RMB7,785,153.91. The
capitalization amount of cumulative borrowing expenses is RMB120,294,570.53, of which RMB9,293,934.39 occurred in this year.(4) Assets unsettled for finished construction contracts at the end of the period
In RMB
Item | Amount |
Accumulative occurred costs | 6,981,959,708.12 |
Accumulative recognized gross margin | 1,035,918,349.30 |
Settled amount | 7,859,299,860.46 |
Assets unsettled for finished construction contracts | 158,578,196.96 |
Others:
10. Other current assets
In RMB
Item | Closing balance | Opening balance |
Input tax to be deducted | 66,232,870.42 | 31,554,835.73 |
Bank financial products | 200,000,000.00 | 400,000,000.00 |
Prepaid income tax | 3,216,614.08 | 5,861,896.52 |
Prepaid VAT | 1,271,090.83 | 2,233,706.21 |
Other prepaid taxes | 11,502.34 | |
Tax to be input | 228,552.26 | |
Total | 270,720,575.33 | 439,890,493.06 |
Others:
11. Sellable financial assets(1) Sellable financial assets
In RMB
Item | Closing balance | Opening balance | ||||
Remaining book value | Impairment provision | Book value | Remaining book value | Impairment provision | Book value | |
Sellable equity instruments: | 28,562,575.67 | 28,562,575.67 | 28,562,575.67 | 28,562,575.67 | ||
Measured at cost | 28,562,575.67 | 28,562,575.67 | 28,562,575.67 | 28,562,575.67 | ||
Total | 28,562,575.67 | 28,562,575.67 | 28,562,575.67 | 28,562,575.67 |
(2) Sellable financial assets messaged at costs at the end of the period
In RMB
Invested entity | Remaining book value | Impairment provision | Shareholding in the invested entity | Cash dividend in the period | ||||||
Beginning of the period | Increase | Decrease | Closing balance | Beginning of the period | Increase | Decrease | Closing balance | |||
Shenyang Fangda | 28,562,575.67 | 28,562,575.67 | 64.58% | |||||||
Total | 28,562,575.67 | 28,562,575.67 | -- |
12. Long-term share equity investment
In RMB
Invested entity | Opening balance | Change (+,-) | Closing balance | Balance of impairment provision at the end of the period | |||||||
Increased investment | Decreased investment | Investment gain and loss recognized using the equity method | Other miscellaneous income adjustment | Other equity change | Cash dividend or profit announced | Impairment provision | Others | ||||
1. Joint venture | |||||||||||
2. Associate | |||||||||||
Shenzhen Ganshang Joint Investment Co., Ltd. | 8,472,360.71 | -3,454.95 | 8,468,905.76 | ||||||||
Shenzhen | 6,469,694 | -944,585. | 5,525,109 |
Huihai Yirong Internet Service Co., Ltd. | .91 | 78 | .13 | ||||||||
Jiangxi Business Innovative Property Joint Stock Co., Ltd. | 19,200,000.00 | 36,800,000.00 | -122,960.04 | 55,877,039.96 | |||||||
Subtotal | 34,142,055.62 | 36,800,000.00 | -1,071,000.77 | 69,871,054.85 | |||||||
Total | 34,142,055.62 | 36,800,000.00 | -1,071,000.77 | 69,871,054.85 |
Other note(2) In this period, the subsidiary Hongjun Investment added a new investment of RMB 36.80 million to Jiangxi Business InnovativeProperty Joint Stock Co., Ltd., holding 16% of the shares and appointing a director on the board of directors.
13. Investment real estates(1) Investment real estate measured at costs
√ Applicable □ Inapplicable
In RMB
Item | Houses & buildings | Land using right | Construction in process | Total |
I. Book value | ||||
1. Opening balance | 767,970,582.63 | 767,970,582.63 | ||
2. Increase in this period | 1,659,804.76 | 1,659,804.76 | ||
(1) External purchase | ||||
(2) Transfer-in from inventory\fixed assets\construction in progress | 1,659,804.76 | 1,659,804.76 | ||
(3) Increase due to enterprise merger |
3. Decrease in this period | ||||
(1) Purchase | ||||
Other transfer-out | ||||
4. Closing balance | 769,630,387.39 | 769,630,387.39 | ||
II. Accumulative depreciation and amortization | ||||
1. Opening balance | 6,455,037.77 | 6,455,037.77 | ||
2. Increase in this period | 943,799.03 | 943,799.03 | ||
(1) Provision or amortization | 417,270.06 | 417,270.06 | ||
(2) Fixed assets | 526,528.97 | 526,528.97 | ||
3. Decrease in this period | ||||
(1) Purchase | ||||
Other transfer-out | ||||
4. Closing balance | 7,398,836.80 | 7,398,836.80 | ||
III. Impairment provision | ||||
1. Opening balance | ||||
2. Increase in this period | ||||
(1) Provision | ||||
3. Decrease in this period | ||||
(1) Purchase | ||||
Other transfer-out | ||||
4. Closing balance | ||||
IV. Book value | ||||
1. Closing book | 762,231,550.59 | 762,231,550.59 |
value | ||||
2. Opening book value | 761,515,544.86 | 761,515,544.86 |
(2) Investment real estate measured at fair value
√ Applicable □ Inapplicable
In RMB
Item | Houses & buildings | Land using right | Construction in process | Total |
I. Opening balance | 1,492,278,859.69 | 1,492,278,859.69 | ||
II. Change in this period | ||||
Add: external purchase | ||||
Transfer-in from inventory\fixed assets\construction in progress | 83,046,894.38 | 83,046,894.38 | ||
Increase due to enterprise merger | ||||
Less: disposal | 5,343,905.00 | 5,343,905.00 | ||
Other transfer-out | ||||
Change in fair value | ||||
III. Closing balance | 1,569,981,849.07 | 1,569,981,849.07 |
(3) Investment real estate without ownership certificate
In RMB
Item | Book value | Reason |
Commercial podium of Fangda Town | 1,229,634,705.70 | Under initial registration |
Building 1# of Fangda Town | 846,945,841.00 | Not completed (since it will be used for rental after completion, it will be included in the investment real estate according to the cost) |
Other note
14. Fixed assets(1) Fixed assets
In RMB
Item | Houses & buildings | PV power plants | Mechanical equipment | Transport equipment | Electronics and other devices | Total |
I. Original book value: | ||||||
1. Opening balance | 352,537,411.13 | 129,638,636.81 | 119,041,075.24 | 20,314,073.83 | 47,717,030.59 | 669,248,227.60 |
2. Increase in this period | 24,662,085.83 | 40,692.31 | 1,010,683.76 | 369,128.21 | 388,412.43 | 26,471,002.54 |
(1) Purchase | 24,662,085.83 | 40,692.31 | 1,010,683.76 | 369,128.21 | 388,412.43 | 26,471,002.54 |
(2) Transfer-in of construction in progress | ||||||
(3) Increase due to enterprise merger | ||||||
3. Decrease in this period | 8,914,051.50 | 25,405.53 | 5,280.00 | 36,066.70 | 8,980,803.73 | |
(1) Disposal or retirement | 7,254,246.74 | 25,405.53 | 5,280.00 | 36,066.70 | 7,320,998.97 | |
(2) Investment real estate transfer-out | 1,659,804.76 | 1,659,804.76 | ||||
4. Closing balance | 368,285,445.46 | 129,679,329.12 | 120,026,353.47 | 20,677,922.04 | 48,069,376.32 | 686,738,426.41 |
II. Accumulative depreciation | ||||||
1. Opening balance | 56,287,505.21 | 9,896,036.60 | 95,637,048.49 | 13,893,304.21 | 24,061,664.41 | 199,775,558.92 |
2. Increase in this period | 5,020,766.60 | 3,078,980.50 | 1,823,913.85 | 806,517.51 | 1,372,219.60 | 12,102,398.06 |
(1) Provision | 5,020,766.60 | 3,078,980.50 | 1,823,913.85 | 806,517.51 | 1,372,219.60 | 12,102,398.06 |
3. Decrease in this period | 593,677.00 | 22,864.98 | 4,752.00 | 32,460.03 | 653,754.01 | |
(1) Disposal or retirement | 67,148.03 | 22,864.98 | 4,752.00 | 32,460.03 | 127,225.04 | |
(2) Investment real estate transfer-out | 526,528.97 | 526,528.97 | ||||
4. Closing balance | 60,714,594.81 | 12,975,017.10 | 97,438,097.36 | 14,695,069.72 | 25,401,423.98 | 211,224,202.97 |
III. Impairment provision | ||||||
1. Opening balance | 1,354,389.50 | 1,354,389.50 | ||||
2. Increase in this period | ||||||
(1) Provision | ||||||
3. Decrease in this period | ||||||
(1) Disposal or retirement | ||||||
4. Closing balance | 1,354,389.50 | 1,354,389.50 | ||||
IV. Book value | ||||||
1. Closing book value | 307,570,850.65 | 116,704,312.02 | 21,233,866.61 | 5,982,852.32 | 22,667,952.34 | 474,159,833.94 |
2. Opening book value | 296,249,905.92 | 119,742,600.21 | 22,049,637.25 | 6,420,769.62 | 23,655,366.18 | 468,118,279.18 |
(2) Fixed assets without ownership certificate
In RMB
Item | Book value | Reason |
Houses in Urumuqi for offsetting debt | 538,924.59 | Historical reasons |
Yuehai Office Building C 502 | 142,776.45 | Historical reasons |
Other note
On 30.06.18, the cumulative depreciation of the original value of RMB60,287,329.40 in the Group’s houses and buildings is
RMB8,218,384.06. The net value of RMB52,839,273.10 has been pledged to Shenzhen OCT branch of China Construction Bank.
The relevant borrowing has been repaid, but the pledge has not been released.15. Construction in process(1) Construction in progress
In RMB
Item | Closing balance | Opening balance | ||||
Remaining book value | Impairment provision | Book value | Remaining book value | Impairment provision | Book value | |
PV power generation project | 1,703,080.57 | 1,703,080.57 | 1,703,080.57 | 1,703,080.57 | ||
Chengda Fangda’s Xinjin energy-saving green curtain wall project | 1,115,549.18 | 1,115,549.18 | 965,118.05 | 965,118.05 | ||
Fangda Group China East Base | 1,630.00 | 1,630.00 | ||||
Total | 2,820,259.75 | 2,820,259.75 | 2,668,198.62 | 2,668,198.62 |
(2) Changes in major construction in process in this period
In RMB
Project | Budget | Opening balance | Increase in this period | +Amount transfer-in to fixed assets in this period | Other decrease in this period | Closing balance | Proportion of accumulative engineering investment in the budget | Project progress | Accumulative capitalized interest | Including: capitalized interest for the current period | Interest capitalization rate | Capital source |
Xiabu 20MWp PV power plant project | 168,000,000.00 | 1,703,080.57 | 1,703,080.57 | 1.01% | Ground leveling | Others | ||||||
Chengda Fangda’s Xinjin | 35,000,000.00 | 965,118.05 | 150,431.13 | 1,115,549.18 | 3.19% | Preliminary preparati | Others |
energy-saving green curtain wall project | on | |||||||||||
Total | 203,000,000.00 | 2,668,198.62 | 150,431.13 | 2,818,629.75 | -- | -- | -- |
16. Intangible assets(1) Intangible assets
In RMB
Item | Land using right | Patent | Unpatented technologies | Computer software | Total |
I. Book value | |||||
1. Opening balance | 56,497,540.74 | 10,458,271.30 | 5,719,888.37 | 7,928,758.80 | 80,604,459.21 |
2. Increase in this period | |||||
(1) Purchase | 21,750,000.00 | 177,680.25 | 749,845.53 | 22,677,525.78 | |
(2) Internal R&D | |||||
(3) Increase due to enterprise merger | |||||
3. Decrease in this period | |||||
(1) Purchase | |||||
4. Closing balance | 78,247,540.74 | 10,635,951.55 | 5,719,888.37 | 8,678,604.33 | 103,281,984.99 |
II. Accumulative amortization | |||||
1. Opening balance | 8,816,354.27 | 3,705,177.97 | 4,666,638.58 | 4,546,843.86 | 21,735,014.68 |
2. Increase in | 570,661.06 | 299,938.17 | 222,401.76 | 285,936.16 | 1,378,937.15 |
this period | |||||
(1) Provision | 570,661.06 | 299,938.17 | 222,401.76 | 285,936.16 | 1,378,937.15 |
3. Decrease in this period | |||||
(1) Purchase | |||||
4. Closing balance | 9,387,015.33 | 4,005,116.14 | 4,889,040.34 | 4,832,780.02 | 23,113,951.83 |
III. Impairment provision | |||||
1. Opening balance | |||||
2. Increase in this period | |||||
(1) Provision | |||||
3. Decrease in this period | |||||
(1) Purchase | |||||
4. Closing balance | |||||
IV. Book value | |||||
1. Closing book value | 68,860,525.41 | 6,630,835.41 | 830,848.03 | 3,845,824.31 | 80,168,033.16 |
2. Opening book value | 47,681,186.47 | 6,753,093.33 | 1,053,249.79 | 3,381,914.94 | 58,869,444.53 |
Intangible asset formed by internal R&D of the period takes up 1.88% in the closing total book value of intangible assets.(2) Failure to obtain the land use right certificates
In RMB
Item | Book value | Reason |
Others:
17. Long-term amortizable expenses
In RMB
Item | Opening balance | Increase in this period | Amortized amount in this period | Other decrease | Closing balance |
Xuanfeng Chayuan village and Zhuyuan village land transfer compensation | 1,252,933.34 | 28,050.78 | 1,224,882.56 | ||
Dongguan separation project | 77,817.13 | 38,908.80 | 38,908.33 | ||
Great Wall broadband network fee | 9,799.96 | 9,799.96 | |||
Membership fee | 460,000.00 | 65,000.10 | 394,999.90 | ||
Temporary sales center construction cost | 245,651.86 | 245,651.86 | |||
Total | 2,046,202.29 | 387,411.50 | 1,658,790.79 |
Other note18. Differed income tax assets and differed income tax liabilities(1) Non-deducted deferred income tax assets
In RMB
Item | Closing balance | Opening balance | ||
Deductible temporary difference | Deferred income tax assets | Deductible temporary difference | Deferred income tax assets | |
Assets impairment provision | 335,524,123.23 | 60,651,438.67 | 384,353,309.47 | 73,519,373.35 |
Deductible loss | 79,008,453.57 | 19,401,372.69 | 27,076,168.17 | 5,825,923.08 |
Donation | 700,000.00 | 175,000.00 | ||
Unrealizable gross profit | 139,359,848.50 | 34,839,962.13 | 159,943,328.49 | 39,138,879.86 |
Reserved expense | 2,525,840.01 | 369,964.39 | 1,931,083.44 | 289,662.51 |
Deferred earning | 2,295,662.18 | 348,635.04 | 2,343,160.67 | 351,474.11 |
Anticipated liabilities | 4,427,700.40 | 664,155.06 | 6,368,353.05 | 955,252.96 |
Arbitrage gain and loss | 2,050,625.00 | 76,473.76 | 159,000.00 | 23,850.00 |
Adjustment of fair value | 309,641.05 | 46,446.16 | 309,641.05 | 46,446.16 |
of investment real estate | ||||
Provided unpaid taxes | 518,334,989.90 | 129,583,747.48 | 441,086,914.18 | 110,271,728.55 |
Total | 1,083,836,883.84 | 245,982,195.38 | 1,024,270,958.52 | 230,597,590.58 |
(2) Non-deducted deferred income tax liabilities
In RMB
Item | Closing balance | Opening balance | ||
Taxable temporary difference | Deferred income tax liabilities | Taxable temporary difference | Deferred income tax liabilities | |
Gain/loss caused by changes in fair value | 1,143,275,103.52 | 285,818,775.88 | 1,143,654,805.86 | 285,913,701.47 |
Estimated gross margin when Fangda Town records income, but does not reach the taxable income level | 234,545,169.56 | 58,636,292.39 | 113,637,356.36 | 28,409,339.09 |
Total | 1,377,820,273.08 | 344,455,068.27 | 1,257,292,162.22 | 314,323,040.56 |
(3) Net deferred income tax assets or liabilities listed
In RMB
Item | Deferred income tax assets and liabilities at the end of the period | Offset balance of deferred income tax assets or liabilities after offsetting | Deferred income tax assets and liabilities at the beginning of the period | Offset balance of deferred income tax assets or liabilities after offsetting |
Deferred income tax assets | 245,982,195.38 | 230,597,590.58 | ||
Deferred income tax liabilities | 344,455,068.27 | 314,323,040.56 |
(4) Details of unrecognized deferred income tax assets
In RMB
Item | Closing balance | Opening balance |
Deductible temporary difference | 946,030.45 | 946,030.45 |
Deductible loss | 5,506,383.60 | 5,506,383.60 |
Total | 6,452,414.05 | 6,452,414.05 |
(5) Deductible losses of the un-recognized deferred income tax asset will expire in the following years
In RMB
Year | Closing amount | Opening amount | Notes |
2021 | 772,174.85 | 772,174.85 | |
2022 | 4,734,208.75 | 4,734,208.75 | |
Total | 5,506,383.60 | 5,506,383.60 | -- |
Others:
19. Other non-current assets
In RMB
Item | Closing balance | Opening balance |
Prepaid house and equipment amount | 1,447,483.00 | 31,130,198.46 |
Total | 1,447,483.00 | 31,130,198.46 |
Others:
The closing balance of other non-current assets is mainly the prepaid house payment of Fangda Jianke.
20. Short-term borrowings(1) Classification of short-term borrowings
In RMB
Item | Closing balance | Opening balance |
Guarantee loan | 324,000,000.00 | 416,000,000.00 |
Acceptant discount | 200,000,000.00 | 200,000,000.00 |
Total | 524,000,000.00 | 616,000,000.00 |
Notes to classification of short-term borrowings21. Derivative financial liabilities
√ Applicable □ Inapplicable
In RMB
Item | Closing balance | Opening balance |
Futures contracts | 2,050,625.00 | 159,000.00 |
Total | 2,050,625.00 | 159,000.00 |
Others:
22. Notes payable
In RMB
Type | Closing balance | Opening balance |
Commercial acceptance | 452,380,678.45 | 62,954,258.46 |
Bank acceptance | 38,977,593.10 | 469,966,767.02 |
Total | 491,358,271.55 | 532,921,025.48 |
The total amount of payable bills that have matured but not been paid at the end of the period is RMB869,338.55.23. Account payable(1) Account payable
In RMB
Item | Closing balance | Opening balance |
Account repayable and engineering repayables | 610,716,916.55 | 610,735,320.33 |
Construction payable | 23,127.38 | 34,924,745.05 |
Payable installation and implementation fees | 251,914,154.85 | 297,174,327.49 |
Others | 5,022.00 | 3,557,866.05 |
Total | 862,659,220.78 | 946,392,258.92 |
(2) Significant payables aging more than 1 year
In RMB
Item | Closing balance | Reason |
Supplier 1 | 77,006,984.19 | Not mature |
Supplier 2 | 12,652,180.48 | Not mature |
Supplier 3 | 11,331,623.97 | Not mature |
Supplier 4 | 11,269,909.64 | Not mature |
Supplier 5 | 9,382,975.54 | Not mature |
Total | 121,643,673.82 | -- |
Others:
24. Prepayment received(1) Prepayment received
In RMB
Item | Closing balance | Opening balance |
Curtain wall and screen door engineering payment | 157,270,671.47 | 89,485,775.55 |
Material loan | 1,023,741.82 | 5,227,948.87 |
Real estate sales payment | 33,936,292.00 | 78,377,257.88 |
Others | 1,194,550.67 | 2,260,704.15 |
Total | 193,425,255.96 | 175,351,686.45 |
25. Employees’ wage payable1. Employees’ wage payable
In RMB
Item | Opening balance | Increase | Decrease | Closing balance |
1. Short-term remuneration | 40,387,519.16 | 113,392,044.46 | 133,917,808.10 | 19,861,755.52 |
2. Retirement pension program-defined contribution plan | 11,611.59 | 6,354,798.60 | 6,354,346.31 | 12,063.88 |
3. Dismiss compensation | 658,490.00 | 658,490.00 | ||
4. Other welfare due in one year | 0.00 | 0.00 | ||
Total | 40,399,130.75 | 120,405,333.06 | 140,930,644.41 | 19,873,819.40 |
(2) Short-term remuneration
In RMB
Item | Opening balance | Increase | Decrease | Closing balance |
1. Wage, bonus, allowance and subsidies | 38,779,381.74 | 106,385,893.92 | 126,920,701.62 | 18,244,574.04 |
2. Employee welfare | 1,543,356.07 | 1,517,804.07 | 25,552.00 | |
3. Social insurance | 2,414,768.04 | 2,414,768.04 | ||
Including: medical insurance | 1,976,989.74 | 1,976,989.74 |
Labor injury insurance | 216,154.82 | 216,154.82 | ||
Breeding insurance | 221,623.48 | 221,623.48 | ||
4. Housing fund | 65,471.00 | 2,888,043.89 | 2,889,669.89 | 63,845.00 |
5. Labor union budget and staff education fund | 1,542,666.42 | 159,982.54 | 174,864.48 | 1,527,784.48 |
Total | 40,387,519.16 | 113,392,044.46 | 133,917,808.10 | 19,861,755.52 |
(3) Defined contribution plan
In RMB
Item | Opening balance | Increase | Decrease | Closing balance |
1. Basic pension | 11,611.59 | 6,112,144.65 | 6,113,174.42 | 10,581.82 |
2. Unemployment insurance | 242,653.95 | 241,171.89 | 1,482.06 | |
Total | 11,611.59 | 6,354,798.60 | 6,354,346.31 | 12,063.88 |
Others:
26. Taxes payable
In RMB
Item | Closing balance | Opening balance |
VAT | 6,252,241.32 | 12,300,790.83 |
Enterprise income tax | 38,377,712.06 | 114,953,308.81 |
Personal income tax | 2,140,346.81 | 1,183,514.25 |
City maintenance and construction tax | 1,527,893.08 | 1,881,115.36 |
Land using tax | 493,781.01 | 333,906.32 |
Property tax | 1,632,123.67 | 1,432,301.04 |
Education surtax | 738,010.58 | 896,603.56 |
Local education surtax | 353,663.61 | 460,806.13 |
Deed tax | 3,429,437.28 | |
Others | 3,558,361.26 | 83,732.86 |
Total | 55,074,133.40 | 136,955,516.44 |
Others:
27. Interest payable
In RMB
Item | Closing balance | Opening balance |
Long-term borrowing with interest installment and repayment of principal upon maturity | 1,965,436.98 | 1,822,719.47 |
Short-term borrowing interests payable | 446,878.62 | 602,592.50 |
Total | 2,412,315.60 | 2,425,311.97 |
28. Other payables(1) Other payables presented by nature
In RMB
Item | Closing balance | Opening balance |
Performance and quality deposit | 33,348,339.57 | 20,867,337.69 |
Deposit | 9,912,642.10 | 8,047,165.84 |
Reserved expense | 8,844,296.69 | 11,466,723.82 |
Fangda Town pledge | 100,000.00 | 100,000.00 |
Tax withheld | 518,334,989.90 | 441,086,914.18 |
Others | 16,628,045.45 | 19,621,369.16 |
Total | 587,168,313.71 | 501,189,510.69 |
Other note1. The tax withheld is the land VAT that needs to be settled and paid for the property delivered of the Fangda Town developed by
Fangda Property.2. The major other payables aged over 1 year at the end of the period are mainly the land value-added tax of RMB353,577,098.43,
which is not yet settled.29. Non-current liabilities due within 1 year
In RMB
Item | Closing balance | Opening balance |
Long-term loans due within 1 year | 200,000,000.00 | 200,000,000.00 |
Total | 200,000,000.00 | 200,000,000.00 |
Others:
30. Other current liabilities
In RMB
Item | Closing balance | Opening balance |
Substituted money on VAT | 12,076,092.33 | 9,531,014.81 |
Total | 12,076,092.33 | 9,531,014.81 |
31. Long-term borrowings(1) Classification of long-term borrowings
In RMB
Item | Closing balance | Opening balance |
Loan by pledge | 793,978,153.39 | 893,978,153.39 |
Guarantee loan | 500,000,000.00 | |
Total | 1,293,978,153.39 | 893,978,153.39 |
Notes to classification of long-term borrowings:
The above-mentioned borrowing is the 100% stock pledging of Fangda Property Development held by the Company.
Other note, including interest rate range:
The interest rate range for pledge loans is 5.39%-6.785%; the interest rate for guaranteed loans is 4.845%.
In RMB32. Anticipated liabilities
In RMB
Item | Closing balance | Opening balance | Reason |
Others | 4,427,700.40 | 6,368,353.05 | |
Total | 4,427,700.40 | 6,368,353.05 | -- |
Note: including related significant assumptions and estimates for anticipated liabilities33. Deferred earning
In RMB
Item | Opening balance | Increase | Decrease | Closing balance | Reason |
Government subsidy | 10,489,483.94 | 123,854.91 | 10,365,629.03 | Assets-related | |
Government subsidy | 1,546,500.00 | 1,546,500.00 | Earning-related | ||
Total | 10,489,483.94 | 1,546,500.00 | 1,670,354.91 | 10,365,629.03 | -- |
Items involving government subsidies:
In RMB
Liabilities | Opening balance | Amount of new subsidy | Amount included in non-operating revenue | Other misc. gains recorded in this period | Costs offset in the period | Other change | Closing balance | Related to assets/earning |
Major investment project prize from Industry and Trade Development Division of Dongguan Finance Bureau | 1,738,095.50 | 28,571.40 | 1,709,524.10 | Assets-related | ||||
Massive production project of air-breathing double-layer hollow glass energy-saving curtain call | 7,517,843.03 | 61,993.62 | 7,455,849.41 | Assets-related | ||||
Railway transport screen door controlling system and information transmission technology | 125,065.17 | 18,927.09 | 106,138.08 | Assets-related | ||||
Distributed PV power generation project subsidy sponsored by Dongguan Reform and Development Commission | 443,750.09 | 12,499.98 | 431,250.11 | Assets-related | ||||
Luxi county | 184,730.15 | 1,862.82 | 182,867.33 | Assets-relate |
Xuanfeng town government business introduction subsidy | d | |||||||
Shenzhen SME Service Bureau enterprise IT construction subsidy | 480,000.00 | 480,000.00 | Assets-related | |||||
Government subsidy | 1,546,500.00 | 1,546,500.00 | Earning-related | |||||
Total | 10,489,483.94 | 1,546,500.00 | 1,670,354.91 | 10,365,629.03 | -- |
Others:
34. Capital share
In RMB
Opening balance | Change (+,-) | Closing balance | |||||
Issued new shares | Bonus shares | Transferred from reserves | Others | Subtotal | |||
Total of capital shares | 1,183,642,254.00 | 1,183,642,254.00 |
Others:
35. Capital reserve
In RMB
Item | Opening balance | Increase | Decrease | Closing balance |
Capital premium (share capital premium) | 71,375,387.61 | 71,375,387.61 | ||
Other capital reserves | 1,454,097.35 | 1,454,097.35 | ||
Total | 72,829,484.96 | 72,829,484.96 |
Other note, including explanation about the reason of the change:
36. Other miscellaneous income
In RMB
Item | Opening balance | Amount occurred in the current period | Closing balance | ||||
Amount before income tax | Less: amount written into other gains and transferred into gain/loss in previous terms | Less: Income tax expenses | After-tax amount attributed to the parent | After-tax amount attributed to minority shareholders | |||
2. Other misc. incomes that will be re-classified into gain and loss | 8,585,847.99 | -671,004.92 | 1,303,288.75 | -94,537.50 | -1,879,756.17 | 6,706,091.82 | |
Effective part in the gain and loss of arbitrage of cash flow | -119,850.00 | -630,250.00 | 1,303,288.75 | -94,537.50 | -1,839,001.25 | -1,958,851.25 | |
Translation difference of foreign exchange statement | -50,855.47 | -40,754.92 | -40,754.92 | -91,610.39 | |||
Investment real estate measured at fair value | 8,756,553.46 | 8,756,553.46 | |||||
Other miscellaneous income | 8,585,847.99 | -671,004.92 | 1,303,288.75 | -94,537.50 | -1,879,756.17 | 6,706,091.82 |
Other note, including the adjustment of the initial recognition amount of the effective part of the cash flow hedging profit and losstransferred to the hedged item:
37. Surplus reserves
In RMB
Item | Opening balance | Increase | Decrease | Closing balance |
Statutory surplus reserves | 110,690,396.65 | 110,690,396.65 | ||
Total | 110,690,396.65 | 110,690,396.65 |
Note, including explanation about the reason of the change:
38. Retained profit
In RMB
Item | Current period | Last period |
Adjustment on retained profit of previous period | 1,863,191,218.58 | 1,016,820,576.30 |
Retained profit adjusted at beginning of year | 1,863,191,218.58 | 1,016,820,576.30 |
Plus: Net profit attributable to owners of the parent | 230,131,663.19 | 228,003,319.43 |
Common share dividend payable | 177,546,338.10 | 276,183,192.60 |
Closing retained profit | 1,915,776,543.67 | 968,640,703.13 |
Details of retained profit adjusted at beginning of the period1) Retrospective adjustment due to adopting of the Enterprise Accounting Standard and related regulations, included the retainedprofit by RMB.2) Variation of accounting policies, influenced the retained profit by RMB.3) Correction of material accounting errors, influenced the retained profit by RMB.4) Change of consolidation range caused by merger of entities under common control, influenced the retained profit by RMB.5) Other adjustment influenced the retained profit by RMB.
39. Operational revenue and costs
In RMB
Item | Amount occurred in the current period | Occurred in previous period | ||
Income | Cost | Income | Cost | |
Main business | 1,426,207,018.36 | 925,306,886.60 | 1,380,976,886.98 | 893,499,713.26 |
Other businesses | 15,843,878.17 | 10,179,289.13 | 18,734,054.31 | 9,898,213.71 |
Total | 1,442,050,896.53 | 935,486,175.73 | 1,399,710,941.29 | 903,397,926.97 |
40. Taxes and surcharges
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
City maintenance and construction tax | 3,980,442.45 | 3,811,990.65 |
Education surtax | 2,866,384.67 | 1,912,382.95 |
Property tax | 2,556,126.19 | 1,912,543.31 |
Land using tax | 808,834.13 | 602,382.14 |
Vehicle usage tax | 15,240.00 | |
Stamp tax | 849,673.18 | 480,851.19 |
Business tax | 1,199,973.15 | |
Land VAT | 89,995,084.20 | 93,136,916.43 |
Others | 132,410.21 | 1,015,236.98 |
Total | 101,204,195.03 | 104,072,276.80 |
Others:
41. Sales expense
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
Labor costs | 9,512,746.08 | 10,452,498.33 |
Freight and miscellaneous charges | 2,569,313.15 | 2,531,576.75 |
Advertisement and exhibition costs | 932,974.88 | 2,068,972.23 |
Travel expense | 1,011,110.84 | 2,713,200.94 |
Sales agency fee | 8,390,339.52 | 895,705.00 |
Others | 4,643,656.77 | 4,475,328.52 |
Total | 27,060,141.24 | 23,137,281.77 |
Others:
The increase in sales agency fees for the current period was due to the increase in commissions paid by the subsidiary, FangdaProperty, to various sales channels and to the agency companies.
42. Management expenses
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
Labor costs | 36,024,438.72 | 35,844,267.20 |
Depreciation and amortization | 5,262,351.65 | 8,586,833.31 |
R&D | 7,700,023.60 | 8,758,714.52 |
Tax | 120,324.19 | |
Others | 25,547,771.83 | 17,696,589.57 |
Total | 74,534,585.80 | 71,006,728.79 |
Others:
43. Financial expenses
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
Interest expense | 37,291,108.08 | 31,694,708.78 |
Less: Interest income | 3,715,935.93 | 7,660,124.39 |
Exchange gain/loss | 687,689.10 | 1,379,236.27 |
Commission charges and others | 490,539.57 | 483,494.23 |
Total | 33,772,321.68 | 25,897,314.89 |
Others:
44. Assets impairment loss
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
1. Bad debt loss | 1,854,963.05 | -9,908,133.36 |
Total | 1,854,963.05 | -9,908,133.36 |
Others:
45. Income from fair value fluctuation
In RMB
Source of income from fluctuation of fair value | Amount occurred in the current period | Occurred in previous period |
Financial assets measured at fair value with variations accounted into current income account | -8,572,843.25 | |
Investment real estate measured at fair value | -323,794.00 | 698,811.63 |
Total | -8,896,637.25 | 698,811.63 |
Others:
46. Investment income
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
Gains from long-term equity investment measured by equity | -1,071,000.77 | -626,631.62 |
Investment gain obtained from disposal of financial assets measured at fair value with variations accounted into current income account | 9,187,877.90 | |
Investment gain of financial products | 18,127,885.28 | 7,507,227.89 |
Total | 26,244,762.41 | 6,880,596.27 |
Others:
47. Assets disposal gains
In RMB
Source | Amount occurred in the current period | Occurred in previous period |
Gain and loss from disposal of fixed assets ("-" for loss) | -1,551,291.52 | -87,244.32 |
Total | -1,551,291.52 | -87,244.32 |
48. Other gains
In RMB
Source | Amount occurred in the current period | Occurred in previous period |
Pre-employment training subsidy | 6,400.00 | 119,100.00 |
Childbearing subsidy | 34,353.92 | 73,280.27 |
Significant industrial and trade development investment project award | 28,571.40 | 28,571.40 |
Self-breathing dual-layer hallow grass energy-saving curtain wall development project | 61,993.62 | 61,993.62 |
Employment subsidy | 14,134.11 | 13,781.11 |
Intellectual property right subsidy | 26,300.00 | 100,000.00 |
Railway transport screen door controlling system and information transmission technology | 18,927.09 | 21,614.64 |
Patent subsidy | 35,200.00 | 7,000.00 |
Hi-tech enterprise technology subsidy | 300,000.00 | 100,000.00 |
Industrial growth | 680,000.00 | |
PV power generation Dongguan subsidy | 12,499.98 | 12,499.98 |
Zhongshan Henglan economy development and technological bureau sponsorship | 190,609.98 | |
VAT rebated into revenue | 945,948.64 | |
Integration sponsorship | 100,000.00 | |
Shenzhen Technology Innovation Committee 2016 R&D sponsorship | 1,113,000.00 | |
Others | 1,862.82 | |
Total | 2,699,191.58 | 1,408,451.00 |
49. Non-business income
In RMB
Item | Amount occurred in the current period | Occurred in previous period | Amount accounted into the current accidental gain/loss |
Government subsidy | 303,119.83 | 10,266.85 | 303,119.83 |
Penalty income | 213,905.88 | 204,691.26 | 213,905.88 |
Compensation received | 1,500,000.00 | 1,500,000.00 |
Penalty received | 18,200.00 | 183,860.65 | 18,200.00 |
VAT rebated into revenue | 1,233,869.85 | ||
Payable account not able to be paid | 0.20 | 4,428.50 | 0.20 |
Others | 5,030,812.50 | 2,870,397.98 | 5,030,812.50 |
Total | 7,066,038.41 | 4,507,515.09 | 7,066,038.41 |
Government subsidies accounted into current profit or loss:
In RMB
Item | Issuer | Reason | Nature | Whether affecting gain and loss in this year | Whether it is a special subsidy | Amount occurred in the current period | Occurred in previous period | Related to assets/earning |
Personal income tax refunding | Finance Bureau | Award | No | No | 303,119.83 | 10,266.85 | Earning-related | |
Total | -- | -- | -- | -- | -- | 303,119.83 | 10,266.85 | -- |
Others:
1. The compensation income of RMB1,500,000.00 is the defendant's indemnity in the patent infringement lawsuit.2. The other items in the other details are mainly the subsidiary company Jianke Company's confirmation of the winning case incomeof RMB4,688,191.35.
50. Non-business expenses
In RMB
Item | Amount occurred in the current period | Occurred in previous period | Amount accounted into the current accidental gain/loss |
Loss of non-current assets disposal | 14,020.21 | 14,020.21 | |
Penalty and overdue fine | 225,047.87 | 225,047.87 | |
Others | 283,092.35 | 229,327.22 | 283,092.35 |
Total | 522,160.43 | 229,327.22 | 522,160.43 |
Others:
51. Income tax expenses(1) Details about income tax expense
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
Income tax expenses in this period | 48,132,940.61 | 68,286,547.49 |
Deferred income tax expenses | 14,913,239.34 | -518,442.97 |
Total | 63,046,179.95 | 67,768,104.52 |
(2) Adjustment process of accounting profit and income tax expense
In RMB
Item | Amount occurred in the current period |
Total profit | 275,177,843.14 |
Income tax expenses calculated based on the legal (or applicable) tax rates | 68,794,460.79 |
Impacts of different tax rates applicable for some subsidiaries | -10,867,680.86 |
Impacts of income tax before adjustment | 1,876,714.28 |
Impacts of non-deductible cost, expense and loss | 256,842.03 |
Deductable temporary difference and deductable loss of unrecognized deferred income tax assets | 2,002,057.41 |
Taxation impact of R&D expense and (presented with ―-‖) | -417,287.42 |
Others | 1,401,073.72 |
Income tax expenses | 63,046,179.95 |
Other note52. Other miscellaneous incomeSee Note VII 36.53. Notes to the cash flow statement(1) Other cash inflow related to operation
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
Interest income | 2,872,253.69 | 3,708,261.11 |
Subsidy income | 2,028,279.98 | 2,874,387.49 |
Retrieving of deposits for exchange bills | 7,101,000.00 | |
Bidding deposit and pledge | 224,435,277.86 | 75,525,724.38 |
Others | 6,855,911.78 | 9,607,007.94 |
Total | 243,292,723.31 | 91,715,380.92 |
Notes to other cash inflow related to operation:
(2) Other cash paid related to operation
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
Management costs paid | 12,475,066.93 | 15,879,543.69 |
Sales costs paid | 3,036,411.56 | 5,406,466.34 |
Deposit and pledge paid | 282,540,434.70 | 69,992,371.84 |
Personal borrowing | ||
Others | 15,465,822.42 | 9,991,825.76 |
Total | 313,517,735.61 | 101,270,207.63 |
Notes to other cash paid related to operation:
54. Supplementary data of cash flow statement(1) Supplementary data of cash flow statement
In RMB
Supplementary information | Amount of the Current Term | Amount of the Previous Term |
1. Net profit adjusted to cash flow of business operation | -- | -- |
Net profit | 230,131,663.19 | 227,518,243.36 |
Plus: Asset impairment provision | 1,854,963.05 | -9,908,133.36 |
Fixed asset depreciation, gas and petrol depreciation, production goods depreciation | 10,105,993.76 | 14,933,192.38 |
Amortization of intangible assets | 986,452.62 | 1,706,801.70 |
Amortization of long-term amortizable expenses | 348,502.82 | 2,114,078.76 |
Loss from disposal of fixed assets, intangible assets, and other long-term assets (―-― for gains) | -1,551,865.58 | -33,313.54 |
Loss from fixed asset discard (―-― for gains) | 743.00 | 120,557.86 |
Loss from fair value fluctuation (―-― for gains) | 8,896,637.25 | -698,811.63 |
Financial expenses (―-― for gains) | 31,237,594.20 | 31,694,708.78 |
Investment losses (―-― for gains) | -26,244,762.41 | -6,880,596.27 |
Decrease of deferred income tax asset | -15,384,604.80 | -19,617,905.97 |
(―-― for increase) | ||
Increase of deferred income tax asset (―-― for increase) | 30,132,027.71 | 18,971,848.45 |
Decrease of inventory (―-― for increase) | 93,221,757.37 | 72,721,993.69 |
Decrease of operational receivable items (―-― for increase) | -225,446,791.23 | 323,784,130.19 |
Increase of operational receivable items (―-― for decrease) | -119,226,407.78 | -441,163,587.02 |
Others | -50,488,170.81 | |
Cash flow generated by business operations, net | -31,426,267.64 | 215,263,207.38 |
2. Major investment and financing operation not involving with cash | -- | -- |
3. Net change of cash and cash equivalents | -- | -- |
Balance of cash at period end | 951,511,945.70 | 792,090,304.49 |
Less: Initial balance of cash | 931,285,535.55 | 935,824,575.40 |
Net increase in cash and cash equivalents | 20,226,410.15 | -143,734,270.91 |
(2) Composition of cash and cash equivalents
In RMB
Item | Closing balance | Opening balance |
I. Cash | 951,511,945.70 | 931,285,535.55 |
Including: Cash in stock | 205,631.16 | 42,636.09 |
Bank savings can be used at any time | 950,871,321.82 | 921,773,052.65 |
Other monetary capital can be used at any time | 434,992.72 | 9,469,846.81 |
III. Balance of cash and cash equivalents at end of term | 951,511,945.70 | 931,285,535.55 |
Others:
55. Ownership- or use-right-restricted assets
In RMB
Item | Closing book value | Reason |
Monetary capital | 247,683,230.02 | |
Fixed assets | 52,068,945.34 | |
Investment real estate | 307,321,568.00 | Loan by pledge |
100% stake in Fangda Property Development held by the Company | 200,000,000.00 | Loan by pledge |
Total | 807,073,743.36 | -- |
Others:
56. Foreign currency monetary items(1) Foreign currency monetary items
In RMB
Item | Closing foreign currency balance | Exchange rate | Closing RMB balance |
Monetary capital | -- | -- | 80,938,421.50 |
Including: USD | 4,340,674.80 | 6.6166 | 28,720,508.88 |
HK Dollar | 56,604,049.86 | 0.8431 | 47,722,874.44 |
AUD | 326,537.67 | 4.8633 | 1,588,050.65 |
SGD | 600,791.04 | 4.8386 | 2,906,987.53 |
Account receivable | -- | -- | 35,120,183.23 |
Including: USD | 5,097,535.12 | 6.6166 | 33,728,350.87 |
AUD | 4,404.39 | 4.8633 | 21,419.87 |
SGD | 283,225.00 | 4.8386 | 1,370,412.49 |
Other receivables | -- | 268,037.09 | |
Including: USD | 13,682.31 | 6.6166 | 90,530.37 |
HK Dollar | 208,960.00 | 0.8431 | 176,174.18 |
AUD | 274.00 | 4.8633 | 1,332.54 |
Account payable | -- | 110,007.59 | |
Including: USD | 16,626.00 | 6.6166 | 110,007.59 |
Employees’ wage payable | -- | 600,329.72 | |
Including: HKD | 653,533.19 | 0.8431 | 550,993.83 |
AUD | 10,144.53 | 4.8633 | 49,335.89 |
Other payables | -- | 26,897.80 | |
Including: USD | 4,065.20 | 6.6166 | 26,897.80 |
Others:
(2) The note of overseas operating entities should include the main operation places, book keeping currencies and selectionbasis. Where the book keeping currency is changed, the reason should also be explained.
□ Applicable √ Inapplicable
57. HedgingHedging items and related tools, qualitative and quantitative information about hedging risks:
Hedging type Hedged item Hedging instrument Hedged riskCash flow hedging Aluminum plate futures transaction Aluminum futures contract Rise on raw material prices, causingpurchase cost increase
VIII. Change to Consolidation Scope1. Change to the consolidation scope for other reasonsChange in the consolidation scope due to other reasons (such as new subsidiaries and liquidation of subsidiaries) and the situations:
1. In the current period, Shanghai Fangda Jingling Technology Co. Ltd. and Shenzhen Fangda Cloud Rail Technology Co. Ltd. havebeen newly established two new companies in the current consolidated statement.
2. In this period, Fangda Decoration Engineering (Shenyang) Co. Ltd. an indirectly controlled subsidiary was cancelled and no longercontrolled. Therefore, one subsidiary is moved out of the consolidation scope in this period.
IX. Equity in Other Entities1. Interests in subsidiaries(1) Group Composition
Company | Place of business | Registered address | Business | Shareholding percentage | Obtaining method | |
Direct | Indirect | |||||
Fangda Jianke | Shenzhen | Shenzhen | Designing, manufacturing, and installation of curtain walls | 98.39% | 1.61% | Incorporation |
Fangda Automatic | Shenzhen | Shenzhen | Production, processing and installation of subway screen doors | 14.00% | 86.00% | Incorporation |
Fangda New Material | Nanchang | Nanchang | Prodution and sales of new-type | 75.00% | 25.00% | Incorporation |
materialsm composite materials and production of curtain walls | ||||||
Kexunda | Shenzhen | Shenzhen | Computer software development | 100.00% | Incorporation | |
Fangda Property | Shenzhen | Shenzhen | Real estate development and operation | 100.00% | Incorporation | |
Fangda New Energy | Shenzhen | Shenzhen | Design and construction of PV power plants | 100.00% | Incorporation | |
Chengdu Fangda | Chengdu | Chengdu | Trusted processing of building curtain wall materials | 100.00% | Incorporation | |
Shihui International Holding Co., Ltd. | Virgin Islands | Virgin Islands | Investment | 100.00% | Incorporation | |
Dongguan New Material | Dongguan | Dongguan | Production and sales of building curtain walls | 100.00% | Incorporation | |
Shenyang Decoration | Shenyang | Shenyang | Designing, manufacturing, and installation of curtain walls | 100.00% | Incorporation | |
Fangda Property Management | Shenzhen | Shenzhen | Property management | 100.00% | Incorporation | |
Jiangxi Fangda Property Development Co., Ltd. | Nanchang | Nanchang | Real estate development and operation | 100.00% | Incorporation | |
Pingxiang Fangda Luxin New Energy Co., Ltd. | Pingxiang | Pingxiang | Design and construction of PV power plants | 100.00% | Incorporation | |
Pingxiang Xiangdong Fangda New Energy Co., Ltd. | Pingxiang | Pingxiang | Design and construction of PV power plants | 100.00% | Incorporation |
Nanchang Xinjian Fangda New Energy Co., Ltd. | Nanchang | Nanchang | Design and construction of PV power plants | 100.00% | Incorporation | |
Dongguan Fangda New Energy Co., Ltd. | Dongguan | Dongguan | Design and construction of PV power plants | 100.00% | Incorporation | |
Kechuangyuan Software | Shenzhen | Shenzhen | Software development | 100.00% | Incorporation | |
Fangda Automation (Hong Kong) Co., Ltd. | Hong Kong | Hong Kong | Metro screen door | 100.00% | Incorporation | |
Hongjun Investment Company | Shenzhen | Shenzhen | Investment | 98.00% | 2.00% | Incorporation |
Jianke Australia | Australia | Australia | Designing, manufacturing, and installation of curtain walls | 100.00% | Incorporation | |
Fangda Cloud Rail | Shenzhen | Shenzhen | Design, development and sales of cloud rail transport equipment | 100.00% | Incorporation | |
Shanghai Fangda Jingling Technology Co., Ltd. | Shanghai | Shanghai | Production and sales of building curtain walls | 100.00% | Incorporation |
Note to the difference between shareholdings in subsidiaries and percentage of votes:
Basis for holding half or less votes but controlling invested entities, and holding half or more votes but not controlling investedentities:
Basis for control of structural entities incorporated in the consolidation scope:
Basis for recognizing a company as an agent or consigner:
Others:
2. Interests in joint ventures or associates(1) Financial summary of insignificant joint ventures and associates
In RMB
Closing balance/amount occurred in this | Opening balance/amount occurred in |
period | previous period | |
Joint venture: | -- | -- |
Total shareholding | -- | -- |
Associate: | -- | -- |
Total book value of investment | 69,871,054.85 | 34,142,055.62 |
Total shareholding | -- | -- |
Net profit | -1,071,000.77 | -2,162,975.06 |
Total of misc. incomes | -1,071,000.77 | -2,162,975.06 |
Other noteX. Risks of Financial ToolsMajor financial tools of the Group include monetary fund, accounts receivable, receivable bills, other receivables, other current assets,
financial assets measured at fair value and whose change recorded in the profit and loss of this period, accounts payable, interestpayable, payable bills, other payables, short-term borrowings, other current liabilities, non-current liabilities due within one year andlong-term borrowings. Details about the Group's financial instruments are disclosed in related notes. The following explains risksrelated to the financial instruments and risk management policies adopted by the Group to lower the risks. The management of theGroup manages and monitor the risks to ensure that the risks are within the acceptable range.
1. Risk management target and policy
The target of the risk management is to balance between risk and benefit and lower financial risks’ impacts on the Group’s financial
performance. Based on the target, the Group has formulated risk management policy to identify and analyze risks facing the Groupand set an appropriate acceptable level and internal control procedures to monitor the risks. The Group regularly reviews the risk
management policies and related internal control system to suit the market status and changes in the Group’s operating activities. The
internal auditing department of the Group will regularly or randomly check the implementation of the internal control system.
Risks caused by the Group’s financial instruments are credit risk, liquidity risk and market risk (including interest, exchange rate and
product price/equity tool price risks).(1) Credit riskCredit risk is caused by the failure of one party of a financial instrument in performing its obligations, causing the risk of financial
loss for the other party.The Group manages credit risks through classification. The credit risk is mainly caused by bank deposit and receivables.
The Group’s bank deposit is mainly deposited in state-owned banks and large-sized listed banks. The credit risk caused by bank
deposited is minor.For receivables, the Group sets up related policies to control the credit risk. The Group set the credit line and term for debtors
according to their financial status, external rating, and possibility of getting third-party guarantee, credit record and other factors. The
Group regularly monitors debtors’ credit record. For those with poor credit record, the Group will send written payment reminders,
shorten or cancel credit term to lower the general credit risk.
The largest credit risk facing the Group is the book value of each financial asset on the balance sheet. The Group makes no guaranteethat may cause the Group credit risks.
Among the Group’s receivables, accounts receivable from top 5 customers account for 16.94% of the total accounts receivable (2017:
19.39%); among other receivables, other receivables from top 5 customers account for 70.02% of the total other receivables (2017:
30.70%).
(2) Liquidity riskLiquidity risk is the risk of capital shortage when the Group needs to pay cash or settled with other financial assets.The Group keeps adequate cash and cash equivalent, and monitors the level to ensure that the cash and cash equivalent can meet the
operation needs. The management of the Group monitors the use of bank loans and ensures that they are used as agreed. The Groupalso obtains guarantee from financial institutions for adequate standby fund to meet short-term and long-term capital demand.
The Group can also use fund generated by operating activities and bank and other loans. On June 31, 2018, the total credit line of theGroup was RMB5,890,000,000, with RMB3,039,830,000 unused (December 31, 2017: RMB2,538,021,800).
Financial liabilities and excluded guarantees held by the Group by undiscounted residual contract cash flow (in RMB10,000) at theend of the period:
Closing amount | ||||
Assets | Less than 1 year | Within 1-3 years | Over 3 years | Total |
Financial liabilities: | ||||
Short-term loans | 52,400.00 | 52,400.00 | ||
Notes payable | 49,135.83 | 49,135.83 |
Account payable | 78,390.47 | 7,865.42 | 10.03 | 86,265.92 |
Employees’ wage payable | 1,987.38 | 1,987.38 | ||
Interest payable | 241.23 | 241.23 | ||
Other payables | 25,077.15 | 30,296.25 | 3,343.43 | 58,716.83 |
Non-current liabilities due in 1 year | 20,000.00 | 20,000.00 |
Other current liabilities | 1207.61 | 1207.61 | ||
Long-term loans | 50,000.00 | 70,000.00 | 9,397.82 | 129,397.82 |
Total liabilities | 278,439.67 | 108,161.67 | 12,751.28 | 399,352.62 |
Financial liabilities and excluded guarantees held by the Group by undiscounted residual contract cash flow (in RMB10,000) at thebeginning of the period:
Opening amount |
Assets | Less than 1 year | Within 1-3 years | Over 3 years | Total |
Financial liabilities: | ||||
Short-term loans | 61,600.00 | 59,100.00 |
Notes payable | 53,292.10 | 53,292.10 |
Account payable | 87,896.56 | 6,732.71 | 9.96 | 94,639.23 |
Employees’ wage payable | 4,039.91 | 4,039.91 | ||
Interest payable | 242.53 | 242.53 |
Other payables | 15,533.63 | 31,241.89 | 3,343.43 | 50,118.95 |
Non-current liabilities due in 1 year | 20,000.00 | 20,000.00 |
Other current liabilities | 953.10 | 953.10 | ||
Long-term payable | 80,000.00 | 9,397.82 | 89,397.82 | |
Total liabilities | 243,557.83 | 117,974.60 | 12,751.21 | 374,283.64 |
(3) Market riskMarket risk of financial instrument is caused by changes in the fair value of financial instruments or future cash flow, including
interest risk, exchange rate and other price risks.Interest rate risk is caused by fluctuation of the fair value or future cash flow of financial instruments caused by changes in the
market interest rate. The interest rate risk can be caused by recognized interest-bearing financial instruments and unrecognizedfinancial instruments.
The Group's interest rate risk is mainly caused by short-term borrowings, other current liabilities and long-term borrowings. Financialliabilities with floating interest rate cause cash flow interest rate risk for the Group. Financial liabilities with fixed interest rate causefair value interest rate risk for the Group. The Group decides the proportion between fixed interest rate and floating interest rateaccording to the market environment and regularly reviews and monitors the combination of fixed and floating interest rateinstruments. All financial liabilities of the Group at the end of the period bear fixed interest rawtes.
The Group pays close attention to the risks of changing interest rates. The Group adopts no hedging policies currently. Themanagement is responsible for monitoring the interest risks. As fixed deposits are short-term borrowing, the interest rate risk of thefair value of bank deposit is minor.
As there is no floating interest rate borrowing during the current period, if the borrowing rate calculated with floating interest raterises or falls by 50 basis points, while other factors remain unchanged, the Group's net profit and shareholders' equity will remainunchanged on June 30, 2018 (December 31, 2017: RMB 0.00).
Exchange rate riskExchange rate risk is caused by fluctuation of the fair value or future cash flow of financial instruments caused by changes in the
foreign exchange rates. The exchange rate risk can be caused by financial instruments priced in foreign currencies.The principal operations of the Group are located in the territory of China. Except for subsidiaries established in Hong Kong and
Australia which hold foreign currency as assets in settlement currency, the principal business is settled in RMB. The proportion offoreign assets and liabilities held by the Group in the overall assets and liabilities is not significant. Therefore, the market risk offoreign exchange changes undertaken by the Company is not significant.
See Note VII. 57 Foreign Currency Item Note for the Group’s financial assets and liabilities priced in foreign currencies.
Other price risks
Other price risks refer to risks of fluctuations caused by changes to market prices, regardless of whether the changes are caused byfactors related to a single financial tool or issuer, or factors related to all similar financial tools traded in the market. Other price riskscome from changes in product prices or equity tool prices.
The Group's investment in financial assets classified as fair value through changes in fair value through profit or loss, and investmentproperties measured in fair value are measured at fair value on the balance sheet date. Therefore, the Group bears risks of changes inthe securities market and real estate market prices.
The Group closely follows impacts of price changes to the Company’s securities investment price and real estate price risks. The
Group takes no measure to prevent other price risks currently.The management is responsible for monitoring the other price risks.2. Capital management
The Group’s capital management aims to ensure continuous operation of the Group, provide returns for shareholders, help other
interested parties make benefit, and maintain the best capital structure and lower capital cost.The Group may adjust the dividend distributed to shareholders, issue new shares or sell assets to maintain or adjust the capital
structure.
The Group monitors the capital structure based on the assets/liability ratio. On June 30, 2018, the Group’s assets/liability ratio is
58.32% (December 31, 2017: 57.52%).
XI. Fair Value1. Closing fair value of assets and liabilities measured at fair value
In RMB
Item | Closing fair value | |||
First level fair value | Second level fair value | Third level fair value | Total | |
1. Continuous fair value measurement | -- | -- | -- | -- |
(2) Investment real estate | 1,569,981,849.07 | 1,569,981,849.07 | ||
2. Leased building | 1,569,981,849.07 | 1,569,981,849.07 | ||
Total assets measured at fair value continuously | 1,569,981,849.07 | 1,569,981,849.07 | ||
Derivative financial liabilities | 2,050,625.00 | 2,050,625.00 | ||
Total assets measured at fair value continuously | 2,050,625.00 | 2,050,625.00 | ||
2. Discontinuous fair | -- | -- | -- | -- |
2. Recognition basis of market value of continuous and discontinuous items measured at first level fair valueThe Group determines the fair value using quotation in an active market for financial instruments traded in an active market;Valuation technique and qualitative and quantitative information for key parameters of continuous and discontinuous second
level fair value itemsFor investment in real estate similar with real estate transaction, the Group uses valuation techniques to determine its fair value. The
technique is comparison method. Inputs include transaction date, status, region and other factors.
4. Switch between different levels, switch reason and switching time policyIn the period, there is no switch in the financial assets measured at fair value between the first and second level or transfer in or out of
the third level.5. Fair value of financial assets and liabilities not measured at fair valueFinancial assets and liabilities measured at amortized cost include: monetary capital, bills receivable, accounts receivable, other
receivables, short-term borrowings, notes payable, accounts payables, other payables, and long-term payables.The difference between book value and fair value of financial assets and liabilities not measured at fair value is small.
XII. Related Parties and Transactions1. Parent of the Company
value measurement
Parent
Parent | Registered address | Business | Registered capital | Share of the parent co. in the Company | Voting power of the parent company |
Shenzhen Banglin Technologies Development Co., Ltd. | Shenzhen | Industrial investment | 30,000,000.00 | 8.72% | 8.72% |
Shengjiu Investment Ltd. | Hong Kong | Industrial investment | HKD1,000,000.00 | 7.76% | 7.76% |
Gong Qing Cheng Shi Li He Investment Management Partnership | Jiujiang | Industrial investment | 19,780,992.00 | 2.26% | 2.26% |
Particulars about the parent of the Company1. All of the investors of Shenzhen Banglin Technology Development Co., Ltd., the holding shareholder of the Company, are natural
persons. Among them, Chairman Xiong Jianming is holding 85% of the shares, and Mr. Xiong Xi – son of Mr. Xiong Jianming, is
holding 15% of the shares.2. Among the top 10 shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu Investment Co., Ltd. areparties action-in-concert. Shenzhen Banglin Technology Development Co., Ltd. and Gong Qing Cheng Shi Li He InvestmentManagement Partnership Enterprise are related parties. The Company is not notified of other action-in-concert or related partiesamong the other holders of current shares.
The final controller of the Company is Xiong Jianming.Others:
2. Subsidiaries of the CompanySee Note IX. 1.3. Joint ventures and associatesSee Note IX. 2 for details of significant joint ventures and associates of the Company.
Information about other joint ventures or associates with related transactions in this period or with balance generated by relatedtransactions in previous period:
Enterprise (limitedpartner)Joint venture or associate
Joint venture or associate | Relationship with the Company |
Shenzhen Ganshang Joint Investment Co., Ltd. | Associate |
Shenzhen Huihai Yirong Internet Service Co., Ltd. | Associate |
Jiangxi Business Innovative Property Joint Stock Co., Ltd. | Associate |
Other note4. Other associates
Other related parties | Relationship with the Company |
Directors, manager, CFO and secretary of the Board of Directors | Key management |
Shenzhen Qijian Technology Co., Ltd. | Common actual controller |
Other note5. Related transactions(1) Related transactions for purchase and sale of goods, provision and acceptance of servicesPurchasing of goods and services
In RMB
Affiliated party | Related transaction | Amount occurred in the current period | Approved amount | Whether the transaction amount is exceeded | Occurred in previous period |
Sales of goods and services
In RMB
Affiliated party | Related transaction | Amount occurred in the current period | Occurred in previous period |
Shenzhen Ganshang Joint Investment Co., Ltd. | Property service and sales of goods | 5,060.89 | 5,060.89 |
Shenzhen Qijian Technology Co., Ltd. | Property service and sales of goods | 15,209.97 | 5,071.79 |
Notes about related transactions for purchase and sale of goods, provision and acceptance of services(2) Related leasingThe Company is the leasor:
In RMB
Name of the leasee | Category of asset for lease | Rental recognized in the period | Rental recognized in the period |
Shenzhen Ganshang Joint Investment Co., Ltd. | Houses & buildings | 65,040.67 | 62,170.38 |
Shenzhen Qijian Technology Co., Ltd. | Houses & buildings | 134,808.00 | 44,936.00 |
The Company is the leasee:
In RMB
Name of the owner | Category of asset for lease | Rental recognized in the period | Rental recognized in previous period |
Note to related leasing(3) Related guaranteesThe Company is the guarantor:
In RMB
Beneficiary party | Amount guaranteed | Start date | Due date | Completed or not |
Fangda Jianke | 48,000.00 | 06.07.16 | 15.07.18 | No |
Fangda Jianke | 40,000.00 | 06.12.17 | 06.12.18 | No |
Fangda Jianke | 30,000.00 | 23.08.17 | 22.08.18 | No |
Fangda Jianke | 40,000.00 | 01.11.17 | 01.11.18 | No |
Fangda Jianke | 20,000.00 | 10.04.18 | 09.04.19 | No |
Fangda Automatic | 21,600.00 | 06.07.16 | 05.07.18 | No |
Fangda Automatic | 15,000.00 | 31.10.17 | 31.10.18 | No |
Fangda Automatic | 20,000.00 | 23.08.17 | 22.08.18 | No |
Fangda Automatic | 15,000.00 | 08.03.18 | 08.03.19 | No |
Fangda Property | 130,000.00 | 03.02.15 | 02.02.23 | No |
Jiangxi New Material | 8,000.00 | 27.05.17 | 26.05.18 | No |
Jiangxi New Material | 6,500.00 | 01.06.18 | 31.05.19 | No |
The Company is the guarantied party:
In RMB
Gurantor | Amount guaranteed | Start date | Due date | Completed or not |
Fangda Jianke | 25,000.00 | 26.09.17 | 26.09.18 | No |
Note to related guaranteesThe above-mentioned guarantees are all associated guarantees within interested entities of the Group.(4) Remuneration of key management
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
Wage, remuneration and subsidy | 3,899,726.00 | 2,601,833.77 |
6. Receivable and payables due with related parties(1) Receivable interest
In RMB
Project | Affiliated party | Closing balance | Opening balance | ||
Remaining book value | Bad debt provision | Remaining book value | Bad debt provision | ||
Other receivables | Shenzhen Woke | 865,802.94 | 233,740.88 | 865,802.94 | 86,580.29 |
Other receivables | Shenyang Fangda | 42,877.00 | 1,286.31 | 42,877.00 | 1,286.31 |
Account receivable | Qijian Technology | 811.31 | 8.11 | 735.00 | 7.35 |
XIII. Share Payment1. Overall share payment
□ Applicable √ Inapplicable
2. Share payment settled by equity
□ Applicable √ Inapplicable
3. Share payment settled by cash
□ Applicable √ Inapplicable
4. Revising and termination of share payment5. OthersXIV. Commitment and Contingent Events1. Major commitmentsMajor commitments that exist on the balance sheet day
The Company has no other commitments that should be disclosed by 30.06.18.2. Contingencies(1) Significant contingencies on the balance sheet date
a. Contingent liabilities formed by material lawsuit or arbitration, and their influences on the financial positionIn February 2018, Fangda Jianke, a subsidiary of the Group, filed an arbitration application with the Guangzhou ArbitrationCommission of China, requesting Guangzhou Heyin Plaza Development Co. Ltd. and Hunan Provincial No. 4 Engineering Co. Ltd.to pay construction and losses of RMB 21.43 million. As of the date of this report, this arbitration application has been accepted andhas not yet been decided.
b. Pending major lawsuitsOn September 6, 2017, Chenghua District People's Court of Chengdu Municipality sentenced Sichuan Chuta Hengyuan
Industrial Co., Ltd. to pay construction money to Fangda Jianke within 10 days from the date of the verdict 川0108民初1828号
RMB10,242,182.99.As of the date of this report, Fangda Jianke has applied for execution and has not received the relevant payment.One June 21, 2018, the Chongqing No. 1 Intermediate People's Court sentenced Wang Weihong to the Fangda Jianke Companyfor payment of RMB928,167.75 within 10 days from the effective date of the Judgment of the First Judgment No. 01205.As of thedate of this report, Fangda Jianke has applied for execution and has not received the relevant payment.
c. Providing guarantee for property purchasers
The Group’s property business provides periodic mortgage guarantee for property purchasers. The term of the periodic
guarantee lasts from the effectiveness of guarantee contracts to the completion of mortgage registration and transfer of housingownership certificates to banks. By June 30, 2018, the Company has provided periodic guarantee of RMB413 million.
On 30.06.18, the Company has no other contingent events that should be disclosed.
(2) Significant contingent events that do not need to be disclosed should be explainedNo such significant contingent event3. OthersXV. Other material events1. Segment information(1) Recognition basis and accounting policy for segment reportThe Group divides its businesses into five reporting segments. The reporting segments are determined based on financial information
required by routine internal management. The Group’s management regularly review the operating results of the reporting segments
to determine resource distribution and evaluate their performance.The reporting segments are:
(1) Curtain wall segment, production and sales of curtain wall materials, construction curtain wall design, production and installation;(2) Rail transport segment: assembly and processing of metro screen doors;(3) Real estate segment: development and operating of real estate on land of which land use right is legally obtained by the Company;
property management;(4) New energy segment, R&D, installation and sales of PV devices, design and construction of PV power plants; R&D, design,
production, sales and installation of light accessories, and other lights, LED products and hardware.(5) OthersThe segment report information is disclosed based on the accounting policies and measurement standards used by the segments when
reporting to the management. The policies and standards should be consistent with those used in preparing the financial statement.
(2) Financial information
In RMB
Item | Curtain wall | Rail transport | Real estate | New energy | Others | Offset between segments | Total |
Major business turnover | 810,053,775.15 | 129,911,419.20 | 477,125,957.64 | 11,321,020.09 | -2,205,153.72 | 1,426,207,018.36 | |
Main business cost | 706,142,044.98 | 100,399,942.26 | 126,331,507.32 | 3,694,831.29 | -11,261,439.25 | 925,306,886.60 |
XVI. Notes to Financial Statements of the Parent1. Account receivable(1) Account receivable disclosed by categories
In RMB
Type | Closing balance | Opening balance | ||||||||
Remaining book value | Bad debt provision | Book value | Remaining book value | Bad debt provision | Book value | |||||
Amount | Proportion | Amount | Provision rate | Amount | Proportion | Amount | Provision rate | |||
Recognition and providing of bad debt provisions on groups | 420,777.88 | 100.00% | 12,623.34 | 3.00% | 408,154.54 | |||||
Total | 420,777.88 | 100.00% | 12,623.34 | 3.00% | 408,154.54 |
Account receivable with major individual amount and bad debt provision provided individually at the end of the period:
□ Applicable √ Inapplicable
In the group, the account receivable of which bad debt provision is made through the account aging method:
√ Applicable □ Inapplicable
In RMB
Age | Closing balance | ||
Account receivable | Bad debt provision | Provision rate | |
Sub-item of within 1 year |
Group recognition basis:
Account receivable adopting the balance percentage method in the group
□ Applicable √ Inapplicable
Account receivable adopting other methods in the group:
(2) Bad debt provision made, returned or recovered in the periodA bad debt provision of RMB0 was made in the period. RMB12,623.34 was recovered or reversed.
Including significant recovery or reversal:
In RMB
Entity | Written-back or recovered amount | Method |
None |
2. Other receivables(1) Other receivables disclosed by categories
In RMB
Type | Closing balance | Opening balance | ||||||||
Remaining book value | Bad debt provision | Book value | Remaining book value | Bad debt provision | Book value | |||||
Amount | Proportion | Amount | Provision rate | Amount | Proportion | Amount | Provision rate | |||
Other receivables with major individual amount and bad debt provision provided individually | 13,110,000.00 | 1.92% | 13,110,000.00 | 100.00% | 13,150,000.00 | 1.92% | 13,150,000.00 | 100.00% | ||
(2) Recognition and providing of bad debt provisions on groups | 943,177,661.95 | 98.08% | 337,483.38 | 0.04% | 942,840,178.57 | 672,959,963.61 | 98.08% | 186,183.16 | 0.03% | 672,773,780.45 |
Total | 956,287,661.95 | 100.00% | 13,447,483.38 | 1.43% | 942,840,178.57 | 686,109,963.61 | 100.00% | 13,336,183.16 | 1.94% | 672,773,780.45 |
Other receivables with major individual amount and bad debt provision provided individually at the end of the period:
√ Applicable □ Inapplicable
In RMB
Other receivables (by entity) | Closing balance | |||
Other receivables | Bad debt provision | Provision rate | Reason | |
Guangdong Fangda SOZN Lighting Co., Ltd. | 13,110,000.00 | 13,110,000.00 | 100.00% | Cannot be recovered because of insolvency |
Total | 13,110,000.00 | 13,110,000.00 | -- | -- |
In the group, the other receivables of which bad debt provision are made through the account aging method:
√ Applicable □ Inapplicable
In RMB
Age | Closing balance | ||
Other receivables | Bad debt provision | Provision rate | |
Sub-item of within 1 year | |||
Subtotal for less than 1 year | 101,431.88 | 3,042.96 | 3.00% |
1-2 years | 130,000.00 | 13,000.00 | 10.00% |
2-3 years | 735,802.94 | 220,740.88 | 30.00% |
Over 5 years | 100,699.54 | 100,699.54 | 100.00% |
Total | 1,067,934.36 | 337,483.38 |
Group recognition basis:
Other receivables adopting the balance percentage method in the group:
□ Applicable √ Inapplicable
Other receivables adopting other methods in the group
□ Applicable √ Inapplicable
(2) Bad debt provision made, returned or recovered in the periodA bad debt provision of RMB111,300.22 was made in the period. RMB0.00 was recovered or reversed.(3) Other receivables are disclosed by nature
In RMB
By nature | Closing balance of book value | Opening balance of book value |
Associate accounts | 942,109,727.59 | 671,896,683.41 |
Other trades | 14,177,934.36 | 14,213,280.20 |
Total | 956,287,661.95 | 686,109,963.61 |
(4) Balance of top 5 other receivables at the end of the period
In RMB
Entity | By nature | Closing balance | Age | Percentage (%) | Balance of bad debt provision at the end of the period |
Fangda Jianke | Associate accounts | 743,657,276.99 | Less than 1 year | 77.77% | |
Fangda New Energy | Associate accounts | 84,836,258.14 | Less than 1 year | 8.87% | |
Fangda New Energy | Associate accounts | 15,913,329.89 | 1-2 years | 1.66% | |
Fangda Automatic | Associate accounts | 55,119,448.33 | Less than 1 year | 5.76% | |
Shihui International | Associate accounts | 30,430,197.80 | 2-3 years | 3.18% | |
Shihui International | Associate accounts | 20,271.90 | 3-4 years | 0.00% | |
Fangda SOZN | Associate accounts | 13,110,000.00 | 2-3 years | 1.37% | 13,110,000.00 |
Total | -- | 943,086,783.05 | -- | 98.61% | 13,110,000.00 |
3. Long-term share equity investment
In RMB
Item | Closing balance | Opening balance | ||||
Remaining book | Impairment | Book value | Remaining book | Impairment | Book value |
value | provision | value | provision | |||
Investment in subsidiaries | 983,339,494.35 | 983,339,494.35 | 925,349,494.35 | 925,349,494.35 | ||
Total | 983,339,494.35 | 983,339,494.35 | 925,349,494.35 | 925,349,494.35 |
(1) Investment in subsidiaries
In RMB
Invested entity | Opening balance | Increase | Decrease | Closing balance | Provision made in this period | Balance of impairment provision at the end of the period |
Fangda Jianke | 491,950,000.00 | 491,950,000.00 | ||||
Fangda Automatic | 18,831,241.35 | 18,831,241.35 | ||||
Fangda New Material | 74,496,600.00 | 74,496,600.00 | ||||
Fangda Property | 200,000,000.00 | 200,000,000.00 | ||||
Shihui International Holding Co., Ltd. | 61,653.00 | 61,653.00 | ||||
Fangda New Energy | 100,000,000.00 | 100,000,000.00 | ||||
Hongjun Investment Company | 40,010,000.00 | 57,990,000.00 | 98,000,000.00 | |||
Total | 925,349,494.35 | 57,990,000.00 | 983,339,494.35 |
4. Operational revenue and costs
In RMB
Item | Amount occurred in the current period | Occurred in previous period | ||
Income | Cost | Income | Cost | |
Other businesses | 15,112,290.20 | 673,578.25 | 13,854,120.29 | 803,595.88 |
Total | 15,112,290.20 | 673,578.25 | 13,854,120.29 | 803,595.88 |
Others:
5. Investment income
In RMB
Item | Amount occurred in the current period | Occurred in previous period |
Gains from long-term equity investment measured by equity | -626,631.62 | |
Investment gain obtained from disposal of financial assets measured at fair value with variations accounted into current income account | 3,674,941.97 | |
Investment gain of financial products | 4,463,541.25 | 1,641,303.05 |
Total | 8,138,483.22 | 1,014,671.43 |
XVII. Supplementary Materials1. Detailed accidental gain/loss
√ Applicable □ Inapplicable
In RMB
Item | Amount | Notes |
Gain/loss of non-current assets | -1,565,317.62 | |
Subsidies accounted into the current income account (except the government subsidy closely related to the enterprise’s business and based on unified national standard quota) | 2,185,580.79 | |
Gain from entrusted investment or assets management | 9,615,882.62 | |
Gain generated by contingencies irrelevant to the Company’s business | 8,939,594.68 | |
Gain/loss from change of fair value of transactional financial asset and liabilities, and investment gains from disposal of transactional financial assets and liabilities and sellable financial assets, other than valid period value instruments related to the Company’s common businesses | 187,445.30 | |
Gain/loss from change of fair value of investment property measured at fair value in follow-up measurement | -323,794.00 | |
Other non-business income and expenditures other than the above | 6,110,628.97 | |
Other gain/loss items satisfying the | 0.40 |
definition of non-recurring gain/loss account | ||
Less: Influenced amount of income tax | 4,723,476.29 | |
Total | 20,426,544.85 | -- |
Explanation statement should be made for accidental gain/loss items defined and accidentalgain/loss items defined as regular gain/loss items according to the Explanation Announcement of
Information Disclosure No. 1 - Non-recurring gain/loss mentioned.
□ Applicable √ Inapplicable
2. Net income on asset ratio and earning per share
Profit of the report period | Weighted average net income/asset ratio | Earning per share | |
Basic earnings per share (yuan/share) | Diluted Earnings per share (yuan/share) | ||
Net profit attributable to common shareholders of the Company | 6.99% | 0.1944 | 0.1944 |
Net profit attributable to the common owners of the PLC after deducting of non-recurring gains/losses | 6.37% | 0.1772 | 0.1772 |
3. Differences in accounting data under domestic and foreign accounting standards(1) Differences in net profits and assets in financial statements disclosed according to the international and Chinese account
standards
□ Applicable √ Inapplicable
(2) Differences in net profits and assets in financial statements disclosed according to the international and Chinese accountstandards
□ Applicable √ Inapplicable
(3) Differences in financial data using domestic and foreign accounting standards, the overseas institution name should bespecified if the difference in data audited by an overseas auditor is adjusted
□ Applicable √ Inapplicable
Chapter 11 Documents for Reference1. The Interim Report 2018 and the Summary with signature of the legal representative (Chinese and English);
2. Financial statements stamped and signed by the legal representative, CFO and accounting manager;3. Originals of all documents and manuscripts of Public Notices of the Company disclosed in public in the newspapers as designatedby China Securities Regulatory Commission.
China Fangda Group Co., Ltd.Legal representative: Xiong Jianming07.08.18