无锡威孚高科技集团股份有限公司2022年年度报告全文
WEIFU HIGH-TECHNOLOGY GROUP CO., LTD.
ANNUAL REPORT 2022
April 2023
无锡威孚高科技集团股份有限公司2022年年度报告全文
Section I. Important Notice, Contents and InterpretationBoard of Directors, Board of Supervisory, all directors, supervisors and senior executives of WeifuHigh-Technology Group Co., Ltd. (hereinafter referred to as the Company) hereby confirm thatthere are no any fictitious statements, misleading statements, or important omissions carried in thisreport, and shall take all responsibilities, individual and/or joint, for the reality, accuracy andcompletion of the whole contents.Wang Xiaodong, Principal of the Company, and Ou Jianbin, person in charger of accounting worksand accounting organ (accounting principal) hereby confirm that the Financial Report of 2022Annual Report is authentic, accurate and complete.All directors have attended the Meeting for the Report deliberation.Non standard audit opinion reminder?Applicable □Not applicableGongzheng Tianye Certified Public Accountants (SGP) issued the audit report for the company withan unqualified opinion with highlighted paragraphs, the board of directors and the Board ofSupervisors of the company have explained the relevant matters in detail, please read carefully.Internal control major defect warning?Applicable □Not applicableGongzheng Tianye Certified Public Accountants(SGP) issued the audit report for the company withan unqualified opinion with highlighted paragraphs which involves material deficiencies in non-financial reporting, the board of directors and the Board of Supervisors of the company haveexplained the relevant matters in detail, please read carefully.The forward-looking statements with future plans involved in the Report do not constitute asubstantial commitment for investors. Investors and related parties should maintain sufficient riskawareness and investors are advised to exercise caution of investment risks.Main risks that the Company may face in future operation are described in the “prospects for thefuture development” under the “Management Discussion and Analysis” in the Report and investorsare advised to check them out.
无锡威孚高科技集团股份有限公司2022年年度报告全文
The profit distribution plan that was deliberated and approved by the Board Meeting is: based ontotal share capital of 983,173,293, distributed 1.00 yuan (tax included) bonus in cash for every 10-share hold by all shareholders, 0 share bonus issued (tax included) and no transfer of capital reserveinto share capital. When the profit distribution plan is implemented, if there is a change in the totalamount of shares entitled to profit distribution, the total amount of shares entitled to profitdistribution on the equity registration date at the time of implementation of the distribution planshall be adjusted based on the principle of unchanged distribution proportion.
The Report is prepared in Chinese and English respectively. In the event of any discrepancybetween the two versions, the Chinese version shall prevail.
无锡威孚高科技集团股份有限公司2022年年度报告全文
Content
Section I. Important Notice, Contents and Interpretation ...........................................................................................2
Section II Company Profile and Main Financial Indexes ...... 8
Section III Discussion and Analysis of the Management ...... 12
Section IV. Corporate Governance ...........................................................................................................................40
Section V. Environmental and Social Responsibility ................................................................................................60
Section VI. Important Matters ..................................................................................................................................67
Section VII. Changes in Shares and Particulars about Shareholders ........................................................................81
Section VIII. Preferred Stock ...................................................................................................................................89
Section IX. Corporate Bonds ....................................................................................................................................90
Section X. Financial Report ......................................................................................................................................91
无锡威孚高科技集团股份有限公司2022年年度报告全文
Documents Available for Reference
I. Financial statement carrying the signatures and seals of person in charge of the company, principal of theaccounting works and person in charge of accounting organ (accounting supervisor);II. Original audit report with the seal of accounting firm and signature and seal of the CPA;III. Original documents of the Company and manuscripts of public notices that disclosed in the website designatedby CSRC in the reporting period;IV. Text of the Annual Report 2022 containing the signature of the legal representative of the Company;V. Place for preparation: Office of the BOD of the Company
无锡威孚高科技集团股份有限公司2022年年度报告全文
Interpretation
| Items | Refers to | Contents |
| Company, The Company, WFHT | Refers to | WEIFU HIGH-TECHNOLOGY GROUP CO., LTD. |
| Weifu Group | Refers to | Wuxi Weifu Group Co., Ltd. |
| Wuxi Industry Group | Refers to | Wuxi Industry Development Group Co., Ltd. |
| Robert Bosch, Robert Bosch Company | Refers to | Robert Bosch Co., Ltd, ROBERT BOSCH GMBH |
| RBCD | Refers to | Robert Bosch Powertrain Ltd. |
| WFLD | Refers to | WUXI WEIFU LIDA CATALYTIC CONVERTER CO., LTD. |
| WFJN | Refers to | NANJING WFJN CO., LTD. |
| WFTT | Refers to | NINGBO WFTT TURBOCHARGING TECHNOLOGY CO.,LTD. |
| WFCA | Refers to | WUXI WEIFU CHANG?AN CO.,LTD. |
| WFMA | Refers to | WUXI WEIFU MASHAN FUEL INJECTION EQUIPMENT CO., LTD. |
| WFTR | Refers to | WUXI WEIFU INTERNATIONAL TRADE CO.,LTD. |
| WFSC | Refers to | WUXI WEIFU SCHMITTER POWERTRAIN COMPONENTS CO.,LTD. |
| WFAM | Refers to | WUXI WFAM PRECISION MACHINERY CO.,LTD. |
| WFDT | Refers to | WUXI WEIFU E-DRIVE TECHNOLOGIES CO., LTD. |
| WFAS | Refers to | WUXI WEIFU AUTOSMART SEATING SYSTEM CO., LTD. |
| SPV | Refers to | Weifu Holding ApS |
| IRD | Refers to | IRD Fuel Cells A/S |
| Borit | Refers to | Borit NV |
| WFQL | Refers to | Wuxi Weifu Qinglong Power Technology Co., Ltd. |
| VHIT | Refers to | VHIT S.p.A. Società Unipersonale |
| VHCN | Refers to | VHIT Automotive Systems(Wuxi) Co.Ltd |
| Lezhuo Bowei | Refers to | Lezhuo Bowei Hydraulic Technology (Shanghai) Co., Ltd |
| WFEC | Refers to | Wuxi WFECal Catalysts. Co., Ltd. |
| WFPM | Refers to | Wuxi Weifu Precision Machinery Manufacturing Co., Ltd. |
| Zhonglian Electronics | Refers to | Zhonglian Automobile Electronics Co., Ltd. |
| Shinwell Automobile | Refers to | Shinwell Automobile Technology (Wuxi) Co., Ltd. |
| Guokai Metal | Refers to | Wuxi Guokai Metal Resources Co., Ltd. |
| CSRC | Refers to | China Securities Regulatory Commission |
| SZSE | Refers to | Shenzhen Stock Exchange |
| Gongzheng Tianye | Refers to | Gongzheng Tianye Certified Public Accountants (Special General Partnership) |
无锡威孚高科技集团股份有限公司2022年年度报告全文
The reporting period
| The reporting period | Refers to | From Jan. 1, 2022 to Dec. 31, 2022 |
无锡威孚高科技集团股份有限公司2022年年度报告全文
Section II Company Profile and Main Financial IndexesI. Company information
| Short form of the stock | WFHT, Su Weifu-B | Stock code | 000581, 200581 |
| Stock exchange for listing | Shenzhen Stock Exchange | ||
| Name of the Company (in Chinese) | 无锡威孚高科技集团股份有限公司 | ||
| Short form of the Company (in Chinese) | 威孚高科 | ||
| Foreign name of the Company (if applicable) | WEIFU HIGH-TECHNOLOGY GROUP CO.,LTD. | ||
| Short form of foreign name of the Company (if applicable) | WFHT | ||
| Legal representative | Wang Xiaodong | ||
| Registrations add. | No.5 Huashan Road, Xinwu District, Wuxi (production & operation place:1. No.8 Huashan Road, Xinwu District, Wuxi; 2. No.17 Changjiang Road, Xinwu District, Wuxi; 3. No.139 Xixie Road, Xinwu District, Wuxi; 4. No.13 Xinhua Road, Xinwu District, Wuxi) | ||
| Code for registrations add | 214028 | ||
| Historical changes of registered address | On May 25, 1994, registered address of the Company changed to “Lot 46, National High-Tech Industrial Development Zone, Wuxi” instead of “No.107, Renmin West Road, Wuxi”; on December 9, 2008, registered address changed to “No.5 Huashan Road, New District, Wuxi” instead of“Lot 46, National High-Tech Industrial Development Zone, Wuxi”; on June 12, 2019, registered address changed to “No.5 Huashan Road, Xiwu District, Wuxi (production & operation place:1. No.8 Huashan Road, Xinwu District, Wuxi; 2. No.17 Changjiang Road, Xinwu District, Wuxi; 3. No.139 Xixie Road, Xinwu District, Wuxi; 4. No.13 Xinhua Road, Xinwu District, Wuxi)” | ||
| Offices add. | No.5 Huashan Road, Xinwu District, Wuxi | ||
| Codes for office add. | 214028 | ||
| Company’s Internet Web Site | http://www.weifu.com.cn | ||
| Web@weifu.com.cn | |||
II. Person/Way to contact
| Secretary of the Board | Rep. of security affairs | |
| Name | Liu Jinjun | Xu Kan |
| Contact add. | No.5 Huashan Road, Xinwu District, Wuxi | No.5 Huashan Road, Xinwu District, Wuxi |
| Tel. | 0510-80505999 | 0510-80505999 |
| Fax. | 0510-80505199 | 0510-80505199 |
| Web@weifu.com.cn | Web@weifu.com.cn |
无锡威孚高科技集团股份有限公司2022年年度报告全文
III. Information disclosure and preparation place
| Website of the Stock Exchange where the annual report of the Company is disclosed | Shenzhen Stock Exchange(http://www.szse.cn/) |
| Media and Website where the annual report of the Company is disclosed | China Securities Journal; Securities Times; and Juchao Website(http://www.cninfo.com.cn) |
| Preparation place for annual report | Office of the Board of Directors |
IV. Registration changes of the Company
| Organization code | 91320200250456967N |
| Changes of main business since listing (if applicable) | No change |
| Previous changes of controlling shareholders (if applicable) | Controlling shareholder of the Company was Weifu Group before 2009. and controlling shareholder changed to Wuxi Industry Group since 31 May 2009 due to the merge of Weifu Group by Wuxi Industry Group. Weifu Group and Wuxi Industry Group are wholly state-owned companies of Wuxi State-owned Assets Supervision & Administration Commission of State Council, therefore, the actual controller of the Company turns to Wuxi State-owned Assets Supervision & Administration Commission of State Council. |
V. Other relevant informationCPA engaged by the Company
| Name of CPA | Gongzheng Tianye Certified Public Accountants (Special General Partnership) |
| Offices add. for CPA | 10/F, No.5 Building, Jiakaicheng Fortune Center, Jingrong 3rd Street, Taihu Xincheng, Binghu District, Wuxi, Jiangsu Province |
| Signing Accountants | Gu Zhi, Zhang Qianqian |
Sponsor engaged by the Company for performing continuous supervision duties in reporting period
□ Applicable ? Not applicable
Financial consultant engaged by the Company for performing continuous supervision duties in reporting period
□ Applicable ? Not applicable
VI. Main accounting data and financial indexesWhether the Company is required to retrospectively adjust or restate prior year’s accounting data
□ Yes ? No
| 2022 | 2021 | Year-on-year increase(+)/decrease(-) | 2020 | |
| Operation income (RMB) | 12,729,634,917.03 | 13,682,426,710.95 | -6.96% | 12,883,826,306.60 |
| Net profit attributable to shareholders of the listed company(RMB) | 118,819,836.30 | 2,575,371,419.80 | -95.39% | 2,772,769,377.96 |
| Net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses(RMB) | 119,966,549.62 | 2,544,559,926.75 | -95.29% | 2,089,986,086.10 |
无锡威孚高科技集团股份有限公司2022年年度报告全文
Net cash flows arising from operatingactivities (RMB)
| Net cash flows arising from operating activities (RMB) | -2,575,742,649.43 | 627,712,593.41 | -510.34% | 781,811,234.01 |
| Basic earnings per share (RMB/Share) | 0.09 | 2.57 | -96.50% | 2.79 |
| Diluted earnings per share (RMB/Share) | 0.09 | 2.57 | -96.50% | 2.79 |
| Weighted average ROE | 0.64% | 13.67% | -13.03% | 15.78% |
| Year-end of 2022 | Year-end of 2021 | Year-on-year increase(+)/decrease(-) | Year-end of 2020 | |
| Total assets (RMB) | 28,528,913,065.01 | 27,970,858,427.84 | 2.00% | 27,350,695,388.21 |
| Net assets attributable to shareholder of listed company (RMB) | 17,696,679,170.72 | 19,398,607,689.65 | -8.77% | 18,282,017,990.66 |
The lower of the company’s net profit before or after deduction of non-recurring profit (gain)/loss for the last three financial years isnegative, and the audit report for the latest year indicates that there is uncertainty about the company’s ability to continue as a goingconcern
□Yes ?No
The lower of the net profit before or after deduction of non-recurring profit (gain)/loss is negative
□Yes ?No
VII. Difference of the accounting data under accounting rules in and out of China
1. Difference of the net profit and net assets disclosed in financial report, under both IAS (InternationalAccounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable ? Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either IAS (InternationalAccounting Standards) or Chinese GAAP (Generally Accepted Accounting Principles) in the period.
2. Difference of the net profit and net assets disclosed in financial report, under both foreign accountingrules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable ? Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either foreign accounting rules orChinese GAAP (Generally Accepted Accounting Principles) in the period.VIII. Quarterly main financial index
In RMB
| Q1 | Q2 | Q3 | Q4 | |
| Operation income | 4,322,024,211.55 | 2,815,148,646.42 | 2,607,800,533.18 | 2,984,661,525.88 |
| Net profit attributable to shareholders of the listed company | 720,738,423.95 | 370,388,056.13 | 175,558,437.23 | -1,147,865,081.01 |
| Net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses | 736,298,585.98 | 391,110,353.55 | 210,509,494.30 | -1,217,951,884.21 |
| Net cash flows arising from operating activities | -797,509,772.69 | -1,696,472,272.20 | -814,584,807.48 | 732,824,202.94 |
无锡威孚高科技集团股份有限公司2022年年度报告全文
Whether there are significant differences between the above-mentioned financial index or its total number and the relevant financialindex disclosed in the company’s quarterly report and semi-annual report?Yes □ NoThe Company has retroactively adjusted the data disclosed in the First Quarter Report, Semi-annual Report and Third Quarter Report,the specific reasons for adjustment can be found in “Announcement on Correction of Previous Accounting Errors” disclosed by theCompany on the designated website of Shenzhen Stock Exchange on April 28, 2023.IX. Items and amounts of extraordinary(non-recurring) profit (gains)/loss?Applicable □Not applicable
In RMB
| Item | 2022 | 2021 | 2020 | Note |
| Gains/losses from the disposal of non-current asset (including the write-off that accrued for impairment of assets) | -148,566.90 | -12,350,725.86 | 10,719,959.77 | |
| Governmental grants reckoned into current gains/losses (except for those with normal operation business concerned, and conform to the national policies & regulations and are continuously enjoyed at a fixed or quantitative basis according to certain standards) | 111,917,334.77 | 71,274,511.67 | 146,475,795.26 | |
| Profit and loss of assets delegation on others’ investment or management | 1,236,142.58 | 2,425.40 | 271,684,174.09 | |
| Except for the effective hedging operations related to normal business operation of the Company, the gains/losses of fair value changes from holding the trading financial assets and trading financial liabilities, and the investment earnings obtained from disposing the trading financial asset, trading financial liability and financial assets available for sale | -145,070,562.29 | -29,889,140.23 | 375,102,546.00 | |
| reversal of provision for depreciation of account receivable which was singly taken depreciation test | 1,265,113.45 | 8,976,264.09 | 3,078,424.43 | |
| Other non-operating income and expenditure except for the aforementioned items | 39,799,099.77 | 130,837.12 | -3,090,715.87 | |
| Less: Impact on income tax | 1,952,583.99 | 4,345,456.60 | 116,175,046.47 | |
| Impact on minority shareholders’ equity (post-tax) | 8,192,690.71 | 2,987,222.54 | 5,011,845.35 | |
| Total | -1,146,713.32 | 30,811,493.05 | 682,783,291.86 | -- |
Specific information on other items of profits/losses that qualified the definition of non-recurring profit(gain)/loss
□Applicable ?Not applicable
The Company does not have other items of profits/losses that qualified the definition of non-recurring profit(gain)/lossInformation on the definition of non-recurring profit(gain)/loss that listed in the Q&A Announcement No.1 on Information Disclosurefor Companies Offering Their Securities to the Public --- Extraordinary (non-recurring) Profit(gain)/loss as the recurringprofit(gain)/loss
□Applicable ?Not applicable
The Company does not have any non-recurring profit(gain)/loss listed under the Q&A Announcement No.1 on Information Disclosurefor Companies Offering Their Securities to the Public --- Extraordinary (non-recurring) Profit(gain)/loss defined as recurringprofit(gain)/loss
无锡威孚高科技集团股份有限公司2022年年度报告全文
Section III Discussion and Analysis of the Management
I. Industrial information of the Company within the reporting periodThe Company shall comply with the disclosure requirements of the automobile manufacturing-related industry in the Guidelines forSelf-regulation of Listed Companies on Shenzhen Stock Exchange No. 3 - Disclosure of Industry InformationThe industry in which the Company operates falls into the automotive parts manufacturing industry, which is closely related to thedevelopment of the automotive industry. In 2022, facing the triple pressures of reduced demand, unmet supply and weakenedexpectations, the auto industry overcame the impact of many unfavorable factors, stepped out of the mid-year fluctuations anduncertainties, and continued to maintain a recovery in growth, with steady increases in auto production and sales throughout the year.In 2022, the Company's automobile production and sales completed 27.021 million and 26.864 million units respectively, with anyoy increase of 3.4% and 2.1% respectively.
1. Market Conditions of Commercial Vehicle
In 2022, the demand for commercial vehicles was overdrawn by environmental protection and overloading control policies, includingfactors such as oil prices being at a high level, which slowed down the overall demand for commercial vehicles. In 2022, theCompany's production and sales of commercial vehicle completed 3.185 million and 3.30 million units, respectively, with an yoydecrease of 31.9% and 31.2%.In terms of production and sales by vehicle type, in 2022, truck production and sales were 2,778,000 units and 2,893,000 units, down
33.4% and 32.6% on a year-on-year basis, respectively; Passenger car production and sales were 407,000 units and 408,000 units,down 19.9% and 19.2% on a year-on-year basis, respectively;In terms of subdivided models, among the truck segments, the productions and sales of heavy, medium, light and mini trucksdeclined to varying degrees, with the most significant decline in heavy trucks. The sales of heavy trucks amounted to 671,900 units,down 52% on a year-on-year basis; The sales of medium trucks amounted to 95,700 units, down 46% on a year-on-year basis; Thesales of light trucks amounted to 1.6181 million units, down 23% on a year-on-year basis; The sales of mini trucks amounted to506,900 units, down 16% on a year-on-year basis. Among the bus segments, the production and sales of large buses showedrelatively rapid growth, while the production and sales of medium buses and light buses were in decline. The sales of large busesamounted to 51,500 units, up 7% on a year-on-year basis; The sales of medium buses amounted to 36,800 units, down 19% on ayear-on-year basis; The sales of light buses amounted to 319,600 units, down 22% on a year-on-year basis.
2. Market Conditions of Commercial Vehicle
In 2022, passenger cars realized relatively fast growth driven by policies such as stabilizing growth and promoting consumption,contributing significantly to the modest annual growth. Despite the factors such as chip shortage, due to the purchase tax incentivesand rapid growth of new energy sector, the sales of domestic passenger car market this year showed a characteristic of "U-shapedreversal, significant increase". Passenger car production and sales were completed 23,836,000 units and 23,563,000 million units, up
11.2% and 9.5% on a year-on-year basis, an increase of over 7% above the industry average.
3. Market Conditions of New Energy Vehicle
Under the dual effects of policy and market, in 2022, new energy vehicles continued to grow in an explosive manner, with productionand sales reaching 7,058,000 units and 6,887,000 units respectively, up 96.9% and 93.4% on a year-on-year basis, with a marketshare of 25.6%, 12.1% higher than the previous year. In particular, the sales of pure electric vehicles amounted to 5,365,000 units, an
无锡威孚高科技集团股份有限公司2022年年度报告全文
increase of 81.6% on a year-on-year basis; The sales of plug-in hybrid vehicles amounted to 1,518,000 units, up 1.5 times on a year-on-year basis; The sales of fuel cell vehicles amounted to 3, 000 units, up 1.1 times on a year-on-year basis;
4. Market Conditions of Off-road Vehicle
According to the requirements in the modification order of the Emission Limits and Measurement Methods for Exhaust Pollutantsfrom Diesel Engines for Non-road Mobile Machinery (China Stage III and IV) (GB20891-2014) and the Technical Requirements forPollutant Emission Control of Non-road Diesel Mobile Machinery (HJ1014-2020) issued and implemented by the Ministry ofEcology and Environment on December 28, 2020, from December 1, 2022, all production, import and sales of off-road mobilemachinery below 560KW (including 560KW) and its installed diesel engines shall satisfy the requirements of the Stage IV emissionstandards.In 2022, as affected by factors such as the slowdown in macroeconomic growth, the lack of effective project commencement rate, aswell as the adjustment of agricultural machinery subsidy policies, the off-road market demand for construction machinery andagricultural machinery decreased. In 2022, the sales of diesel internal combustion engines for construction machinery amounted to837,000 units, down 20.12% on a year-on-year basis; In 2022, the sales of diesel internal combustion engines for agriculturalmachinery amounted to 1.222 million units, down 16.55% on a year-on-year basis.(Note: The above industry data are sourced from the China Association of Automobile Manufacturers, cvworld.cn, and the ChinaInternal Combustion Engine Industry Association)
5. Matching of Company Operations with Industry
In 2022, the operation of the Company matched the development of the industry. Under the influence of multiple unfavorable factorssuch as the decline in demand in the commercial vehicle market and the overall economic slowdown, the Company realizedoperating income of RMB 12.730 billion during the reporting period, down 6.96% from the same period last year, and net profitattributable to shareholders of the listed company of RMB 0.119 billion, down 95.39% from the same period last year.II. Major Business of the Company within the reporting period
The Company shall comply with the disclosure requirements of the automobile manufacturing-related industry in the Guidelines forSelf-regulation of Listed Companies on Shenzhen Stock Exchange No. 3 - Disclosure of Industry Information.(I) Main business engaged by the CompanyThe Company is engaged in the research and development, production and sales of core automotive parts and components. Duringthe reporting period, the main products are diesel fuel injection system products, exhaust gas after-treatment system products and airintake system products. Meanwhile, the core components of the fuel cell products of the company have been produced and marketedin small batches.
1. The diesel fuel injection system products are widely applied to diesel engines of all grades of power, to support various types oftrucks, buses, construction machinery, marine, agricultural machinery, generator sets, etc. The products can satisfy the National VIand Off-road Stage IV emission regulations for vehicles, and are in the leading position within the industry in terms of productvariety, production scale, market share, etc. While making efforts to match with domestic main engines, some products have beenexported to America, Southeast Asia, the Middle East and other regions.
2. Exhaust after-treatment system products can satisfy the National VI and Off-road Stage IV emission regulations for vehicles. Theproducts are in the leading position domestically in terms of technology level, market scale and production capacity, and are widelyused in the fields of passenger cars, commercial vehicles, off-road machinery, etc., which can provide strong support for the productupgrading of main engine manufacturers.
无锡威孚高科技集团股份有限公司2022年年度报告全文
3. Intake system products (superchargers), can satisfy the National VI, Off-road Stage IV emission regulations for vehicles, theapplication range covers multiple fields such as commercial vehicles, passenger cars, construction machinery, agricultural machineryand generator sets, providing support for major domestic OEMs and vehicle manufacturers.
4. The core components of fuel cells, including membrane electrode, graphite bipolar plate, metal bipolar plate and key BOPcomponents are used for supporting domestic and overseas fuel cell reactor and system manufacturers.(II) Business model of the CompanyThe Company follows the business philosophy of “Making Fine Products, Creating Famous Brands and Achieving Common Growthin Values” and implements the business model of unified management by the parent company and decentralized production by thesubsidiaries. The parent company is responsible for formulating strategic development plans and business objectives, and providingunified management, guidance and assessment to the subsidiaries in terms of finance, major personnel management, core rawmaterials, quality control, technology development, etc. Subsidiaries arrange production based on the order management model of themarket, which not only enables the subsidiaries to maintain uniform product quality, but also facilitates timely understanding ofcustomer demands and saving logistics costs, so as to improve the economic efficiency of the Company by maintaining the timelinessof product production and supply.Production and operation of vehicle manufacturing during the reporting period
□Applicable ?Not Applicable
Production and operation of auto parts during the reporting period? Applicable □ Not applicable
Unit: Ten thousand pieces
| Capacity | Sales volume | |||||
| Current period | Same period of last year | Year-on-year increase/decrease(+/-) | Current period | Same period of last year | Year-on-year increase/decrease(+/-) | |
| By components | ||||||
| Fuel management system- multi-cylinder pumps | 182.19 | 279 | -34.70% | 217.80 | 284.8 | -23.53% |
| Fuel management system- fuel injector | 148.20 | 216.7 | -31.61% | 184.20 | 189.6 | -2.85% |
| After-treatment system - purifier | 49 | 58 | -15.52% | 61 | 44.4 | 37.39% |
| Air management system -turbocharger | 81.73 | 87.5 | -6.60% | 80.7 | 90.5 | -10.83% |
| By vehicle facilities | ||||||
| After-treatment system - purifier | 289.19 | 286 | 1.12% | 309.63 | 263.6 | 17.46% |
| By after-sales service market | ||||||
| Fuel management system- multi-cylinder pumps | 0.32 | 1.0 | -68.00% | 0.40 | 1.2 | -66.67% |
| Fuel management system- fuel injector | 0.60 | 0.3 | 100.00% | 0.60 | 0.4 | 50.00% |
| Air management system -turbocharger | 1.07 | 1.5 | -28.67% | 1.1 | 1.5 | -26.67% |
| By region | ||||||
| Domestic areas | ||||||
| Fuel management system- multi-cylinder pumps | 182.51 | 280 | -34.82% | 218.20 | 286 | -23.71% |
| Fuel management | 148.80 | 217 | -31.43% | 184.80 | 190 | -2.74% |
无锡威孚高科技集团股份有限公司2022年年度报告全文
system- fuel injector
| system- fuel injector | ||||||
| After-treatment system - purifier | 338.19 | 344 | -1.69% | 370.63 | 308 | 20.33% |
| Air management system -turbocharger | 82.80 | 89 | -6.97% | 81.8 | 92 | -11.09% |
Explanation of reasons for a year-on-year change of 30% or more? Applicable □ Not applicableIn 2022, subject to the impact of a number of unfavorable factors such as the macroeconomic downturn and the overdraft of demandin early switching of the National V to National VI, environmental protection and overload control policies, the domestic commercialvehicle market was running at a low level. Under the combined influence of industry cyclical adjustment and sluggish marketdemands, the production and sales volume of the main products of the Company, such as fuel injection system and air intake system,decreased to a certain extent over the same period last year.Sales model of spare partsThe Company adheres to the customer-centric approach and applies flexible marketing strategies and standardized developmentprocedures to satisfy the demands of different types of customers, ensure the smooth implementation of customer development plans,and strive for more customers and a larger market share. The Company has established a mechanism for strategic customer visits,with senior management visiting customers or receiving visits from customers on a regular basis, holding high-level strategicmeetings, special cooperation exchanges and other activities. The Company implements special management for strategic customersand establishes a four-in-one collaborative organization consisting of the responsible leaders, key account managers, marketingdepartment and business divisions to do a good job of customer demand analysis and management, customer satisfaction survey andanalysis, etc. Meanwhile, the Company optimizes business processes by means of information technology to enhance the speed ofresponse to customer demands, and assists customer relationship management through modern technological tools such as callcenters, customer data warehouses, business intelligence, mobile devices and web conferencing. The Company promotescollaborative marketing of existing businesses and new businesses, strengthens communication and cooperation with existingbusiness customers in new businesses, and actively expands new customers and develops potential customers.The Company engages in auto finance business
□Applicable ?Not Applicable
The Company engages in business related to new energy automobile? Applicable □ Not applicableProduction and operation of new energy vehicles and parts
In RMB
| Category | Capacity | Output | Sales volume | Sales revenue |
| Core components for hydrogen fuel cells | 1,500,000 pieces | 901,000 pieces | 845,000 pieces | 83,178,778.24 |
| Core parts for E-drive | 2,120,000 pieces | 1,713,000 pieces | 1,695,000 pieces | 189,144,908.67 |
| Exhaust (PEHV) cleaner | 120,000 pieces | 40,000 pieces | 36,000 pieces | 483,320,000.00 |
| Intake(PHEV) supercharger | 150,000 units | 81,000 units | 75,000 units | 71,466,238.00 |
III. Analysis on Core Competitiveness
The Company shall comply with the disclosure requirements of the automobile manufacturing-related industry in the Guidelines forSelf-regulation of Listed Companies on Shenzhen Stock Exchange No. 3 - Disclosure of Industry Information.
1. Industry and brand advantages. Established in 1958, with more than sixty years of development, the Company has become arenowned manufacturer of auto parts in China and has established long-term and stable cooperation with major domestic OEMs andvehicle manufacturers. The existing core auto parts products such as automotive fuel injection system, exhaust gas after-treatment
无锡威孚高科技集团股份有限公司2022年年度报告全文
system, air intake system and core parts of hydrogen fuel cell have strong market competitiveness and high market shares. TheCompany is a leading enterprise in the internal combustion engine industry in China as well as a Top 30 Enterprise in the auto partsindustry in China.
2. Technology and product advantages. The Company is a national high-tech enterprise with scientific research platforms such asNational Enterprise Technology Center, National High Technology Research and Development Program AchievementIndustrialization Base, Postdoctoral Research Station, Jiangsu Provincial Postgraduate Workstation, as well as several provincialengineering technology research centers, provincial engineering laboratories and other R&D institutions, which mainly focus on fuelinjection system for vehicles, exhaust gas after-treatment system, air intake system, hydrogen fuel cell, intelligent network, thermalmanagement system and other businesses for technological innovation and product development. The Company has acquired anumber of key core technologies, with the technical indicators of its main products at the leading level in the industry. In recent years,the Company has made key strategic layout in the fields of green hydrogen energy and intelligent electric power, established theInstitute of New Energy and Netlink Technology, and formed product technology research and development capabilities in hydrogenfuel cell core components, intelligent netlink, new energy thermal management system components, etc.
3. Management and manufacturing advantages. The Company features a perfect organizational structure, management system andprocess, as well as a financial sharing platform, which can realize the effective migration and stable operation of organization andpersonnel, business and accounting; The Company has built a human resource information system platform, so as to guarantee thetimely and accurate standardization of basic data of organization, personnel, salary and attendance; The Company has established aprocurement sharing system, which enables the interconnection of information between enterprises and suppliers that enables closed-loop management of the procurement process; The Company has implemented the Weifu Production System (WPS) with leanconcept and established an overall process quality management system with relatively strong manufacturing, quality assurance, costcontrol and product delivery capabilities. With the focus on smart manufacturing, the Company has continued to build a smartfactory with Weifu characteristics and promote the application of cloud computing and 5G network, which can strongly support thefuture business development of the Company.
4. Marketing and service advantages. The Company features a stable, professional and experienced marketing team, which canprovide targeted support and services based on customer demands, as well as cordial customer relationships. With regard to long-term strategic customers, the Company has established a four-in-one marketing coordination group consisting of responsible leaders,key account managers, marketing departments and business divisions, and regular visits among the management of the companies topromote communication and cooperation. The Company has a relatively complete after-sales service system, and has built an after-sales service network, intelligent service platform, and set up special maintenance technical service stations nationwide to regularlytrain end-users in the use of maintenance and fault analysis and judgment, so as to provide customers with fast, timely andprofessional all-round after-sales services.
5. Talent team advantages. The management team of the Company has extensive experience in the auto parts industry with excellentindustry reputation. The Company attaches importance to the growth of employees as well as the development of core talents. Withyears of accumulation, the Company has deposited a group of professional and high-quality management and technical talents andestablished a reasonable talent echelon, which provides a strong guarantee of human resources for the long-term and stabledevelopment of the Company. The human resource management system of the Company is relatively comprehensive, and thecontinuously optimized human resource management system has provided a fair platform for career development of employees torealize their values. The Company attaches importance to the service and care for employees, and aims to enhance the serviceexperience of employees through the construction of employee self-help platform to create a working environment with warmth anda sense of belonging.
6. International cooperation advantages. The Company is committed to the core automotive parts industry and has long beencooperating with strategic partners at home and abroad in depth. The Company has been cooperating with industry giant RobertBosch Compan since 1984, and has established a long-term and stable cooperation relationship with Bosch and continuouslyexpanded cooperation in new business areas, and the cooperation model between the two sides has become an industry model.Meanwhile, the Company has built joint ventures with Autocam in the United States and Schmidt in Germany, and cooperates
无锡威孚高科技集团股份有限公司2022年年度报告全文
closely in the field of high-end precision manufacturing. By long-term cooperation with renowned enterprises in Europe and theUnited States, the Company has cultivated a group of middle and senior management and technical personnel with internationalcommunication abilities, international visions and familiarity with international standards, and has mastered R&D process design,quality control and production management capabilities with international advanced levels, which has promoted favorabledevelopment of the business of the Company as well as international business and market development.
7. Excellent corporate culture with the mission of “Better Life Powered by Quality and Intelligence” and the vision of “CentennialWeifu Expert in Core Auto Parts Industry”, the Company has practiced the core values of “Focus, Innovation, Commitment andIntegration” while adopting the enterprise spirit of “Being Practical, Being Courageous, Being Cooperative and Being Pioneering”.The Company has been building a culture system of “Quality and Intelligence”, with “Quality” and “Intelligence” as the twin enginesof the corporate culture, which reflect the adherence to the original intention and the pursuit of the future. The excellent corporateculture has provided strong support for the continued operational excellence of the Company and its growth into a trustworthy andrespected industrial expert, thereby playing an active role in the achievement of the strategic goals of the Company.
IV. Analysis of Main Businesses
1. Overview
In 2022, facing the complicated and severe macroeconomic situation and the pressure of the downward development of theautomobile industry, the Company has closely followed the development objectives of the 14
thFive-Year Plan, implemented theannual work policy of “Targeting Strategic Targets, Improving Business Quality, Consolidating Management System andAccelerating the Implementation of New Industries”, and all employees have made concerted efforts to overcome difficulties andactively taken measures to cope with various challenges, and the comprehensive economic operation indicators of the Company havebeen superior to the industry average. During the report period, the operating income of the company reached RMB 12.730 billion,
6.96% lower than that in previous year; the net profit owned by the shareholders of the listed company reached RMB 0.119 billion,
95.39% lower than that in the same period of previous year; the total assets of the Company was RMB 28.529 billion, with an yoyincrease of 2%; the net margin belonging to shareholders of listed companies was RMB 17.697 billion, with an yoy decrease of
8.77%.
Major work performed by the Company during the reporting period:
1. Join hands and overcome difficulties to maintain overall stability in revenue scale
Facing the complicated environment and changes in the industry, the Company has actively expanded its projects in the domestic keycustomer market, while seizing the business in the overseas export market to achieve an overall stable revenue scale. Fuel injectionsystem products: The annual sales of common rail pumps exceeded 1,350,000 units; VE distribution pump sales amounted to nearly400,000 units; Benefiting from the growth of the export market, the annual sales of mechanical pumps exceeded 160,000 units, up 22%on a year-on-year basis. Post-treatment system products: The annual sales of gasoline purifier exceeded 2,170,000 sets, and theannual sales of diesel purifier exceeded 250,000 sets, with the market share and competitiveness of the products being steadilyimproved. A number of core customer projects have been completed and approved for production in the T4 off-road market, withbusiness volume rising rapidly; The hybrid vehicle market has been expanding strongly, with several customer projects achievingbatch production. Air intake system products: The annual sales of four-cylinder diesel supercharger exceeded 520,000 units, andcontinued to maintain the position of the first domestic market share of the industry. The annual sales of gasoline superchargerexceeded 220,000 units, doubling on a year-on-year basis, and a number of domestic leading new energy vehicle customer projectshave been acquired and gradually achieved batch production. The annual sales of motor shaft products of the Company exceeded560,000 pieces, realizing a four-fold increase on a year-on-year basis. The Company has achieved bulk supply to internationallyleading new energy vehicle customers, and continued to acquire projects from a number of leading customers. The business volumesof hydrogen fuel cell components, such as “one membrane and two plates” and BOP key components, have grown steadily, andbreakthroughs have been achieved in several customer projects.
无锡威孚高科技集团股份有限公司2022年年度报告全文
2. The Company has promoted the efficient development of its main products and expedited the research and deployment ofnew industry productsEfficient and clean internal combustion power products: For the GP electronically controlled fuel system, the Company hascompleted the application development of some models of key customers and realized small batch delivery, and completed thedevelopment of Sample A of 2200bar system and Sample C of CB6-25 high-pressure pump; The Company has completed the T4announcement for all source machines of the 12 off-road manufacturers of the VP system. The Company has completed thedevelopment of the Sample D of the second generation platform of the six-cylinder supercharger WT04/05 and the small batchdelivery of key customer projects; The Company has completed the batch production and delivery of four-cylinder superchargers foreight key commercial vehicle customers. The Company has completed the development of Sample B of the light diesel platform andSample C of the heavy diesel platform of the post-treatment system; The Company has completed the transformation of 80 post-treatment products for customers of passenger car independent brands. The Company has completed the development of the SampleB of the mechanical part of the variable valve system and the Sample A of the controller; The Company has completed the batchdelivery of 17 displacement products for 3 platforms of hydraulic pumps.Hydrogen energy and intelligent electric products: The Company has completed the development of Sample C of platinum carboncatalysts and the construction of platinum carbon and platinum alloy catalyst production lines; The Company has completed the batchdelivery of hydrogen injector, hydrogen isolation valve and hydrogen safety valve for low pressure hydrogen subsystem, as well asthe first batch of samples for hydrogen circulation pump for customers; The Company has completed the development of Sample Aand partial reliability testing of the high-pressure hydrogen subsystem; The Company has realized the delivery of electric boostercustomer samples in the air subsystem; For hydrothermal management system, the Company has completed the development ofSample A for electronic water pump and thermostat and the supply of samples to customers. The Company has completed theconstruction of a 100 kW level PEM electrolytic water hydrogen production demonstration line for renewable energy hydrogenproduction system. The Dongfeng Fengshen E70, equipped with the wheel hub motor product of the Company, is the first wheel hubmotor model in the world to obtain the type approval notice for passenger cars, and has already satisfied the requirements for massproduction. The Company has completed the development of Sample C for throw radar and Sample B for in-cabin radar; The 4Dimaging radar products have been awarded the mainline logistics project.
3. The strategic planning system is running, and the investment layout of new industries is acceleratedIn terms of strategic planning, the Company has completed the optimization and release of the company’s strategic blueprint, forminga new strategic pattern of all-round development of four major sectors, namely the energy saving and emission reduction, greenhydrogen energy, smart electric power and other core components. The Company has implemented the annual review and evaluationof strategic planning, promoted the communication and docking between functions and businesses, and released the planning revisionplan of major business segments through the Company's strategic special committee. The Company has established a strategicresearch organization, promoted the investigation and preliminary planning of thermal management system and core components,and completed the strategic special research work such as hydrogen production from electrolyzed water, hydrogen fuel cells,electrification of commercial vehicles, and alternative fuels. The Company has actively promoted the government docking workrelated to planned land use and industrial subsidies.In terms of investment cooperation, the Company has signed a strategic cooperation agreement with Bosch Rexroth and establishedLezhuo Bowei joint venture company; The Company has completed the signing of the merger and acquisition project of vacuumpump and electronic oil pump and has delivered the project smoothly; The Company has completed the planning of three globalhydrogen business bases and the review and approval of related investment projects, actively implemented the capacity constructionprojects of membrane electrodes and bipolar plates, realized strategic cooperation with ROBERT BOSCH Company and XinwuDistrict Government of Wuxi City, and established Wuxi Weifu Qinglong Power Technology Co., Ltd.. The Company has activelypromoted the preliminary work of investment cooperation related to 4D imaging millimeter wave radar and PEM water electrolysishydrogen production projects. The Company has completed the formulation of post-evaluation management measures for equityinvestment projects and established a normalized post-investment evaluation mechanism.
4. Strengthen quality and safety management, promote the construction of intelligent information
无锡威孚高科技集团股份有限公司2022年年度报告全文
The Company has realized stable improvement in the zero-kilometer level of core products, and maintained the zero-kilometer faultof common rail products ≤ 10 ppm; The Company has deepened the application of Q11 quality tools and the hierarchicalnormalization evaluation of all process elements; The Company has carried out design review, experimental design, quality housetool training and project pilot of failure mode; The Company has promoted the standardization of online measurement managementsystem and coding and identification of measuring instruments; The Company has carried out continuous improvement of theGroup's 25 value stream systems and completed 154 improvement projects; Three business divisions have completed the launch ofthe process module of the product life cycle management platform and the standardization and update of the working hours quota.The Company has steadily promoted the construction of the R&D building, and successfully completed the construction projectssuch as motor shaft workshop, VHCN workshop, WFQL workshop and the transformation of Class A laboratory for hydrogenproduction by proton exchange membrane. The Company has completed the external audit and certification of ISO50001 energymanagement system; The Company has optimized the environmental health and safety information supervision platform, andimplement normalized supervision for large risk points; The Company has maintained zero major casualty and fire incidentthroughout the year. The Company's Automotive Diesel System Division has successfully passed the four-level evaluation ofnational intelligent manufacturing capability maturity; The SAP S4 HANA upgrade project has been officially launched, and theprocess management system project, digital collaborative office platform and defect machine vision inspection project have beencompleted and put into operation; The expansion of data service platform architecture and the construction of real-time computingplatform have been steadily promoted, and it has been promoted and applied in cooperation with intelligent manufacturing projects;The construction of information technology service management system has been initially completed, and the operation andmaintenance service platform was officially put into use; The Company has completed the design of software R&D and operationand maintenance management system, built the basic software R&D platform, and realized the launch of the hybrid cloudmanagement and control platform.
5. Consolidate the quality of enterprise operation and improve the efficiency of operation and managementThe Company has promoted the construction of process management system in R&D domain, marketing domain and administrativedomain, initially completed the closed loop of long-term mechanism of process, complete the design of business unit organizationand operation mechanism, promoted the pilot operation of precision manufacturing business unit, and completed the centralizedmanagement of major innovation incentive projects of the company. The Company has re-planned the procurement business systemfrom three aspects: supplier management, daily procurement management and logistics management, and completed the second stageadjustment of the company's procurement organization reform. The Company has promoted the implementation of the optimizationof supplier classification methods and performance evaluation for direct and indirect materials, and further standardized suppliermanagement. The Company has completed the preliminary storage planning of the company and determined the step-by-stepimplementation roadmap. The Company has deepened its asset management measures, optimized the efficiency of operating assets,closely monitored asset risks, and continued to promote the special audit management of "foreign capital"; The Company hasstrengthened the ability of cost control, refine the granularity of cost and promoted the systematization of cost analysis. TheCompany has strengthened the integration of risk control compliance elements into the system process review, and completed specialinternal control tests and evaluations such as marketing domain-credit control, information technology-information security. TheCompany has paid emphasis on promoting the introduction of strategic new business R&D talents and completed the construction ofWFQL’s core talent team; The Company has continued to build a talent development system of “San Hang Yi Jiang” and developquality models of key positions such as marketing and technology; Facing the strategic new business, the Company has activelyexplored the incentive mechanism with more market competitiveness; continuously optimized the salary model and improve theproject incentive mechanism according to the business characteristics. The second phase of the personnel information system hasbeen put into operation, further improving the digital management ability of human resources.
无锡威孚高科技集团股份有限公司2022年年度报告全文
2.Revenue and cost
(1) Composition of operation revenue
In RMB
| 2022 | 2021 | Year-on-year increase(+)/decrease(-) | |||
| Amount | Ratio in operation revenue | Amount | Ratio in operation revenue | ||
| Total operation revenue | 12,729,634,917.03 | 100% | 13,682,426,710.95 | 100% | -6.96% |
| By industry | |||||
| Automotive components | 12,333,099,421.87 | 96.88% | 13,184,138,129.88 | 96.36% | -6.46% |
| Other business | 396,535,495.16 | 3.12% | 498,288,581.07 | 3.64% | -20.42% |
| By product | |||||
| Automotive fuel management system | 6,007,572,425.95 | 47.19% | 6,025,368,344.71 | 44.04% | -0.30% |
| Automotive after-treatment system | 5,757,697,818.52 | 45.23% | 6,511,015,127.55 | 47.59% | -11.57% |
| Air management system | 567,829,177.40 | 4.46% | 647,754,657.62 | 4.73% | -12.34% |
| Other business | 396,535,495.16 | 3.12% | 498,288,581.07 | 3.64% | -20.42% |
| By region | |||||
| Domestic | 11,917,440,065.87 | 93.62% | 13,304,186,980.94 | 97.24% | -10.42% |
| Foreign | 812,194,851.16 | 6.38% | 378,239,730.01 | 2.76% | 114.73% |
| By sales model | |||||
| Direct sale | 12,729,634,917.03 | 100.00% | 13,682,426,710.95 | 100.00% | -6.96% |
(2) The industries, products, regions or sales model accounting for over 10% of the Company’s operationrevenue or operation profit?Applicable □ Not applicable
In RMB
| Operation revenue | Operation cost | Gross profit ratio | Year-on-year increase(+)/decrease(-) of operation revenue | Year-on-year increase(+)/decrease(-) of operation cost | Year-on-year increase(+)/decrease(-) of gross profit ratio | |
| By industry | ||||||
| Automotive components | 12,333,099,421.87 | 10,658,281,929.91 | 13.58% | -6.46% | -1.52% | -4.33% |
| By product | ||||||
| Automotive fuel management system | 6,007,572,425.95 | 4,910,467,473.94 | 18.26% | -0.30% | 7.98% | -6.26% |
| Automotive | 5,757,697,818.52 | 5,279,643,720.82 | 8.30% | -11.57% | -9.15% | -2.45% |
无锡威孚高科技集团股份有限公司2022年年度报告全文
In case of changes in the statistical caliber of principal business data in the reporting period, the Company will refer to the principalbusiness data after adjustment in recent 1 year:
□Applicable ?Not Applicable
(3) Whether the Company’s revenue from physical sales is greater than its revenue from labor services? Yes □ No
| Industries | Item | Unit | 2022 | 2021 | Year-on year increase(+)/decrease(-) |
| Fuel management system- multi-cylinder pumps | Sales volume | In 10 thousand sets | 218.20 | 286.00 | -23.71% |
| Output | In 10 thousand sets | 182.51 | 280.00 | -34.82% | |
| Storage | In 10 thousand sets | 2.31 | 38.00 | -93.92% | |
| Fuel management system- fuel injector | Sales volume | In 10 thousand suits | 184.80 | 190.00 | -2.74% |
| Output | In 10 thousand suits | 148.80 | 217.00 | -31.43% | |
| Storage | In 10 thousand suits | 16.00 | 52.00 | -69.23% | |
| After-treatment system - purifier | Sales volume | In 10 thousand pieces | 370.63 | 308.00 | 20.33% |
| Output | In 10 thousand pieces | 338.19 | 344.00 | -1.69% | |
| Storage | In 10 thousand pieces | 48.56 | 81.00 | -40.05% | |
| Air management system -turbocharger | Sales volume | In 10 thousand sets | 81.80 | 92.00 | -11.09% |
| Output | In 10 thousand sets | 82.80 | 89.00 | -6.97% | |
| Storage | In 10 thousand sets | 18.00 | 17.00 | 5.88% |
Description for relevant year-on-year data changing over 30%? Applicable □ Not applicableAffected by the decrease in market demand, the production and sales of fuel injection system products decreased compared with lastyear; Due to the reduction of market demand and the requirements of the company's production planning and inventory controlmanagement, the inventory of fuel injection system products and after treatment system products decreased significantly year-on-year during the reporting period.
| after-treatment system | ||||||
| Air management system | 567,829,177.40 | 468,170,735.15 | 17.55% | -12.34% | 0.98% | -10.88% |
| By region | ||||||
| Domestic sales | 11,520,904,570.71 | 10,063,929,347.38 | 12.65% | -10.03% | -3.74% | -5.71% |
| Foreign sales | 812,194,851.16 | 594,352,582.53 | 26.82% | 114.73% | 61.82% | 23.93% |
| By sales mode | ||||||
| Direct sales | 12,333,099,421.87 | 10,658,281,929.91 | 13.58% | -6.46% | 0.00% | -4.33% |
无锡威孚高科技集团股份有限公司2022年年度报告全文
(4) Performance of significant sales contracts, major procurement contract entered into by the company upto the current reporting period
□ Applicable ? Not applicable
(5) Composition of operation cost
Classification of industries and products
In RMB
| Industries | Item | 2022 | 2021 | Year-on-year increase(+)/decrease(-) | ||
| Amount | Ratio in operation cost | Amount | Ratio in operation cost | |||
| Automotive components | Direct material | 8,095,497,519.84 | 75.95% | 9,048,058,229.72 | 83.60% | -10.53% |
| Automotive components | Labor cost | 929,458,806.34 | 8.72% | 790,874,802.43 | 7.31% | 17.52% |
| Automotive components | Depreciation | 343,934,013.85 | 3.23% | 257,633,922.53 | 2.38% | 33.50% |
| Automotive components | Varieties of consumption | 1,289,391,589.88 | 12.10% | 726,033,566.22 | 6.71% | 77.59% |
In RMB
| Products | Item | 2022 | 2021 | Year-on-year increase(+)/decrease(-) | ||
| Amount | Ratio in operation cost | Amount | Ratio in operation cost | |||
| Fuel management system | Direct material | 3,115,518,946.44 | 63.45% | 3,080,614,222.05 | 67.74% | 1.13% |
| Fuel management system | Labor cost | 748,680,992.35 | 15.25% | 676,106,197.66 | 14.87% | 10.73% |
| Fuel management system | Depreciation | 255,349,057.28 | 5.20% | 214,171,045.70 | 4.71% | 19.23% |
| Fuel management system | Varieties of consumption | 790,918,477.87 | 16.10% | 576,787,018.40 | 12.68% | 37.12% |
| After-treatment system | Direct material | 4,569,665,321.35 | 86.55% | 5,554,787,086.57 | 95.59% | -17.73% |
| After-treatment system | Labor cost | 149,450,815.08 | 2.83% | 90,930,353.55 | 1.56% | 64.36% |
| After-treatment system | Depreciation | 72,125,006.14 | 1.37% | 27,076,236.77 | 0.47% | 166.38% |
| After-treatment system | Varieties of consumption | 488,402,578.25 | 9.25% | 138,506,106.63 | 2.38% | 252.62% |
| Air management system | Direct material | 410,313,252.05 | 87.64% | 412,656,921.10 | 89.01% | -0.57% |
| Air management system | Labor cost | 31,326,998.91 | 6.69% | 23,838,251.22 | 5.14% | 31.41% |
| Air management | Depreciation | 16,459,950.43 | 3.52% | 16,386,640.06 | 3.53% | 0.45% |
无锡威孚高科技集团股份有限公司2022年年度报告全文
system
| system | ||||||
| Air management system | Varieties of consumption | 10,070,533.76 | 2.15% | 10,740,441.19 | 2.32% | -6.24% |
(6) Whether there was a change in the scope of consolidation during the reporting period?Yes □No
| Changes in the scope of consolidation | Name of enterprise | Acquisition manner of equity | Contribution ratio |
| Increase in consolidation scope | WFQL | Jointly funded and established by the Company with its wholly-owned subsidiaries IRD FUEL CELLS A/S, BORIT NV, as well as ROBERT BOSCH INTERNATIONALE BETEILIGUNGEN AG and Wuxi High-Tech Zone New Dynamic Industrial Development Fund (Limited Partnership) | 75.00% |
| Increase in consolidation scope | VHIT | A wholly-owned subsidiary purchased by the Company through SPV in cash in the current period | 100.00% |
| Increase in consolidation scope | VHCN | Wholly owned subsidiary purchased in cash by the Company in the current period | 100.00% |
(7) Major changes or adjustment in business, product or service of the Company in Reporting Period
□ Applicable ?Not applicable
(8) Major sales and main suppliers
Major sales clients of the Company
| Total top five clients in sales (RMB) | 4,715,798,936.72 |
| Proportion in total annual sales volume for top five clients | 37.04% |
| Ratio of the related party sales in total annual sales from top five clients | 29.03% |
Information of top five clients of the Company
| Serial | Name | Sales (RMB) | Proportion in total annual sales |
| 1 | RBCD | 2,220,345,511.60 | 17.44% |
| 2 | Robert Bosch Company | 1,475,458,231.00 | 11.59% |
| 3 | Client 1 | 376,978,411.80 | 2.96% |
| 4 | Client 2 | 358,805,398.60 | 2.82% |
| 5 | Client 3 | 284,211,383.72 | 2.23% |
| Total | -- | 4,715,798,936.72 | 37.04% |
Other situation of main clients?Applicable □ Not applicableThe Company has association with RBCD and Robert Bosch Company. In addition, the directors, supervisors, senior executives,core technicians and actual controller of the Company have no equity in main suppliers directly or indirectly.Main suppliers of the Company
| Total purchase amount from top five suppliers (RMB) | 2,903,660,303.77 |
| Proportion in total annual purchase amount for top five suppliers | 25.40% |
| Ratio of the related party purchase in total annual purchase amount from top | 7.66% |
无锡威孚高科技集团股份有限公司2022年年度报告全文
five suppliers
five suppliers
Information of top five suppliers of the Company
| Serial | Suppliers | Purchasing amount (RMB) | Ratio in annual total purchasing amount |
| 1 | Client 1 | 1,147,286,046.48 | 10.04% |
| 2 | WFEC | 575,378,265.05 | 5.03% |
| 3 | Client 2 | 593,414,524.51 | 5.19% |
| 4 | RBCD | 301,077,307.73 | 2.63% |
| 5 | Client 3 | 286,504,160.00 | 2.51% |
| Total | -- | 2,903,660,303.77 | 25.40% |
Other notes of main suppliers of the Company? Applicable □ Not applicableThe Company has association with WFEC and RBCD. In addition, the directors, supervisors, senior executives, core technicians andactual controller of the Company have no equity in main suppliers directly or indirectly.
3.Expense
In RMB
| 2021 | 2020 | Year-on-year increase(+)/decrease(-) | Note of major changes | |
| Sales expenses | 189,528,090.71 | 264,651,432.56 | -28.39% | Mainly due to the continuous optimization of product quality management and the reduction of three guarantee fees for customers |
| Administration expenses | 586,386,474.32 | 611,872,150.24 | -4.17% | |
| Financial expenses | 82,327,615.76 | 20,063,248.84 | 310.34% | Mainly due to the increase in loan interest |
| R&D expenses | 581,488,711.88 | 595,406,951.64 | -2.34% |
4. R&D investment
√ Applicable □ Not applicable
| Projects | Purpose | Progress | Goals to be achieved | Expected impact on the future development of the Company |
| Development and application of the core components of clean fuel injection system | R&D the technology for alternative(hydrogen，natural gas, etc) traditional fuel injection system | In progress, customer project is progressing | Resulting a core component products for clean fuel injection system and apply to the market | Promotes the market share of clean fuel products in the future |
| Development and application on the common-rail pump products to meet the Euro VII emission standard | Development on the common-rail pump products that meets the Euro VII emission standards for automotive diesel engines | In progress, customer project is progressing | Resulting the products that meets the Euro VII emission standards for automotive diesel engines and apply to the market | Enhance the existing products and extend the life of traditional products |
| Development and application on the diesel fuel injection parts products to meet the off-road T4 emission standards | Development on the diesel fuel injection parts products that meets the off-road T4 emission standards | In progress, some projects of customers have been put into mass production.In progress, some projects | Resulting the diesel fuel injection parts products that meets the off-road T4 emission standards and apply to | Enhance the existing products and extend the life of traditional products |
无锡威孚高科技集团股份有限公司2022年年度报告全文
of customers have beenput into massproduction.
| of customers have been put into mass production. | the market | |||
| Development and application on the passenger car after-treatment products to meet the National VI emission standards | Development on the passenger car after-treatment products that meets the National VI emission standards | In progress, and some models are in customer application already and have been supplied. | Resulting the passenger car after-treatment products that meets the National VI emission standards and apply to the market | Enhance the existing products and extend the life of traditional products |
| Development and application on the commercial vehicle after-treatment products to meet the Euro VII emission standards | Development on the commercial vehicle after-treatment products that meets the Euro VII emission standards | In progress, and some models are in customer application and have been supplied in small batches | Resulting the passenger car after-treatment products that meets the Euro VII emission standards and apply to the market | Enhance the existing products and extend the life of traditional products |
| Development and application on the after-treatment products to meet the off-road T4 emission standards | Development on the after-treatment products that meets the off-road T4 emission standards | In progress, and some models are in customer application already | Resulting the after-treatment products that meets the off-road T4 emission standards and apply to the market | Enhance the existing products and extend the life of traditional products |
| Development and application on the supercharger products for gasoline engine to meet the National VI emission standards | Development on the supercharger products for gasoline engine that meets the National VI emission standards | In progress, and some models are in customer application already and have been supplied in small batch. | Resulting the supercharger products for gasoline engine that meets the National VI emission standards and put them on the market | Enhance the existing products and extend the life of traditional products |
| Development and application on the supercharger products for diesel engine to meet the Euro VII emission standards | Development on the supercharger products for diesel engine that meets the Euro VII emission standards | In progress, and customer project is in progress. | Resulting the supercharger products for diesel engine that meets the National VI emission standards and put them on the market | Enhance the existing products and extend the life of traditional products |
| Development and application on the supercharger products for natural gas engine to meet the National VI emission standards | Development on the supercharger products for natural gas engine that meets the National VI emission standards | In progress, and some models are in customer application already | Resulting the supercharger products for natural gas engine that meets the National VI emission standards and put them on the market | Enhance the existing products and extend the life of traditional products |
| Development and application of the supercharger for automotive incremental engine | Development on the supercharger for automotive incremental engine | In progress, and some customers are supplied batches | Resulting the supercharger products for automotive incremental engine and put them on the market | Enhance the existing products, fit in with new application scenarios and extend the life of traditional products |
| Development and application on the core materials of hydrogen fuel cell | Development on the core materials (one membrane & two plates, catalyst)of hydrogen fuel cell | In progress, relevant products have achieved small production and have entered customer application | Resulting a large-scale production of core materials for the hydrogen fuel cells and put them on the market | Main direction of the emerging business of the Company in the future and new business growth points |
| Development and application on BOP key component products of hydrogen fuel cells | Development on the BOP key component (valve, pumps, etc.) products of hydrogen fuel cells | In progress, relevant products have achieved small production and have entered customer application | Resulting a large-scale production of BOP key component products of hydrogen fuel cells and put them on the market | Main direction of the emerging business of the Company in the future and new business growth points |
| Development and application of the E-drive components products for new energy vehicles | Development on E-drive component (motor shaft, motor case, etc. ) products for new energy vehicles | In progress, relevant products have been mass-produced and have been supplied in batch. | Resulting development on the E-drive components products for new energy vehicles and put them on the market | Main direction of the emerging business of the Company in the future and new business growth points |
| Development and application of | Development on intelligent sensing core | In progress, sample delivery of relevant | Resulting the intelligent sensing core | Main direction of the emerging business of |
无锡威孚高科技集团股份有限公司2022年年度报告全文
intelligent sensing coremodule products
| intelligent sensing core module products | module products (milliliter-wave radar) | products have been achieved and been applied pilot in some projects. | module products and put them on the market | the Company in the future and new business growth points |
| Development and application of smart seating products | Development on smart seating products | In progress, some products have entered customer applications and have been supplied in small batch | Resulting the smart seating products and put them on the market | Main direction of the emerging business of the Company in the future and new business growth points |
| Development and application on core component products of hydraulic system | Development on hydraulic system core component products | In progress, some products have entered customer applications | Resulting the hydraulic system core component products and put them on the market | Main direction of the emerging business of the Company in the future and new business growth points |
| Development and application on core component products of brake system | Development on brake system core component products | In progress, some products have entered customer applications | Resulting the brake system core component products and put them on the market | Main direction of the emerging business of the Company in the future and new business growth points |
| Development and application of the intelligent manufacturing equipment | Development on intelligent manufacturing equipment | In progress, some products have entered customer applications | Resulting the intelligent manufacturing equipment and put them on the market | Improve the technological capabilities in field of intelligent manufacturing and creating economic benefits |
Personnel of R&D
| 2022 | 2021 | Change ratio | |
| Number of R&D (person) | 1,232 | 1,112 | 10.79% |
| Ratio of number of R&D | 20.92% | 20.82% | 0.10% |
| Education background | |||
| Undergraduate | 708 | 679 | 4.27% |
| Master | 240 | 207 | 15.94% |
| Age composition | |||
| Under 30 | 328 | 289 | 13.49% |
| 30~40 | 649 | 570 | 13.86% |
Investment of R&D
| 2022 | 2021 | Change ratio | |
| R&D investment (RMB) | 581,488,711.88 | 595,406,951.64 | -2.34% |
| R&D investment/Operation revenue | 4.57% | 4.35% | 0.22% |
| Capitalization of R&D investment (RMB) | 0.00 | 0.00 | |
| Capitalization of R&D investment/R&D investment | 0.00% | 0.00% |
Reasons and effects of significant changes in composition of the R&D personnel
□Applicable ?Not applicable
The reason of great changes in the proportion of total R&D investment accounted for operation income than last year
□ Applicable ? Not applicable
Reason for the great change in R&D investment capitalization rate and rational description
□ Applicable ? Not applicable
无锡威孚高科技集团股份有限公司2022年年度报告全文
5.Cash flow
In RMB
| Item | 2022 | 2021 | Year-on-year growth rate |
| Subtotal of cash inflow arising from operating activities | 16,421,144,267.50 | 15,691,750,941.15 | 4.65% |
| Subtotal of cash outflow arising from operating activities | 18,996,886,916.93 | 15,064,038,347.74 | 26.11% |
| Net cash flows arising from operating activities | -2,575,742,649.43 | 627,712,593.41 | -510.34% |
| Subtotal of cash inflow from investing activities | 12,081,224,107.55 | 19,393,979,375.09 | -37.71% |
| Subtotal of cash outflow from investing activities | 8,485,283,459.06 | 19,422,030,926.39 | -56.31% |
| Net cash flows arising from investing activities | 3,595,940,648.49 | -28,051,551.30 | |
| Subtotal of cash inflow from financing activities | 4,817,002,243.34 | 1,717,278,897.47 | 180.50% |
| Subtotal of cash outflow from financing activities | 4,681,832,516.84 | 2,154,807,351.77 | 117.27% |
| Net cash flows arising from financing activities | 135,169,726.50 | -437,528,454.30 | |
| Net increase of cash and cash equivalents | 1,183,098,668.09 | 149,072,918.03 | 693.64% |
Main reasons for y-o-y major changes in aspect of relevant data? Applicable □ Not applicable
1. Net cash flows arising from operating activities decreased y-o-y, mainly due to the platform trade cash outflow during the year;
2. Net cash flows arising from investing activities increased y-o-y, mainly due to the increase in operating cash demand required thereduction of the scale of financial management and the investment outflow decreased during the year;
3. Net cash flows arising from financing activities increased y-o-y, mainly due to: Financing inflows during the reporting period weredominated by a RMB 3 billion increase in borrowing during the year; Financing outflows mainly for loan repayment increased 1.8billion, dividend increased outflow 200 million, equity repurchase 400 million during the year.Reasons of major difference between the cash flow of operation activity in report period and net profit of the Company? Applicable □ Not applicableMainly due to the increased profit from investment income and net cash outflow from platform business.V. Analysis of the non-main business?Applicable □Not applicable
In RMB
| Amount | Ratio in total profit | Cause description | Whether be sustainable | |
| Investment earnings | 1,849,145,500.50 | 1029.51% | Investment earnings mainly form the two joint ventures (RBCD and Zhonglian Electronics) with stock participated by the Company | The joint ventures RBCD and Zhonglian Electronics have stable production and operation , so the investment returns can be sustained and stable |
| Gain/loss of fair value changes | -157,622,752.09 | -87.76% | ||
| Asset impairment | -181,610,433.12 | -101.11% | ||
| Non-operating income | 5,699,768.04 | 3.17% |
无锡威孚高科技集团股份有限公司2022年年度报告全文
Non-operatingexpense
| Non-operating expense | 7,711,660.06 | 4.29% |
VI. Assets and liability analysis
1. Major changes of assets composition
In RMB
| Year-end of 2021 | Year-begin of 2021 | Ratio changes (+/-) | Note of major changes | |||
| Amount | Ratio in total assets | Amount | Ratio in total assets | |||
| Monetary funds | 2,389,551,930.76 | 8.38% | 1,896,063,265.69 | 6.78% | 1.60% | |
| Account receivable | 3,127,490,177.25 | 10.96% | 2,053,800,293.77 | 7.34% | 3.62% | The newly acquired companies VHIT and VHCN are included in the consolidated statements and seasonal fluctuation of orders |
| Inventory | 2,283,119,656.27 | 8.00% | 3,445,396,375.09 | 12.32% | -4.32% | Mainly due to a decrease in inventory consumption and finished products |
| Investment real estate | 49,296,869.73 | 0.17% | 19,387,746.56 | 0.07% | 0.10% | |
| Long-term equity investment | 6,282,818,108.96 | 22.02% | 5,717,944,788.12 | 20.44% | 1.58% | |
| Fixed assets | 3,769,984,185.94 | 13.21% | 2,932,210,452.51 | 10.48% | 2.73% | |
| Construction in progress | 509,105,587.49 | 1.78% | 387,429,933.08 | 1.39% | 0.39% | Mainly due to the increase of equipment and engineering investment |
| Right-of-use assets | 41,865,100.38 | 0.15% | 23,148,405.58 | 0.08% | 0.07% | Mainly due to the increase in leasing of production plants |
| Short-term borrowings | 3,604,376,527.82 | 12.63% | 1,437,958,206.55 | 5.14% | 7.49% | Mainly due to the increase in platform trade business borrowing |
| Contract liability | 94,850,083.23 | 0.33% | 136,427,636.39 | 0.49% | -0.16% | Mainly due to lending liability maturing |
| Long-term borrowings | 238,000,000.00 | 0.83% | 0.00% | 0.83% | Mainly for the subsidiary borrowing | |
| Lease liability | 31,589,277.20 | 0.11% | 15,795,469.25 | 0.06% | 0.05% | Mainly due to the increase in leasing of production plants |
Foreign assets account for a relatively high proportion
□Applicable ?Not applicable
2. Assets and liability measured by fair value
?Applicable □ Not applicable
In RMB
| Items | Amount at the beginning period | Changes of fair value gains/losses in this period | Accumulative changes of fair value reckoned into equity | Devaluation of withdrawing in the period | Amount of purchase in the period | Amount of sale in the period | Other changes (+,-) | Amount at period-end |
| Financial assets | ||||||||
| 1.Trading financial | 7,692,496,307.12 | -140,249,770.47 | 6,719,441,525.14 | - | 4,045,429,568. | |||
无锡威孚高科技集团股份有限公司2022年年度报告全文
asset(excludingderivativefinancialassets)
| asset(excluding derivative financial assets) | 10,226,258,492.92 | 87 | ||||||
| 2.Other equity instrument investment | 285,048,000.00 | 392,742,690.00 | 677,790,690.00 | |||||
| 3.Receivable financing | 713,017,014.50 | 1,205,351,830.71 | 1,918,368,845.21 | |||||
| 4.Foreign exchange contracts | 74,734,940.30 | 214,239,287.50 | -288,974,227.80 | |||||
| Subtotal of financial assets | 8,765,296,261.92 | -140,249,770.47 | 7,326,423,502.64 | -9,309,880,890.01 | 6,641,589,104.08 | |||
| Above total | 8,765,296,261.92 | -140,249,770.47 | 7,326,423,502.64 | -9,309,880,890.01 | 6,641,589,104.08 | |||
| Financial liabilities | 0.00 | 747,115.75 | 747,115.75 |
Other changes: Maturity redemptionWhether there have major changes on measurement attributes for main assets of the Company in report period or not
□ Yes ?No
3.The assets rights restricted till end of the period
In RMB
| Item | Book value at period-end | Restriction reason |
| Monetary funds | 18,840,000.00 | Dollar margin for foreign exchange contracts |
| Monetary funds | 24,368,385.65 | Cash deposit paid for bank acceptance |
| Monetary funds | 7,487,250.00 | IRD performance bond |
| Monetary funds | 199,660.00 | Cash deposit for Mastercard |
| Monetary funds | 180,000.00 | Court freezing |
| Monetary funds | 5,000.00 | ETC freezing |
| Note receivable | 82,908,186.94 | Notes pledge for bank acceptance |
| Receivable financing | 530,337,600.45 | Notes pledge for bank acceptance |
| Total | 664,326,083.04 |
VII. Investment analysis
1. Overall situation
□Applicable ?Not applicable
2. Major equity investment obtained in the reporting period
□ Applicable ? Not applicable
3. Major non-equity investment in progress in the reporting period
□ Applicable ? Not applicable
4. Financial assets investment
(1) Securities investment
无锡威孚高科技集团股份有限公司2022年年度报告全文
? Applicable □Not applicable
In RMB
| Variety of securities | Code of securities | Short form of securities | Initial investment cost | Accounting measurement model | Book value at the beginning of the period | Current gain/loss of fair value changes | Cumulative fair value changes in equity | Current purchase amount | Current sales amount | Profit and loss in the Reporting Period | Book value at the end of the period | Accounting subject | Capital Source |
| Domestic and foreign stocks | 600841 | SNAT | 199,208,000.00 | Measured by fair value | 153,643,308.00 | -74,808,576.00 | -74,808,576.00 | 78,834,732.00 | Trading financial asset | Own fund | |||
| Domestic and foreign stocks | 002009 | Miracle Automation | 69,331,500.00 | Measured by fair value | 113,793,600.00 | -47,100,000.00 | -47,100,000.00 | 66,693,600.00 | Trading financial asset | Own fund | |||
| Domestic and foreign stocks | 601456 | Guolian Securities | 12,000,000.00 | Measured by fair value | 208,795,178.00 | -22,186,264.00 | -22,186,264.00 | 186,608,914.00 | Trading financial asset | Own fund | |||
| Domestic and foreign stocks | 601777 | Lifan Technology | 62,845.00 | Measured by fair value | 77,802.11 | -29,285.77 | -29,285.77 | 48,516.34 | Trading financial asset | Own fund | |||
| Domestic and foreign stocks | 000980 | Zoyte Auto | 613,265.48 | Measured by fair value | 28,699.00 | 613,265.48 | 179,550.00 | 28,699.00 | 462,414.48 | Trading financial asset | Own fund | ||
| Total | 281,215,610.48 | -- | 476,309,888.11 | -144,095,426.77 | 0.00 | 613,265.48 | 179,550.00 | -144,095,426.77 | 332,648,176.82 | -- | -- | ||
| Disclosure date of securities investment approval of the Board | 2012-03-24 | ||||||||||||
| 2013-06-04 | |||||||||||||
Note: 1) SDEC was renamed into SNAT during the reporting period; 2) the financial asset investment to Zoyte Auto was generatedby the conversion of accounts receivable by WFLD into equity.
(2) Derivative investment
□ Applicable ? Not applicable
There is no derivative investment during the reporting period.
无锡威孚高科技集团股份有限公司2022年年度报告全文
5. Application of raised proceeds
□ Applicable ? Not applicable
There is no application of raised proceeds during the reporting period.
VIII. Sales of major assets and equity
1.Sales of major assets
□ Applicable ? Not applicable
No major assets were sold during the reporting period.
2. Sales of major equity
□ Applicable ? Not applicable
IX. Analysis of the main controlling and participating companies? Applicable □ Not applicableMain subsidiary and participating enterprises with over 10% influence on net profit of the Company
In RMB
| Company name | Type | Main business | Register capital | Total assets | Net assets | Operating revenue | Operating profit | Net profit |
| WFLD | Subsidiary | After-treatment system products | 502,596,300.00 | 6,281,611,332.72 | 2,551,419,127.25 | 5,937,549,034.42 | 253,317,797.71 | 265,352,997.31 |
| WFJN | Subsidiary | Fuel management system products | 346,286,825.80 | 1,435,778,324.42 | 1,054,213,332.19 | 732,361,563.72 | 87,436,633.69 | 83,150,768.43 |
| RBCD | Equity participation enterprise | Fuel management system products | USD 382,500,000.00 | 18,847,559,360.81 | 10,037,249,721.72 | 13,443,929,728.58 | 3,210,134,490.05 | 3,059,444,530.82 |
| Zhonglian Electronics | Equity participation enterprise | Gasoline system products | 600,620,000.00 | 7,798,719,691.47 | 7,790,030,240.47 | 26,913,563.07 | 1,880,653,975.53 | 1,876,187,641.39 |
Subsidiary acquired and disposed in the Period? Applicable □ Not applicable
| Subsidiary name | Method of acquiring and disposing of subsidiaries during the reporting period | Impact on overall production, operation, and performance |
| WFQL | Investment establishment | WFQL is mainly engaged in R&D, production, and sales of core components for hydrogen fuel cells. The establishment of this subsidiary has no significant impact on the overall production, operation, and performance of the Company during the reporting period. |
| VHCN | Cash acquisition | VHCN is mainly engaged in R&D, production, and sales of automotive component products. The acquisition of this subsidiary has no significant impact on the overall production, operation, and performance of the company during the reporting period. |
Explanation of the main controlling and participating companies
无锡威孚高科技集团股份有限公司2022年年度报告全文
During the reporting period, due to the impact of macroeconomic and commercial vehicle market downturn, the operating revenue,operating profit, and net profit of WFLD, WFJN, and RBCD all declined in varying degree y-o-y.
X. Structured subject controlled by the Company
□ Applicable ? Not applicable
XI. Prospect of future development of the Company(I) Future development strategy of the CompanyBased on corporate vision “expert of hundred years in automobile core parts industry”, during the “14
thFive-Year Plan” period, theCompany will continue to adhere to the strategic policy of “internationalization, autonomy and multi-dimensional”, accelerate the“double-engine drive” strategy of “optimizing and upgrading existing core businesses, breaking through and blocking strategicemerging businesses”, and form “energy saving and emission reduction”, “green hydrogen energy”, “smart electric” and “other coreparts”.
(1) Energy saving and emission reduction, as the existing core business segment of the Company, contains three major business areasof high pressure fuel injection system, post-treatment system and turbocharging. The Company has positioned new increments,actively promoted business transformation and upgrading, maintained its industry leading position and maintained organic businessgrowth. Under the general trend of low carbon and energy saving, the Company will seize the strategic opportunity of upgradingemission regulations, expedited the expansion of the market of products related to ordinary hybrid and plug-in hybrid, and intensifythe cooperation with joint venture brands and head of new car-making forces to further increase the market share of products; TheCompany will focus on high efficiency, energy saving (including plug-in hybrid), clean alternative fuel (natural gas, methanol,hydrogen, etc.) fuel, after-treatment and turbocharging, etc. during product development, strengthen key technology productdevelopment capabilities, enhance forward engineering capabilities and system integration as well as application developmentcapabilities; In addition, the Company will consolidate and improve its process operation ability and improve its cost and qualitycontrol ability.
(2) Green hydrogen energy is an important strategic direction for the transformation of the Company's business structure. TheCompany will focus on the core components of hydrogen fuel cells and hydrogen production from renewable energy in the middleand upper reaches of the hydrogen energy industry chain, building core competitiveness and realizing large-scale business growth.
1. In terms of the business of core components of hydrogen fuel cell, the Company will, based on the core technical capabilities ofcore materials (membrane electrode, graphite bipolar plate and metal bipolar plate) and key components of BOP that have beenacquired and constructed at present, accelerate the establishment and operation of organizational planning, promote the constructionof three major bases in the world and realize the small-scale market applications.
①Enhance global engineering capability. The Company will actively promote the construction of engineering centers in Asia-Pacific,Europe and North America, strengthen investment, continuously improve the level of engineering technology, especially the researchand development and application of product technology, and quickly realize the batch production of customer market projects.
②Expand global business functions. The Company will accelerate the capacity building of business centers in Asia-Pacific, Europeand North America, strengthen the planning and coordination of global markets and operations, realize the sharing of strategicresources and efficient and coordinated market expansion among centers and business segments, actively expand international anddomestic customers, continuously deepen the cooperative relationship with strategic partners, strategic customers and majorcustomers, and promote the large-scale application of the market.
③Enhance global manufacturing capability. Accelerate the capacity building of manufacturing centers in Asia-Pacific, Europe andNorth America, with the goals of global production capacity of 8,000,000 membrane electrodes, 9,000,000 graphite bipolar plates,4,000,000 metal bipolar plates and 100,000 BOP key parts during 2021-2025; Among them, the target production capacity of Asia
无锡威孚高科技集团股份有限公司2022年年度报告全文
Pacific (China) is 4,000,000 membrane electrodes, 5,000,000 graphite bipolar plates, 2,000,000 metal bipolar plates and 100,000BOP key parts.
④Strengthen strategic coordination and resource integration. Based on the platform of Hydrogen Energy Division, strengthen globalbusiness strategic coordination and resource integration. In particular, in terms of the construction of the Asia Pacific base, theCompany will integrate the business related to the core components of hydrogen fuel cells, strengthen the cooperation with variousstrategic partners, establish a joint venture company, WFQL, to develop the application, supply chain, manufacturing, sales andservice of products for the Asia Pacific market, mainly in China.
2. In terms of hydrogen production from renewable energy, based on the current core component technologies such as membraneelectrodes and graphite/metal bipolar plates, as well as the R&D, testing and verification capabilities of PEM electrolytic waterreactors, the Company has focused on cultivating and incubating PEM electrolytic water hydrogen production system and equipmenttechnologies to realize product market applications.
①Focus on the implementation of the demonstrative line project. Complete the construction of Phase I and Phase II of the PEMelectrolytic water hydrogen production demonstration line, and achieve the overall solution design and implementation servicecapabilities for electrolytic water hydrogen production.
②Actively acquire key technology capabilities. Explore external technology and industrial investment cooperation opportunities,expedite independent R&D, and build key technology capabilities such as electric reactors, system equipment design, developmentand integration. Develop and incubate a number of low-power system equipment products in niche sectors (hydrogen production) anddevelop high-power system equipment technologies and products applicable to energy storage and hydrogen refueling stations.
③Expand market application projects. Vigorously extend the customers and markets, endeavor to realize the application of smallpower system equipment and shape small batch market application, actively participate in the large-scale renewable energy hydrogenproduction demonstration projects, and reach domestic leading enterprises in the industry to explore cooperation opportunities.
(3) intelligent electric segment Focus on the four major business areas of core components of electric drive system, thermalmanagement system and core components, core modules for intelligent sensing, as well as core components in the cabin, shape corecompetitiveness in market, technology and intelligent manufacturing, and realize business transformation and growth in scale.
1. Core components of electric drive system: based on the understanding of core automotive parts system R&D capabilities and high-end intelligent manufacturing capabilities, develop the core electric drive parts business and promote market scale, as well as theforward-looking layout of the wheel hub motor technology of the Company, cultivate and incubate in all aspects and realize marketapplications of products.
①For electric drive core parts, take motor shaft, water jacket, end cover, etc. as the entry point, extend to other core parts, enrich theproduct catalogue, and shape the supply capabilities of key products; Based on extensive practical experience accumulated throughcooperation with renowned domestic electric drive enterprises, make breakthroughs with key new energy vehicle enterprisecustomers, especially high-end new power, establish deep strategic cooperation and promote the diversified development of strategiccustomers.
②Expedite the product technology optimization of wheel motors, realize the penetration to passenger car scenario, and promote theconstruction of assembly capacity to establish batch production capabilities.
2. For thermal management system and core components, take electronic oil pump as the entry point, rely on the group-basedtechnology, market and manufacturing platform advantages of the Company, fully promote the development and application of keycomponents such as integrated pumps, valves, heat exchangers as well as strategic products of thermal management system, andfurther proactively seek the development in other application scenarios such as energy storage.
① Realize the breakthrough of high-end customers and in-depth strategic cooperation of customers. To actively penetrate maturemainstream high-end customers in China and Europe by leveraging the overseas technology and product accumulation of VHacquired by the Company, complete technology validation and shape the first batch of product supply; Actively explore globalcustomer resources such as OEM and electric drive system integrators of self-research electric drive/thermal management system,converge channel resources integration capabilities, and make breakthroughs in key strategic customers.
无锡威孚高科技集团股份有限公司2022年年度报告全文
②Synchronize global R&D and actively extend product portfolio. Promote global resource planning and layout, construct globalsynchronous R&D capability, realize global synchronous R&D synergy, further expand product series, actively launch thedevelopment and supply capabilities of core components for thermal management system-level solutions, and extend products suchas integrated pumps, valves and heat exchangers.
③Upgrade global batch production and supply capabilities. Reinforce the construction of global supply chain system capabilities inEurope and China, integrate the intelligent manufacturing elements of the Company, and achieve large-scale production and supplycapabilities.
3. Intelligent sensing core module
For core module of intelligent sensing business, strategically focus on millimeter wave radar, offer customized radar modules andsensing solutions, penetrate from basic scenarios and cultivate capabilities, meanwhile aim at high-end application market forautonomous driving.
①Expand multi-scene applications and progressively evolve to high-end applications. Take the initiative to enter the non-vehicleradar field, extend the radar application in the intelligent cockpit field simultaneously, quickly achieve the market application of 3Dradar products, and take the vehicle ADAS 3D radar as an opportunity to progressively penetrate the vehicle market, accumulate thevehicle scene technology, and penetrate the vehicle autonomous driving application scene upon the maturity of 4D radar technology.
②Technology accumulation and capability maturity for high-end product technology breakthroughs. Intensify the key technologyand R&D capabilities of millimeter wave radars, establish a large-scale production capacity of 3D radars for ADAS, while expeditingthe R&D progress of 4D radar products, and making technical breakthroughs on high-end products to progressively realize thecommercialization of ADAS 4D radars.
③Deepen industry chain cooperation and realize large-scale growth. Actively pursue potential strategic investment cooperation inglobal industry chain, focus on integration of millimeter wave radar module link, become a standardized radar module supplier andshape large-scale business growth.
4. Core components in the cabin
Focus on core components in the cabins, of which, take the initiative to enter the medium and high-end commercial vehicle market,develop a competitive edge with differentiated products of high performance, high quality, high cost performance, accelerate thedevelopment of industrial scale and extend to the medium and high-end passenger car market; Establish the capabilities of systematicdesign and testing of seating products, improve technical innovation capabilities, develop towards networking and intelligence, andalign with the demands of intelligent cockpit scenes. Meanwhile, the Company will leverage its cooperation with smart cockpitpartners to engage in the business field of smart cockpit based on domain control technology and endeavor to seek and expandbusiness opportunities related to smart cockpit.
(4) For other core components segments, the Company will further promote the business transformation and upgrading of hydraulicsystems and their core components, core components of braking systems, intelligent manufacturing equipment, post-marketing andtrading, and actively explore the layout of cutting-edge technologies and markets in line with the strategic orientation of thedevelopment of the Company to achieve an increase in business volumes. In particular, for the hydraulic system and corecomponents as the main strategic development direction of the Company, jointly expand the market of walking hydraulics andindustrial hydraulics by establishing a joint venture with Bosch Rexroth. Meanwhile, integrate the strategic resources of the overallvalue chain process of both sides, continue to establish a more cost advantage, better performance, faster response time andcomprehensive competitiveness, and continue to promote the strategic business layout and development of hydraulic systems andcore components.The Company will further deepen the management plan, budget management and performance management systems under theguidance of strategies, implement differentiated control and governance, implement efficient inter-segment business synergy,accelerate the training of strategic core talents, and improve the operation and management capabilities during the strategictransformation period in a comprehensive manner to satisfy the medium and long-term strategic development demands of theCompany.
无锡威孚高科技集团股份有限公司2022年年度报告全文
(II) Priority tasks for 2023Facing the volatile and severe macroeconomic conditions as well as the development trend of automobile market, in 2023, theCompany will closely follow the development target of “14th Five-year Plan”, implement the annual operation guideline of “Aimingat Strategic Objectives, Committed to Operation Enhancement and New Business Cultivation”, actively address the new changes andchallenges in the industry, solidly perform the key tasks, adhere to seeking progress amidst stability, and promote the high-qualitytransformation and development of the Company.
1. Improve the operation quality of strategic system, promote the layout of new business investmentFurther improve the operation quality of strategic system, strengthen the dynamic assessment and optimization of the strategicplanning for laid business; The Company will continuously improve the organization and management ability of strategic specialresearch, and strengthen the planning and implementation of new business. The Company will actively promote the millimeter-waveradar and hydraulic business investment cooperation projects, continue to promote the capacity-building investment projects of thethree global bases of green hydrogen energy business, and promote the in-depth cooperation of projects invested in smart electricbusiness. The Company will actively explore and practice the formation of post-investment governance structure and system withWeifu characteristics, and comprehensively promote post-investment integration and governance. The Company will strengthen theincubation function of new business, promoted it in the form of project system, accelerate the cultivation of millimeter wave radar,PEM electrolyzed water to produce hydrogen and other businesses, and strengthen the operation management of post-investmentprojects.
2. Stabilize the Company’s position in the industry by main business, accelerate market breakthrough by new productsFuel injection system: Ensure the order delivery rate and market share of common rail pumps; for VE pumps, actively respond to theT4 market competition pattern, and deeply dig into the market increment; for GP electronic control products, ensure the supply ofexisting customers and obtain key projects of core customers; for high-pressure fuel rail of gasoline, continue to explore new marketsand increase market share. Post-processing system: Accelerate the development of hybrid and high-end self-owned brand passengercar market and seek new growth points; Steadily promote core customer projects in commercial vehicle market; Rapidly increase themarket shares of core customers in off-road T4 products. Air intake system: In aspect of gasoline supercharger, fully expand thehybrid passenger car market and promote the batch production of core customer projects; For the four-cylinder diesel supercharger,continue to obtain key projects of core customers and gradually increase the market share of each host customer; For the six-cylinderdiesel supercharger, stabilize the existing customer share and ensure the batch production of new customer projects. Relying on thenational “the belt and road initiative” strategy, consolidate and expand existing overseas markets and enhance international tradebusiness.Accelerate the acquisition of new business, new customers and new projects, and promote the cooperation of strategic partners innew business areas. Actively explore the market of electric drive core parts products, and achieve rapid growth in business volume;For the thermal management system, realize the batch supply of electronic oil pumps for leading enterprises of new energy vehicles.As to the “one membrane and two plates” products, complete the first-phase production capacity construction, completed, realizedomestic supply of the catalyst, membrane electrode and bipolar plate products in small batches in China, and complete thedevelopment of B sample development for battery cells. As to the hydrogen safety valves, realize mass production, complete thedevelopment of sample C for tailgate valve and the high-voltage platforms, and complete the development of sample B for low-voltage platform of hydrogen circulating pump; Realize small batch production of 35MPa high-pressure hydrogen valves, andcomplete sample B development for 70MPa high-pressure hydrogen valves; Complete the development of sample B for corecomponents of air compressor and electric supercharger, and complete the development of sample C for the electronic water pumpand electronic thermostat and realize supply in small batches. For self-made 100 kW PEM demonstration line of hydrogenproduction from electrolyzed water, complete the construction and put into operation. Complete C sample development and smallbatch supply for in-cabin radars, and realize small batch delivery for 4D imaging radar customer project.
3. Strengthen quality management and intelligent manufacturing, and promote engineering construction and safetyguarantee
无锡威孚高科技集团股份有限公司2022年年度报告全文
Improve the mechanism of developing quality valves and optimize the management of special characteristics. Deepen the verticaldeepening and horizontal broadening of Q11 quality basic criteria, and improve the effectiveness of process total factor maturityassessment and the coverage of core key processes. Consolidate the quality improvement project, check the operation results, link theapplication of tools and methods, and realize hierarchical frequency control. Focus on the main after-sales quality problems and zero-kilometer customer complaints, and cooperate with customers to analyze and improve the special system. Further promote leanproduction management, promote the optimization of bottleneck process rhythm, optimize equipment management system, andimprove equipment operation efficiency. Continuously improve the R&D and application capabilities of intelligent manufacturingand accelerate the full implementation of the intelligent manufacturing blueprint; Improve the automation level of advancedmanufacturing processes and promote the construction of information platforms, and explore intelligent technologies and big dataapplications. Advance the R&D building project as planned and complete the preliminary design of the new energy industrial park;Build an energy management platform and continue to promote energy-saving and environmental protection green office; Takeprevention management as the starting point and implement the responsibility of safety subject; Carry out the evaluation andcertification of the first-class enterprise of safety production standardization; Through the integration of environmental health andsafety information supervision platform and AI safety monitoring, optimize and improve the visual management and control of safety.
4. Promote continuous improvement of management performance and reinforce strategic talent team buildingAdvance the research, planning and implementation of the differentiated organization and control models, deeply optimize the logicalalignment of business plans with strategies and budgets, and continue to promote the application and expansion of processmechanisms in procurement, R&D and marketing domains with the support of process business platforms. Deepen the constructionof the park management committee by taking the service platform as a carrier. Establish a sharing platform for direct materialprocurement, systematically advance the unification and standardization of procurement business processes and information sharingacross the Group, and enable integrated procurement supply chain management. Deepen the technology for cost reduction, refine thecategory management strategies, integrate new business planning, and launch new business supply chains in advance. Regularlymanage the inventory classification, analysis, alignment and disposal of slow-moving products. Make proper storage planningrefinement, refine in batches according to multi-dimensional in conjunction with the own development needs of the division, andclarify the objectives. Promote the highly efficient operation of the trinity of risk control, compliance, internal audit as well as thethree risk prevention and control management mechanisms, construct a special evaluation of major and important defects and amechanism to trace back the responsibility of risk control, promote the implementation and continuous optimization of the contractmanagement system, and improve the legal risk control of the investment and M&A projects of the Company. Accelerate talentallocation and strengthen the layout of new strategic business talents with the aim of building a strategy-led talent team; Accomplishtalent allocation and personnel training for major strategic cooperation projects according to business demands; Optimizeconstruction of overall career development channels for employees and further promote piloting of talent sharing mechanism. Basedon the development of quality and ability of key positions, continue to promote the construction of the “San Hang Yi Jiang” talentdevelopment system; Explore international talent exchange training programs to satisfy the strategic development demands ofenterprises; Reinforce the innovation of talent mechanism and further explore the methods of business evaluation and incentive inR&D field. Based on the human resources information system platform, continue to explore the value of human resources data tofurther promote management optimization and improve the efficiency of human resources services.(III) Possible risks and countermeasures
1. Macroeconomic and market risks
Currently, the macroeconomic and market conditions are still complex and challenging, with the automobile industry still facingrelatively high pressure. In case of a decline in demand from the automotive industry, the production, operation and profit level of theCompany will be affected to a certain extent.Countermeasures: The Company will constantly monitor macroeconomic and industry development trends, consolidate its existingbusiness market presence, actively expand new business, and strive to improve its core competitiveness and overall anti-riskcapabilities.
2. Operation management and control risks
无锡威孚高科技集团股份有限公司2022年年度报告全文
With the acceleration of the international layout of the Company and the expansion of the scope of strategic new business, especiallyin the field of new energy, the management span is relatively large with potential operational management and investment risks.Countermeasures: The Company will continuously improve and optimize internal management, improve processes, and furtherregulate management and control operational risks; Reinforce the control of international business and accelerate the construction ofinternational talent team to satisfy the strategic development demands of the enterprise.
3. Risk of raw material price fluctuation
The main raw materials of the Company include steel, aluminum, precious metals, etc. of various grades, the continuous increase oftheir prices will pose the risk of cost increase to the Company.Countermeasures: The Company will actively improve its market forecasting capabilities, plan production capacity in advance, andreasonably control raw material inventories to reduce the exposure to raw material price fluctuations, while continuously optimizingsupply chain management, strengthening the vertical integration capability of the industry chain, and transferring part of the risksthrough cost control measures and product price adjustments so as to reduce the impact of raw material price fluctuations onperformance.
4. Risks related to financial instruments
The major financial instruments of the Company include monetary funds, structured deposits, receivables, investments in equityinstruments, financial products, borrowings, payables, etc. In the process of operation, the Company is exposed to risks related tofinancial instruments, including credit risks, market risks and liquidity risks.Countermeasures: Identify and analyze various risks exposed to the Company, establish appropriate risk tolerance thresholds andmanage risks, monitor various risks in a timely manner, ensure that risks are controlled within limits, minimize the negative impactof risks on the operating performance of the Company, and maximize the interests of shareholders and other investors.
XII. Reception of investigation, communication and interview during the reporting period
?Applicable □ Not applicable
| Reception time | Reception place | Reception mode | Reception object type | Reception Object | Main content talked about and materials provided | Index of basic situation of research |
| January 12, 2022 | Conference room of the Company | Telephoning | Institution | Institutional investor | For details, please refer to the Record of Investor Relations Activities disclosed by the Company on Juchao Website (No. 2022-001) | http://www.cninfo.com.cn |
| January 13, 2022 | Conference room of the Company | Field research | Institution | Institutional investor | For details, please refer to the Record of Investor Relations Activities disclosed by the Company on Juchao Website (No. 2022-002) | http://www.cninfo.com.cn |
| January 20 , 2022 | Conference room of the Company | Telephoning | Institution | Institutional investor | For details, please refer to the Record of Investor Relations Activities disclosed by the Company on Juchao Website (No. 2022-003) | http://www.cninfo.com.cn |
| February 9, 2022 | Conference room of the Company | Telephoning | Institution | Institutional investor | For details, please refer to the Record of Investor Relations Activities disclosed | http://www.cninfo.com.cn |
无锡威孚高科技集团股份有限公司2022年年度报告全文
by the Company onJuchao Website (No.2022-004)
| by the Company on Juchao Website (No. 2022-004) | ||||||
| April 19, 2022 | Conference room of the Company | Telephoning | Institution | Institutional investor | For details, please refer to the Record of Investor Relations Activities disclosed by the Company on Juchao Website (No. 2022-005) | http://www.cninfo.com.cn |
| May 11, 2022 | WeChat Applet | Other | Other | Other | For details, please refer to the Record of Investor Relations Activities disclosed by the Company on Juchao Website (No. 2022-006) | http://www.cninfo.com.cn |
| June 16, 2022 | Conference room of the Company | Telephoning | Institution | Institutional investor | For details, please refer to the Record of Investor Relations Activities disclosed by the Company on Juchao Website (No. 2022-007) | http://www.cninfo.com.cn |
| June 17, 2022 | Conference room of the Company | Telephoning | Institution | Institutional investor | For details, please refer to the Record of Investor Relations Activities disclosed by the Company on Juchao Website (No. 2022-007) | http://www.cninfo.com.cn |
| August 23, 2022 | Conference room of the Company | Telephoning | Institution | Institutional investor | For details, please refer to the Record of Investor Relations Activities disclosed by the Company on Juchao Website (No. 2022-008) | http://www.cninfo.com.cn |
| December 28, 2022 | Conference room of the Company | Telephoning | Institution | Institutional investor | For details, please refer to the Record of Investor Relations Activities disclosed by the Company on Juchao Website (No. 2022-009) | http://www.cninfo.com.cn |
| December 30, 2022 | Conference room of the Company | Telephoning | Institution | Institutional investor | For details, please refer to the Record of Investor Relations Activities disclosed by the Company on Juchao Website (No. 2022-009) | http://www.cninfo.com.cn |
| January 1 to December 31, 2022 | Interactive platform of investor relationship | Written inquiry | Other | Other | Basic company information and view of the market | Answered 163 questions online through the interactive platform for investor relations |
无锡威孚高科技集团股份有限公司2022年年度报告全文
January 1toDecember31, 2022
| January 1 to December 31, 2022 | Company tel. | Telephoning | Other | Other | Basic company information and view of the market | 532 telephone communications with the investors |
无锡威孚高科技集团股份有限公司2022年年度报告全文
Section IV. Corporate Governance
I. Corporate governance of the CompanyDuring the reporting period, the Company earnestly implemented the Basic Internal Control Standards forEnterprise and its guidance in strict accordance to the requirements of laws, administrative regulations,department provisions and normative documents as Company Law, Securities Law, Code of CorporateGovernance for Listed Companies, Rules Governing the Listing of shares on Shenzhen Stock Exchange andGuidelines on Self-Regulation of Listed Companies of Shenzhen Stock Exchange No. 1 - Standardized Operationof Main board listed company, continued to improve and enhance legal person governance structure and internalcontrol system, thus to standardize its operation.The actual status of corporate governance in accordance with therequirements of China Securities Regulatory Commission regulatory documents related to listing Corporation.The Company has established a series of document systems for standardized management including the Rules ofProcedure of three committees, Working Rules, internal control system, Evaluation Management System ofInternal Control, Information Disclosure Management Approach, Financial Decision-making System ofSignificant Investment, Related Party Transaction Management System and Inside Information and InsiderManagement System.According to the Company Law, Articles of Association and relevant laws and regulations, the companyestablished a relatively complete organizational control architecture system. The company’s board of directorsexecutes the resolution of general meeting of stockholders, takes charge of the company’s significant decisions,and takes responsible for the general meeting of stockholders; the company sets up the general manager accordingto law to preside over the company’s daily production and operation and management, organize and implementthe resolutions of the board of directors, and take responsible for the board of directors; the company’s board ofsupervisors is the company’s supervisory body, takes responsible for behaviors of the directors and seniormanagement and the supervise the company’s financial affairs. The board of directors has four special committeesincluding the strategy committee, remuneration committee, audit committee, and nominations committee. Thecompany’s general meeting of stockholders, board of directors, board of supervisors, and management layer haveclear rights and obligations, perform their own duties, effectively check and balance, scientifically make decisions,coordinate operations, and lay a solid foundation for the Company’s sustainable, stable and healthy development.The Company’s independent directors perform their duties and faithfully and conscientiously fulfill theirobligations in strict accordance with relevant regulations of Articles of Association and the Independent DirectorSystem, and actively attend the board meetings and shareholders' meetings, understand and obtain relevantinformation before meetings; carefully consider each motion, and actively participate in the discussions and makerecommendations. Seriously make independent opinions, and effectively protect the interests of the Company andshareholders, especially the minority shareholders. Independent directors have no objections on relevant mattersof the Company.
无锡威孚高科技集团股份有限公司2022年年度报告全文
The Company further implements the Basic Norms of Enterprise Internal Control and its guidelines, constructsthe internal control system in the Company headquarters and major subsidiaries, enhance the Company'smanagement and control level, optimize the work flow, improve the internal control system, identify and controlthe operational risks. Please see the detailed contents of 2021 Internal Control Evaluation Report onwww.cninfo.com.cn which is the information disclosure website designated by Shenzhen Stock Exchange.Is there any difference between the actual condition of corporate governance and relevant regulations aboutcorporate governance for listed company from CSRC?
□ Yes ?No
There are no differences between the actual condition of corporate governance and relevant regulations aboutcorporate governance for listed company from CSRC.
II. Independence of the Company relative to controlling shareholder and the actual controllerin ensuring the Company’s assets, personnel, finance, organization and businesses
1. Business: the company has a complete independent research and development, procurement, production andsales systems, the main business does not have horizontal competition with the controlling shareholders. Thebusiness is absolutely separated.
2. Personnel: the company has mutual independence with its controlling shareholders in labor, personnel andsalary management; there is no mixed operation and management with the controlling shareholders. Thecompany’s general manager, vice general manager, financial administrator, secretary of the board, and seniorexecutives don’t hold any position in the shareholders’ units.
3. Assets: the company's assets are independent and complete, the property relations with the controllingshareholders are clear.
4. Organization: the company has established organization completely independent from its controllingshareholders, the duty and authority of the company’s shareholders’ meeting, board of directors, board ofsupervisors and management level are clearly defined, the internal management system can operate independently.
5. Finance: the company has set up an independent financial department, established the independent financialaccounting system and financial management system, opened the independent bank account, and paid taxesseparately according to law.III. Horizontal competition
□ Applicable ? Not applicable
IV. Annual shareholders’ general meeting and extraordinary shareholders’ general meetingheld during the reporting period
1. Annual shareholders’ general meeting during the reporting period
无锡威孚高科技集团股份有限公司2022年年度报告全文
Ordinal number ofmeeting
| Ordinal number of meeting | Type | Ratio of investor participation | Date | Date of disclosure | Resolution of meeting |
| Annual general meeting of 2021 | AGM | 40.82% | 2021-05-18 | 2022-05-19 | (Notice No.: 2022-036) published on Juchao Website(www.cninfo.com.cn) |
| 1st extraordinary general meeting of 2022 | Extraordinary general meeting | 40.90% | 2022-08-19 | 2022-08-20 | (Notice No.: 2022-051) published on Juchao Website(www.cninfo.com.cn) |
2. Request for extraordinary shareholders’ general meeting by preferred stockholders whose voting rightsrestore
□ Applicable ?Not applicable
V. Directors, supervisors and senior officers
1. Basic information
| Name | Title | Working status | Gender | Age | Start dated of office term | End date of office term | Shares held at period-begin (Share) | Amount of shares increased in this period (Share) | Amount of shares decreased in this period (Share) | Other changes (share) | Shares held at period-end (Share) | Reasons for increase or decrease of shares |
| Wang Xiaodong | Chairman | Currently in office | Male | 56 | 2020-05-28 | 2024-05-19 | 420,781 | 420,781 | ||||
| Kirsch Christoph | Vice Chairman | Currently in office | Male | 61 | 2021-05-20 | 2024-05-19 | ||||||
| Xu Yunfeng | Vice Chairman, GM | Currently in office | Male | 51 | 2020-05-28 | 2024-05-19 | 363,000 | 363,000 | ||||
| Ou Jianbin | Director, Executive Deputy General Manager and financing Charger | Currently in office | Male | 56 | 2012-03-07 | 2024-05-19 | 290,000 | 290,000 | ||||
| Chen Yudong | Director | Currently in office | Male | 61 | 2012-03-07 | 2024-05-19 | ||||||
| Zhao Hong | Director | Currently in office | Fe male | 41 | 2021-05-20 | 2024-05-19 | ||||||
| Huang Rui | Director | Currently in office | Male | 38 | 2021-05-20 | 2024-05-19 | ||||||
| Yu Xiaoli | Independent Director | Currently in office | Fe male | 59 | 2018-06-27 | 2024-05-19 | ||||||
| Xing Min | Independent Director | Currently in office | Male | 68 | 2021-05-20 | 2024-05-19 | ||||||
| Feng Kaiyan | Independent Director | Currently in office | Fe male | 49 | 2021-05-20 | 2024-05-19 | ||||||
| Pan Xinggao | Independent Director | Currently in office | Male | 51 | 2021-05-20 | 2024-05-19 | ||||||
| Ma Yuzhou | Chairman of the Supervisory Committee | Currently in office | Male | 48 | 2021-05-20 | 2024-05-19 | ||||||
| Chen Ran | Supervisor | Currently in office | Male | 50 | 2020-05-28 | 2024-05-19 | 1,000 | 1,000 | ||||
| Liu Songxue | Supervisor | Currently in office | Fe male | 37 | 2021-05-20 | 2024-05-19 | ||||||
| Miao Yuming | Deputy GM | Currently in office | Male | 59 | 2003-04-16 | 2024-05-19 | 290,000 | 290,000 | ||||
| Xu Sheng | Deputy GM | Currently in office | Male | 48 | 2020-05-28 | 2024-05-19 | 280,000 | 280,000 | ||||
| Rong Bin | Deputy GM | Currently in office | Male | 47 | 2020-05-28 | 2024-05-19 | 280,000 | 280,000 | ||||
| Liu Jinjun | Deputy GM and | Currently in office | Male | 47 | 2020-05-28 | 2024-05-19 | 280,000 | 280,000 |
无锡威孚高科技集团股份有限公司2022年年度报告全文
Secretary ofthe Board
| Secretary of the Board | ||||||||||||
| Li Gang | Chief engineer | Currently in office | Male | 52 | 2020-05-28 | 2024-05-19 | 280,000 | 280,000 | ||||
| Total | -- | -- | -- | -- | -- | -- | 2,484,781 | 0 | 0 | 0 | 2,484,781 | -- |
During the reporting period, whether there was any departure of directors and supervisors and dismissal of Senior Executives
□Yes ?No
Changes of directors, supervisors and senior executives
□Applicable ? Not applicable
2.Post-holding
Professional background, major working experience and present main responsibilities in Company of directors,supervisors and senior executiveMr. Wang Xiaodong, born in November 1966, Chinese nationality and no permanent residence abroad, member of theCPC, a university graduate, MBA and full senior engineer. He previously served as the engineer, director and deputychief engineer in technology center of the Company, sales director, deputy GM of RBCD, Supervisor of thecompany, vice chairman and GM of the Company. Currently serves as Chairman and Party Secretary of theCompany.Mr. Kirsch Christoph, born in October 1961, German nationality, Master’s degree. He previously served as R&Dengineer, product manager and key account sales manager of the diesel system division in Robert Bosch Group,GM of Bosch Automotive Diesel System Co., Ltd, senior vice president of the commercial vehicle business,Bosch Diesel System Division, the executive vice president of production & quality in United AutomotiveElectronic Systems Co., Ltd(UAES), executive vice president of production & quality, gasoline system division ofBosch Group, the executive vice president of commercial vehicle & off-road business, the solution businessdivision of RBCD, representing the Bosch Automotive and Intelligent Mobility Asia Pacific Board. Currently heserves as BMS in Robert Bosch Group and the vice chairman of the Company.Mr. Xu Yunfeng, born in November 1971, Chinese nationality and no permanent residence abroad, member of theCPC, a university graduate and an engineer, and holds a master's degree. He worked as a test engineer and designteam leader in technical center of the Company, assistant of the oil pump & nozzle research institute of thetechnical center, deputy director of the product research institute of technical center, the technical sales manager,GM assistant and GM of the Wuxi Weifu Automobile Diesel System Co., ltd, and deputy GM of the Company. Hecurrently serves as Vice Chairman and GM of the Company and deputy secretary of the party committee of theCompany.Mr. Ou Jianbin, born in June 1966, Chinese nationality and no permanent residence abroad, member of the CPC, asenior college graduated and an accountant. Previously served as Deputy Minister of Financial Department ofWeifu Company, Director and deputy GM of subsidiary WFJN, Deputy GM and GM of subsidiary WFLD andsupervisor of the Company. Currently he serves as director and standing deputy GM as well as chief of thefinancial of the Company.Mr. Chen Yudong, born in September 1961, an America citizenship and a Doctor. He previously served as seniorvice president of the gasoline system division of Robert Bosch Group, executive vice president of Bosch (China)
无锡威孚高科技集团股份有限公司2022年年度报告全文
Investment Ltd. Now he serves as President of Bosch (China) Investment Ltd. and Director of the Company.Ms. Zhao Hong, born in September 1981, Chinese nationality and no permanent residence abroad, member of theCPC, Bachelor’s degree, an accountant. She worked as an account in Wuxi Tianyi Membrane TechnologyApplication Equipment Factory, the project auditor of Wuxi Founder Taxation Firm, the deputy director of auditand inspection department, director, deputy secretary of discipline inspection commission, secretary of directorbureau and chief of staff in Wuxi Industry Development Group Co., Ltd. Now she is the secretary to the BOD andchief operating officer of Wuxi Industry Development Group Co., Ltd and the Director of the Company.Mr. Huang Rui, born in December 1984, Chinese nationality and no permanent residence abroad, member of theCPC, Master’s degree. He worked as the product manager of Shangde Power, senior project manager of WuxiMerchants Bureau, manager of the Ernst & Young Huaming CPA (Shanghai), deputy GM, municipal environmentdivision of Wuxi Guolian Environmental Energy Group, the vice president of investment development department,vice president of investment development department II (presiding over the work), vice president of investmentbanking of Wuxi Industry Development Group Co., Ltd. Now he is the GM of investment banking department ofWuxi Industry Development Group Co., Ltd and Director of the Company.Ms. Yu Xiaoli, born in January 1963, Chinese nationality and no permanent residence abroad, member of the CPC,Ph.D., a professor, she has been teaching at Zhejiang University since 1985. She served as an independent directorof the sixth, seventh and ninth of the Board of the Company, and the dean of the engineering branch of ZhejiangUniversity City College. She is currently a professor at Zhejiang University and Doctoral supervisor, the chairmanof the Society of Automotive Engineers of Zhejiang, an director of Zhejiang Bozhong Automobile TechnologyCo., Ltd., and independent director of Zhejiang Yinlun Co., Ltd, an independent director of Zhejiang EVTECHCo., Ltd.and independent director of Zhejiang Fenglong Electric Co., Ltd., and the independent director of theCompany.Mr. Xing Min, born in January 1954, Chinese nationality and no permanent residence abroad, member of the CPC,Bachelor’s degree, a professor-level senior engineer. He worked as the secretary of the Party Committee of ChinaHeavy Machinery Corporation, secretary of the Party Committee and GM of China Machine Tool Corporation.Now he is the executive vice president and secretary general of China Internal Combustion Engine IndustryAssociation, Independent Director of Zhejiang Zhongjian Technology Co., Ltd, Independent Director of JiangsuYunyi Electric Co., Ltd., Independent Director of Changchai Company Limited, Independent Director of ZhejiangXinchai Co., Ltd, Director of Anhui Aikelan Environmental Protection Co., Ltd, and Independent Director of theCompany.Ms. Feng Kaiyan, born in October 1973, Chinese nationality and no permanent residence abroad, member of theCPC, a Bachelor’s degree, Certified Public Accountant and senior accountant. She worked as the accounting forWuxi Production Materials Corporation and Wuxi Geological & Mining Information Service Center. Currently,she is the chief accountant of Wuxi Donghua Accounting Firms Co., Ltd, responsible person of the Sunan Branch,Jiangsu Fuhua Engineering Cost Consulting Co., Ltd, the independent director of Wuxi Weifeng Technology Co.,Ltd, independent director of yuancheng Cable Co., Ltd, independent director of Kangdexin Composite MaterialGroup Co., Ltd, the external director of Wuxi Urban Construction Development Group Co., Ltd and independent
无锡威孚高科技集团股份有限公司2022年年度报告全文
director of the Company.Mr. Pan Xinggao, born in June 1971, Chinese nationality and no permanent residence abroad, a Bachelor’s degreeand a lawyer. He served as a lawyer of Shandong Jinan Quancheng Laws Firm, a lawyer of Beijing Zhongyin LawFirm and lawyer of Beijing Zhonglun Jingtong Laws Firm. Now he is the Partner of Beijing Tongshang Law Firm,the independent director of Huarui Traffic Technology Co., Ltd and independent director of the Company.Mr. Ma Yuzhou, born in September 1974, Chinese nationality and no permanent residence abroad, member of theCPC, a Master graduate and an engineer. He worked as the craftsman in the Company’s assembly branch,assistant secretary of the mission committee of the Company, deputy secretary of the Company’s fuel injectionbranch, deputy director of the Company’s Party Committee Work Dept., plunger branch deputy plant manager,head treatment plan manager, director of oil pump branch plant, assembly plant manager, deputy GM of WFTT,deputy GM and GM of the Company’s mechanical system division and director of organization & personnel dept.of the Company. Now he is the deputy secretary of the Company’s Party Committee and chairman of theSupervisory Committee of the Company.Mr. Chen Ran, born in December 1972, Chinese nationality and no permanent residence abroad, member of the CPC,a Bachelor’s degree, and a senior human resource manager. He once served as deputy director of the company’smanagement department, deputy director of the investment and audit department, director of human resourcesdepartment, deputy director of the party and mass department, deputy director of administration department,deputy director of engineering procurement department, director of the company’s party and mass department anddirector of the disciplinary inspection and supervision department. He is currently a director of the Company’sorganization and personnel department and supervisor of the Company.Ms. Liu Songxue, born in July 1985, Chinese nationality and no permanent residence abroad, member of the CPC, aBachelor’s degree, and an engineer. She worked as the product testing engineer and product design engineer intechnical center of the Company. Currently she is the secretary general of the Science & Technology Associationof the Company and Supervisor of the Company.Mr. Miao Yuming, born in April 1963, Chinese nationality and no permanent residence abroad, member of the CPC,Master’s Degree and senior engineer. He previously served as deputy director and director of sales department andassistant GM and deputy GM of the Company. Currently he serves as deputy GM of the Company and deputy GM ofRBCD.Mr. Xu Sheng, born in March 1974, Chinese nationality and no permanent residence abroad, member of the CPC,graduate degree, holds a master’s degree, and is an engineer. He once served as secretary of the party committeeof the company’s party committee work department, deputy director of the office of the general manager of thecompany, deputy secretary of the party branch and deputy factory manager of the company’s injector parts branch,HSE manager of Bosch Automotive Diesel System Co., Ltd., senior manager of BPS, director of MOE5, andassistant general manager of the company. He is currently the deputy GM of the Company.Mr. Rong Bin, born in December 1975, Chinese nationality and no permanent residence abroad, member of the CPC,holds a bachelor's degree, and is an assistant engineer. He joined the Company in July 1998 and worked as vice
无锡威孚高科技集团股份有限公司2022年年度报告全文
plant manager of the company's plunger branch, deputy manager of the common rail component company, deputymanager and manager of the first manufacturing department of the company's mechanical system businessdepartment, assistant to the general manager, deputy general manager, and general manager of the company'smechanical system business department, and general manager of the automotive diesel system division andgeneral manager of the mechanical system division. He currently serves as the deputy GM of the Company.Mr. Liu Jinjun, born in September 1975, Chinese nationality and no permanent residence abroad, member of theCPC, holds a bachelor’s degree and a master’s degree, and is an engineer. He once served as the manager of thepersonnel administration department and technical sales manager of Wuxi Weifu Automotive Diesel System Co.,Ltd., the director of the company's human resources department, supervisor of the seventh and eighth of theSupervisory Committee of the Company, head of the corporate strategy & new business department and head ofmarket development department of the Company. He is currently the deputy GM and secretary of the Board of theCompany.Mr. Li Gang, born in November 1970, Chinese nationality and no permanent residence abroad, member of the publicinterest Party, holds a bachelor’s degree and a master’s degree, and a full senior engineer. He once served as theproduct design engineer of the company's technology center, the production supervisor of the productiondepartment and the technical director of the technical sales department of Wuxi Weifu Automotive Diesel SystemCo., Ltd., the deputy director of the company's technology center, deputy dean of the company's engineeringtechnology research institute and the director of the technology center, and the standing deputy director (deputychief engineer) of the company's technology center. He is currently the chief engineer of the Company.Post-holding in shareholder’s unit?Applicable □ Not applicable
| Name | Name of shareholding entity | Position in shareholding entity | Start dated of office term | End date of office term | Received remuneration from shareholding entity (Y/N) |
| Kirsch Christoph | ROBERT BOSCH GMBH | BMS | 2023-04-01 | Y | |
| Chen Yudong | Bosch (China) Investment Ltd. | President | 2011-01-01 | Y | |
| Zhao Hong | Wuxi Industry Development Group Co., Ltd. | Secretary of director bureau, chief operating officer | 2021-04-19 | Y | |
| Huang Rui | Wuxi Industry Development Group Co., Ltd. | GM of Investment Banking Dept. | 2021-05-01 | Y | |
| Miao Yuming | Robert Bosch Powertrain Ltd. | Deputy GM | 2012-03-01 | Y |
Post-holding in other unit?Applicable □ Not applicable
| Name | Name of other entities | Position in other entities | Start dated of office term | End date of office term | Received remuneration from other entities (Y/N) |
| Yu Xiaoli | Zhejiang University | Teacher and professor | 1985-08-01 | Y | |
| Yu Xiaoli | Society of Automotive Engineers of Zhejiang | Director | 2015-06-01 | N | |
| Yu Xiaoli | Zhejiang Bozhong Automobile Technology Co., Ltd | Director | 2008-04-01 | N | |
| Yu Xiaoli | Zhejiang Fenglong Electric Co., Ltd. | Independent Director | 2016-04-01 | Y | |
| Yu Xiaoli | Zhejiang EVTECH Co., Ltd | Independent Director | 2016-06-01 | Y | |
| Yu Xiaoli | Zhejiang Yinlun Co., Ltd | Independent Director | 2020-08-06 | Y |
无锡威孚高科技集团股份有限公司2022年年度报告全文
Xing Min
| Xing Min | China Internal Combustion Engine Industry Association | Executive vice president and secretary general | 2008-08-01 | Y | |
| Xing Min | Jiangsu Yunyi Electric Co., Ltd | Independent Director | 2019-07-31 | 2022-05-30 | Y |
| Xing Min | Zhejiang Zhongjian Technology Co., Ltd | Independent Director | 2017-06-20 | 2023-03-31 | Y |
| Xing Min | Zhejiang Xinchai Co., Ltd | Independent Director | 2019-12-06 | 2022-09-22 | Y |
| Xing Min | Changchai Company Limited | Independent Director | 2020-04-16 | Y | |
| Xing Min | Anhui Aikelan Environmental Protection Co., Ltd | Director | 2021-11-22 | Y | |
| Feng Kaiyan | Wuxi Donghua Accounting Firms Co., Ltd | Chief accountant | 1998-10-01 | Y | |
| Feng Kaiyan | Jiangsu Fuhua Engineering Cost Consulting Co., Ltd - Sunan Branch | Responsible person | 2020-07-16 | Y | |
| Feng Kaiyan | Wuxi Weifeng Technology Co., Ltd | Independent Director | 2017-12-28 | Y | |
| Feng Kaiyan | yuancheng Cable Co., Ltd. | Independent Director | 2019-11-22 | Y | |
| Feng Kaiyan | Kangdexin Composite Material Group Co., Ltd | Independent Director | 2020-08-26 | Y | |
| Feng Kaiyan | Wuxi Urban Construction Development Group Co., Ltd | External Director | 2021-12-31 | Y | |
| Pan Xinggao | Beijing Tongshang Law Firm | Lawyer/ Partner | 2007-10-01 | Y | |
| Pan Xinggao | Huarui Traffic Technology Co., Ltd | Independent Director | 2022-02-26 | Y | |
| Explanation on post-holding in other entities | The aforesaid are the independent directors of the Company | ||||
Punishment of securities regulatory authority in recent three years to the company’s current and outgoing directors, supervisors andsenior management during the reporting period
□ Applicable ? Not applicable
3. Remuneration of directors, supervisors and senior executives
Decision-making procedures, recognition basis and payment for directors, supervisors and senior executives
1. Decision-making procedure: the remuneration committee of the Board shall make proposals according to completion status of themajor annual targets, the implementation of which is subject to submission to and approval by the Board;
2. Determination reference: remuneration of directors, supervisors and senior management who receive remuneration from theCompany is determined based on the Annual Operating Results Assessment Measures of Senior Management and RemunerationManagement Rules of Senior Management as approved at the shareholders’ general meetings. Allowance for independent directors ofthe Company is determined by shareholders’ general meeting which is set at 150,000 yuan per person/year (tax included), and thetraveling expense occurred by them arising from attending the Company’s board meeting, general meetings and relevant activitieswill be reimbursed according to the actual conditions.
3. Actual payment: remuneration of directors, supervisors and senior management who receive remuneration from the Companycomprises of basic annual pay and performance related annual salary. The basic annual pay shall be determined based on specificpositions and paid monthly, while the performance related salary is determined and paid based on satisfaction of the variousperformance indicators since it is directly linked with the economic benefits of the Company. Remuneration of independent directorswill be paid on a quarterly basis.Remuneration of directors, supervisors and senior executives in reporting period
In ten thousand yuan
无锡威孚高科技集团股份有限公司2022年年度报告全文
Name
| Name | Title | Gender | Age | Post-holding status | Total remuneration obtained from the Company (before taxes) | Whether remuneration obtained from related party of the Company (Y/N) |
| Wang Xiaodong | Chairman | Male | 56 | Currently in office | 99 | N |
| Kirsch Christoph | Vice Chairman | Male | 61 | Currently in office | Y | |
| Xu Yunfeng | Vice Chairman,GM | Male | 51 | Currently in office | 89 | N |
| Ou Jianbin | Director, Executive Deputy General Manager and financing Charger | Male | 56 | Currently in office | 69 | N |
| Chen Yudong | Director | Male | 61 | Currently in office | Y | |
| Zhao Hong | Director | Female | 41 | Currently in office | Y | |
| Huang Rui | Director | Male | 38 | Currently in office | Y | |
| Yu Xiaoli | Independent Director | Female | 59 | Currently in office | 15 | N |
| Xing Min | Independent Director | Male | 68 | Currently in office | 15 | N |
| Feng Kaiyan | Independent Director | Female | 49 | Currently in office | 15 | N |
| Pan Xinggao | Independent Director | Male | 51 | Currently in office | 15 | N |
| Ma Yuzhou | Chairman of the Supervisory Committee | Male | 48 | Currently in office | 69 | N |
| Chen Ran | Supervisor | Male | 50 | Currently in office | 59 | N |
| Liu Songxue | Supervisor | Female | 37 | Currently in office | 18 | N |
| Miao Yuming | Deputy GM | Male | 59 | Currently in office | Y | |
| Xu Sheng | Deputy GM | Male | 48 | Currently in office | 69 | N |
| Rong Bin | Deputy GM | Male | 47 | Currently in office | 69 | N |
| Liu Jinjun | Deputy GM, Secretary of the Board | Male | 47 | Currently in office | 69 | N |
| Li Gang | Chief engineer | Male | 52 | Currently in office | 69 | N |
| Total | -- | -- | -- | -- | 739 | -- |
VI. Responsibility performance of directors during the reporting period
1.Meetings held by BOD during the reporting period
| Meeting | Date of meeting | Disclosure date | Meeting resolutions |
| The 6th meeting of 10th session of the BOD | 2022-01-07 | 2022-01-11 | The Notice of the Resolution of 6th meeting of 10th session of the BOD (Notice No.: 2022-001) published on Juchao Website (www.cninfo.com.cn) |
| The 7th meeting of 10th session of the BOD | 2022-02-07 | 2022-02-09 | The Notice of the Resolution of 7th meeting of 10th session of the BOD (Notice No.: 2022-005) published on Juchao Website (www.cninfo.com.cn) |
| The 8th meeting of 10th session of the BOD | 2022-04-15 | 2022-04-19 | The Notice of the Resolution of 8th meeting of 10th session of the BOD (Notice No.: 2022-008) published on Juchao Website (www.cninfo.com.cn) |
| The 9th meeting of 10th session of the BOD | 2022-04-25 | The Notice of the Resolution of 9th meeting of 10th session of the BOD (announcement-free according to relevant regulations) |
无锡威孚高科技集团股份有限公司2022年年度报告全文
The 10
th
meeting of
th
session of theBOD
| The 10th meeting of 10th session of the BOD | 2022-05-05 | 2022-05-07 | The Notice of the Resolution of 10th meeting of 10th session of the BOD (Notice No.: 2022-029) published on Juchao Website (www.cninfo.com.cn) |
| The 11th meeting of 10th session of the BOD | 2022-07-29 | 2022-08-02 | The Notice of the Resolution of 11th meeting of 10th session of the BOD (Notice No.: 2022-045) published on Juchao Website (www.cninfo.com.cn) |
| The 12th meeting of 10th session of the BOD | 2022-08-19 | The Notice of the Resolution of 12th meeting of 10th session of the BOD (announcement-free according to relevant regulations) | |
| The 13th meeting of 10th session of the BOD | 2022-10-21 | The Notice of the Resolution of 13th meeting of 10th session of the BOD (announcement-free according to relevant regulations) | |
| The 14th meeting of 10th session of the BOD | 2022-12-07 | 2022-12-09 | The Notice of the Resolution of 14th meeting of 10th session of the BOD (Notice No.: 2022-062) published on Juchao Website (www.cninfo.com.cn) |
2.Attendance of directors at board meetings and shareholders’ general meetings
| Attendance of directors to board meeting and shareholders’ general meeting | |||||||
| Director | Times of Board meeting supposed to attend in the report period | Times of Presence | Times of attending the Board Meeting by communication | Times of entrusted presence | Times of Absence | Absent the Meeting for the second time in a row (Y/N) | Times of attend the general meeting |
| Wang Xiaodong | 9 | 1 | 8 | N | 2 | ||
| Kirsch Christoph | 9 | 0 | 9 | N | 0 | ||
| Xu Yunfeng | 9 | 1 | 8 | N | 2 | ||
| Ou Jianbin | 9 | 1 | 8 | N | 2 | ||
| Chen Yudong | 9 | 0 | 9 | N | 0 | ||
| Zhao Hong | 9 | 1 | 8 | N | 2 | ||
| Huang Rui | 9 | 1 | 8 | N | 2 | ||
| Yu Xiaoli | 9 | 0 | 9 | N | 2 | ||
| Xing Min | 9 | 0 | 9 | N | 2 | ||
| Feng Kaiyan | 9 | 1 | 8 | N | 2 | ||
| Pan Xinggao | 9 | 0 | 9 | N | 2 | ||
Explanation of not attending the board meeting in person for two consecutive times: Nil
3. Objection for relevant events from directors
Directors come up with objection about Company’s relevant matters
□ Yes ? No
No directors come up with objection about Company’s relevant matters in the Period
4. Other explanation on responsibility performance of directors
The opinions from directors have been adopted? Yes □ NoDirector’s statement to the Company that a proposal has been or has not been adoptedDuring the reporting period, all the directors of the Company were diligent and conscientious, carried out their work in strict
无锡威孚高科技集团股份有限公司2022年年度报告全文
accordance with the relevant regulations of the China Securities Regulatory Commission and the Shenzhen Stock Exchange, as wellas the Articles of Association, Rules of Procedure for the Board of Directors and other systems, and paid close attention to theCompany’s standardized operation and business condition, put forward relevant opinions on the Company’s major governance andoperation decisions according to the actual situation of the Company, form a consensus after full communication and discussion, andsupervise and promote the implementation of the resolutions of the board of directors, ensure scientific, timely and efficient decision-making, and maintain the legitimate rights and interests of the Company and all shareholders.VII. Special committees under the BOD during the reporting period
| Committee name | Members | Number of meetings held | Date of meeting | Meeting content | Important comments and suggestions made | Other performance of duties | Specific circumstances of the objection (if applicable) |
| The 10th session of Strategy Committee | Wang Xiaodong, Kirsch Christoph, Xu Yunfeng Xing Min Yu Xiaoli | 2 | 2022-01-07 | Deliberation of the Proposal on Formulating a Strategic Plan for the Development of Hydrogen Energy Business and Establishing a Hydrogen Energy Business Department | The Strategy Committee verified and deliberated on the matters strictly in terms of the Rules of Work of Strategy Committee of the Board and relevant laws and regulations, relevant proposals are unanimously agreed. | N/A | N/A |
| 2022-04-15 | Consideration of the Strategic Vision of the Company’s Future Development | N/A | N/A | ||||
| The 10th Session of Remuneration Committee | Yu Xiaoli, Feng Kaiyan, Huang Rui | 2 | 2022-04-15 | Consideration of the (1) Proposal Report on Remuneration Assessment for Senior Executives and Payout for year of 2021; (2) Proposal on Proposal on Purchasing Liability Insurance for Directors, Supervisors and senior executives | The Remuneration Committee verified and deliberated on the matters strictly in terms of the Rules of Work of Remuneration Committee of the Board and relevant laws and regulations, relevant proposals are unanimously agreed. | N/A | N/A |
| 2022-12-07 | Consideration of the (1) Proposal on the Achievement of the Conditions for the First Release of Restrictions on Sales in the Incentive Plan for Restricted stock in 2020;(2) Proposal on Adjustment of the Buy-back Price on Restricted Stock Incentive Plan for year of 2020; and (3) Proposal on Buy-back and Cancellation of the Restricted Stocks Partially Granted without Circulation for year of 2020 | N/A | N/A |
无锡威孚高科技集团股份有限公司2022年年度报告全文
The 10th
session ofAuditCommittee
| The 10th session of Audit Committee | Feng Kaiyan, Pan Xinggao, Zhao Hong | 4 | 2022-04-15 | Consideration of the (1) Annual Report of 2021 (full-text) and Summary of Annual Report 2021; (2) Financial Report of 2021; (3) Summary Report of Audit Work of 2021; (4) Assessment Report of Internal Control of 2021 (5) the Proposal on Conducting Bill Pool Business (6) Proposal on Estimating the Total Amount of Routine Related Transactions in 2022 (7) Proposal on Entrusted Wealth Management with Idle Own-Funds of the Company; (8) Proposal on Appointment of the Auditing Institution for 2022 Financial Report; and (9) Proposal on Appointment of Auditing Institution for 2022 Internal Control Evaluation | Audit Committee verified and deliberated on the matters strictly in terms of the Rules of Work of Audit Committee of the Board and relevant laws and regulations, relevant proposals are unanimously agreed. | N/A | N/A |
| 2022-04-25 | Consideration of the First Quarter Report of 2022 | N/A | N/A | ||||
| 2022-08-19 | Consideration of the Semi-Annual Report of 2022 (full-text) and Summary of Semi-Annual Report 2022 | N/A | N/A | ||||
| 2022-10-21 | Consideration of the Third Quarter Report of 2022 | N/A | N/A |
VIII. Works of Supervisory CommitteeDoes the Supervisory Committee discover any risks in the company during its supervisory activities during the reporting period?
□ Yes ? No
The Supervisory Committee has no objections to the supervisory matters during the reporting period.IX. Particulars of workforce
1.Number of employees, professional composition and education background
| The total number of current employees at year end (person) | 2,681 |
| The total number of current employees to receive pay (person) | 3,208 |
| Retired employee’ s expenses borne by the parent Company and main subsidiaries (person) | 5,889 |
| The total number of current employees at year end (person) | 5,889 |
| The total number of current employees to receive salaries (person) | 0 |
| Professional composition | |
| Category of professional composition | Number of professional composition(person) |
| Production personnel | 3,484 |
| Sales personnel | 169 |
| Technical personnel | 1,413 |
| Financial personnel | 99 |
无锡威孚高科技集团股份有限公司2022年年度报告全文
Administrative personnel
| Administrative personnel | 724 |
| Total | 5,889 |
| Education background | |
| Category of education background | Numbers(person) |
| Master degree and above | 491 |
| Undergraduate | 1,715 |
| Junior college | 1,076 |
| Other | 2,607 |
| Total | 5,889 |
2. Remuneration policy
According to the talent concept of “Joint endeavour and fair sharing”, the Company further improves theperformance management and salary management system, strengthens the scientificity and pertinence ofperformance goals, and focuses on the Company’s strategy and business plan to give full play to the guiding andpromoting role of goals; further plays the role of incentive funds, strengthens the promotion and incentive strengthof major innovation and development projects so as to promote the realization of the Company’s strategic goals.
3.Training plan
Taking “Building a Strategy-oriented Talent Team” as the objective, the Company actively promotes thedevelopment and construction of “San Hang Yi Jiang” talents, and comprehensively enhances the competence ofemployees as well as their business and technical capabilities. Establish a multi-channel training approach andintegrate online and offline training resources to expand training coverage; Design and implement training anddevelopment plans for job requirements and enhance internal knowledge sharing; Further advance action-basedlearning, emphasize the transformation of training effects, and promote the upgrading of the talent capabilities ofthe Company.
4. Labor outsourcing
□ Applicable ?Not applicable
X. Profit distribution plan and transfer of capital reserve into share capital
Formulation, implementation and adjustment of profit distribution policy, in particular the cash dividend policy during the reportingperiod? Applicable □ Not applicable
1. Cash dividend policy: carry out bonus distribution according to the regulations of Articles of Association.
2. During the reporting period, the Company implemented the profit distribution for year of 2021, based on theshares which exclude the buy-back shares on buy-back account (2,997,277 A-stock) from total share capital1,008,659,570 shares, distributed 16 yuan (tax included) cash dividend for every 10 shares held, withoutcapitalization from capital reserves. The plan was completed in June 2022. The implementation of the Company’scash dividend policy is in compliance with the provisions of Articles of Association, relevant decision-making
无锡威孚高科技集团股份有限公司2022年年度报告全文
procedures are complete and fully listen to the views of independent directors and small & medium shareholdersand maintain the legitimate rights and interests of small & medium shareholders.
| Special explanation on cash dividend policy | |
| Satisfy regulations of General Meeting or requirement of Article of Association (Y/N): | Y |
| Well-defined and clearly dividend standards and proportion (Y/N): | Y |
| Completed relevant decision-making process and mechanism (Y/N): | Y |
| Independent directors perform duties completely and play a proper role (Y/N): | Y |
| Small & medium shareholders have opportunity to express opinions and demands totally and their legal rights are fully protected (Y/N): | Y |
| Condition and procedures are compliance and transparent while the cash dividend policy adjusted or changed (Y/N): | Not applicable |
The Company earnings during the reporting period and profit available for distribution to shareholders from parent company ispositive, but no cash dividend distribution plan has been proposed
□ Applicable ?Not applicable
Profit distribution and capitalization of capital reserves during the reporting period?Applicable □Not applicable
| Bonus shares for every 10-share (Share) | 0 |
| Dividends for every 10-share (RMB) (Tax included) | 1 |
| Increase for every 10-share (Share) | |
| Equity base of distribution plan (Share) | 983,173,293 |
| Total cash dividend (RMB) (Tax included) | 98,317,329.30 |
| Cash dividend by other ways (share buy-back included) (RMB) | 397,804,542.63 |
| Total cash dividend (other ways included) (RMB) | 496,121,871.93 |
| Profits available for distribution (RMB) | 10,765,319,818.29 |
| Ratio of the total cash dividend (other ways included) in total profit distribution | 100% |
| Cash dividend policy | |
| Other | |
| Detail explanation on profit distribution or capitalization from capital reserves | |
| The company's 2022 annual profit distribution plan: based on the 983,173,293 shares which exclude the buy-back shares on buy-back account (25,000,000 A-stock) from total share capital 1,008,950,570 shares (According to the provisions of the The Company Law of the People's Republic of China, the listed company does not have the right to participate in the profit distribution and the conversion of the capital reserve into the share capital by repurchasing the shares held by the company through the special securities account), distributing 1.00 yuan (tax included) cash dividend for every 10 shares held, no bonus shares, without capitalization from capital reserves. The remaining undistributed profit is carried forward to the next year. The total amount of cash dividend to be paid is RMB 98,317,329.3 (tax included). If the total share capital of the Company changes before the implementation of the distribution plan, the Company will be allocated according to the principle of unchanged distribution proportion and adjustment of the total amount of distribution. The independent directors of the Company expressed their independent opinions and agreed to the above proposal. The profit distribution plan will be submitted for consideration at the 2022 Annual General Meeting. | |
无锡威孚高科技集团股份有限公司2022年年度报告全文
XI. Implementation of the company’s stock incentive scheme, employee stock ownership planor other employee incentives?Applicable □Not applicable
1. Stock incentive
On October 12, 2020, the Company held the 17
th meeting of the 9
thsession of BOD to deliberated and approvedrelevant proposal as the “Restricted Stock Incentive Plan 2020 (Draft)”.On November 3, 2020, the Company held the second extraordinary shareholders’ general meeting of 2020 todeliberated and approved relevant proposals as the “Restricted Stock Incentive Plan 2020 (Draft) and itssummary”, “Proposal on Assessment Management Measures for Restricted Stock Incentive Plan Implementation”and “Proposal to Request the Shareholders’ General Meeting to Authorized BOD to Fully Handle MattersRegarding Stock Incentive”.On November 12, 2020, the Company held the 21
st meeting of 9
thsession of the BOD, as authorized by the secondextraordinary shareholders’ general meeting of 2020, deliberated and approved the “Proposal on Adjusting theList of Incentive Objects of the Restricted Stock Incentive Plan and the Number of Rights Granted” and the“Proposal on the First Grant of Restricted Stocks to Incentive Objects of the 2020 Restricted Stock IncentivePlan”. The BOD considers that conditions for the initial grant of 2020 restricted stock incentive plan have beenmet, and November 12, 2020 is determine as the initial grant date, 19,540,000 restricted shares are granted to 601incentive recipients at a grant price of 15.48 yuan/Share.The Notice on Completion of the First Grant of 2020 Restricted Stock Incentive Plan was released by theCompany dated December 8, 2020.On October 22, 2021, the Company held the 5
th meeting of 10
thsession of the BOD to deliberate and approverelevant proposals as Adjustment of the Buy-back Price on Restricted Stock Incentive Plan for year of 2020 andBuy-back and Cancellation of the Restricted Stocks Partially Granted without Circulation for year of 2020, anddecided to buy-back and cancel 291,000 restricted shares held by 11 incentive recipients that had been granted butnot yet unlocked. As of December 20, 2021, cancellation of the above mentioned buy-back shares are completedat the Shenzhen Branch of CSDC. After cancellation, number of the incentive recipients for the first grant of 2020restricted stock incentive plan was adjusted from 601 to 590, restricted stock of 19,249,000 shares are being heldin total.On December 7, 2022, the Company held the 14
th meeting of 10
thsession of the BOD, and deliberated and passedthe Proposal on the Achievement of the Conditions for the Release of Restricted Shares in the First RestrictedPeriod of the 2020 Restricted Stock Incentive Plan, the Proposal on Adjustment of the Buy-back Price onRestricted Stock Incentive Plan for year of 2020 and the Proposal on Buy-back and Cancellation of the RestrictedStocks Partially Granted without Circulation for year of 2020. It agreed to apply for the release of 7,632,000restricted stocks granted to 581 incentive recipients and decided to buy-back and cancel 430,000 restricted sharesheld by 23 incentive recipients that had been granted but not yet unlocked. On December 16, 2022, the shares
无锡威孚高科技集团股份有限公司2022年年度报告全文
released from this restricted sale were formally available for circulation. As of February 16, 2023, the Companycompleted the buy-back and cancellation procedures for the aforementioned 430,000 shares at Shenzhen branch ofChina Securities Depository and Clearing Co., Ltd. After this cancellation, the number of incentive recipientsgranted for the first time by the Company's restricted stock incentive plan in 2020 was adjusted from 590 to 568,holding 11,187,000 restricted stock in total.Equity incentive received by directors and senior executives? Applicable □ Not applicable
In share
| Name | Title | Number of stock options held at beginning of the year | Number of new stock options granted during the reporting period | Number of stock exercisable during the reporting period | Number of stock exercised during the reporting period | Exercise price of the stock exercised during the reporting period(RMB/Share) | Number of stock options held at end of the period | Market value at end of the Period (RMB/Share) | Number of restricted shares held at beginning of the period | Number of shares unlocked during the period | Number of new restricted shares granted during the reporting period | Grant price of restricted shares (RMB/Share) | Number of restricted shares held at end of the period |
| Wang Xiaodong | Chairman | 17.73 | 400,000 | 160,000 | 15.48 | 240,000 | |||||||
| Xu Yunfeng | Vice Chairman, GM | 17.73 | 350,000 | 140,000 | 15.48 | 210,000 | |||||||
| Ou Jianbin | Director, executive vice president and head of finance | 17.73 | 280,000 | 112,000 | 15.48 | 168,000 | |||||||
| Miao Yuming | Deputy GM | 17.73 | 280,000 | 112,000 | 15.48 | 168,000 | |||||||
| Xu Sheng | Deputy GM | 17.73 | 280,000 | 112,000 | 15.48 | 168,000 | |||||||
| Rong Bin | Deputy GM | 17.73 | 280,000 | 112,000 | 15.48 | 168,000 | |||||||
| Liu Jinjun | Deputy GM, Secretary of the Board | 17.73 | 280,000 | 112,000 | 15.48 | 168,000 | |||||||
| Li Gang | Chief engineer | 17.73 | 280,000 | 112,000 | 15.48 | 168,000 | |||||||
| Total | -- | 0 | 0 | 0 | 0 | -- | 0 | -- | 2,430,000 | 972,000 | 0 | -- | 1,458,000 |
Assessment mechanism and incentive condition of the senior executivesAssessment and incentive of senior management of the Company is conducted pursuant to the Company Law,Articles of Association, and the Annual Operating Results Assessment Measures of Senior Management andRemuneration Management Rules of Senior Management as approved at the general meetings. Assessment ofoperating results of senior management comprises of annual operating results assessment and term-of-serviceoperating results assessment. Assessment on results and procedure was combined, and assessment results were
无锡威孚高科技集团股份有限公司2022年年度报告全文
linked to incentives and punishment. With respect to annual operating results review, the remuneration committeeof the Board made comprehensive assessment on satisfaction of the annual operating targets and determined theannual remuneration, incentives or punishment for senior management based on their review results (which wasimplemented according to remuneration management rules of senior management), based on the major annualoperating targets set by the Board under required procedures and methods through establishment of scientificperformance indicators and assessment system and combination of scoring in terms of quantity and reviewcomments. During the reporting period, the Company made appropriate assessment on its senior managementunder the performance indicator and assessment system, the results of which had been reflected in the annualperformance related remuneration.Whereas the Company implements the 2020 restricted stock incentive plan, and the incentive targets overlap withthe long-term incentives for core talents, the remuneration committee of the BOD proposes that the Company’s2020 restricted stock incentive plan suspend the provision of incentive funds during the implementation periodand use for medium and long-term incentives for core talents.
2. Implementation of employee stock ownership plan
□Applicable ?Not applicable
3. Other employee incentives
□Applicable ?Not applicable
XII. Construction and implementation of internal control system during the reporting period
1. Construction and implementation of internal control
This year, the Company established the internal control system for the business and matters included in the scopeof evaluation in accordance with the requirements of the Basic Norms for Enterprise Internal Control and itssupporting guidelines and regularly improve and optimize the relevant system, the company and the subordinatecompanies are able to achieve the basic effective implementation of internal control system. In 2022, the wholly-owned subsidiary WFTR may have been defrauded by the contract in the "platform trade" business. The publicsecurity organs have filed a case, as of the date of this report, the case is still in the investigation stage.
2. Details of major defects in internal control identified during the reporting period
?Yes □ No
| Defects happened time | Specific description of the defect | Potential impact of defects on financial reporting | Corrective actions that have been or are to be implemented | Rectification time | Person responsible for the rectification | Result of the rectification |
| 2023 | When the transaction volume and transaction | The company has recorded a credit impairment loss | The Company has stopped the execution of contracts with | 2023-4 | WFTR | The company has set up a special working group and |
无锡威孚高科技集团股份有限公司2022年年度报告全文
volume of thecontractincreasedsignificantly,the companyfailed to verifythe authenticityof relevantagreements in atimely andprudentmanner, andfailed to judgethe rationalityof the endcustomer'sdemand, so asto verify theend customer
| volume of the contract increased significantly, the company failed to verify the authenticity of relevant agreements in a timely and prudent manner, and failed to judge the rationality of the end customer's demand, so as to verify the end customer | in its 2022 annual report | the parties involved in the “platform trade” business, the security organs have launched a criminal investigation on the case that WFTR was defrauded by contracts in its "platform trade" business. At present, the case is in the investigation stage | concentrates on the disposal of risk matters | |||
| 2023 | Failed to carefully check whether there was real physical movement of the "platform trade" business without controlling the trading inventory | The company has recorded a credit impairment loss in its 2022 annual report | The Company has stopped the execution of contracts with the parties involved in the “platform trade” business, the security organs have launched a criminal investigation on the case that WFTR was defrauded by contracts in its "platform trade" business. At present, the case is in the investigation stage | 2023- | WFTR | The company has set up a special working group and concentrates on the disposal of risk matters |
| 2023 | When the "platform trade" business has a large capital demand, it fails to prudently check the credit status of the supplier and evaluate the performance ability of the supplier, and prudently check whether the | The company has recorded a credit impairment loss in its 2022 annual report | The Company has stopped the execution of contracts with the parties involved in the “platform trade” business, the security organs have launched a criminal investigation on the case that WFTR was defrauded by | 2023-4 | WFTR | The company has set up a special working group and concentrates on the disposal of risk matters |
无锡威孚高科技集团股份有限公司2022年年度报告全文
upstreamsupplier anddownstreamcustomer arecontrolled bythe same actualcontroller andwhether there isa relationshipbetween themand thetransactionobject
| upstream supplier and downstream customer are controlled by the same actual controller and whether there is a relationship between them and the transaction object | contracts in its "platform trade" business. At present, the case is in the investigation stage |
XIII. Management and controls on subsidiaries during the reporting period
| Name | Integration plans | Integration progress | Problems encountered in integration | Countermeasures taken | Resolution progress | Follow-up resolution plan |
| Not applicable | Not applicable | Not applicable | Not applicable | Not applicable | Not applicable | Not applicable |
XIV. Internal control self-assessment report or internal control audit report
1. Self-assessment Report of Internal Control
| Disclosure date of full internal control assessment report | 2023-04-28 | |
| Disclosure index of full internal control assessment report | For more details, please refer to the Self-assessment Report of Internal Control for 2022 published on in Juchao Website (www.cninfo.com.cn) appointed by Shenzhen Stock Exchange | |
| The ratio of the total assets of entities included in the scope of assessment accounting for the total assets on the company's consolidated financial statements | 92.74% | |
| The ratio of the operating income of units included in the scope of assessment accounting for the operating income on the company's consolidated financial statements | 97.98% | |
| Defects recognition criteria | ||
| Category | Financial Reports | Non-financial Reports |
| Qualitative criteria | See details in (II) Basis for assessment of internal controls and defect recognition criteria of internal controls of III Assessment of Internal Controls in 2022 Annual Internal Control Self-Assessment Report disclosed on www.cninfo.com.cn dated April 28, 2023. | See details in (II) Basis for assessment of internal controls and defect recognition criteria of internal controls of III Assessment of Internal Controls in 2022 Annual Internal Control Self-Assessment Report disclosed on www.cninfo.com.cn dated April 28, 2023. |
| Quantitative standard | See details in (II) Basis for assessment of internal controls and defect recognition criteria of internal controls of III Assessment of Internal Controls in 2022 Annual Internal Control Self-Assessment Report disclosed on www.cninfo.com.cn dated April 28, 2023. | See details in (II) Basis for assessment of internal controls and defect recognition criteria of internal controls of III Assessment of Internal Controls in 2022 Annual Internal Control Self-Assessment Report disclosed on www.cninfo.com.cn dated April 28, 2023. |
无锡威孚高科技集团股份有限公司2022年年度报告全文
Number of significant defects infinancial reports
| Number of significant defects in financial reports | 0 |
| Number of significant defects in non-financial reports | 3 |
| Number of important defects in financial reports | 0 |
| Number of important defects in non-financial reports | 0 |
2. Audit report of internal control
?Applicable □ Not applicable
| Deliberations in Internal Control Audit Report | |
| Audit institute considers that: according to relevant regulations and Basic Internal Control Standards for Enterprise, Weifu High-Technology Group Co., Ltd. in all major aspects, keeps an efficiency of internal control of financial report dated December 31, 2022. | |
| Disclosure details of audit report of internal control | Disclosed |
| Disclosure date of audit report of internal control (full-text) | 2023-04-18 |
| Index of audit report of internal control (full-text) | For more details, please refer to the Audit report of internal control for year of 2022 published on Juchao website (www.cninfo.com.cn) appointed by Shenzhen Stock Exchange |
| Opinion type of auditing report of IC | Unqualified opinion with highlighted paragraphs |
| Whether the non-financial report had major defects (Y/N) | Y |
Carried out modified opinion for internal control audit report from CPA?Yes□ NoUsers of internal control audit reports are reminded of the following:
the security organs have launched a criminal investigation on the case that WFTR was defrauded by contracts in its "platform trade"business. At present, the case is in the investigation stage, and the outcome of the case is uncertain in the future. The management ofWFHT has identified the internal control defects in the development of the "platform trade" business and included them in theenterprise internal control evaluation report. This paragraph does not affect the audit opinion expressed regarding the effectiveness ofinternal control over financial reporting.The internal control audit report, issued by CPA, has concerted opinion with self-evaluation report, issued from the Board? Yes □ NoXV. Rectification of self-examination problems in special governance actions in listedcompanyNil
无锡威孚高科技集团股份有限公司2022年年度报告全文
Section V. Environmental and Social ResponsibilityI. Major environmental issuesThe listed Company and its subsidiary whether belongs to the key sewage units released from environmental protection department?Yes □ NoAdministrative punishment for environmental problems during the reporting periodPolicies and industry standards related to environmental protectionWuxi Weifu High-Tech Group Co., Ltd. and its subsidiaries diligently fulfill environmental protection policies and guidelines atall levels during production and operation, strictly comply with related national environmental protection laws and regulations suchas Environmental Protection Law of the People's Republic of China, Environmental Impact Assessment Law of the People's Republicof China, Air Pollution Prevention and Control Law of the People's Republic of China, Water Pollution Prevention and Control Lawof the People's Republic of China, Solid Waste Pollution Prevention and Control Law of the People's Republic of China, NoisePollution Prevention and Control Law of the People's Republic of China, Energy Conservation Law of the People's Republic ofChina, Cleaner Production Promotion Law of the People's Republic of China, Environmental Protection Tax Law of the People'sRepublic of China, Measures for the Management of Hazardous Waste Transfer, Regulations on Environmental Protection ofConstruction Projects, Regulations on the Administration of Emission Permits as well as related local environmental protectionmanagement rules and regulations, regularly collect newly promulgated laws and regulations on ecological and environmentalprotection at all levels, and perform compliance evaluation transformation by combining with production reality to ensurecompliance with the law at all times in the production and operation of the Company.
In the process of production, the Company has constructed comprehensive waste gas and waste water treatment facilities andsolid waste storage facilities in strict accordance with the requirements of related standards such as Standards for ComprehensiveSewage Discharge, Water Quality Standards for Sewage Discharge into Urban Sewers, Comprehensive Emission Standards for AirPollutants, and Pollution Control Standards for Hazardous Waste Storage, and guaranteed stable operation, in an effort to minimizethe negative impact of production and operation on the ecological environment.Administrative licenses for environmental protectionAll the construction projects of Wuxi Weifu High-Tech Group Co., Ltd. and its subsidiaries have been prepared withenvironmental impact reports (forms), and have been approved by the local ecological and environmental authorities, and all haveobtained emission permits (registrations) in accordance with the requirements of laws and regulations, and the emission permits(registrations) to expire in 2022 have been changed or renewed in a timely manner, thereby effectively achieving licensed emissionand legal and compliant emission. Discharge Permit of Wuxi Weifu High-Tech Group Co., Ltd., valid period: from March 27, 2020 toMarch 26, 2023; Discharge Permit of Nanjing Weifu Jinning Co., Ltd., valid period: From September 24, 2022 to September 23,2027; Discharge Permit of Wuxi Weifu Chang’an Co., Ltd., valid period: from December 31, 2020 to December 30, 2023.Industry emission standards and the specific situation of pollutant emissions involved in production and business activities
| Company/Subsidiary | Main pollutants and specific pollutants | Name of main pollutants and specific pollutants | Emission mode | Number of emission outlets | Distribution of emission outlets | Emission concentration/strength | Standard for emission of pollutants implemented | Total emissions | Total emissions approved | Excessive emission |
| WFHT | Water pollutant | Chemical oxygen demand, | Discharged through the | 1 | WFMS sewage discharge | Chemical oxygen demand 97mg/l, | Wastewater Quality Standards for | Chemical oxygen demand | Chemical oxygen demand | None |
无锡威孚高科技集团股份有限公司2022年年度报告全文
ammonianitrogen, totalnitrogen, totalnitrogen,petroleum
| ammonia nitrogen, total nitrogen, total nitrogen, petroleum | municipal sewage pipe network after being treated by the company's sewage treatment station | outlet | ammonia nitrogen 11.1mg/l, total phosphorus 0.15mg/l, total nitrogen 13.4mg/l, and petroleum 5.5mg/l | Discharge to Municipal Sewers (GB/T31962-2015) | 18.86 tons, ammonia nitrogen 2.15 tons, total phosphorus 0.03 tons, total nitrogen 2.61 tons, and petroleum 1.06 tons | 78 tons, ammonia nitrogen 7.8 tons, total phosphorus 0.52 tons, total nitrogen 10.4 tons, and petroleum 1.95 tons | |||
| Water pollutant | Chemical oxygen demand, ammonia nitrogen, petroleum, total nitrogen and petroleum | Discharged through the municipal sewage pipe network after being treated by the company's sewage treatment station | 1 | WFAC sewage discharge outlet | Chemical oxygen demand 135mg/l, Ammonia nitrogen 18.9mg/l, total nitrogen 32.35mg/l, total phosphorus 1.88mg/l, petroleum 3.2mg/l | Wastewater Quality Standards for Discharge to Municipal Sewers (GB/T31962-2015) | Chemical oxygen demand 1.893 tons, ammonia nitrogen 0.265 tons, total nitrogen 0.453 tons, 0.027 tons of total phosphorus and 0.045 tons of petroleum. | Chemical oxygen demand ≤8.924 tons, ammonia nitrogen ≤0.682 tons, total nitrogen ≤1.017 tons, total phosphorus ≤0.094 tons, and petroleum ≤0.410 tons | None |
| Air pollutants | Non-methane hydrocarbon | The exhaust air will be discharged in an organized way after being treated by oil mist processor and absorbed by activate | 17 | There are 5 machining workshops, 10 heat treatment workshops and 4 assembly workshops | 2.14 mg/m3 | Comprehensive Emission Standard of Air Pollutants (GB16297-1996) | 1.78 tons | 2.523 tons | None |
无锡威孚高科技集团股份有限公司2022年年度报告全文
dcarbon
| d carbon | |||||||||
| Air pollutants | Non-methane hydrocarbon | The exhaust air will be discharged in an organized way after being treated by oil mist processor and absorbed by activated carbon | 4 | 4 in 101 workshop | 2.32mg/m3 1.75 mg/m3 2.18 mg/m3 1.49 mg/m3 | Integrated Emission Standard of Air Pollutants (GB16297-1996) | 0.5706 tons | 1.152 tons | None |
| Air pollutants | Ammonia gas | Discharged in an organized way after being absorbed by ammonia spray tower | 1 | 1 heat treatment workshop | 1.2 mg/m3 | Emission Standards for Odor Pollutants (GB14554-93) | 0.061 tons of ammonia gas | 0.071 tons of ammonia gas | None |
| Air pollutants | Particles | Organized discharge after bag dust-cleaning. | 2 | 2 heat treatment workshops | 1.64mg/m3; , 1.84 mg/m3 | Comprehensive Emission Standard of Air Pollutants (GB16297-1996) | 0.0118 tons | 0.048 tons | None |
| Solid waste | Hazardous wastes such as waste oil, waste emulsion, cleaning waste liquid, grinding wheel ash, sewage pretreatment sludge and oil-containing filter element | Entrust a legally qualified unit for disposal. | Not applicable | Not applicable | Not applicable | Not applicable | 1255.6 tons | 1757.5 tons | None |
无锡威孚高科技集团股份有限公司2022年年度报告全文
s
| s | ||||||||||
| WFCA | Water pollutant | Chemical oxygen demand, ammonia nitrogen, total phosphorus, total nitrogen, suspended solids | Discharged through the municipal sewage pipe network after being treated by the company's sewage treatment station | 1 | Sewage discharge outlet | Chemical oxygen demand 36mg/L, suspended matter 11mg/L, ammonia nitrogen 1.57mg/L, total phosphorus 0.054mg/L, and total nitrogen 5.01 mg/L | Wastewater Quality Standards for Discharge to Municipal Sewers (GB/T31962-2015) | Chemical oxygen demand is 3.015 tons, suspended matter is 0.921 tons, ammonia nitrogen is 0.1315 tons, total phosphorus is 0.0045 tons and total nitrogen is 0.42 tons | Chemical oxygen demand is 35.018 tons, suspended matter is 26.263 tons, ammonia nitrogen is 2.626 tons, total phosphorus is 0.438 tons, and total nitrogen is 3.502 tons | None |
| Nanjing Weifu Jinning Co., Ltd. | Water pollutant | Chemical oxygen demand and ammonia nitrogen | Discharged through the municipal sewage pipe network after being treated by the company's sewage treatment station | 1 | Sewage discharge outlet | Chemical oxygen demand 72mg/L, Ammonia nitrogen 13mg, total phosphorus 0.38 mg/L, and petroleum 0.48 mg/L | Wastewater Quality Standards for Discharge to Municipal Sewers (GB/T31962-2015) | Chemical oxygen demand 6.1 tons, ammonia nitrogen 1 ton, total phosphorus 0.03 ton, and petroleum 0.04 ton | Not applicable | None |
| Solid waste | Hazardous wastes such as waste oil, oily sludge, grinding wheel ash, empty barrels, activated carbon and filter | Entrust a qualified unit for disposal. | Not applicable | Not applicable | Not applicable | Not applicable | 292t | Not applicable | None |
无锡威孚高科技集团股份有限公司2022年年度报告全文
elements.
elements.
Treatment of pollutantsWuxi Weifu High-Tech Group Co., Ltd. mainly focuses on mechanical processing, and mainly produces oil mist exhaust gas(non-methane total hydrocarbon) from metal processing. And the oil mist exhaust gas produced by Workshop 101 will be treated byhigh-efficiency oil mist purifier and then discharged through four 15m-high exhaust funnels. The oil mist waste gas generated by MSmachining workshop will be treated by high-efficiency oil mist purifier and then discharged through four 15m-high exhaust funnels;The cleaning waste gas (non-methane total hydrocarbons) will be treated by high-efficiency oil mist purifier and activated carbonadsorption device, and then discharged through two 15m-high exhaust funnels; The quenching waste gas (non-methane totalhydrocarbons) will be treated by high-efficiency oil mist purifier and then charged up to standard via three 15m-high exhaust funnels;The test waste gas (non-methane total hydrocarbons) will be treated by high-efficiency oil mist purifier and then charged up tostandard via a 15m-high exhaust funnel; The shot blasting waste gas (particulate matter) is treated by bag filter and then dischargedthrough two 15m-high exhaust funnels. The waste gas (ammonia, methanol, non-methane total hydrocarbons) produced bycarbonitriding process will be treated by acid spray tower and then discharged through a 15m-high exhaust funnel. The carburizedwaste gas (non-methane total hydrocarbon) will be treated by fire curtain combustion+activated carbon adsorption device, and thendischarged up to the standard through six 15m-high exhaust funnels. The rest of the waste gas will be discharged up to the standard inthe workshop. The Company has built two sewage treatment stations with the designed treatment capacity of 1600m
/d and 150 m
/din WFMS and WFAC factories. After being adjusted in the air flotation tank, the production wastewater then will be discharged intothe biochemical system of the sewage station together with the domestic sewage treated by septic tanks and grease traps for treatment,and the treated sewage will be discharged via the municipal pipe network according to the standard.Wuxi Weifu Chang’an Co., Ltd. has built a sewage treatment station with a designed treatment capacity of about 300m
/d in thefactory. After being adjusted by the air flotation tank, the production wastewater is discharged into the biochemical system of thesewage station for treatment together with the domestic sewage treated by septic tanks and grease traps, and the treated sewage isdischarged via the municipal pipe network according to the standard.Nanjing Weifu Jinning Co., Ltd. has built a set of industrial sewage treatment station with a designed treatment capacity ofabout 150m?/d and a domestic sewage treatment station with a treatment capacity of about 450m?/d in the factory area. After beingadjusted by the air flotation tank, the industrial wastewater will be discharged into the biochemical system of the sewage stationtogether with the domestic sewage treated by septic tanks and grease traps for treatment, and the treated sewage will be dischargedvia the municipal pipe network according to the standard.Emergency plan for environmental emergenciesThe Company and its subsidiaries have compiled the Emergency Plan for Sudden Environmental Events in accordance with thestandards and specifications, combined with the actual production situation of the Company, and have filed it after the revieworganized by relevant local departments, and revised it on schedule. During the reporting period, the Company carried outcomprehensive emergency plan drills and special emergency plan drills according to the annual emergency drill plan, andsummarized and evaluated the drills and improved the corresponding emergency measures.Environmental self-monitoring programDuring the reporting period, the Company and its subsidiaries have compiled the Environmental Self-monitoring Plan for 2022in accordance with relevant management requirements and norms, and passed the review and filing by local ecological andenvironmental authorities. According to the requirements of the scheme, a qualified third party agency has been entrusted to monitorthe company's waste gas, waste water and noise on a regular basis. All monitoring data have been disclosed on national and localself-monitoring platforms in accordance with the Measures for Self-monitoring and Information Disclosure of State Key MonitoringEnterprises (Trial) and supervised by the public. The monitoring data are in line with national and local standards, and there is noexcessive discharge found.The investment in environmental governance and protection and the relevant situation of paying environmental protectiontax
无锡威孚高科技集团股份有限公司2022年年度报告全文
The Company and its subsidiaries have set up complete environmental protection treatment facilities in accordance with therequirements of the EIA reply and the current environmental management requirements, and reached the discharge standard of all airpollutants and water pollutants. The Company has built compliant storage facilities to store solid wastes and entrusted qualified unitsfor disposal, running at the leading level in the industry in terms of investment in environmental protection. During the reportingperiod, the Company and its subsidiaries have paid environmental protection taxes on a quarterly basis in accordance with therequirements of laws and regulations.The investment in environmental governance and protection and the relevant situation of paying environmental protectiontaxWuxi Weifu High-Tech Group Co., Ltd. and its subsidiaries have set up complete environmental protection treatment facilitiesin accordance with the requirements of the EIA reply and the current environmental management requirements, and reached thedischarge standard of all air pollutants and water pollutants. The Company has built compliant storage facilities to store solid wastesand entrusted qualified units for disposal, running at the leading level in the industry in terms of investment in environmentalprotection.During the reporting period, Wuxi Weifu High-Tech Group Co., Ltd. and its subsidiaries have paid environmental protectiontaxes on a quarterly basis in accordance with the requirements of laws and regulations.Measures to reduce carbon emissions during the reporting period and effectsSaving resources and reducing consumption is an important part of the Company's core values. On the one hand, it is beneficial toimprove the efficiency of the Company, but also to improve the utilization rate of resources in the whole society. Therefore, theCompany continues to improve the utilization of resources through technological innovation, vigorously promote energyconservation and emission reduction, and strive to achieve green production. The Company's existing main business is focused onautomobile energy saving and emission reduction. At present, all the Company's main products have met the emission regulationsbeing implemented by the country, and the Company is actively storing products that meet the requirements of more stringentemission regulations. At the same time, in recent years, the Company has accelerated the promotion of green hydrogen energy,intelligent electric and other new energy business layout and development, contributing to the realization of carbon peak carbonneutral goal.Administrative penalties for environmental problems during the reporting periodNoneOther information about the environment that shall be disclosed.During the reporting period, the Company and its subsidiaries have regularly filled in the implementation reports (quarterlyreports and annual reports) of pollutant discharge permits in accordance with national and local laws and regulations. All airpollutants and water pollutants have been released in accordance with the standards, and hazardous wastes have been disposed of byqualified units, and the transfer slip system has been strictly implemented.Other environmental informationNot applicableII. Social responsibilityFor details, please refer to the Social Responsibility Report for Year of 2022 released by the Company on the same day on JuchaoWebsite (www.cninfo.com.cn)
无锡威孚高科技集团股份有限公司2022年年度报告全文
III. Consolidating and expanding the achievements of poverty alleviation and ruralrevitalization
During the reporting period, the Company has actively fulfilled its social responsibilities, demonstrated its commitment to thetimes, established a favorable corporate image and made positive contributions to the promotion of sustainable and high-qualityeconomic and social development.In the initiative of “Ten Thousand Enterprises Linked with Ten Thousand Villages to Jointly Take the Road of Revitalization”,the Company paired up with Maohua Village in Taihua Town, Yixing. The Company has integrated the procurement of agriculturalproducts for employee welfare and team-building activities for employees with support for the development and revitalization ofMaohua Village, and has engaged in joint building and exchange activities with Maohua Village, with three batches of agriculturalproducts from Maohua Village purchased during the year. The Party Committee of the Company signed an alliance with the PartyBranch of the Baita Village of Yixing Xizhu Town to deepen the connotation of cooperation, extend the results of cooperation andrealize mutual benefits. The Company has integrated the visit and study of the Party backbone and the team culture building of theemployees with the development and revitalization of Baita Village, and has organized two batches of the Party members andemployees to visit Baita Village for team culture building activities.
无锡威孚高科技集团股份有限公司2022年年度报告全文
Section VI. Important MattersI. Implementation of undertakings
1. Undertakings that the actual controller, shareholders, related party, buyers and the Company havefulfilled during the reporting period and have not yet fulfilled by the end of reporting period
□ Applicable ? Not applicable
No undertakings that the actual controller, shareholders, related party, buyers and the Company have fulfilled during the reportingperiod and have not yet fulfilled by the end of the period
2. For assets or projects of the Company which keeps profitable forecast during the reporting period,description reasons for reaching the original profitable forecast
□ Applicable ?Not applicable
II. Occupation of the non-operational funds of the listed company by controlling shareholdersand its related party
□ Applicable ? Not applicable
No non-operational funds of the listed company have been occupied by the controlling shareholders and its related party in period.
III. External guarantee out of the regulations
□ Applicable ? Not applicable
No external guarantee out of the regulations occurred in the period.IV. Statement on the latest “modified audit report” by BOD
□ Applicable ? Not applicable
V. Explanation from Board of Directors, Supervisory Committee and Independent Directors(if applicable) for “Qualified Opinion” that issued by CPA
□ Applicable ? Not applicable
VI. Explanation of the changes in accounting polices, accounting estimates or correction ofsignificant accounting errors compared with the financial report of the previous year? Applicable □ Not applicableInterpretation No. 15 of the Accounting Standards and Interpretation No. 16 of the Accounting Standards: On December 30,2021, the Ministry of Finance issued the Accounting Standards Interpretation No. 15 for Business Enterprises (Cai Kuai [2021] No.
35), which stipulates the accounting treatment and presentation of products or by-products generated by fixed assets before reaching
无锡威孚高科技集团股份有限公司2022年年度报告全文
their intended usable state or during the research and development process, and that the net amount of revenue related to trialoperation sales should not be offset against fixed asset costs or research and development expenses. It is clarified that the “cost offulfilling the contract” considered by enterprises when determining whether the contract constitutes a loss contract should includeboth the incremental cost of fulfilling the contract and the allocation amount of other costs directly related to fulfilling the contract.This regulation will come into effect from January 1, 2022. On November 30, 2022, the Ministry of Finance issued the AccountingStandards Interpretation No. 16 for Business Enterprises (Cai Kuai [2022] No. 31), stipulating that for financial instrumentsclassified as equity instruments by enterprises, if relevant dividend expenditures are deducted before corporate income tax inaccordance with relevant tax policies, the income tax impact related to dividends should be recognized when determining the payabledividends, and in accordance with the accounting treatment adopted in transactions or events that generate distributable profits in thepast, the impact of dividend income tax is recorded in the current period’s profit and loss or owner’s equity (including othercomprehensive income items), clarifying the terms and conditions of the enterprise's modification of cash settled share-basedpayment agreements to become equity settled share-based payments. On the modification date (whether occurring during the waitingperiod or after the end), equity settled share-based payments should be measured at the fair value on the date of modification of thegranted equity instrument, and the services obtained should be included in the capital reserve. At the same time, the recognition ofcash settled share-based payments as recognized liabilities on the modification date should be terminated, and the difference betweenthe two should be included in the current profit and loss. For specific details, please refer to “Note V-37. Changes in SignificantAccounting Policies and Accounting Estimates” in Section 10 of the Financial Report.
VII. Comparing with last year’s financial report, explain changes in the scope of consolidatedstatement?Applicable □ Not applicable
| Changes in the scope of consolidation | Name of enterprise | Acquisition manner of equity | Contribution ratio |
| Increase in consolidation scope | WFQL | Jointly funded and established by the Company with its wholly-owned subsidiaries IRD FUEL CELLS A/S, BORIT NV, as well as ROBERT BOSCH INTERNATIONALE BETEILIGUNGEN AG and Wuxi High-Tech Zone New Dynamic Industrial Development Fund (Limited Partnership) | 75.00% |
Increase inconsolidation scope
| Increase in consolidation scope | VHIT | A wholly-owned subsidiary purchased by the Company through SPV in cash in the current period | 100.00% |
| Increase in consolidation scope | VHCN | Wholly owned subsidiary purchased in cash by the Company in the current period | 100.00% |
VIII. Appointment and non-reappointment (dismissal) of CPAAccounting firm appointed
| Name of domestic accounting firm | Gongzheng Tianye Certified Public Accountants (Special General Partnership) |
| Remuneration of domestic accounting firms (in ten thousand yuan) | 193 |
| Continuous life of auditing service for domestic accounting firm | 30 |
| Name of domestic CPA | Gu Zhi, Zhang Qianqian |
| Continuous life of auditing service for domestic accounting firm | Gu Zhi (2 year), Zhang Qianqian (3 year) |
Re-appointed accounting firms in this period
□Yes ?No
Appointment of internal control auditing accounting firm, financial consultant or sponsor? Applicable □ Not applicableBeing deliberated in Annual Shareholders General Meeting of 2021, Gongzheng Tianye was appointed as audit accounting firm for
无锡威孚高科技集团股份有限公司2022年年度报告全文
internal control of the Company for year of 2022. In the Period, auditing charge for internal control amounting to 250,000 yuan.
IX. Particular about delisting after annual report disclosed
□ Applicable ? Not applicable
X. Bankruptcy reorganization
□ Applicable ?Not applicable
No bankruptcy reorganization for the Company in reporting period
XI. Major litigation and arbitration?Applicable □ Not applicable
| Basic Situation of Litigation (Arbitration) | Amount Related to the Case (in ten thousand yuan) | Whether Formed Accrued Liabilities | Progress of Litigation (Arbitration) | Trial Results and Effects of Litigation (Arbitration) | Judgment Implementation of Litigation (Arbitration) | Disclosure Date | Disclosure Index |
| On March 6, 2017, the company received the civil ruling No.(2016)Y03MC2490 and No.(2016) Y03MC2492 from Shenzhen Intermediate People's Court about the dispute case that the plaintiff applicant China Cinda Asset Management Co., Ltd. Shenzhen Branch (hereinafter referred to as “Cinda Company”) appealed the respondent WFHT and other seven respondents and the shareholders of the third party Hejun Company damaged the interests of corporate creditors, which adopted the mandatory measures to freeze the assets with value of 217 | 21,703 | No | The plaintiff, Cinda Company, applied to Shenzhen Intermediate People’s Court for withdrawal of the lawsuit on Dec. 6, 2022. On Dec. 8, the Shenzhen Intermediate People’s Court issued two civil rulings (2022) Yue Min Chu No. 4298 and 4300, allowing the plaintiff, Cinda Company, to withdraw the lawsuit. After confirmation, the 4.71 million shares and fruits of | This litigation will not affect the company’s daily operating activities for the time being | Have been enforced | Dec. 28, 2022 | (Notice No.:2022-073)published on Juchao Website(www.cninfo.com.cn) |
无锡威孚高科技集团股份有限公司2022年年度报告全文
million yuan underthe name of theCompany and otherseven respondentsand HejunCompany. Froze
4.71 million shares
of MiracleAutomation and
15.3 million shares
of SDEC(nowrenamed intoSNAT) held by theCompany.
| million yuan under the name of the Company and other seven respondents and Hejun Company. Froze 4.71 million shares of Miracle Automation and 15.3 million shares of SDEC(now renamed into SNAT) held by the Company. | Miracle Automation held by the Company, as well as the 11,739,102 shares and fruits of SDEC (now renamed into SNAT) held by the company, were unfrozen on Dec. 26, 2022 and are currently in a tradable state. | ||||||
| The Company has applied to Futian People’s Court of Shenzhen for compulsory liquidation with Hejun Company | 3,300 | No | The Company has applied to Futian People’s Court of Shenzhen for compulsory liquidation with Hejun Company. The civil ruling paper (Yue (0304) QS [2017] No. 5) made by Shenzhen Futian District People’s Court ruled that Hejun Company should be made compulsory liquidation. In process of the case, the liquidation team found that Hejun Company was | There is no impact on daily operation activities of the Company | Shenzhen Intermediate Court declared the bankruptcy of Hejun Company | Aug. 23, 2022 | (Semi-annual report 2022, full text) published on Wuchao Website(www.cninfo.com.cn) |
无锡威孚高科技集团股份有限公司2022年年度报告全文
insolventand turnedto theShenzhenIntermediate Court toapply forbankruptcy.TheCompanyhasreceived aCivilRulingLetter fromShenzhenIntermediate Court.HejunCompanydeclared tobankruptcyandterminatedthebankruptcyproceedings for HejunCompany.
insolventand turnedto theShenzhenIntermediate Court toapply forbankruptcy.TheCompanyhasreceived aCivilRulingLetter fromShenzhenIntermediate Court.HejunCompanydeclared tobankruptcyandterminatedthebankruptcyproceedings for HejunCompany.
XII. Penalty and rectification
□ Applicable ? Not applicable
No penalty and rectification for the Company during the reporting period.XIII. Integrity of the Company, its controlling shareholders and actual controllers
□ Applicable ? Not applicable
XIV. Major related party transaction
1. Related party transaction involved with daily operation
?Applicable □ Not applicable
| Related party | Relationship | Type of related transaction | Content of related party transaction | Pricing principle | Related party transaction price | Related party transaction amount (in 10 thousand yuan) | Proportion in similar transactions | Trading limit approved (in 10 thousand yuan) | Whether over the approved limited or not (Y/N) | Clearing form for related transaction | Available similar market price | Date of disclosure | Index of disclosure |
无锡威孚高科技集团股份有限公司2022年年度报告全文
WFPM
| WFPM | Associated enterprise | Procurement of goods and services | Procurement of goods and services | Fair market pricing | Market price | 5,277.57 | 0.46% | 4,000 | Y | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 |
| RBCD | Associated enterprise, controlling subsidiary of Robert Bosch | Procurement of goods and services | Procurement of goods and services | Fair market pricing | Market price | 30,107.73 | 2.63% | 45,000 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 |
| WFEC | Joint venture of WFLD | Procurement of goods | Procurement of goods | Fair market pricing | Market price | 57,537.83 | 5.03% | 70,000 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 |
| Robert Bosch Company | Second largest shareholder of the Company | Procurement of goods and services | Procurement of goods and services | Fair market pricing | Market price | 23,216.38 | 2.03% | 30,000 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 |
| Changchun Xuyang | Joint venture of WFLD | Procurement of goods | Procurement of goods | Fair market pricing | Market price | 34.25 | 0.00% | 150 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 |
| Guokai Metal | Holding subsidiary of Wuxi Industry Group | Procurement of goods and services | Procurement of goods and services | Fair market pricing | Market price | 1,451.64 | 0.13% | 0 | Y | According to the contract | Market price | ||
| WFPM | Associated enterprise | Sales of goods and services | Sales of goods and services | Fair market pricing | Market price | 98.09 | 0.01% | 1,000 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 |
| RBCD | Associated enterprise, controlling subsidiary of Robert Bosch | Sales of goods and services | Sales of goods and services | Fair market pricing | Market price | 222,034.55 | 17.44% | 350,000 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 |
| WFEC | JOINT VENTURE OF WFLD | Sales of goods and services | Sales of goods and services | Fair market pricing | Market price | 94.45 | 0.01% | 700 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 |
| Robert Bosch Company | Second largest shareholder | Sales of goods and | Sales of goods and | Fair market prici | Market price | 147,545.82 | 11.59% | 180,000 | N | According to the contra | Market price | Apr. 19, 202 | Notice No.:2022-012 |
无锡威孚高科技集团股份有限公司2022年年度报告全文
of theCompany
| of the Company | services | services | ng | ct | 2 | ||||||||
| Changchun Xuyang | Joint venture of WFLD | Sales of goods | Sales of goods | Fair market pricing | Market price | 28.6 | 0.00% | 500 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 |
| WFPM | Associated enterprise | Procurement of goods and services | Procurement of goods and services | Fair market pricing | Market price | 5 | 0 | Y | According to the contract | Market price | |||
| RBCD | Associated enterprise, controlling subsidiary of Robert Bosch | Other | Payable technical service fees | Fair market pricing | Market price | 0 | 50 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 | |
| RBCD | Associated enterprise, controlling subsidiary of Robert Bosch | Other | Payment of technical commission fee etc. | Fair market pricing | Market price | 114.73 | 150 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 | |
| RBCD | Associated enterprise, controlling subsidiary of Robert Bosch | Other | Procurement of fixed assets | Fair market pricing | Market price | 450.35 | 250 | Y | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 | |
| RBCD | Associated enterprise, controlling subsidiary of Robert Bosch | Other | Provide technicala service, etc. | Fair market pricing | Market price | 205.3 | 0 | Y | According to the contract | Market price | |||
| Robert Bosch Company | Second largest shareholder of the Company | Other | Payment of technical commission fee etc. | Fair market pricing | Market price | 231.68 | 100 | Y | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 | |
| Robert Bosch Company | Second largest shareholder of the Compa | Other | Procurement of fixed assets | Fair market pricing | Market price | 4,906.12 | 2,800 | Y | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 |
无锡威孚高科技集团股份有限公司2022年年度报告全文
ny
| ny | |||||||||||||
| WFEC | Joint venture of WFLD | Other | Technical service fees payable etc. | Fair market pricing | Market price | 10.21 | 50 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 | |
| WFEC | Joint venture of WFLD | Other | Provide technical services, etc. | Fair market pricing | Market price | 4.22 | 150 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 | |
| WFEC | Joint venture of WFLD | Other | Rental fees receivable | Fair market pricing | Market price | 238.08 | 300 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 | |
| WFEC | Joint venture of WFLD | Other | Utilities payable-water, electricity power and gas | Fair market pricing | Market price | 118.78 | 200 | N | According to the contract | Market price | Apr. 19, 2022 | Notice No.:2022-012 | |
| Urban public distribution | Enterprise controlled by the parent Company | Other | Purchase canteen ingredients, etc | Fair market pricing | Market price | 139.25 | 0 | Y | According to the contract | Market price | |||
| Total | -- | -- | 493,850.63 | 685,400 | -- | -- | -- | -- | -- | ||||
| Detail of sales return with major amount involved | Not applicable | ||||||||||||
| Report the actual implementation of the day-to-day related transactions which were projected about their total amount by types during the reporting period (if applicable) | Being deliberated and approved by AGM of 2021, total related party transaction involved with daily operation for year of 2022 was predicted as 7,045 million yuan, and actually 4,938.5063 million yuan occurred in the Period. The related transactions classified according to types are as: 1. It estimated that procurement of goods and labor service from related party in 2022 will up to 1,491.50 million yuan, while 1,176.254 million yuan occurred actually in the Period; 2. It estimated that sales of goods and labor service to related party in 2022 will up to 5,522 million yuan, while 3,698.02 million yuan actually occurred. 3. It estimated that other related transactions with related party for year of 2022 will up to 40.50 million yuan while 64.24 million yuan actually occurred. | ||||||||||||
| Reasons for major differences between trading price and market reference price (if applicable) | Not applicable | ||||||||||||
无锡威孚高科技集团股份有限公司2022年年度报告全文
Explanation: In addition to the above related transactions, because that WFTR developed the "platform trade" business with itsrelated direct customer Company A (Because it is still in the investigation stage of the public security organs, for the sake of caseconfidentiality, temporarily use “Company A” to indicate). After verification, it is found that the four companies that carry out"platform trade" business with WDTR may be controlled by Company A. Based on the association relationship between WeifuHigh-tech and Company A, these four companies constitute related parties of the company. Based on the principle of caution, thebalance of the four companies that may be controlled by Company A is combined and listed in Company A. The aforementionedbalance is the difference between the "purchase fund" paid by the “platform trade” business and the "sales fund" received.According to relevant information, the balance has been paid to the upstream suppliers (not related party) by the four companies. Inaccordance with the principle of substance over form, the "platform trade" business of WFTR is not treated as normal trade businessbut as fund receipt and payment, which is listed as “other receivables”.
2. Related party transactions of assets or acquisition and sold
□ Applicable ? Not applicable
No related party transactions of assets or equity acquisition and sold occurred during the reporting period
3. Related party transactions of mutual investment outside
□ Applicable ?Not applicable
No related party transactions of mutual investment outside occurred during the reporting period.
4. Contact of related party credit and debt
?Applicable □ Not applicable
| Related Party | Related Connection | Reason | Non-business Capital Occupied | Beginning Balance（10K yuan） | Added Balance（10K yuan） | Recoverable Amount（10K yuan）） | Rate | Current Interest （10K yuan） | Ending Balance （10K yuan） |
| Company A | Company director/senior managers’ family controlled | Platform trade | Y | 241,515.19 | 241,515.19 | ||||
| The financial and operating influence of Related Liability | Impact on the company's operating costs and financial conditions can be found in the "other receivables" platform trade "business form expected credit losses within | ||||||||
Other explaination: Based on the principle of caution, the Company combines the balance of 4 companies thatmay be controlled by Company A into the following list. The balance is the difference between the "purchasefund" paid by WFTR based on the "platform trade" business and the "sales fund" received by WFTR. Inaccordance with the principle of substance over form, the company does not treat the "platform trade" business ofWFTR as normal trade business but as fund collection and payment business for accounting treatment, so it islisted as other receivables.
无锡威孚高科技集团股份有限公司2022年年度报告全文
5. Contact with the related finance companies
□ Applicable ? Not applicable
There are no deposits, loans, credits or other financial business between the finance companies with associated relationship andrelated parties
6. Transactions between the finance company controlled by the Company and related parties
□ Applicable ? Not applicable
There are no deposits, loans, credits or other financial business between the finance companies controlled by the Company andrelated parties
7. Other material related party transactions
? Applicable □ Not applicableOn January 7, 2022, the Company held the 6
th meeting of 10
th
session of the BOD to deliberated and approved the Proposal onEstablishment of a Joint Venture Company for Hydrogen Fuel Cell Parts and Related Transactions. The joint venture completed theindustrial & commercial registration procedures on June 30, 2022, and obtained the Business License issued by Market SupervisionAdministration of Wuxi National High-tech Industrial Development Zone (Xinwu District of Wuxi).On February 7, 2022, the Company held the 7
th meeting of 10
th
session of the BOD to deliberated and approved the Proposal onAcquisition of Equity and Related Transactions. In December 2022, the company paid the consideration, completed equity deliveryof equity transactions, the industrial and commercial change and filing procedures for VHIT and VHCN respectively.On May 5, 2022, the Company held the 10
th
meeting of 10
thsession of the BOD to deliberated and approved the Proposal to IncreaseCapital in a Participating Company and Related Transaction. The participating company Xichan Weixin completed the industrial &commercial registration procedures on June 29, 2022, and obtained the new Business License.On July 29, 2022, the Company held the 11
th
meeting of the 10
th
session of the BOD and approved the Proposal on Establishing aJoint Venture and Related Party Transactions through Strategic Cooperation with Bosch Rexroth. On December 8, 2022, the jointventure company completed the industrial and commercial registration procedures and obtained the business license.Inquiries of related website with extraordinary report disclosed with material related transaction concerned
| extraordinary report | Disclosure date | Website for disclosure |
| Announcement on Establishment of a Joint Venture Company for Hydrogen Fuel Cell Parts and Related Transactions | 2022-01-11 | Juchao Website(http://www.cninfo.com.cn) |
| Announcement on Acquisition of Equity and Related Transactions | 2022-02-09 | Juchao Website(http://www.cninfo.com.cn) |
| Announcement on Increasing Capital in a Participating Company and Related Transaction. | 2022-05-07 | Juchao Website(http://www.cninfo.com.cn) |
| Announcement on Establishing a Joint Venture and Related Party Transactions through Strategic Cooperation with Bosch Rexroth | 2022-08-02 | Juchao Website(http://www.cninfo.com.cn) |
XV. Significant contract and implementations
1. Trusteeship, contract and leasing
(1) Trusteeship
□ Applicable ? Not applicable
无锡威孚高科技集团股份有限公司2022年年度报告全文
No trusteeship occurred during the reporting period
(2) Contracting
□ Applicable ? Not applicable
No contract occurred during the reporting period
(3) Leasing
□ Applicable ? Not applicable
No leasing occurred during the reporting period
2. Material guarantees
? Applicable □ Not applicable
In ten thousand yuan
| The Company’ guarantee towards subsidiaries | ||||||||||
| Name of guaranteed object | Disclosure date of announcement related to the guaranteed amount | Guaranteed amount | Actual occurring date | Actual guaranteed amount | Guarantee type | Collateral | Counter Guarantee | Guarantee period | Fulfilled or not | Guaranteed by related parties or not |
| VHIT Automotive Systems (Wuxi) Co. Ltd. | December 9, 2022 | 1,000 | December 12, 2022 | 1,000 | Joint liability guarantee | None | None | From the date of execution of the main contract up to and including two years from the date of expiry of the performance period of the obligations under the main contract or December 30, 2026 (whichever is the earlier) | No | No |
| Approved total guaranteed amount towards the subsidiaries within the reporting period | 1,000 | Total actual amount occurred towards subsidiaries within the reporting period | 1,000 | |||||||
| Approved total guaranteed amount towards the subsidiaries at the year end | 1,000 | Total actual guarantee balance towards subsidiaries at the year end | 1,000 | |||||||
| Total amount of the company’s guarantee | ||||||||||
| Approved total amount guaranteed | 1,000 | Total actual guaranteed amount | 1,000 | |||||||
无锡威孚高科技集团股份有限公司2022年年度报告全文
within the reportingperiod
| within the reporting period | occurred within the reporting period | ||
| Approved total amount guaranteed at the year end | 1,000 | Actual total guarantee balance at the year end | 1,000 |
| Proportion of actual total guaranteed amount to net assets | 0.06% | ||
| Wherein: | |||
| Total guaranteed amount towards shareholders, actual controllers and related parties | 0 | ||
| Guaranteed amount provided for guaranteed objects with a liability rate of assets of over 70% directly or indirectly | 0 | ||
| Excess of total guaranteed amount over 50% of net assets | 0 | ||
| The aforementioned total amount guaranteed of three items | 0 | ||
Specific description for using the guarantee by complex method: None
3. Trusted cash asset management
(1) Trust financing
? Applicable □ Not applicableTrust financing during the period
In ten thousand yuan
| Type | Capital sources | Amount occurred | Outstanding balance | Overdue amount | Amount with impairment accrued for the overdue financial products which has not been recovered |
| Financing products | Own funds | 70,908 | 9,850 | 0 | 0 |
| Financial products of securities firms | Own funds | 110,012 | 67,500 | 0 | 0 |
| Trust financial products | Own funds | 323,412 | 129,550 | 0 | 0 |
| Other type | Own funds | 148,713 | 114,649 | 0 | 0 |
| Total | 653,045 | 321,549 | 0 | 0 | |
Details of the single major amount, or high-risk trust investment with low security, poor fluidity? Applicable □ Not applicable
In ten thousand yuan
| Trustee institution r name | Trustee type | Type | Amount | Source of funds | Start date | End date | Capital investment purpose | Criteria for fixing reward | Reference annual rate of return | Anticipated income (if applicable) | Actual gains/losses in period | Actual collected gains/losses in period | Amount of reserve for devaluation of withdrawing (if applic | Whether approved by legal procedure (Y/N) | Whether has entrust finance plan in the futu | Summary of the items and related query index (if applicable) |
无锡威孚高科技集团股份有限公司2022年年度报告全文
able)
| able) | re | |||||||||||||||
| Bank | Bank | Non-guaranteed floating income | 474,600 | Own fund | 2022-01-05 | 2022-12-29 | Bank financial products | Reference annual rate of return by the contract | 2.05%-2.05% | 1,518.28 | 1,440.99 | Collected according to the contract | 0 | Y | Y | Apr. 19, 2022(Announcement No.:2022-013) |
| Securities | Securities | Non-guaranteed floating income | 105,000 | Own fund | 2022-01-07 | 2024-11-22 | Asset management Plan | Reference annual rate of return by the contract | 4.70%-20.3% | 24,527.28 | 2,976.07 | 0 | Y | Y | ||
| Trust | Trust | Non-guaranteed floating income | 78,500 | Own fund | 2022-01-27 | 2024-03-18 | Collection trust plan | Reference annual rate of return by the contract | 3.40%-7.10% | 3,487.25 | 14,943.69 | 0 | Y | Y | ||
| Other | Other professional financial institutions | Non-guaranteed floating income | 20,400 | Own fund | 2022-02-24 | 2023-07-26 | Private Equity Products | Reference annual rate of return by the contract | 8.00%-10% | 1,624.37 | 1,846.35 | 0 | Y | Y | ||
| Total | 678,500 | -- | -- | -- | -- | -- | -- | 31,157.18 | 21,207.1 | -- | 0 | -- | -- | -- | ||
It is expected that the principal of entrusted financial management fails to recover or there are other situations leading to impairmentin entrusted financial management
□ Applicable ? Not applicable
(2) Entrusted loans
□ Applicable ? Not applicable
The company had no entrusted loans in the reporting period.
4. Other significant contract
□ Applicable ? Not applicable
The company had no other significant contract in the reporting period.
无锡威孚高科技集团股份有限公司2022年年度报告全文
XVI. Explanation on other material matters?Applicable □ Not applicable
1. Share buyback during the reporting period
On April 15, 2022, the Company convened the 8
th meeting of the 10
thsession of the BOD and deliberated and approved the Proposalon the Repurchase Program of Part of the Company's A Shares. The Company will repurchase part of its A shares by means ofcentralized competitive trading, with the total repurchase fund not less than RMB 362,500,000 (inclusive) and not more than RMB725,000,000 (inclusive), and the price of the repurchased shares (A shares) shall not exceed RMB 29 per share (inclusive) [As theannual equity distribution for 2021 has been implemented and completed, the price of repurchased shares (A shares) will be adjustedfrom up to RMB 29 per share (inclusive) to up to RMB 27.41 per share from the ex-dividend date of the equity distribution (June 10,2022) in accordance with related regulations]. As of December 31, 2022, the Company has bought back a total of 21,085,000 sharesby means of centralized competitive bidding through the special securities account for repurchase, of which the highest transactionprice was RMB 20.85 per share and the lowest transaction price was RMB 17.17 per share, and the total amount paid was RMB397,804,542.63 (including transaction fees).
2. Release of restricted stocks during the reporting period
On December 7, 2022, the Company held the 14
th
meeting of 10
thsession of the BOD, and deliberated and passed the Proposal onthe Achievement of the Conditions for the Release of Restricted Shares in the First Restricted Period of the 2020 Restricted StockIncentive Plan, which agreed to apply for the release of 7,632,000 restricted stocks granted to 581 incentive recipients. On December16, 2022, the shares released from this restricted sale were formally available for circulation.XVII. Material matters of subsidiary of the Company
□ Applicable ? Not applicable
无锡威孚高科技集团股份有限公司2022年年度报告全文
Section VII. Changes in Shares and Particulars about ShareholdersI. Changes in Share Capital
1. Changes in Share Capital
In Share
| Before the change | Change during the year(+/-)) | After the change | |||||||
| Amount | Proportion | New shares issued | Bonus shares | Public reserve transfer into share capital | Other | Subtotal | Amount | Proportion | |
| I. Restricted shares | 19,289,336 | 1.91% | -7,267,500 | -7,267,500 | 12,021,836 | 1.19% | |||
| 1. State-owned shares | |||||||||
| 2. State-owned legal person’s shares | |||||||||
| 3. Other domestic shares | 19,289,336 | 1.91% | -7,267,500 | -7,267,500 | 12,021,836 | 1.19% | |||
| Including: Domestic legal person’s shares | |||||||||
| Domestic natural person’s shares | 19,289,336 | 1.91% | -7,267,500 | -7,267,500 | 12,021,836 | 1.19% | |||
| 4. Foreign shares | |||||||||
| Including: Foreign legal person’s shares | |||||||||
| Foreign natural person’s shares | |||||||||
| II. Unrestricted shares | 989,370,234 | 98.09% | 7,211,223 | 7,211,223 | 996,581,457 | 98.81% | |||
| 1. RMB ordinary shares | 816,990,234 | 81.00% | 7,211,223 | 7,211,223 | 824,201,457 | 81.72% | |||
| 2. Domestically listed foreign shares | 172,380,000 | 17.09% | 172,380,000 | 17.09% | |||||
| 3. Overseas listed foreign shares | |||||||||
| 4. Others | |||||||||
| III. Total shares | 1,008,659,570 | 100.00% | -56,277 | -56,277 | 1,008,603,293 | 100.00% | |||
Reasons for share changed?Applicable □Not applicable
1. Within the reporting period, a total of 7,632,000 restricted shares granted to 581 incentive recipients of the Company werereleased from restricted sales and were officially listed for circulation on December 16, 2022. As 364,500 shares of lock-up sharesfor executives were involved, the actual number of shares released from restricted sales was 7,267,500 shares, thereby resulting in achange in the number of shares subject to restricted sales.
无锡威孚高科技集团股份有限公司2022年年度报告全文
2. Within the reporting period, the Company has completed the cancellation of 56,277 shares of the special securities accountfor repurchase, resulting in the change of total share capital.Approval status of share changes?Applicable □Not applicable
1. On April 15 and May 18, 2022, the Company held the 8
th
meeting of the 10
thsession of the BOD and the 2021 AnnualGeneral Meeting respectively, deliberated and approved the Proposal on Adjusting the Use and Cancellation of RemainingRepurchased Shares. It was approved to adjust the use of 56,277 remaining shares in the repurchase special securities account from“for equity incentives” to “for cancellation to reduce registered capital”.
2. On December 7, 2022, the Company held the 14
th meeting of 10
thsession of the BOD, and deliberated and passed theProposal on the Achievement of the Conditions for the Release of Restricted Shares in the First Restricted Period of the 2020Restricted Stock Incentive Plan, which agreed to apply for the release of 7,632,000 restricted stocks granted to 581 incentiverecipients.Ownership transfer of share changed
□Applicable ?Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to commonshareholders of Company in latest year and period
□ Applicable ? Not applicable
Other information necessary to disclose or need to disclosed under requirement from security regulators
□ Applicable ? Not applicable
2.Changes of lock-up stocks
?Applicable □Not applicable
In Share
| Shareholders | Opening shares restricted | Restricted shares increased in the Period | Shares released in Period | Ending shares restricted | Restricted reasons | Date for released |
| Wang Xiaodong | 415,586 | 60,000 | 160,000 | 315,586 | Lock-up shares held by senior executives and Restricted Stock Incentive Plan for year of 2020 | Dec. 16, 2022 |
| Xu Yunfeng | 359,750 | 52,500 | 140,000 | 272,250 | Lock-up shares held by senior executives and Restricted Stock Incentive Plan for year of 2020 | Dec. 16, 2022 |
| Ou Jianbin | 287,500 | 42,000 | 112,000 | 217,500 | Lock-up shares held by senior executives and Restricted Stock Incentive Plan for year of 2020 | Dec. 16, 2022 |
| Miao Yuming | 287,500 | 42,000 | 112,000 | 217,500 | Lock-up shares held by senior executives and Restricted Stock Incentive Plan for year of 2020 | Dec. 16, 2022 |
| Rong bin | 280,000 | 42,000 | 112,000 | 210,000 | Lock-up shares held by senior executives and Restricted Stock Incentive | Dec. 16, 2022 |
无锡威孚高科技集团股份有限公司2022年年度报告全文
Plan for year of 2020
| Plan for year of 2020 | ||||||
| Liu Jinjun | 280,000 | 42,000 | 112,000 | 210,000 | Lock-up shares held by senior executives and Restricted Stock Incentive Plan for year of 2020 | Dec. 16, 2022 |
| Li Gang | 280,000 | 42,000 | 112,000 | 210,000 | Lock-up shares held by senior executives and Restricted Stock Incentive Plan for year of 2020 | Dec. 16, 2022 |
| Xu Sheng | 280,000 | 42,000 | 112,000 | 210,000 | Lock-up shares held by senior executives and Restricted Stock Incentive Plan for year of 2020 | Dec. 16, 2022 |
| Middle management | 16,819,000 | 6,660,000 | 10,159,000 | Restricted Stock Incentive Plan for year of 2020 | Dec. 16, 2022 | |
| Total | 19,289,336 | 364,500 | 7,632,000 | 12,021,836 | -- | -- |
II. Securities issuance and listing
1. Security offering (without preferred stock) in Reporting Period
□ Applicable ? Not applicable
2. Changes of total shares and shareholders structure as well as explanation on changes of assets andliability structure? Applicable □ Not applicableDuring the reporting period, the restricted shares for year of 2020 which has granted without circulation have repurchased andcanceled partially by the Company, that is 56,277 shares, total share capital of the Company comes to 1,008,659,570 shares from1,008,603,293 shares.
3. Current internal staff shares
□ Applicable ? Not applicable
III. Particulars about shareholders and actual controller of the Company
1. Amount of shareholders of the Company and particulars about shares holding
In Share
| Total common stock shareholders in reporting period-end | 66.140 | Total common stock shareholders at end of last month before annual report disclosed | 69,132 | Total preference shareholders with voting rights recovered at end of reporting period (if applicable) | 0 | Total preference shareholders with voting rights recovered at end of last month before annual report disclosed (if applicable) | 0 | |
| Particulars about shares held above 5% by shareholders or top ten shareholders | ||||||||
| Full name of Shareholders | Nature of sharehol | Proportion of shares held | Total shareholders at the end of | Changes in report period | Number of lock- | Amount of un-lock up stock held | Information of shares pledged, tagged or frozen | |
无锡威孚高科技集团股份有限公司2022年年度报告全文
der
| der | report period | up stocks held | State of share | Amount | ||||||
| Wuxi Industry Development Group Co., Ltd. | State-owned corporate | 20.23% | 204,059,398 | 0 | 0 | 204,059,398 | ||||
| ROBERT BOSCH GMBH | Foreign corporate | 14.16% | 142,841,400 | 0 | 0 | 142,841,400 | ||||
| Hong Kong Securities Clearing Company | Foreign corporate | 1.95% | 19,663,238 | -5,046,183 | 0 | 19,663,238 | ||||
| BBH BOS S/A FIDELITY FD - CHINA FOCUS FD | Foreign corporate | 1.39% | 14,006,315 | -1,438,400 | 0 | 14,006,315 | ||||
| NSSF-413 | Other | 1.00% | 10,110,000 | 4,770,000 | 0 | 10,110,000 | ||||
| FIDELITY INVMT TRT FIDELITY INTL SMALL CAP FUND | Foreign corporate | 0.68% | 6,863,386 | -180,000 | 0 | 6,863,386 | ||||
| Shanghai Chongyang Strategic Investment Co., Ltd. - Chongyang Strategic Yingzhi Fund | Other | 0.55% | 5,500,106 | 5,500,106 | 0 | 5,500,106 | ||||
| Xie Zuogang | Domestic natural person | 0.51% | 5,132,967 | 1,320,881 | 0 | 5,132,967 | ||||
| Fei Guohua | Domestic natural person | 0.50% | 5,020,725 | 5,020,725 | 0 | 5,020,725 | ||||
| Basic Pension Insurance Fund- 1003 | Other | 0.45% | 4,524,356 | -3,191,300 | 0 | 4,524,356 | ||||
| Strategy investor or general legal person becoming the top 10 shareholders by placing new shares (if applicable) | N/A | |||||||||
| Explanation on associated relationship among the aforesaid shareholders | Among the aforesaid shareholders, there has no associated relationship between Wuxi Industry Development Croup Co., Ltd., the first largest shareholder of the Company, and other shareholders; and they do not belong to the persons acting in concert regulated by the Management Measure of Information Disclosure on Change of Shareholding for Listed Company. | |||||||||
| Description of the above shareholders in relation to delegate/entrusted voting rights and abstention from voting rights. | N/A | |||||||||
| Special note on the repurchase account among the top 10 shareholders (if applicable) | As of Dec. 31, 2022, the repurchase special securities account of Weifu High-Technology Group Co., Ltd has 21,085,00 shares of ordinary A-Share, hereby stated that in according withe relevant requirement, they are not included in the top 10 shareholders of the Company. | |||||||||
| Particular about top ten shareholders with un-lock up stocks held | ||||||||||
| Shareholders’ name | Amount of un-lock up stocks held at Period-end | Shares held | ||||||||
| Type | Amount | |||||||||
无锡威孚高科技集团股份有限公司2022年年度报告全文
Wuxi Industry Development Group Co., Ltd.
| Wuxi Industry Development Group Co., Ltd. | 204,059,398 | RMB common shares | 204,059,398 |
| ROBERT BOSCH GMBH | 142,841,400 | RMB common shares | 115,260,600 |
| Domestically listed foreign shares | 27,580,800 | ||
| Hong Kong Securities Clearing Company | 19,663,238 | RMB common shares | 19,663,238 |
| BBH BOS S/A FIDELITY FD - CHINA FOCUS FD | 14,006,315 | Domestically listed foreign shares | 14,006,315 |
| NSSF-413 | 10,110,000 | RMB common shares | 10,110,000 |
| FIDELITY INVMT TRT FIDELITY INTL SMALL CAP FUND | 6,863,386 | Domestically listed foreign shares | 6,863,386 |
| Shanghai Chongyang Strategic Investment Co., Ltd. - Chongyang Strategic Yingzhi Fund | 5,500,106 | RMB common shares | 5,500,106 |
| Xie Zuogang | 5,132,967 | Domestically listed foreign shares | 5,132,967 |
| Fei Guohua | 5,020,725 | RMB common shares | 5,020,725 |
| Basic Pension Insurance Fund- 1003 | 4,524,356 | RMB common shares | 4,524,356 |
| Expiation on associated relationship or consistent actors within the top 10 un-lock up shareholders and between top 10 un-lock up shareholders and top 10 shareholders | Among the aforesaid shareholders, there has no associated relationship between Wuxi Industry Development Croup Co., Ltd. , the first lagest shareholder of the Company, and other shareholders; and they do not belong to the persons acting in concert regulated by the Management Measure of Information Disclosure on Change of Shareholding for Listed Company. | ||
| Explanation on top 10 shareholders involving margin business (if applicable) | Among the top 10 shareholders, Shanghai Chongyang Strategic Investment Co., Ltd. - Chongyang Strategic Yingzhi Fund holds 5,500,106 shares through investor credit securities accounts; Shareholder Fei Guohua holds 5,020,725 shares through investor's credit securities account. | ||
Whether top ten common stock shareholders or top ten common stock shareholders with un-lock up shares held have a buy-backagreement dealing in reporting period
□ Yes ? No
The top ten common stock shareholders or top ten common stock shareholders with un-lock up shares held of the Company have nobuy-back agreement dealing in reporting period.
2. Controlling shareholder of the Company
Nature of controlling shareholders: local state-owned holdingType of controlling shareholders: legal person
| Controlling shareholders | Legal person/person in charge of the unit | Date of foundation | Organization code | Main operation business |
无锡威孚高科技集团股份有限公司2022年年度报告全文
Changes of controlling shareholders in reporting period
□ Applicable ? Not applicable
The Company had no changes of controlling shareholders in reporting period
3. Actual controller and person acting in concert of the Company
Nature of actual controller: local state-owned assets managementType of actual controller: legal person
| Name of actual controlling shareholders | Legal person/person in charge of the unit | Date of foundation | Organization code | Main operation business |
| The State-owned Assets Supervision & Administration Commission of Wuxi Municipality of Jiangsu Province | Zhang Jianchun | ~ | State-owned Assets management | |
| Equity of domestic/oversea listed company control by actual controller in report period | Not applicable | |||
Changes of actual controller in reporting period
□ Applicable ? Not applicable
No changes of actual controllers for the Company in reporting period.Property right and controlling relationship between the actual controller and the Company is as follow
| Wuxi Industry Development Group Co., Ltd. | Yao Zhiyong | 1995-10-05 | 913202001360026543 | External investment with own funds; housing rental services; self-operation and acting as an agent for the import & export of various commodities and technologies (except for commodities and technologies that restricted or prohibited for import & export by the State), domestic trading (restricted and prohibited projects by the State excluded) |
| Equity of other domestic/oversea listed company control by controlling shareholder as well as stock-joint in report period | 1. The majority shareholder of the Company, Wuxi Industry Group, is the controlling shareholder of Wuxi Taiji Industry Corporation Limited (stock code: 600667). 2. The majority shareholder of the Company, Wuxi Industry Group, holds 23,185,000 circulating shares (15.65% of total shares of New Hongtai) of Wuxi New Hongtai Electrical Technology Co., Ltd. (Short name: New Hongtai, Stock Code: 603016). | |||
无锡威孚高科技集团股份有限公司2022年年度报告全文
Actual controller controlling the Company by entrust or other assets management
□ Applicable ? Not applicable
4.The total number of shares pledged by controlling shareholders or the first majority shareholder and itspersons acting in concert accounts for 80% of the shares held by them
□ Applicable ? Not applicable
5. Particulars about other legal person shareholders with over 10% shares held? Applicable □ Not applicable
| Corporate shareholders | Legal person./person in charge of unit | Establishment date | Registered capital | Main business or management activity |
| ROBERT BOSCH GMBH | Bettina Holzwarth, Nora Kristin Klug | 1886-11-15 | 1,200 million euros | Development, manufacture and distribution of products, technologies, systems, solutions and service performance, especially in mobile, electrical engineering, electronics, mechanical engineering, mechanics, metals and other materials, medicine, logistics, communications and information technology, including solutions based on data, and related fields. The Company’s goal is to further perform regionally based and business-related services. The Company may directly or indirectly enter into various business transactions to achieve this goal. In order to achieve the goal, the Company can establish, acquire and participate in business activities in any form permitted by law, or carry out business activities through them and |
Wuxi State-owned Assets Supervision &
Wuxi State-owned Assets Supervision &
Administration Commission of State
CouncilWuxi Guofa Capital Operation
Co., Ltd.
Wuxi Guofa Capital Operation
Co., Ltd.
Department of Finance of
Jiangsu provinceWuxi Industry Development Group Co., Ltd.
Wuxi Industry Development Group Co., Ltd.
27.3081%
27.3081%
68.1518%
| 68.1518% | 4.5401% |
100%
100%
20.23%
20.23%
Weifu High-Technology Group Co., Ltd.
无锡威孚高科技集团股份有限公司2022年年度报告全文
organize under unified management. The Company mayrestrict some of the activities described in paragraph 1above or hold and manage their participating interests.
organize under unified management. The Company mayrestrict some of the activities described in paragraph 1above or hold and manage their participating interests.
6. Restriction on shares reduction for controlling shareholders, actual controllers, restructuring side andother undertakings entities
□ Applicable ? Not applicable
IV. The specific implementation of shares buy-back during the reporting period
Implementation progress of shares buy-back
□ Applicable ? Not applicable
| Disclosure time of the plan | Number of shares buy-back (shares) | Proportion to total share capital | Proposed buy-back amount (ten thousand yuan) | Proposed buy-back period | Share buy-back purpose | Repurchased quantity (shares) | The proportion of repurchased shares to the underlying stocks involved in the equity incentive plan (if any) |
| Apr. 19, 2022 | Not higher than 25,000,000 and not lower than 12,500,000 shares | Not higher than 2.48% and lower than 1.24% | Not exceeding RMB 725 million (inclusive) and not less than RMB 362.5 million (inclusive) | From 2022-04-15 to 2023-04-14 | Intended for implementing employee stock ownership plans or equity incentive plans | 21,085,000 |
Implementation progress of the reduction of repurchases shares by centralized bidding
□ Applicable ? Not applicable
Section VIII. Preferred Stock
□ Applicable ? Not applicable
The Company had no preferred stock in the Period.
Section IX. Corporate Bonds
□ Applicable ? Not applicable
Section X. Financial Report
I. Audit report
| Type of audit opinion | Unqualified opinion with highlighted paragraphs |
| Signing date of audit report | April 26, 2023 |
| Name of audit institute | Gongzheng Tianye Certified Public Accountants (Special General Partnership) |
| Serial of Auditing Report | Su Gong W【2023】No. A853 |
| Name of CPA | Gu Zhi, Zhang Qianqian |
Auditor’s Report
Su Gong W【2022】No. A853
To the Shareholders of Weifu High-Technology Group Co., Ltd.:
I. Auditing opinionsWe have audited the financial statement under the name of Weifu High-Technology Group Co., Ltd. (hereinafterreferred to as WFHT), including the consolidated and parent Company’s balance sheet of 31 December 2022 andprofit statement, and cash flow statement, and statement on changes of shareholders’ equity for the year ended,and notes to the financial statements for the year ended.
In our opinion, the Company’s financial statements have been prepared in accordance with the EnterprisesAccounting Standards and Enterprises Accounting System, and they fairly present the financial status of theCompany and of its parent company as of 31 December 2022 and its operation results and cash flows for the yearended.
II. Basis of opinion
We conducted our audit in accordance with the Auditing Standards for Certified Public Accountants of China. Ourresponsibilities under those standards are further described in the “Auditor’s Responsibilities for the Audit of theFinancial Statements” section of the auditor’s report. We are independent of the Company in accordance with theCertified Public Accountants of China’s Code of Ethics for Professional Accountants, and we have fulfilled ourother ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our opinion
III. Highlighted paragraphsWe remind users of financial statements to pay attention: As described in Note XVI-7 "Other importanttransactions and matters affecting investors' decisions", the security organs have launched a criminal investigationon the case that WFTR was defrauded by contracts in its "platform trade" business. At present, the case is in the
investigation stage, and the outcome of the case is uncertain in the future.This paragraph does not affect the published audit opinion.IV. Key audit mattersKey audit matters are those matters that, in our professional judgment, were of most significance in our audit ofthe financial statements of the current period. These matters were addressed in the context of our audit of thefinancial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion onthese matters.The key audit issues identified in our audit are as follows:
(I) Accounting treatment of "platform trading" business and the related provision for expected creditlosses
1. Matter description
As described in Note XVI-7 "Other important transactions and matters affecting investors' decisions", the securityorgans have launched a criminal investigation on the case that WFTR was defrauded by contracts in its "platformtrade" business. Based on the "platform trade" business’s background, transaction chain, sales and purchasecontract signing, transaction process, physical flow and so on, the Company carefully analyzed and madecomprehensive judgment, finds that the probability of this business not belonging to normal trade business isextremely high. In terms of accounting treatment, the Company follows the principle of substance over form anddoes not treat it as normal trade business, but according to the receipt and payment of funds，prudently recognizeas claims and liabilities, respectively, purchases actually paid to "Suppliers" and sales collected from "Customers".In the financial statements, the "platform trade" business is net reported to other receivables in the form of the"platform trade" business portfolio, the amount is 2,741.4991 million yuan, for which an expected credit loss of1,644. 0683 million yuan has been charged. The "platform trade" business involved significant amounts of moneyand was at the stage of criminal investigation, the judgment of the nature of the business, accounting treatmentand the provision of expected credit losses are related to management's use of significant accounting estimates andjudgments and have a significant impact on the financial statements. Therefore, we identified the accountingtreatment of the "platform trading" business and the provision of expected credit losses of portfolio claims of"platform trading" business as key audit matters.
2. The solution to the matter in auditing
(1) Interview the management and relevant business personnel of WFTR to understand the business background,operation mode, contract signing method, pricing method, transaction and settlement process of its "platformtrade" business;
(2) Evaluate and test the internal controls of the "platform trade" business, evaluate the design of these controls,determine whether they are implemented, and test the operational effectiveness of the relevant internal controls;
(3) Obtain the standing book of purchase and sales contract, inspect the purchase and sales contract, and verify thekey terms of the subject matter, counterparty, contract price, delivery mode and so on involved in the purchaseand sales contract, combine the contract signing time, pricing method, and interview records to further judgewhether the relevant transaction has commercial substance;
(4) Obtain the industrial and commercial information of "customers" and "suppliers" involved in the transaction
process, check the business scope, registered address, equity structure, registered capital, personnel size, telephonenumber and other information of the counterparty to judge whether the business scope of the counterparty and itsown scale match the transaction scale, check whether there is correlation or suspected correlation between theupstream "supplier" and the downstream "customer", and evaluate the business logic and rationality of theexistence of the upstream "supplier" and the downstream "customer" in the transaction chain at the same time;
(5) Obtain detailed accounts and accounting documents involved in the "platform trade" business, check theoriginal documents related to accounting processing, including but not limited to purchase and sales contracts(orders, framework agreements), invoices, logistics documents, payment and payment bank documents, and askrelevant personnel about logistics documents, check their sources and ways of obtaining. Further judge whetherthere is real physical circulation in the transaction process;
(6) Send letters to the "customer" and "supplier", confirm the "transaction amount" and "settlement balance" to the"customer" and "supplier", check the return letter, check the address of the return letter, the seal, the amount of thereturn letter and other information, and take further verification procedures for the return letter with doubts;
(7) Visit the main "customers" and "suppliers", interview the transaction background, transaction content, contractsigning, transaction mode, cargo logistics operation, capital settlement flow, whether there is a correlationbetween WFTR and the "customers" and "suppliers", verify the information formed in the transaction processwith the "customers" and "suppliers". Verify the authenticity of the reply of "customer" and "supplier", andobserve the business premises of "customer" and "supplier" to further judge whether the relevant transaction hascommercial substance and commercial logic;
(8) Evaluate the reasonableness of that the management considers that the business has a high probability of nothaving commercial substance and business logic and does not conduct accounting treatment and presentation asnormal trade business according to the principle of substance over form based on the information obtained in theaudit process;
(9) In combination with related transaction audit procedures, check whether there are related relationships, relatedtransactions and funds occupied by related parties in the "platform trade" business;
(10) Obtain and check the supporting credentials for the actual collection of the "platform trade" business debtportfolio after the balance sheet date, visit the competent departments according to the sources from which themanagement makes estimates, and verify the authenticity and reliability of the sources;
(11) Check the information related to the "platform trade" business has been properly reported and disclosed in thefinancial statements.(II) Revenue recognition
1. Matter description
As described in Note V-32 “Revenue” and Note VII-44 “Operation revenue and operation cost” carried in thefinancial statement, WFHT achieved an operation revenue of 12.730 billion yuan for year of 2022. As one of thebiggest source of profits for WFHT, operating revenue has a significant effect on the general financial statement,in which there are certain of inherent risks existed for the reason that the management manipulate the timing ofrecognition so as to achieve specific objectives or anticipations. Therefore, we will take the Revenue recognitionas the key auditing matter.
2. The solution to the matter in auditing
(1) Understand the key internal controls related to revenue recognition, evaluate the design of these controls,determine whether they are implemented, and test the operational effectiveness of the relevant internal controls;
(2) Review sales contracts to understand main contract terms or conditions and evaluate the appropriateness ofrevenue recognition methods;
(3) Combining with status and data of the industry where WFHT is located, the Company should make ajudgment on the rationality of fluctuation of the revenue composition;
(4) The Company should carry out the procedure of account receivable and revenue letter of confirmation, andmake a judgment on the rationality of the timing of revenue recognition;
(5) Combining with the procedure of letter of confirmation, the Company should make a random inspection onsales contracts or orders, delivery lists, logistics bills, customs declaration, sales invoices, signing-off sheet andother documents related to revenue to verify the authenticity of revenue;
(6) Referring to the recorded revenue before and after the Balance Sheet Date, the Company should select somesamples and check out the supportive documents such as delivery lists, customs declaration and receipt forms tomake a judgment on whether the income has been recorded at the appropriate accounting period.V. Other informationThe management of WFHT is responsible for other information which includes the information covered in theCompany’s 2021 annual report excluding the financial statement and our audit report.Our audit opinions on the financial statements do not cover other information, and we do not issue any form ofauthentication conclusions on other information.In combination with our audit of the financial statements, it is our responsibility to read other information and, inthe process, consider whether there is material inconsistency or material misstatement between the otherinformation and the financial statements or what we learned during the audit.Based on the work we have carried out, if we determine that there is a material misstatement of other information,we should report that fact and i this regard we have noting to report.
VI. Responsibilities of management and those charged with governance for the financial statementsThe management is responsible for the preparation of the financial statements in accordance with the AccountingStandards for Enterprise to secure a fair presentation, and for the design, establishment and maintenance of theinternal control necessary to enable the preparation of financial statements that are free from materialmisstatement, whether due to fraud or error.In preparing the financial statements, the management is responsible for assessing the Company’s ability tocontinue as a going concern, disclosing matters related to going concern (if applicable) and using the goingconcern assumption unless the management either intends to liquidate the Company or to cease operations, or hasno realistic alternative but to do so.Those charged with governance are responsible for overseeing the Company’s financial reporting process.
VII. Responsibilities of the auditor for the financial statementsOur objectives are to obtain reasonable assurance about whether the financial statements as a whole are free frommaterial misstatement, whether due to fraud or error, and to issue an audit report that includes our audit opinion.Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordancewith the CAS will always detect a material misstatement when it exists. Misstatements can arise from fraud orerror and are considered material if, individually or in the aggregate, they could reasonably be expected toinfluence the economic decisions of users taken on the basis of the financial statements.As part of an audit in accordance with the CAS, we exercise professional judgment and maintain professionalskepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error,design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient andappropriate to provide a basis for audit opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates andrelated disclosures made by the management.
(4) Conclude on the appropriateness of the management’s use of the going concern assumption and, based on theaudit evidence obtained, whether a material uncertainty exists related to events or conditions that may castsignificant doubt on the Company’s ability to continue as a going concern. If we conclude that a materialuncertainty exists, we are required by the CAS to draw users’ attention in audit report to the related disclosures inthe financial statements or, if such disclosures are inadequate, to modify audit opinion. Our conclusions are basedon the information obtained up to the date of audit report. However, future events or conditions may cause theCompany to cease to continue as a going concern.
(5) Evaluate the overall presentation, structure and content of the financial statements, and whether the financialstatements represent the underlying transactions and events in a manner that achieves fair presentation.
(6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or businessactivities within the Company to express audit opinion on the financial statements. We are responsible for thedirection, supervision and performance of the group audit. We remain solely responsible for audit opinion.We communicate with those charged with governance regarding, among other matters, the planned scope andtiming of the audit and significant audit findings, including any significant deficiencies in internal control that weidentify during our audit.We also provide the governance with a statement of our compliance with the ethical requirements relating to ourindependence and communicate with the governance on all relationships and other matters that may reasonably beconsidered to affect our independence, as well we the relevant precautions (if applicable).From the matters communicated with those charged with governance, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the key auditmatters. We describe these matters in the auditor’s report unless law or regulation precludes public disclosureabout the matter or when, in extremely rare circumstances, we determine that a matter should not becommunicated in the auditor’s report because of the adverse consequences of doing so would reasonably beexpected to outweigh the public interest benefits of such communication.Jiangsu Gongzheng Tianye CPA Chinese CPA: Gu Zhi(Special General Partnership) (Engagement partner)Wuxi China Chinese CPA: Zhang Qianqian
26 April, 2023
II. Financial Statement
Statement in Financial Notes are carried In RMB
1. Consolidated Balance Sheet
Prepared by Weifu High-Technology Group Co., Ltd.
In RMB
| Item | Dec. 31, 2022 | Dec. 31, 2021 |
| Current assets: | ||
| Monetary funds | 2,389,551,930.76 | 1,896,063,265.69 |
| Settlement provisions | ||
| Capital lent | ||
| Trading financial assets | 2,718,820,654.87 | 6,076,436,069.42 |
| Derivative financial assets | ||
| Note receivable | 135,559,024.27 | 1,116,550,186.21 |
| Account receivable | 3,127,490,177.25 | 2,053,800,293.77 |
| Receivable financing | 1,918,368,845.21 | 713,017,014.50 |
| Accounts paid in advance | 94,323,853.87 | 178,059,249.99 |
| Insurance receivable | ||
| Reinsurance receivables | ||
| Contract reserve of reinsurance receivable | ||
| Other account receivable | 1,264,507,456.47 | 17,908,078.54 |
| Including: Interest receivable | ||
| Dividend receivable | 147,000,000.00 | |
| Buying back the sale of financial assets | ||
| Inventories | 2,283,119,656.27 | 3,445,396,375.09 |
| Contract assets | ||
| Assets held for sale | ||
| Non-current asset due within one year | ||
| Other current assets | 430,547,201.24 | 220,320,922.50 |
| Total current assets | 14,362,288,800.21 | 15,717,551,455.71 |
| Non-current assets: | ||
| Loans and payments on behalf | ||
| Debt investment | ||
| Other debt investment | ||
| Long-term account receivable | ||
| Long-term equity investment | 6,282,818,108.96 | 5,717,944,788.12 |
| Investment in other equity instrument | 677,790,690.00 | 285,048,000.00 |
| Other non-current financial assets | 1,326,608,914.00 | 1,690,795,178.00 |
Investment real estate
| Investment real estate | 49,296,869.73 | 19,387,746.56 |
| Fixed assets | 3,769,984,185.94 | 2,932,210,452.51 |
| Construction in progress | 509,105,587.49 | 387,429,933.08 |
| Productive biological asset | ||
| Oil and gas asset | ||
| Right-of-use assets | 41,865,100.38 | 23,148,405.58 |
| Intangible assets | 487,627,987.92 | 440,593,119.82 |
| Expense on Research and Development | ||
| Goodwill | 237,682,375.72 | 231,255,015.75 |
| Long-term expenses to be apportioned | 28,586,235.84 | 15,304,783.57 |
| Deferred income tax asset | 275,627,772.45 | 242,248,194.57 |
| Other non-current asset | 479,630,436.37 | 267,941,354.57 |
| Total non-current asset | 14,166,624,264.80 | 12,253,306,972.13 |
| Total assets | 28,528,913,065.01 | 27,970,858,427.84 |
| Current liabilities: | ||
| Short-term loans | 3,604,376,527.82 | 1,437,958,206.55 |
| Loan from central bank | ||
| Capital borrowed | ||
| Trading financial liability | ||
| Derivative financial liability | 747,115.75 | |
| Note payable | 1,411,089,606.00 | 1,760,032,216.30 |
| Account payable | 3,454,601,023.60 | 3,206,653,702.59 |
| Accounts received in advance | 3,633,878.33 | 2,854,518.96 |
| Contractual liability | 94,850,083.23 | 136,427,636.39 |
| Selling financial asset of repurchase | ||
| Absorbing deposit and interbank deposit | ||
| Security trading of agency | ||
| Security sales of agency | ||
| Wage payable | 317,434,386.24 | 339,888,502.70 |
| Taxes payable | 54,586,315.53 | 40,105,648.88 |
| Other account payable | 198,990,948.23 | 359,905,317.46 |
| Including: Interest payable | 6,184.14 | |
| Dividend payable | 25,671,100.00 | |
| Commission charge and commission payable | ||
| Reinsurance payable | ||
| Liability held for sale | ||
| Non-current liabilities due within one year | 14,285,348.90 | 34,088,773.68 |
| Other current liabilities | 211,763,779.77 | 212,969,271.55 |
| Total current liabilities | 9,366,359,013.40 | 7,530,883,795.06 |
| Non-current liabilities: |
Insurance contract reserve
| Insurance contract reserve | ||
| Long-term loans | 238,000,000.00 | |
| Bonds payable | ||
| Including: Preferred stock | ||
| Perpetual capital securities | ||
| Lease liability | 31,589,277.20 | 15,795,469.25 |
| Long-term account payable | 30,785,082.11 | 32,015,082.11 |
| Long-term wages payable | 154,093,044.28 | 108,311,923.19 |
| Accrued liability | 10,106,268.87 | |
| Deferred income | 223,123,978.78 | 298,052,867.56 |
| Deferred income tax liabilities | 40,149,550.99 | 23,097,535.20 |
| Other non-current liabilities | ||
| Total non-current liabilities | 727,847,202.23 | 477,272,877.31 |
| Total liabilities | 10,094,206,215.63 | 8,008,156,672.37 |
| Owner’s equity: | ||
| Share capital | 1,008,603,293.00 | 1,008,659,570.00 |
| Other equity instrument | ||
| Including: Preferred stock | ||
| Perpetual capital securities | ||
| Capital reserve | 3,398,368,567.63 | 3,371,344,172.82 |
| Less: Inventory shares | 541,623,002.63 | 270,249,797.74 |
| Other comprehensive income | -911,310.13 | -36,746,344.60 |
| Reasonable reserve | 2,119,800.95 | 712,215.31 |
| Surplus public reserve | 510,100,496.00 | 510,100,496.00 |
| Provision of general risk | ||
| Retained profit | 13,320,021,325.90 | 14,814,787,377.86 |
| Total owner’ s equity attributable to parent company | 17,696,679,170.72 | 19,398,607,689.65 |
| Minority interests | 738,027,678.66 | 564,094,065.82 |
| Total owner’ s equity | 18,434,706,849.38 | 19,962,701,755.47 |
| Total liabilities and owner’ s equity | 28,528,913,065.01 | 27,970,858,427.84 |
Legal Representative: Wang XiaodongPerson in charge of accounting works: Ou JianbinPerson in charge of accounting institute: Ou Jianbin
2.Balance Sheet of Parent company
In RMB
| Item | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets:
| Current assets: | ||
| Monetary funds | 823,574,329.53 | 1,002,808,546.46 |
| Trading financial assets | 2,693,150,975.20 | 5,493,703,374.82 |
| Derivative financial assets | ||
| Note receivable | 29,575,852.04 | 303,726,372.69 |
| Account receivable | 906,808,283.22 | 536,957,890.22 |
| Receivable financing | 216,462,262.44 | |
| Accounts paid in advance | 56,037,892.68 | 93,419,268.82 |
| Other account receivable | 1,472,102,439.27 | 204,125,517.63 |
| Including: Interest receivable | 206,325.34 | 113,055.56 |
| Dividend receivable | 26,718,900.00 | |
| Inventories | 571,571,431.95 | 1,076,094,722.15 |
| Contract assets | ||
| Assets held for sale | ||
| Non-current assets maturing within one year | ||
| Other current assets | 107,462,112.82 | 149,352,872.77 |
| Total current assets | 6,876,745,579.15 | 8,860,188,565.56 |
| Non-current assets: | ||
| Debt investment | ||
| Other debt investment | ||
| Long-term receivables | ||
| Long-term equity investments | 8,369,843,351.10 | 6,867,282,228.56 |
| Investment in other equity instrument | 601,850,690.00 | 209,108,000.00 |
| Other non-current financial assets | 1,326,608,914.00 | 1,690,795,178.00 |
| Investment real estate | 35,584,279.11 | |
| Fixed assets | 2,251,495,050.80 | 1,786,089,596.76 |
| Construction in progress | 251,304,655.41 | 239,183,999.25 |
| Productive biological assets | ||
| Oil and natural gas assets | ||
| Right-of-use assets | 6,061,693.75 | 1,240,879.96 |
| Intangible assets | 209,246,490.17 | 209,952,168.75 |
| Research and development costs | ||
| Goodwill | ||
| Long-term deferred expenses | 6,895,352.43 | 348,970.34 |
| Deferred income tax assets | 109,624,761.50 | 85,012,991.24 |
| Other non-current assets | 168,744,695.04 | 185,646,711.53 |
| Total non-current assets | 13,337,259,933.31 | 11,274,660,724.39 |
| Total assets | 20,214,005,512.46 | 20,134,849,289.95 |
| Current liabilities | ||
| Short-term borrowings | 2,121,354,415.53 | 272,578,883.63 |
Trading financial liability
| Trading financial liability | ||
| Derivative financial liability | 737,424.50 | |
| Notes payable | 251,867,652.05 | 569,405,391.94 |
| Account payable | 1,048,268,519.52 | 1,012,390,712.80 |
| Accounts received in advance | ||
| Contract liability | 6,564,332.93 | 7,879,319.15 |
| Wage payable | 166,314,985.33 | 220,719,432.58 |
| Taxes payable | 6,048,505.30 | 12,427,327.61 |
| Other accounts payable | 926,276,130.15 | 392,455,373.80 |
| Including: Interest payable | 835,069.83 | 117,777.78 |
| Dividend payable | ||
| Liability held for sale | ||
| Non-current liabilities due within one year | 4,306,935.71 | 462,484.41 |
| Other current liabilities | 102,322,311.03 | 143,935,332.78 |
| Total current liabilities | 4,634,061,212.05 | 2,632,254,258.70 |
| Non-current liabilities: | ||
| Long-term loans | ||
| Bonds payable | ||
| Including: preferred stock | ||
| Perpetual capital securities | ||
| Lease liability | 2,690,812.43 | 1,003,106.55 |
| Long-term account payable | ||
| Long term employee compensation payable | 121,683,760.89 | 103,482,333.50 |
| Accrued liabilities | 13,750.00 | |
| Deferred income | 198,149,511.20 | 265,509,545.34 |
| Deferred income tax liabilities | ||
| Other non-current liabilities | ||
| Total non-current liabilities | 322,537,834.52 | 369,994,985.39 |
| Total liabilities | 4,956,599,046.57 | 3,002,249,244.09 |
| Owners’ equity: | ||
| Share capital | 1,008,603,293.00 | 1,008,659,570.00 |
| Other equity instrument | ||
| Including: preferred stock | ||
| Perpetual capital securities | ||
| Capital reserve | 3,515,005,861.23 | 3,487,154,855.59 |
| Less: Inventory shares | 541,623,002.63 | 270,249,797.74 |
| Other comprehensive income | ||
| Special reserve | ||
| Surplus reserve | 510,100,496.00 | 510,100,496.00 |
| Retained profit | 10,765,319,818.29 | 12,396,934,922.01 |
Total owner’s equity
| Total owner’s equity | 15,257,406,465.89 | 17,132,600,045.86 |
| Total liabilities and owner’s equity | 20,214,005,512.46 | 20,134,849,289.95 |
3.Consolidated Profit Statement
In RMB
| Item | 2022 | 2021 |
| I. Total operating income | 12,729,634,917.03 | 13,682,426,710.95 |
| Including: Operating income | 12,729,634,917.03 | 13,682,426,710.95 |
| Interest income | ||
| Insurance gained | ||
| Commission charge and commission income | ||
| II. Total operating cost | 12,526,691,966.36 | 12,772,618,230.58 |
| Including: Operating cost | 11,016,385,488.80 | 11,220,367,713.57 |
| Interest expense | ||
| Commission charge and commission expense | ||
| Cash surrender value | ||
| Net amount of expense of compensation | ||
| Net amount of withdrawal of insurance contract reserve | ||
| Bonus expense of guarantee slip | ||
| Reinsurance expense | ||
| Tax and extras | 70,575,584.89 | 60,256,733.73 |
| Sales expense | 189,528,090.71 | 264,651,432.56 |
| Administrative expense | 586,386,474.32 | 611,872,150.24 |
| R&D expense | 581,488,711.88 | 595,406,951.64 |
| Financial expense | 82,327,615.76 | 20,063,248.84 |
| Including: Interest expenses | 107,737,432.78 | 38,698,621.09 |
| Interest income | 41,020,724.48 | 41,478,845.32 |
| Add: other income | 112,665,397.27 | 71,276,971.68 |
| Investment income (Loss is listed with “-”) | 1,849,145,500.50 | 1,954,523,836.59 |
| Including: Investment income on affiliated company and joint venture | 1,636,986,684.96 | 1,632,117,748.78 |
| The termination of income recognition for financial assets measured by amortized cost(Loss is listed with “-”) | -959,296.18 | |
| Exchange income (Loss is listed with “-”) | ||
| Net exposure hedging income (Loss is listed with “-”) | ||
| Income from change of fair value (Loss is listed with “-”) | -157,622,752.09 | -40,270,333.81 |
| Loss of credit impairment (Loss is listed with “-”) | -1,645,881,142.40 | 4,059,750.80 |
| Losses of devaluation of asset (Loss is listed with “-”) | -181,610,433.12 | -138,117,315.80 |
| Income from assets disposal (Loss is listed with “-”) | 1,986,804.53 | 3,932,344.07 |
| III. Operating profit (Loss is listed with “-”) | 181,626,325.36 | 2,765,213,733.90 |
| Add: Non-operating income | 5,699,768.04 | 656,202.07 |
| Less: Non-operating expense | 7,711,660.06 | 25,509,569.87 |
IV. Total profit (Loss is listed with “-”)
| IV. Total profit (Loss is listed with “-”) | 179,614,433.34 | 2,740,360,366.10 |
| Less: Income tax expense | -11,331,574.91 | 90,995,689.95 |
| V. Net profit (Net loss is listed with “-”) | 190,946,008.25 | 2,649,364,676.15 |
| (i) Classify by business continuity | ||
| 1.continuous operating net profit (net loss listed with “-”) | 190,946,008.25 | 2,649,364,676.15 |
| 2.termination of net profit (net loss listed with “-”) | ||
| (ii) Classify by ownership | ||
| 1.Net profit attributable to owner’s of parent company | 118,819,836.30 | 2,575,371,419.80 |
| 2.Minority shareholders’ gains and losses | 72,126,171.95 | 73,993,256.35 |
| VI. Net after-tax of other comprehensive income | 35,835,034.47 | -50,662,087.73 |
| Net after-tax of other comprehensive income attributable to owners of parent company | 35,835,034.47 | -50,662,964.07 |
| (I) Other comprehensive income items which will not be reclassified subsequently to profit of loss | -399,165.06 | 16,008.80 |
| 1.Changes of the defined benefit plans that re-measured | -399,165.06 | |
| 2.Other comprehensive income under equity method that cannot be transfer to gain/loss | 16,008.80 | |
| 3.Change of fair value of investment in other equity instrument | ||
| 4.Fair value change of enterprise's credit risk | ||
| 5. Other | ||
| (ii) Other comprehensive income items which will be reclassified subsequently to profit or loss | 36,234,199.53 | -50,678,972.87 |
| 1.Other comprehensive income under equity method that can transfer to gain/loss | ||
| 2.Change of fair value of other debt investment | ||
| 3.Amount of financial assets re-classify to other comprehensive income | ||
| 4.Credit impairment provision for other debt investment | ||
| 5.Cash flow hedging reserve | ||
| 6.Translation differences arising on translation of foreign currency financial statements | 36,234,199.53 | -50,678,972.87 |
| 7.Other | ||
| Net after-tax of other comprehensive income attributable to minority shareholders | 876.34 | |
| VII. Total comprehensive income | 226,781,042.72 | 2,598,702,588.42 |
| Total comprehensive income attributable to owners of parent Company | 154,654,870.77 | 2,524,708,455.73 |
| Total comprehensive income attributable to minority shareholders | 72,126,171.95 | 73,994,132.69 |
| VIII. Earnings per share: | ||
| (i) Basic earnings per share | 0.09 | 2.57 |
| (ii) Diluted earnings per share | 0.09 | 2.57 |
Legal Representative: Wang XiaodongPerson in charge of accounting works: Ou JianbinPerson in charge of accounting institute: Ou Jianbin
4. Profit Statement of Parent Company
In RMB
| Item | 2022 | 2021 |
| I. Operating income | 3,864,504,995.80 | 4,832,340,790.45 |
| Less: Operating cost | 3,239,655,060.78 | 3,605,342,507.48 |
| Taxes and surcharge | 21,016,396.56 | 29,689,175.82 |
| Sales expenses | 24,032,764.17 | 44,807,972.25 |
| Administration expenses | 312,390,634.03 | 324,244,883.74 |
| R&D expenses | 215,942,706.30 | 225,949,431.82 |
| Financial expenses | -47,492,346.99 | -15,417,294.04 |
| Including: interest expenses | 75,002,506.86 | 7,427,980.88 |
| Interest income | 123,450,262.42 | 26,881,455.19 |
| Add: other income | 78,660,020.95 | 41,029,454.01 |
| Investment income (Loss is listed with “-”) | 1,698,892,386.70 | 1,758,393,772.54 |
| Including: Investment income on affiliated Company and joint venture | 1,427,651,731.23 | 1,366,704,678.23 |
| The termination of income recognition for financial assets measured by amortized cost (Loss is listed with “-”) | ||
| Net exposure hedging income (Loss is listed with “-”) | ||
| Changing income of fair value (Loss is listed with “-”) | -157,794,622.92 | -40,747,662.86 |
| Loss of credit impairment (Loss is listed with “-”) | -1,645,695,111.31 | -654,218.49 |
| Losses of devaluation of asset (Loss is listed with “-”) | -94,397,143.24 | -40,950,682.53 |
| Income on disposal of assets (Loss is listed with “-”) | 208,706.65 | 850,642.47 |
| II. Operating profit (Loss is listed with “-”) | -45,505,874.07 | 2,335,645,418.52 |
| Add: Non-operating income | 236,560.76 | 527,726.36 |
| Less: Non-operating expense | 1,624,603.88 | 24,178,368.73 |
| III. Total Profit (Loss is listed with “-”) | -46,893,917.19 | 2,311,994,776.15 |
| Less: Income tax | -24,338,482.27 | 101,437,713.12 |
| IV. Net profit (Net loss is listed with “-”) | -22,555,434.92 | 2,210,557,063.03 |
| (i)continuous operating net profit (net loss listed with ‘-”) | -22,555,434.92 | 2,210,557,063.03 |
| (ii) termination of net profit (net loss listed with ‘-”) | ||
| V. Net after-tax of other comprehensive income | ||
| (I) Other comprehensive income items which will not be reclassified subsequently to profit of loss | ||
| 1.Changes of the defined benefit plans that re-measured | ||
| 2.Other comprehensive income under equity method that cannot be transfer to gain/loss | ||
| 3.Change of fair value of investment in other equity instrument | ||
| 4.Fair value change of enterprise's credit risk | ||
| 5. Other | ||
| (II) Other comprehensive income items which will be reclassified subsequently to profit or loss | ||
| 1.Other comprehensive income under equity method that can transfer to gain/loss |
5.Consolidated Cash Flow Statement
In RMB
| Item | 2022 | 2021 |
| I. Cash flows arising from operating activities: | ||
| Cash received from selling commodities and providing labor services | 12,431,900,362.84 | 15,555,511,937.16 |
| Net increase of customer deposit and interbank deposit | ||
| Net increase of loan from central bank | ||
| Net increase of capital borrowed from other financial institution | ||
| Cash received from original insurance contract fee | ||
| Net cash received from reinsurance business | ||
| Net increase of insured savings and investment | ||
| Cash received from interest, commission charge and commission | ||
| Net increase of capital borrowed | ||
| Net increase of returned business capital | ||
| Net cash received by agents in sale and purchase of securities | ||
| Write-back of tax received | 306,395,040.32 | 50,070,441.00 |
| Other cash received concerning operating activities | 3,682,848,864.34 | 86,168,562.99 |
| Subtotal of cash inflow arising from operating activities | 16,421,144,267.50 | 15,691,750,941.15 |
| Cash paid for purchasing commodities and receiving labor service | 10,077,477,240.02 | 12,479,791,466.70 |
| Net increase of customer loans and advances | ||
| Net increase of deposits in central bank and interbank | ||
| Cash paid for original insurance contract compensation | ||
| Net increase of capital lent | ||
| Cash paid for interest, commission charge and commission | ||
| Cash paid for bonus of guarantee slip | ||
| Cash paid to/for staff and workers | 1,384,027,081.31 | 1,436,357,958.29 |
| Taxes paid | 580,286,995.87 | 499,681,099.37 |
| Other cash paid concerning operating activities | 6,955,095,599.73 | 648,207,823.38 |
2.Change of fair value of other debt investment
| 2.Change of fair value of other debt investment | ||
| 3.Amount of financial assets re-classify to other comprehensive income | ||
| 4.Credit impairment provision for other debt investment | ||
| 5.Cash flow hedging reserve | ||
| 6.Translation differences arising on translation of foreign currency financial statements | ||
| 7.Other | ||
| VI. Total comprehensive income | -22,555,434.92 | 2,210,557,063.03 |
| VII. Earnings per share: | ||
| (i) Basic earnings per share | ||
| (ii) Diluted earnings per share |
Subtotal of cash outflow arising from operating activities
| Subtotal of cash outflow arising from operating activities | 18,996,886,916.93 | 15,064,038,347.74 |
| Net cash flows arising from operating activities | -2,575,742,649.43 | 627,712,593.41 |
| II. Cash flows arising from investing activities: | ||
| Cash received from recovering investment | 10,740,023,339.08 | 18,129,191,548.43 |
| Cash received from investment income | 1,183,837,077.82 | 1,238,803,864.71 |
| Net cash received from disposal of fixed, intangible and other long-term assets | 20,576,391.79 | 15,303,195.04 |
| Net cash received from disposal of subsidiaries and other units | 136,787,298.86 | 9,000,000.00 |
| Other cash received concerning investing activities | 1,680,766.91 | |
| Subtotal of cash inflow from investing activities | 12,081,224,107.55 | 19,393,979,375.09 |
| Cash paid for purchasing fixed, intangible and other long-term assets | 1,152,415,535.85 | 753,581,993.49 |
| Cash paid for investment | 7,116,445,479.00 | 18,668,448,932.90 |
| Net increase of mortgaged loans | ||
| Net cash received from subsidiaries and other units obtained | 70,190,329.71 | |
| Other cash paid concerning investing activities | 146,232,114.50 | |
| Subtotal of cash outflow from investing activities | 8,485,283,459.06 | 19,422,030,926.39 |
| Net cash flows arising from investing activities | 3,595,940,648.49 | -28,051,551.30 |
| III. Cash flows arising from financing activities | ||
| Cash received from absorbing investment | 125,000,000.00 | |
| Including: Cash received from absorbing minority shareholders’ investment by subsidiaries | 125,000,000.00 | |
| Cash received from loans | 4,692,002,243.34 | 1,711,808,897.47 |
| Other cash received concerning financing activities | 5,470,000.00 | |
| Subtotal of cash inflow from financing activities | 4,817,002,243.34 | 1,717,278,897.47 |
| Cash paid for settling debts | 2,328,551,163.70 | 575,619,575.18 |
| Cash paid for dividend and profit distributing or interest paying | 1,761,911,157.57 | 1,561,591,089.99 |
| Including: Dividend and profit of minority shareholder paid by subsidiaries | 54,977,987.52 | 13,970,282.31 |
| Other cash paid concerning financing activities | 591,370,195.57 | 17,596,686.60 |
| Subtotal of cash outflow from financing activities | 4,681,832,516.84 | 2,154,807,351.77 |
| Net cash flows arising from financing activities | 135,169,726.50 | -437,528,454.30 |
| IV. Influence on cash and cash equivalents due to fluctuation in exchange rate | 27,730,942.53 | -13,059,669.78 |
| V. Net increase of cash and cash equivalents | 1,183,098,668.09 | 149,072,918.03 |
| Add: Balance of cash and cash equivalents at the period -begin | 1,094,018,936.73 | 944,946,018.70 |
| VI. Balance of cash and cash equivalents at the period -end | 2,277,117,604.82 | 1,094,018,936.73 |
6.Cash Flow Statement of Parent Company
In RMB
| Item | 2022 | 2021 |
| I. Cash flows arising from operating activities: | ||
| Cash received from selling commodities and providing labor services | 3,542,749,700.01 | 5,563,589,299.47 |
| Write-back of tax received | 184,495,154.77 |
Other cash received concerning operating activities
| Other cash received concerning operating activities | 47,404,163.66 | 42,028,025.86 |
| Subtotal of cash inflow arising from operating activities | 3,774,649,018.44 | 5,605,617,325.33 |
| Cash paid for purchasing commodities and receiving labor service | 2,601,006,413.32 | 3,605,626,128.99 |
| Cash paid to/for staff and workers | 707,858,677.98 | 788,560,324.22 |
| Taxes paid | 209,864,912.81 | 283,285,319.76 |
| Other cash paid concerning operating activities | 186,707,374.55 | 172,424,308.24 |
| Subtotal of cash outflow arising from operating activities | 3,705,437,378.66 | 4,849,896,081.21 |
| Net cash flows arising from operating activities | 69,211,639.78 | 755,721,244.12 |
| II. Cash flows arising from investing activities: | ||
| Cash received from recovering investment | 7,606,003,001.77 | 14,660,350,548.43 |
| Cash received from investment income | 1,230,308,621.08 | 1,117,355,887.53 |
| Net cash received from disposal of fixed, intangible and other long-term assets | 7,573,333.23 | 675,341.73 |
| Net cash received from disposal of subsidiaries and other units | ||
| Other cash received concerning investing activities | 1,345,164,876.69 | 32,072,638.81 |
| Subtotal of cash inflow from investing activities | 10,189,049,832.77 | 15,810,454,416.50 |
| Cash paid for purchasing fixed, intangible and other long-term assets | 676,750,590.56 | 466,841,006.41 |
| Cash paid for investment | 5,495,846,939.59 | 15,006,974,321.57 |
| Net cash received from subsidiaries and other units obtained | ||
| Other cash paid concerning investing activities | 4,200,652,968.77 | |
| Subtotal of cash outflow from investing activities | 10,373,250,498.92 | 15,473,815,327.98 |
| Net cash flows arising from investing activities | -184,200,666.15 | 336,639,088.52 |
| III. Cash flows arising from financing activities | ||
| Cash received from absorbing investment | ||
| Cash received from loans | 2,765,016,400.00 | 376,524,000.00 |
| Other cash received concerning financing activities | 668,810,047.94 | 100,000,000.00 |
| Subtotal of cash inflow from financing activities | 3,433,826,447.94 | 476,524,000.00 |
| Cash paid for settling debts | 926,483,000.00 | 202,000,000.00 |
| Cash paid for dividend and profit distributing or interest paying | 1,660,892,442.17 | 1,520,286,898.73 |
| Other cash paid concerning financing activities | 426,203,919.97 | 4,385,823.06 |
| Subtotal of cash outflow from financing activities | 3,013,579,362.14 | 1,726,672,721.79 |
| Net cash flows arising from financing activities | 420,247,085.80 | -1,250,148,721.79 |
| IV. Influence on cash and cash equivalents due to fluctuation in exchange rate | 9,734,626.92 | -4,982,656.55 |
| V. Net increase of cash and cash equivalents | 314,992,686.35 | -162,771,045.70 |
| Add: Balance of cash and cash equivalents at the period -begin | 488,417,498.83 | 651,188,544.53 |
| VI. Balance of cash and cash equivalents at the period -end | 803,410,185.18 | 488,417,498.83 |
7.Statement of Change in Owners’ Equity(Consolidated)
Current Period
In RMB
| Item | 2022 | ||||||||||||||
| Owners’ equity attributable to the parent Company | Minority interests | Total owners’ equity | |||||||||||||
| Share capital | Other equity instrument | Capital reserve | Less: Inventory shares | Other comprehensive income | Reasonable reserve | Surplus reserve | Provision of general risk | Retained profit | Other | Subtotal | |||||
| Preferred stock | Perpetual capital securities | Other | |||||||||||||
| I. Balance at the end of the last year | 1,008,659,570.00 | 3,371,344,172.82 | 270,249,797.74 | -36,746,344.60 | 712,215.31 | 510,100,496.00 | 14,814,787,377.86 | 19,398,607,689.65 | 564,094,065.82 | 19,962,701,755.47 | |||||
| Add: Changes of accounting policy | |||||||||||||||
| Error correction of the last period | |||||||||||||||
| Enterprise combine under the same control | |||||||||||||||
| Other | |||||||||||||||
| II. Balance at the beginning of this year | 1,008,659,570.00 | 3,371,344,172.82 | 270,249,797.74 | -36,746,344.60 | 712,215.31 | 510,100,496.00 | 14,814,787,377.86 | 19,398,607,689.65 | 564,094,065.82 | 19,962,701,755.47 | |||||
| III. Increase/ Decrease in this year (Decrease is listed with “-”) | -56,277.00 | 27,024,394.81 | 271,373,204.89 | 35,835,034.47 | 1,407,585.64 | -1,494,766,051.96 | -1,701,928,518.93 | 173,933,612.84 | -1,527,994,906.09 | ||||||
| (i) Total comprehensive income | 35,835,034.47 | 118,819,836.30 | 154,654,870.77 | 72,126,171.95 | 226,781,042.72 | ||||||||||
| (ii) Owners’ devoted and decreased capital | -56,277.00 | 27,024,394.81 | 271,373,204.89 | -244,405,087.08 | 130,826,610.83 | -113,578,476.25 | |||||||||
| 1.Common shares invested by shareholders | 397,804,542.63 | -397,804,542.63 | 130,000,000.00 | -267,804,542.63 | |||||||||||
| 2. Capital invested by holders of other equity instruments | |||||||||||||||
3. Amount
reckoned intoowners equitywith share-basedpayment
| 3. Amount reckoned into owners equity with share-based payment | 28,116,895.55 | 28,116,895.55 | 826,610.83 | 28,943,506.38 | |||||||||||
| 4. Other | -56,277.00 | -1,092,500.74 | -126,431,337.74 | 125,282,560.00 | 125,282,560.00 | ||||||||||
| (III) Profit distribution | -1,613,585,888.26 | -1,613,585,888.26 | -29,306,887.52 | -1,642,892,775.78 | |||||||||||
| 1. Withdrawal of surplus reserves | |||||||||||||||
| 2. Withdrawal of general risk provisions | |||||||||||||||
| 3. Distribution for owners (or shareholders) | -1,609,059,668.80 | -1,609,059,668.80 | -29,306,887.52 | -1,638,366,556.32 | |||||||||||
| 4. Other | -4,526,219.46 | -4,526,219.46 | -4,526,219.46 | ||||||||||||
| (IV) Carrying forward internal owners’ equity | |||||||||||||||
| 1. Capital reserves conversed to capital (share capital) | |||||||||||||||
| 2. Surplus reserves conversed to capital (share capital) | |||||||||||||||
| 3. Remedying loss with surplus reserve | |||||||||||||||
| 4．Carry-over retained earnings from the defined benefit plans | |||||||||||||||
| 5．Carry-over retained earnings from other comprehensive income |
6. Other
| 6. Other | |||||||||||||||
| (V) Reasonable reserve | 1,407,585.64 | 1,407,585.64 | 287,717.58 | 1,695,303.22 | |||||||||||
| 1. Withdrawal in the report period | 26,087,086.34 | 26,087,086.34 | 2,700,074.03 | 28,787,160.37 | |||||||||||
| 2. Usage in the report period | 24,679,500.70 | 24,679,500.70 | 2,412,356.45 | 27,091,857.15 | |||||||||||
| (VI)Others | |||||||||||||||
| IV. Balance at the end of the report period | 1,008,603,293.00 | 3,398,368,567.63 | 541,623,002.63 | -911,310.13 | 2,119,800.95 | 510,100,496.00 | 13,320,021,325.90 | 17,696,679,170.72 | 738,027,678.66 | 18,434,706,849.38 |
Last Period
In RMB
| Item | 2021 | ||||||||||||||
| Owners’ equity attributable to the parent Company | Minority interests | Total owners’ equity | |||||||||||||
| Share capital | Other equity instrument | Capital reserve | Less: Inventory shares | Other comprehensive income | Reasonable reserve | Surplus reserve | Provision of general risk | Retained profit | Other | Subtotal | |||||
| Preferred stock | Perpetual capital securities | Other | |||||||||||||
| I. Balance at the end of the last year | 1,008,950,570.00 | 3,294,242,368.28 | 303,627,977.74 | 13,916,619.47 | 2,333,490.03 | 510,100,496.00 | 13,756,102,424.62 | 18,282,017,990.66 | 512,447,908.36 | 18,794,465,899.02 | |||||
| Add: Changes of accounting policy | |||||||||||||||
| Error correction of the last period | |||||||||||||||
| Enterprise combine under the same control | |||||||||||||||
| Other | |||||||||||||||
| II. Balance at the beginning of this year | 1,008,950,570.00 | 3,294,242,368.28 | 303,627,977.74 | 13,916,619.47 | 2,333,490.03 | 510,100,496.00 | 13,756,102,424.62 | 18,282,017,990.66 | 512,447,908.36 | 18,794,465,899.02 | |||||
| III. Increase/ Decrease in this year (Decrease is listed with “-”) | -291,000.00 | 77,101,804.54 | -33,378,180.00 | -50,662,964.07 | -1,621,274.72 | 1,058,684,953.24 | 1,116,589,698.99 | 51,646,157.46 | 1,168,235,856.45 | ||||||
| (i) Total comprehensive income | -50,662,964.07 | 2,575,371,419.80 | 2,524,708,455.73 | 73,994,132.69 | 2,598,702,588.42 | ||||||||||
| (ii) Owners’ devoted and decreased capital | -291,000.00 | 70,463,804.54 | -33,378,180.00 | 103,550,984.54 | 17,321,034.44 | 120,872,018.98 | |||||||||
| 1.Common shares invested by shareholders | -291,000.00 | -291,000.00 | 15,000,000.00 | 14,709,000.00 | |||||||||||
| 2. Capital invested by | |||||||||||||||
holders of otherequityinstruments
| holders of other equity instruments | |||||||||||||||
| 3. Amount reckoned into owners equity with share-based payment | 74,241,533.60 | 74,241,533.60 | 2,321,034.44 | 76,562,568.04 | |||||||||||
| 4. Other | -3,777,729.06 | -33,378,180.00 | 29,600,450.94 | 29,600,450.94 | |||||||||||
| (III) Profit distribution | -1,517,422,799.42 | -1,517,422,799.42 | -39,641,382.31 | -1,557,064,181.73 | |||||||||||
| 1. Withdrawal of surplus reserves | |||||||||||||||
| 2. Withdrawal of general risk provisions | |||||||||||||||
| 3. Distribution for owners (or shareholders) | -1,513,341,439.50 | -1,513,341,439.50 | -39,641,382.31 | -1,552,982,821.81 | |||||||||||
| 4. Other | -4,081,359.92 | -4,081,359.92 | -4,081,359.92 | ||||||||||||
| (IV) Carrying forward internal owners’ equity | |||||||||||||||
| 1. Capital reserves conversed to capital (share capital) | |||||||||||||||
| 2. Surplus reserves conversed to capital (share capital) | |||||||||||||||
| 3. Remedying loss with surplus reserve | |||||||||||||||
| 4．Carry-over retained earnings from the defined benefit plans | |||||||||||||||
| 5．Carry-over retained earnings from other comprehensive |
income
| income | |||||||||||||||
| 6. Other | |||||||||||||||
| (V) Reasonable reserve | -1,621,274.72 | -1,621,274.72 | -27,627.36 | -1,648,902.08 | |||||||||||
| 1. Withdrawal in the report period | 22,714,778.27 | 22,714,778.27 | 2,284,337.85 | 24,999,116.12 | |||||||||||
| 2. Usage in the report period | 24,336,052.99 | 24,336,052.99 | 2,311,965.21 | 26,648,018.20 | |||||||||||
| (VI)Others | 6,638,000.00 | 736,332.86 | 7,374,332.86 | 7,374,332.86 | |||||||||||
| IV. Balance at the end of the report period | 1,008,659,570.00 | 3,371,344,172.82 | 270,249,797.74 | -36,746,344.60 | 712,215.31 | 510,100,496.00 | 14,814,787,377.86 | 19,398,607,689.65 | 564,094,065.82 | 19,962,701,755.47 |
8.Statement of Changes in Owners’ Equity (Parent Company)
Current Period
In RMB
| Item | 2022 | |||||||||||
| Share capital | Other equity instrument | Capital reserve | Less: Inventory shares | Other comprehensive income | Reasonable reserve | Surplus reserve | Retained profit | Other | Total owners’ equity | |||
| Preferred stock | Perpetual capital securities | Other | ||||||||||
| I. Balance at the end of the last year | 1,008,659,570.00 | 3,487,154,855.59 | 270,249,797.74 | 510,100,496.00 | 12,396,934,922.01 | 17,132,600,045.86 | ||||||
| Add: Changes of accounting policy | ||||||||||||
| Error correction of the last period | ||||||||||||
| Other | ||||||||||||
| II. Balance at the beginning of this year | 1,008,659,570.00 | 3,487,154,855.59 | 270,249,797.74 | 510,100,496.00 | 12,396,934,922.01 | 17,132,600,045.86 | ||||||
| III. Increase/ Decrease in this year (Decrease is listed with “-”) | -56,277.00 | 27,851,005.64 | 271,373,204.89 | -1,631,615,103.72 | -1,875,193,579.97 | |||||||
| (i) Total comprehensive income | -22,555,434.92 | -22,555,434.92 | ||||||||||
| (ii) Owners’ devoted and decreased capital | -56,277.00 | 27,851,005.64 | 271,373,204.89 | -243,578,476.25 | ||||||||
| 1.Common shares invested by shareholders | 397,804,542.63 | -397,804,542.63 | ||||||||||
| 2. Capital invested by holders of other equity instruments | ||||||||||||
| 3. Amount reckoned into owners equity with share-based | 28,943,506.38 | 28,943,506.38 | ||||||||||
payment
| payment | ||||||||||||
| 4. Other | -56,277.00 | -1,092,500.74 | -126,431,337.74 | 125,282,560.00 | ||||||||
| (III) Profit distribution | -1,609,059,668.80 | -1,609,059,668.80 | ||||||||||
| 1. Withdrawal of surplus reserves | ||||||||||||
| 2. Distribution for owners (or shareholders) | -1,609,059,668.80 | -1,609,059,668.80 | ||||||||||
| 3. Other | ||||||||||||
| (IV) Carrying forward internal owners’ equity | ||||||||||||
| 1. Capital reserves conversed to capital (share capital) | ||||||||||||
| 2. Surplus reserves conversed to capital (share capital) | ||||||||||||
| 3. Remedying loss with surplus reserve | ||||||||||||
| 4．Carry-over retained earnings from the defined benefit plans | ||||||||||||
| 5．Carry-over retained earnings from other comprehensive income | ||||||||||||
| 6. Other | ||||||||||||
| (V) Reasonable reserve | ||||||||||||
| 1. Withdrawal in the report period | 6,791,507.46 | 6,791,507.46 | ||||||||||
| 2. Usage in the report period | 6,791,507.46 | 6,791,507.46 | ||||||||||
| (VI)Others | ||||||||||||
| IV. Balance at the end of the report period | 1,008,603,293.00 | 3,515,005,861.23 | 541,623,002.63 | 510,100,496.00 | 10,765,319,818.29 | 15,257,406,465.89 |
Last Period
In RMB
| Item | 2021 | |||||||||||
| Share capital | Other equity instrument | Capital reserve | Less: Inventory shares | Other comprehensive | Reasonable reserve | Surplus reserve | Retained profit | Other | Total owners’ equity | |||
| Preferred | Perpetual | Other | ||||||||||
stock
| stock | capital securities | income | ||||||||||
| I. Balance at the end of the last year | 1,008,950,570.00 | 3,407,732,016.61 | 303,627,977.74 | 510,100,496.00 | 11,698,982,965.62 | 16,322,138,070.49 | ||||||
| Add: Changes of accounting policy | ||||||||||||
| Error correction of the last period | ||||||||||||
| Other | ||||||||||||
| II. Balance at the beginning of this year | 1,008,950,570.00 | 3,407,732,016.61 | 303,627,977.74 | 510,100,496.00 | 11,698,982,965.62 | 16,322,138,070.49 | ||||||
| III. Increase/ Decrease in this year (Decrease is listed with “-”) | -291,000.00 | 79,422,838.98 | -33,378,180.00 | 697,951,956.39 | 810,461,975.37 | |||||||
| (i) Total comprehensive income | 2,210,557,063.03 | 2,210,557,063.03 | ||||||||||
| (ii) Owners’ devoted and decreased capital | -291,000.00 | 72,784,838.98 | -33,378,180.00 | 105,872,018.98 | ||||||||
| 1.Common shares invested by shareholders | ||||||||||||
| 2. Capital invested by holders of other equity instruments | ||||||||||||
| 3. Amount reckoned into owners equity with share-based payment | 76,562,568.04 | 76,562,568.04 | ||||||||||
| 4. Other | -291,000.00 | -3,777,729.06 | -33,378,180.00 | 29,309,450.94 | ||||||||
| (III) Profit distribution | -1,513,341,439.50 | -1,513,341,439.50 | ||||||||||
| 1. Withdrawal of surplus reserves | ||||||||||||
| 2. Distribution for owners (or shareholders) | -1,513,341,439.50 | -1,513,341,439.50 | ||||||||||
| 3. Other | ||||||||||||
| (IV) Carrying forward internal owners’ equity | ||||||||||||
| 1. Capital reserves conversed to |
capital (sharecapital)
| capital (share capital) | ||||||||||||
| 2. Surplus reserves conversed to capital (share capital) | ||||||||||||
| 3. Remedying loss with surplus reserve | ||||||||||||
| 4．Carry-over retained earnings from the defined benefit plans | ||||||||||||
| 5．Carry-over retained earnings from other comprehensive income | ||||||||||||
| 6. Other | ||||||||||||
| (V) Reasonable reserve | ||||||||||||
| 1. Withdrawal in the report period | 6,436,417.80 | 6,436,417.80 | ||||||||||
| 2. Usage in the report period | 6,436,417.80 | 6,436,417.80 | ||||||||||
| (VI)Others | 6,638,000.00 | 736,332.86 | 7,374,332.86 | |||||||||
| IV. Balance at the end of the report period | 1,008,659,570.00 | 3,487,154,855.59 | 270,249,797.74 | 510,100,496.00 | 12,396,934,922.01 | 17,132,600,045.86 |
III. Basic information of the Company
1. Historical origin of the Company
By the approval of STGS (1992) No. 130 issued by Jiangsu Economic Restructuring Committee, Weifu High-Technology Group Co., Ltd. (hereinafter referred to “the Company” or “Company”) was established as a companyof limited liability with funds raised from targeted sources, and registered at Wuxi Administration for Industry &Commerce in October 1992. The original share capital of the Company totaled 115.4355 million yuan, includingstate-owned share capital amounting to 92.4355 million yuan, public corporate share capital amounting to 8million yuan and inner employee share capital amounting to 15 million yuan.Between year of 1994 and 1995, the Company was restructured and became a holding subsidiary of Wuxi WeifuGroup Co., Ltd (hereinafter referred to as “Weifu Group”).By the approval of Jiangsu ERC and Shenzhen Securities Administration Office in August 1995, the Companyissued 68 million special ordinary shares (B-share) with value of 1.00 yuan for each, and the total value of thoseshares amounted to 68 million yuan. After the issuance, the Company’s total share capital increased to 183.4355million yuan.By the approval of CSRC in June 1998, the Company issued 120 million RMB ordinary shares (A-share) atShenzhen Stock Exchange through on-line pricing and issuing. After the issuance, the total share capital of theCompany amounted to 303.4355 million yuan.In the middle of 1999, deliberated and approved by the Board and Shareholders’ General Meeting, the Companyimplemented the plan of granting 3 bonus shares for each 10 shares. After that, the total share capital of theCompany amounted to 394.46615 million yuan, of which state-owned shares amounted to 120.16615 million yuan,public corporate shares 10.4 million yuan, foreign-funded shares (B-share) 88.40 million yuan, RMB ordinaryshares (A-share) 156 million yuan and inner employee shares 19.5 million yuan.In the year 2000, by the approval of the CSRC and based upon the total share capital of 303.4355 million sharesafter the issuance of A-share in June 1998, the Company allotted 3 shares for each 10 shares, with a price of 10yuan for each allotted share. Actually 41.9 million shares was allotted, and the total share capital after theallotment increased to 436.36615 million yuan, of which state-owned corporate shares amounted to 121.56615million yuan, public corporate shares 10.4 million yuan, foreign-funded shares (B-share) 88.4 million yuan andRMB ordinary shares (A-share) 216 million yuan.In April 2005, Board of Directors of the Company has examined and approved 2004 Profit Pre-distribution Plan,and examined and approved by 2004 Shareholders’ General Meeting, the Company distributed 3 shares for each10 shares to the whole shareholders totaling to 130,909,845 shares in 2005.According to the Share Merger Reform Scheme of the Company that passed by related shareholders’ meeting ofShare Merger Reform and SGZF [2006] No.61 Reply on Questions about State-owned Equity Management inShare Merger Reform of Weifu High-Technology Co., Ltd. issued by State-owned Assets Supervision &Administration Commission of Jiangsu Province, the Weifu Group etc. 8 non-circulating shareholders arrangedpricing with granting 1.7 shares for each 10 shares to circulating A-share shareholders (totally granted 47,736,000shares), so as to realize the originally non-circulating shares can be traded on market when satisfied certainconditions, the scheme has been implemented on April 5, 2006.
On May 27, 2009, Weifu Group satisfied the consideration arrangement by dispatching 0.5 shares for each 10shares based on the number of circulating A share as prior to Share Merger Reform, according to the aforesaidShare Merger Reform, with an aggregate of 14,039,979 shares dispatched. Subsequent to implementation ofdispatch of consideration shares, Weifu Group then held 100,021,999 shares of the Company, representing 17.63%of the total share capital of the Company.Pursuant to the document (XGZQ(2009)No.46) about Approval for Merger of Wuxi Weifu Group Co., Ltd. byWuxi Industry Development Group Co., Ltd. issued by the State-owned Assets Supervision and AdministrationCommission of Wuxi City Government, Wuxi Industry Development Group Co., Ltd. (hereinafter referred to asWuxi Industry Group) acquired Weifu Group. After the merger, Weifu Group was then revoked, and its assets andcredits & debts were transferred to be under the name of Wuxi Industry Group. Accordingly, Wuxi IndustryGroup became the first largest shareholder of the Company since then.In accordance with the resolutions of shareholders' meeting and provisions of amended constitution, and approvedby [2012] No. 109 document of China Securities Regulatory Commission, in February 2012, the Company issuedRMB ordinary shares (A-share) of 112,858,000 shares to Wuxi Industry Groups and overseas strategic investorprivately, Robert Bosch Co., Ltd. (ROBERT BOSCHGMBH) (hereinafter referred to as Robert Bosch Company),face value was ONE yuan per share, added registered capital of 112,858,000 yuan, and the registered capital afterchange was 680,133,995 yuan. Wuxi Industry Group is the first majority shareholder of the Company, and RobertBosch Company is the second majority shareholder of the Company.In March 2013, the profit distribution pre-plan for year of 2012 was deliberated and approved by the Board, andalso passed in Annual General Meeting 2012 of the Company in May 2013. On basis of total share capital680,133,995 shares, distribute 5-share for every 10 shares held by whole shareholders, 340,066,997 shares in totalare distributed. Total share capital of the Company amounting 1,020,200,992 yuan up to December 31, 2013.Deliberated and approved by the company’s first extraordinary general meeting in 2015, the company hasrepurchased 11,250,422 shares of A shares from August 26, 2015 to September 8, 2015, and has finished thecancellation procedures for above repurchase shares in China Securities Depository and Clearing CorporationLimited Shenzhen Branch on September 16, 2015; after the cancellation of repurchase shares, the company’spaid-up capital (share capital) becomes 1,008,950,570 yuan after the change.After deliberation and approved by the 5
th meeting of 10
thsession of the BOD for year of 2021, the 291,000restricted shares are buy-back and canceled by the Company initially granted under the 2020 Restricted ShareIncentive Plan. The cancellation of the above mentioned buy-back shares are completed at the Shenzhen Branchof CSDC on December 20, 2021; the paid-in capital (equity) of the Company comes to 1,008,659,570.00 yuanafter changed.After deliberation and approved by the 8
th meeting of 10
thsession of the BOD for year of 2022, the 56,277restricted shares are buy-back and canceled by the Company initially granted under the 2020 Restricted ShareIncentive Plan. The cancellation of the above mentioned buy-back shares are completed at the Shenzhen Branchof CSDC on July 8, 2022; the paid-in capital (equity) of the Company comes to 1,008,603,293.00 yuan afterchanged.
2. Registered place, organization structure and head office of the Company
Registered place and head office of the Company: No.5 Huashan Road, Xinwu District, WuxiUnified social credit code: 91320200250456967NThe Company sets up Shareholders’ General Meeting, the Board of Directors (BOD) and the Board of Supervisors(BOS)The Company sets up Administration Department, Technology Centre, organization & personnel department,Office of the Board, compliance department, IT department, Strategy & new business Department, marketdevelopment department, Party-masses Department, Finance Department, Purchase Department,ManufacturingQuality Department, MS (Mechanical System) division, AC(Automotive Components) division and DS (DieselSystem ) division, etc. and subsidiaries such as WUXI WEIFU LIDA CATALYTIC CONVERTER CO., LTD,NANJING WFJN CO., LTD, IRD Fuel Cells A/S and Borit NV, etc.
3. Business nature and major operation activities of the Company
Operation scope of parent company: Technology development and consulting service in the machinery industry;manufacture of engine fuel oil system products, fuel oil system testers and equipment, manufacturing of autoelectronic parts, automotive electrical components, non-standard equipment, non-standard knife tool and exhaustafter-treatment system; sales of the general machinery, hardware & electrical equipment, chemical products & rawmaterials (excluding hazardous chemicals), automotive components and vehicles (excluding nine-seat passengercar); internal combustion engine maintenance; leasing of the own houses; import and export business in respect ofdiversified commodities and technologies (other than those commodities and technologies limited or forbidden bythe State for import and export) by self-operation and works as agent for such business. Research and testdevelopment of engineering and technical; R&D of the energy recovery system; manufacture of auto componentsand accessories; general equipment manufacturing (excluding special equipment manufacturing), (any projectsthat needs to be approved by laws can only be carried out after getting approval by relevant authorities) Generalitems: engage in investment activities with self-owned funds (except for items subject to approval according to thelaw, independently carry out business activities according to laws with business licenses )Major subsidiaries respectively activate in production and sales of engine accessories, automotive components,mufflers, purifiers and fuel cell components etc.
4. Authorized reporting parties and reporting dates for the financial report
Financial report of the Company was approved by the Board of Directors for reporting dated April 26, 2023.
5. Scope of consolidate financial statement
| Name of subsidiary | Short name of subsidiary | Shareholding ratio (%) | Proportion of votes (%) | Registered capital (in 10 thousand yuan) | Business scope | Statement consolidated (Y/N) | |
| Directly | Indirectly | ||||||
| NANJING WFJN CO., LTD. | WFJN | 80.00 | -- | 80.00 | 34,628.70 | Internal-combustion engine accessories | Y |
| WUXI WEIFU LIDA CATALYTIC CONVERTER CO., LTD. | WFLD | 94.81 | -- | 94.81 | 50,259.63 | Purifier and muffler | Y |
WUXI WEIFU MASHAN FUEL INJECTIONEQUIPMENT CO., LTD.
| WUXI WEIFU MASHAN FUEL INJECTION EQUIPMENT CO., LTD. | WFMA | 100.00 | -- | 100.00 | 16,500 | Internal-combustion engine accessories | Y |
| WUXI WEIFU CHANG?AN CO.,LTD. | WFCA | 100.00 | -- | 100.00 | 21,000 | Internal-combustion engine accessories | Y |
| WUXI WEIFU INTERNATIONAL TRADE CO.,LTD. | WFTR | 100.00 | -- | 100.00 | 3,000 | Trade | Y |
| WUXI WEIFU SCHMITTER POWERTRAIN COMPONENTS CO.,LTD. | WFSC | 66.00 | -- | 66.00 | 7,600 | Internal-combustion engine accessories | Y |
| NINGBO WFTT TURBOCHARGING TECHNOLOGY CO.,LTD. | WFTT | 98.83 | 1.17 | 100.00 | 11,136 | Internal-combustion engine accessories | Y |
| WUXI WFAM PRECISION MACHINERY CO.,LTD. | WFAM | 51.00 | -- | 51.00 | USD2,110 | Automotive components | Y |
| WUXI WEIFU LIDA CATALYTIC CONVERTER (WUHAN) CO., LTD. | WFLD (WUHAN) | -- | 60.00 | 60.00 | 1,000 | Purifier and muffler | Y |
| Weifu Lida (Chongqing) Automotive components Co., Ltd. | WFLD (Chongqing) | -- | 100.00 | 100.00 | 5,000 | Purifier and muffler | Y |
Nanchang Weifu Lida Automotive ComponentsCo., Ltd.
| Nanchang Weifu Lida Automotive Components Co., Ltd. | WFLD (Nanchang) | -- | 100.00 | 100.00 | 5,000 | Purifier and muffler | Y |
| WUXI WEIFU AUTOSMART SEATING SYSTEM CO., LTD. | WFAS | -- | 66.00 | 66.00 | 10,000 | Smart car device | Y |
| WUXI WEIFU E-DRIVE TECHNOLOGIES CO., LTD. | WFDT | 80.00 | -- | 80.00 | USD2,000 | Wheel motor | Y |
| Wuxi Weifu Qinglong Power Technology Co., Ltd. | WFQL | 45.00 | 30.00 | 75.00 | 50,000 | Fuel cell components | Y |
| VHIT Automotive Systems(Wuxi) Co.Ltd | VHCN | 100.00 | -- | 100.00 | 13,400 | Vacuum and hydraulic pump | Y |
| Weifu Holding ApS | SPV | 100.00 | -- | 100.00 | DKK8,638 | Investment | Y |
IRD Fuel Cells A/S
| IRD Fuel Cells A/S | IRD | -- | 100.00 | 100.00 | DKK10,108 | Fuel cell components | Y |
| IRD FUEL CELLS LLC | IRD America | -- | 100.00 | 100.00 | USD651.91 | Fuel cell components | Y |
| Borit NV | Borit | -- | 100.00 | 100.00 | EUR1035.32 | Fuel cell components | Y |
| Borit Inc. | Borit America | -- | 100.00 | 100.00 | USD0.1 | Fuel cell components | Y |
| VHIT S.p.A | VHIT | -- | 100.00 | 100.00 | EUR500 | Vacuum and hydraulic pump | Y |
IV. Basis of preparation of financial statements
1. Preparation base
The financial statement were stated in compliance with Accounting Standard for Business Enterprises –BasicNorms issued by Ministry of Finance, the specific 42 accounting rules revised and issued dated 15 February 2006and later, the Application Instruments of Accounting Standards and interpretation on Accounting standards andother relevant regulations (together as “Accounting Standards for Business Enterprise”), as well as theCompilation Rules for Information Disclosure by Companies Offering Securities to the Public No.15 – GeneralProvision of Financial Report (Amended in 2014) issued by CSRC in respect of the actual transactions and
proceedings, on a basis of ongoing operation.In line with relevant regulations of Accounting Standards of Business Enterprise, accounting of the Company ison Accrued basis. Except for certain financial instruments, the financial statement measured on historical cost.Assets have impairment been found, corresponding depreciation reserves shall Accrued according to relevantrules.
2. Going concern
The Company comprehensively assessed the available information, and there are no obvious factors that impactsustainable operation ability of the Company within 12 months since end of the reporting period.V. Major Accounting Policies and EstimationSpecific accounting policies and estimation attention:
The Company and its subsidiaries are mainly engaged in the manufacture and sales of engine fuel oil systemproducts, automotive components, mufflers, purifiers and fuel cell components etc., in line with the actualoperational characteristics and relevant accounting standards, many specific accounting policies and estimationhave been formulated for the transactions and events with revenue recognized concerned. As for the explanationon major accounting judgment and estimation, found more in Note V- 36. Other major accounting policy andestimation
1. Statement on observation of Accounting Standard for Business EnterprisesFinancial statements prepared by the Company were in accordance with requirements of Accounting Standard forBusiness Enterprises, which truly and completely reflected the financial information of the Company dated 31December 2022, such as financial status, operation achievements and cash flow for the year of 2022.
2. Accounting period
Accounting period of the Company consist of annual and mid-term, mid-term refers to the reporting period shorterthan one annual accounting year. The company adopts Gregorian calendar as accounting period, namely form each1 January to 31 December.
3. Business cycles
Normal business cycle is the period from purchasing assets used for process by the Company to the cash and cashequivalent achieved. The Company’s normal business cycle was one-year (12 months).
4. Recording currency
The Company’s reporting currency is the RMB yuan.
5. Accounting Treatment Method for Business Combinations under the same/different controlBusiness combination is the transaction or events that two or two above independent enterprises combined as areporting entity. Business combination including enterprise combined under the same control and businesscombined under different control.
(1) The business combination under the same control
Enterprise combination under the same control is the enterprise who take part in the combination are have thesame ultimate controller or under the same controller, the control is not temporary. The assets and liabilityacquired by combining party are measured by book value of the combined party on combination date. Balance ofnet asset’s book value acquired by combining party and combine consideration paid (or total book value of theshares issued), shall adjusted capital reserve (share premium); if the capital reserves (share premium) is notenough for deducted, adjusted for retained earnings. Vary directly expenses occurred for enterprise combination,the combining party shall reckon into current gains/losses while occurring. Combination day is the date whencombining party obtained controlling rights from the combined party.
(2) Combine not under the same control
A business combination not involving entities under common control is a business combination in which all of thecombining entities are not ultimately controlled by the same party or parties both before and after thecombination.As a purchaser, fair value of the assets (equity of purchaser held before the date of purchasingincluded) for purchasing controlling right from the purchaser, the liability occurred or undertake on purchasingdate less the fair value of identifiable net assets of the purchaser obtained in combination, recognized as goodwillif the results is positive; if the number is negative, the acquirer shall firstly review the measurement of the fairvalue of the identifiable assets obtained, liabilities incurred and contingent liabilities incurred, as well as thecombination costs.After that, if the combination costs are still lower than the fair value of the identifiable netassets obtained, the acquirer shall recognize the difference as the profit or loss in the current period.Other directlyexpenses cost for combination shall be reckoned into current gains/losses. Difference of the fair value of assetspaid and its book values, reckoned into current gains/losses. On purchasing date, the identifiable assets, liability orcontingency of the purchaser obtained by the Company recognized by fair value, that required identificationconditions; Acquisition date refers to the date on which the acquirer effectively obtains control of the purchaser.
6. Preparation method for consolidated financial statement
(1) Recognition principle of consolidated scope
On basis of the financial statement of the parent company and owned subsidiaries, prepared consolidatedstatement in line with relevant information. The scope of consolidation of consolidated financial statements isascertained on the basis of effective control. Once certain elements involved in the above definition of control
change due to changes of relevant facts or circumstances, the Company will make separate assessment.
(2) Basis of control
Control is the right to govern an invested party so as to obtain variable return through participating in the investedparty’s relevant activities and the ability to affect such return by use of the aforesaid right over the invested party.Relevant activates refers to activates have major influence on return of the invested party’s.
(3) Consolidation process
Subsidiaries are consolidated from the date on which the company obtains their actual control, and are de-consolidated from the date that such control ceases.All significant inter-group balances, investment, transactionsand unrealized profits are eliminated in the consolidated financial statements.For subsidiaries being disposed, theoperating results and cash flows prior to the date of disposal are included in the consolidated income statementand consolidated cash flow statement; for subsidiaries disposed during the period, the opening balances of theconsolidated balance sheet would not be restated. For subsidiaries acquired from a business combination not undercommon control, their operating results and cash flows subsequent to the acquisition date are included in theconsolidated income statement and consolidated cash flow statement, and the opening balances and comparativefigures of the consolidated balance sheet would not be restated. For subsidiaries acquired from a businesscombination under common control, their operating results and cash flows from the date of commencement of theaccounting period in which the combination occurred to the date of combination are included in the consolidatedincome statement and consolidated cash flow statement, and the comparative figures of the consolidated balancesheet would be restated.In preparing the consolidated financial statements, where the accounting policies or the accounting periods areinconsistent between the company and subsidiaries, the financial statements of subsidiaries are adjusted inaccordance with the accounting policies and accounting period of the company.Concerning the subsidiary obtained under combination with different control, adjusted several financial statementof the subsidiary based on the fair value of recognizable net assets on purchased day while financial statementconsolidation; concerning the subsidiary obtained under combination with same control, considered current statusof being control by ultimate controller for consolidation while financial statement consolidation.The unrealized gains and losses from the internal transactions occurred in the assets the Company sold to thesubsidiaries fully offset "the net profit attributable to the owners of the parent company". The unrealized gains andlosses from the internal transactions occurred in the assets the subsidiaries sold to the Company are distributedand offset between "the net profit attributable to the owners of the parent company" and "minority interest"according to the distribution ratio of the Company to the subsidiary. The unrealized gains and losses from theinternal transactions occurred in the assets sold among the subsidiaries are distributed and offset between "the netprofit attributable to the owners of the parent company" and "minority interest" according to the distribution ratioof the Company to the subsidiary of the seller.The share of the subsidiary’s ownership interest not attributable to the Company is listed as “minority interest”item under the ownership interest in the consolidated balance sheet. The share of the subsidiary’s current profit orloss attributable to the minority interests is listed as "minority interest" item under the net profit item in the
consolidated income statement. The share of the subsidiary’s current consolidated income attributable to theminority interests is listed as the “total consolidated income attributable to the minority shareholders” item underthe total consolidated income item in the consolidated income statement. If there are minority shareholders, addthe "minority interests" item in the consolidated statement of change in equity to reflect the changes of theminority interests. If the losses of the current period shared by a subsidiary’s minority shareholders exceed theshare that the minority shareholders hold in the subsidiary ownership interest in the beginning of the period, thebalance still charges against the minority interests.When the control over a subsidiary is ceased due to disposal of a portion of an interest in a subsidiary, the fairvalue of the remaining equity interest is re-measured on the date when the control ceased. The difference betweenthe sum of the consideration received from disposal of equity interest and the fair value of the remaining equityinterest, less the net assets attributable to the company since the acquisition date, is recognized as the investmentincome from the loss of control. Other comprehensive income relating to original equity investment insubsidiaries shall be treated on the same basis as if the relevant assets or liabilities were disposed of by thepurchaser directly when the control is lost, namely be transferred to current investment income other than therelevant part of the movement arising from re-measuring net liabilities or net assets under defined benefit schemeby the original subsidiary. Subsequent measurement of the remaining equity interests shall be in accordance withrelevant accounting standards such as Accounting Standards for business Enterprises 2 – Long-term EquityInvestments or Accounting Standards for business Enterprises 22 – Financial Instruments Recognition andMeasurement.The company shall determine whether loss of control arising from disposal in a series of transactions should beregarded as a bundle of transactions. When the economic effects and terms and conditions of the disposaltransactions met one or more of the following situations, the transactions shall normally be accounted for as abundle of transactions: ①The transactions are entered into after considering the mutual consequences of eachindividual transaction; ② The transactions need to be considered as a whole in order to achieve a deal incommercial sense;③The occurrence of an individual transaction depends on the occurrence of one or moreindividual transactions in the series; ④ The result of an individual transaction is not economical, but it would beeconomical after taking into account of other transactions in the series. When the transactions are not regarded asa bundle of transactions, the individual transactions shall be accounted as “disposal of a portion of an interest in asubsidiary which does not lead to loss of control” and “disposal of a portion of an interest in a subsidiary whichlead to loss of control”. When the transactions are regarded as a bundle of transactions, the transactions shall beaccounted as a single disposal transaction; however, the difference between the consideration received fromdisposal and the share of net assets disposed in each individual transactions before loss of control shall berecognized as other comprehensive income, and reclassified as profit or loss arising from the loss of control whencontrol is lost.
7. Joint arrangement classification and accounting treatment for joint operationsIn accordance with the Company’s rights and obligation under a joint arrangement, the Company classifies joint
arrangements into: joint ventures and joint operations.The Company confirms the following items related to the share of interests in its joint operations, and inaccordance with the provisions of the relevant accounting standards for accounting treatment:
(1) Recognize the assets held solely by the Company, and recognize assets held jointly by the Company inappropriation to the share of the Company;
(2) Recognize the obligations assumed solely by the Company, and recognize obligations assumed jointly by theCompany in appropriation to the share of the Company;
(3) Recognize revenue from disposal of the share of joint operations of the Company;
(4) Recognize fees solely occurred by Company;
(5) Recognize fees from joint operations in appropriation to the share of the Company.
8. Recognition standards for cash and cash equivalent
Cash refers to stock cash, savings available for paid at any time; cash and cash equivalent refers to the cash heldby the Company with short terms (expired within 3 months since purchased), and liquid and easy to transfer asknown amount and investment with minor variation in risks.
9. Foreign currency business and conversion
The occurred foreign currency transactions are converted into the recording currency in accordance with themiddle rate of the market exchange rate published by the People's Bank of China on the transaction date. Thereinto, the occurred foreign currency exchange or transactions involved in the foreign currency exchange areconverted in accordance with the actual exchange rate in the transactions.At the balance sheet date, the account balance of the foreign currency monetary assets and liabilities is convertedinto the recording currency amount in accordance with the middle rate of the market exchange rate published bythe People's Bank of China on the transaction date. The balance between the recording currency amount convertedaccording to exchange rate at the balance sheet date and the original recording currency amount is disposed as theexchange gains or losses. There into, the exchange gains or losses occurred in the foreign currency loans related tothe purchase and construction of fixed assets are disposed according to the principle of capitalization of borrowingcosts; the exchange gains and losses occurred during the start-up are included in the start-up costs; the rest isincluded in the current financial expenses.At the balance sheet date, the foreign currency non-monetary items measured with the historical costs areconverted in accordance with the middle rate of the market exchange rate published by the People's Bank of Chinaon the transaction date without changing its original recording currency amount; the foreign currency non-monetary items measured with the fair value are converted in accordance with the middle rate of the marketexchange rate published by the People's Bank of China on the fair value date,and the generated exchange gainsand losses are included in the current profits and losses as the gains and losses from changes in fair value.The following displays the methods for translating financial statements involving foreign operations into the
statements in RMB: The asset and liability items in the balance sheets for overseas operations are translated at thespot exchange rates on the balance sheet date. Among the owners’ equity items, the items other than“undistributed profits” are translated at the spot exchange rates of the transaction dates. The income and expenseitems in the income statements of overseas operations are translated at the average exchange rates of thetransaction dates. The exchange difference arising from the above mentioned translation are recognized in othercomprehensive income and is shown separately under owner’ equity in the balance sheet; such exchangedifference will be reclassified to profit or loss in current year when the foreign operation is disposed according tothe proportion of disposal.The cash flows of overseas operations are translated at the average exchange rates on the dates of the cash flows.The effect of exchange rate changes on cash is presented separately in the cash flow statement.
10. Financial instrument
Financial instrument is the contract that taken shape of the financial asses for an enterprise and of the financialliability or equity instrument for other units.
(1) Recognition and termination of financial instrument
A financial asset or liability is recognized when the group becomes a party to a financial instrument contract.The recognition of a financial assets shall be terminated if it meets one of the following conditions:
① the contractual right to receive the cash flow of the financial assets terminates; and
② the financial assets is transferred and the company transfers substantially all the risks and rewards of ownershipof the financial asset to the transferring party;
③the financial asset was transferred and control, although the company has neither transferred nor retained almostall the risks and rewards of the ownership of a financial asset, it relinquishes control over the financial asset.If all or part of the current obligations of a financial liability has been discharged, the financial liability or part ofit is terminated for recognition. When the Company (debtor) and the creditor sign an agreement to replace theexisting financial liabilities with new financial liabilities, and the new financial liabilities and the existingfinancial liabilities are substantially different from the contract terms, terminated the recognition of the existingfinancial liabilities and recognize the new financial liabilities at the same time.Financial assets are traded in the normal way and their accounting recognition and terminated the recognition ofproceed on a trade date basis.
(2) Classification and measurement of financial assets
At the initial recognition, according to the business model of managing financial assets and the contractual cashflow characteristics of financial assets, the Company classifies the financial assets into the financial assetsmeasured at amortized cost, the financial assets measured at fair value and whose changes are included in othercomprehensive income, and the financial assets measured at fair value and whose changes are included in currentprofit or loss. Financial assets are measured at fair value at initial recognition, but if the receivables or receivablesfinancing arising from the sale of goods or the provision of services do not include a significant financingcomponent or do not consider a financing component that does not exceed one year, it shall be initially measured
in accordance with the transaction value. For financial assets measured at fair value and whose changes areincluded in the current profit or loss, related transaction costs are directly included in the current profit and loss;for other types of financial assets, related transaction costs are included in the initially recognized amount.The business model for managing financial assets refers to how the Company manages financial assets to generatecash flows. The business model determines whether the cash flow of financial assets managed by the Company isbased on contract cash flow, selling financial assets or both. The Company determines the business model formanaging financial assets based on objective facts and based on the specific business objectives of financial assetsmanagement determined by key management personnel.The Company evaluates the contractual cash flow characteristics of financial assets to determine whether thecontractual cash flows generated by the relevant financial assets on a specific date are only payments for theprincipal and the interest based on the outstanding principal amount. The principal is the fair value of the financialassets at initial recognition; the interest includes the time value of money, the credit risk associated with theoutstanding principal amount for a specific period, and other basic borrowing risks, costs and consideration ofprofit. In addition, the Company evaluates the contractual terms that may result in changes in the time distributionor the amount of contractual cash flows of the financial assets to determine whether they meet the requirements ofthe above contractual cash flow characteristics.Only when the Company changes its business model of managing financial assets, all affected financial assets arereclassified on the first day of the first reporting period after the business model changes, otherwise the financialassets are not allowed to be reclassified after initial recognition.
① Financial assets measured at amortized cost
The Company classifies the financial assets that meet the following conditions and haven’t been designated asfinancial assets measured at fair value and whose changes are included in current profit or loss as financial assetsmeasured at amortized cost:
A. the group's business model for managing the financial assets is to collect contractual cash flows; andB. the contractual terms of the financial assets stipulate that cash flow generated on a specific date is only paid forthe principal and interest based on the outstanding principal amount.After initial recognition, such financial assets are measured at amortized cost by using the effective interestmethod. Gains or losses arising from financial assets which are measured at amortized cost and are not acomponent of any hedging relationship are included in current profit or loss when being terminated forrecognition, amortized by effective interest method, or impaired.
② Financial assets measured at fair value and whose changes are included in other comprehensive incomeThe Company classifies the financial assets that meet the following conditions and haven’t been designated asfinancial assets measured at fair value and whose changes are included in current profit or loss as financial assetsmeasured at fair value and whose changes are included in other comprehensive income:
A. the Group's business model for managing the financial assets is targeted at both the collection of contractualcash flows and the sale of financial assets; andB. the contractual terms of the financial asset stipulate that the cash flow generated on a specific date is only the
payment of the principal and the interest based on the outstanding principal amount.After initial recognition, such financial assets are subsequently measured at fair value. Interests, impairment lossesor gains and exchange gains and losses calculated by using the effective interest method are included in profit orloss for the period, and other gains or losses are included in other comprehensive income. When being terminatefor recognition, the accumulated gains or losses previously included in other comprehensive income aretransferred from other comprehensive income and included in current profit or loss.
③ Financial assets measured at fair value and whose changes are included in current profit or lossExcept for the above financial assets measured at amortized cost and measured at fair value and whose changesare included in other comprehensive income, the Company classifies all other financial assets as financial assetsmeasured at fair value and whose changes are included in current profit or loss. In the initial recognition, in orderto eliminate or significantly reduce accounting mismatch, the Company irreversibly designates part of thefinancial assets that should be measured at amortized cost or measured at fair value and whose changes areincluded in the other comprehensive income as the financial assets measured at fair value and whose changes areincluded in current profit or loss.After the initial recognition, such financial assets are subsequently measured at fair value, and the gains or losses(including interests and dividend income) are included in the current profit and loss, unless the financial assets arepart of the hedging relationship.However, for non-trading equity instrument investments, the Company irreversibly designates them as thefinancial assets that are measured at fair value and whose changes are included in other comprehensive income inthe initial recognition. The designation is made based on a single investment and the relevant investment is in linewith the definition of equity instruments from the issuer's perspective. After initial recognition, such financialassets are subsequently measured at fair value. Dividend income that meets the conditions is included in profit orloss, and other gains or losses and changes in fair value are included in other comprehensive income. When it isterminated for recognition, the accumulated gains or losses previously included in other comprehensive incomeare transferred from other comprehensive income and included in retained earnings.
(3) Classification and measurement of financial liabilities
The financial liabilities of the Company are classified as financial liabilities measured at fair value and whosechanges are included in current profit or loss and financial liabilities measured at amortized cost at the initialrecognition. For financial liabilities that are not classified as financial liabilities measured at fair value and whosechanges are included in current profit or loss, the related transaction expenses are included in the initialrecognition amount.
① Financial liability measured by fair value and with variation reckoned into current gains/lossesFinancial liability measured by fair value and with variation reckoned into current gains/losses including tradablefinancial liability and the financial liabilities that are designated as fair value in the initial recognition and whosechanges are included in current profit or loss. For such financial liabilities, the subsequent measurement is basedon fair value, and the gains or losses arising from changes in fair value and the dividends and interest expensesrelated to these financial liabilities are included in current profit or loss.
② Financial liability measured by amortized cost
Other financial liabilities are subsequently measured at amortized cost by using the effective interest method. Thegain or loss arising from recognition termination or amortization is included in current profit or loss.
③ Distinctions between financial liabilities and equity instruments
Financial liabilities are liabilities that meet one of the following conditions:
A. Contractual obligations to deliver cash or other financial assets to other parties.B. Contractual obligations to exchange financial assets or financial liabilities with other parties under potentiallyadverse conditions.C. Non-derivative contracts that must be settled or that can be settled by the company's own equity instruments inthe future, and the enterprise will deliver a variable amount of its own equity instruments according to the contract.D. Derivative contracts that must be settled or that can be settled by the company's own equity instruments in thefuture, except for derivatives contracts that exchange a fixed amount of cash or other financial assets with a fixedamount of their own equity instruments.An equity instrument is a contract that proves it has a residual equity in the assets of an enterprise after deductingall liabilities.If the Company cannot unconditionally avoid performing a contractual obligation by delivering cash or otherfinancial assets, the contractual obligation is consistent with the definition of financial liability.If a financial instrument is required to be settled or can be settled by the Company's own equity instruments, it isnecessary to consider whether the Company's own equity instruments used to settle the instrument are a substitutefor cash or other financial assets, or to make the instrument holder enjoy the residual equity in the assets of theissuer after deducting all liabilities. In the former case, the instrument is the Company's financial liability; if it isthe latter, the instrument is the Company's equity instrument.
(4) Fair value of financial instruments
The company uses valuation techniques that are applicable under current circumstances and that have sufficientavailable data and other information support to determine the fair value of related financial assets and financialliabilities. The company divides the input values used by valuation techniques into the following levels and usesthem in sequence:
① The first-level input value is the unadjusted quotation of the same assets or liabilities that can be obtained onthe measurement date in the active market;
② The second-level input value is the direct or indirect observable input value of the relevant assets or liabilitiesother than the first-level input value, including quotations of similar assets or liabilities in an active market;quotations of same or similar assets or liabilities in an active market; other observable input value other thanquotations, such as interest rate and yield curves that are observable during the normal quote interval; market-validated input value, etc.;
③ The third-level input value is the unobservable input value of the relevant assets or liabilities, including theinterest rate that cannot be directly observed or cannot be verified by observable market data, stock volatility,future cash flow of the retirement obligation assumed in the business combination, and financial forecasting made
by its own data, etc.
(5) Impairment of financial assets
On the basis of expected credit losses, the Company performs impairment treatment on financial assets measuredat amortized cost and creditors’ investment etc. measured at fair value and whose changes are included in othercomprehensive income and recognize the provisions for loss.
①Measurement of expected credit losses
Expected credit loss refers to the weighted average of credit losses of financial instruments weighted by the risk ofdefault. Credit loss refers to the difference between all contractual cash flows that the Company discounts at theoriginal actual interest rate and are receivable in accordance with contract and all cash flows expected to bereceived, that is, the present value of all cash shortages. Among them, for the purchase or source of financialassets that have suffered credit impairment, the Company discounts the financial assets at the actual interest rateadjusted by credit.When measuring expected credit losses, the Company individually evaluates credit risk for financial assets withsignificantly different credit risks, such as receivables involving litigation and arbitration with the other party, orreceivables having obvious indications that the debtor is likely to be unable to fulfill its repayment obligations,and so on.Except for the financial assets that separately assess the credit risks, the Company classified the accountreceivable according to their characteristic of risks, calculated the expected credit losses on basis of portfolio.Basis for determining the portfolio as follow:
A - Note receivableNote receivable 1: bank acceptanceNote receivable 2: trade acceptanceB - Account receivableAccount receivable 1: receivable from clientsAccount receivable 2: receivable from internal related partyC- Receivable financingReceivable financing 1: bank acceptanceReceivable financing 2: trade acceptanceD - Other account receivablesOther account receivables 1: receivable from internal related partyOther account receivables 2: receivable from othersAs for the note receivable, account receivable, receivable financing and other account receivable classified inportfolio, by referring to the experience of historical credit loss, the expected credit loss is calculated bycombining the current situation and the forecast of future economic conditions.Except for the financial assets adopting simplified metering method, the Company assesses at each balance sheetdate whether its credit risk has increased significantly since initial recognition. If credit risk has not increased
significantly since initial recognition, it is in the first stage, the Company measures the loss provisions based onthe amount equivalent to the expected credit loss in the next 12 months; if the credit risk has increasedsignificantly since initial recognition but no credit impairment has occurred, it is in the second stage, the Companymeasures the loss provisions based on the amount equivalent to the expected credit loss for the entire duration; ifcredit impairment occurs after initial recognition, it is in the third stage, the Company measures the lossprovisions based on the amount equivalent to the expected credit loss for the entire duration.For financialinstruments with low credit risks at the balance sheet date, the Company assumes that their credit risks have notincreased significantly since initial recognition.The Company evaluates the expected credit losses of financial instruments based on individual items andportfolios. When assessing expected credit losses, the Company considers reasonable and evidence-basedinformation about past events, current conditions, and forecasts of future economic conditions.When the Company no longer reasonably expects to be able to fully or partially recover the contractual cash flowof a financial asset, the Company directly writes down the book balance of the financial asset.
②Assessment of a significant increase in credit risk:
The Company determines the relative changes in default risk of the financial instrument occurred in the expectedduration and assess whether the credit risks of financial instrument has increased significantly since the initialrecognition by comparing the risk of default of the financial instrument on the balance sheet date with the risk ofdefault of financial instrument on the initial recognition date. When determining whether the credit risk hasincreased significantly since the initial recognition, the Company considers reasonable and evidence-basedinformation that can be obtained without unnecessary additional costs or effort, including forward-lookinginformation. The information considered by the Company includes:
A. The debtor fails to pay the principal and interest according to the contractual maturity date;B. Serious worsening of external or internal credit rating (if any) of the financial instruments that have occurred orare expected;C. Serious deterioration of the debtor’s operating results that have occurred or are expected;D. Changes in existing or anticipated technical, market, economic or legal circumstances that will have a materialadverse effect on the debtor's ability to repay the company.Based on the nature of financial instruments, the Company assesses whether credit risk has increased significantlyon the basis of a single financial instrument or combination of financial instruments. When conducting anassessment based on a combination of financial instruments, the Company can classify financial instrumentsbased on common credit risk characteristics, such as overdue information and credit risk ratings.The Company believes that financial assets are subject to default in the following circumstances:
The debtor is unlikely to pay the full amount to the Company, and the assessment does not consider the Companyto take recourse actions such as realizing collateral (if held).
③ Financial assets with credit impairment
On the balance sheet date, the Company assesses whether the credit of financial assets measured at amortized costand the credit of debt investments measured at fair value and whose changes are included in other comprehensive
income has been impaired. When one or more events that adversely affect the expected future cash flows of afinancial asset occur, the financial asset becomes a financial asset that has suffered credit impairment. Evidencethat credit impairment has occurred in financial assets includes the following observable information:
A. The issuer or the debtor has significant financial difficulties;B. The debtor breaches the contract, such as default or overdue repayment of interest or principal;C. The Company gives concessions to the debtor that will not be made in any other circumstances for economic orcontractual considerations relating to the financial difficulties of the debtor;D. The debtor is likely to go bankrupt or carry out other financial restructurings;E. The financial difficulties of the issuer or the debtor have caused the active market of the financial asset todisappear.
④ Presentation of expected credit loss provisions
In order to reflect the changes in the credit risk of financial instruments since the initial recognition, the Companyre-measures the expected credit losses on each balance sheet date, and the resulting increase or reversal of the lossprovisions shall be included in current profit and loss as impairment losses or gains. For financial assets measuredat amortized cost, the loss provisions are written off against the book value of the financial assets listed in thebalance sheet; for debt investments measured at fair value and whose changes are included in othercomprehensive income, the Company recognizes the loss provisions in other comprehensive income and does notdeduct the book value of the financial asset.
⑤ Write-off
If the Company no longer reasonably expects that the financial asset contract cash flow can be fully or partiallyrecovered, directly write down the book balance of the financial asset. Such write-downs constitute thetermination of recognition for related financial assets. This usually occurs when the Company determines that thedebtor has no assets or sources of income to generate sufficient cash flow to repay the amount that will be writtendown. However, according to the Company's procedures for recovering the due amount, the financial assets thathave been written down may still be affected by the execution activities.If the financial assets that have been written down are recovered afterwards, they shall be included in the profit orloss of the period being recovered as the reversal of the impairment loss
(6) Transfer of financial assets
The transfer of financial assets refers to the transfer or delivery of financial assets to the other party (the transferee)other than the issuer of the financial assets.For financial assets that the Company has transferred almost all risks and rewards of ownership of financial assetsto the transferee, terminate the recognition of the financial assets; if almost all the risks and rewards of ownershipof financial assets have been retained, do not terminate the recognition of the financial assets.If the Company has neither transferred nor retained almost all the risks and rewards of ownership of financialassets, dispose as following situations: If the control of the financial assets is abandoned, terminate the recognitionof the financial assets and determine the resulting assets and liabilities. If the control of the financial assets is notabandoned, determine the relevant financial assets according to the extent to which they continue to be involved in
the transferred financial assets, and determine the related liabilities accordingly.
(7) Balance-out between the financial assets and liabilities
As the Group has the legal right to balance out the financial liabilities by the net or liquidation of the financialassets, the balance-out sum between the financial assets and liabilities is listed in the balance sheet. In addition,the financial assets and liabilities are listed in the balance sheet without being balanced out.
11. Note receivable
Note receivable 1: bank acceptanceNote receivable 2: trade acceptanceThe Company calculates expected credit losses by referring to historical credit loss experience, taking intoaccount current conditions and forecasts of the future economic situation.
12.Account receivable
Account receivable 1: receivable from clientsAccount receivable 2: receivable from internal related partyThe Company calculates expected credit losses by referring to historical credit loss experience, taking intoaccount current conditions and forecasts of the future economic situation.
13. Receivable financing
The note receivable and account receivable which are measured at fair value and whose changes are included inother comprehensive income are classified as receivables financing within one year(including one year) from thedate of acquisition. Relevant accounting policy found more in 10. Financial Instrument in Note V.
14.Other account receivables
Determination method of expected credit loss and accounting treatmentOther account receivables 1: receivable from internal related partyOther account receivables 2: receivable from othersThe Company calculates expected credit losses by referring to historical credit loss experience, taking intoaccount current conditions and forecasts of the future economic situation.
15.Inventory
(1) Classification of inventories
The Company’s inventories are categorized into stock materials, product in process and stock goods etc.
(2) Pricing for delivered inventories
The cost of inventory at the time of acquisition and delivery is calculated according to the standard cost method,and the difference in cost that it should bear is carried forward at the end of the period, and the standard cost isadjusted to the actual cost.
(3) Recognition evidence for net realizable value of inventories and withdrawal method for inventory impairmentprovisionInventories as at period-end are priced at the lower of costs and net realizable values; at period end, on the basis ofoverall clearance about inventories, inventory impairment provision is withdrawn for uncollectible part of costs ofinventories which result from destroy of inventories, out-of-time of all and part inventories, or sales pricelowering than cost. Inventory impairment provision for stock goods and quantity of raw materials is subject to thedifference between costs of single inventory item over its net realizable value. As for other raw materials withlarge quantity and comparatively low unit prices, inventory impairment provision is withdrawn pursuant tocategories.As for finished goods, commodities and materials available for direct sales, their net realizable values aredetermined by their estimated selling prices less estimated sales expenses and relevant taxes. For materialinventories held for purpose of production, their net realizable values are determined by the estimated sellingprices of finished products less estimated costs, estimated sales expenses and relevant taxes accumulated tillcompletion of production. As for inventories held for implementation of sales contracts or service contracts, theirnet realizable values are calculated on the basis of contract prices. In the event that inventories held by a companyexceed order amount as agreed in sales contracts, net realizable values of the surplus part are calculated on thebasis of normal sale price.
(4) Inventory system
Perpetual Inventory System is adopted by the Company and takes a physical inventory.
(5) Amortization of low-value consumables and wrappage
① Low-value consumables
The Company adopts one-off amortization method to amortize the low-value consumables.
② Wrappage
The Company adopts one-off amortization method to amortize the wrappage at the time of receipt.
16.Contract assets
The Company presents the contract assets or contract liabilities in the balance sheet based on the relationshipbetween the performance obligation and the customer’s payment.Recognition method and standard of contract assets: contract assets refer to the right of a company to receiveconsideration after transferring goods or providing services to customers, and this right depends on other factorsbesides the passage of time. The company's unconditional (that is, only depending on the passage of time) right tocollect consideration from customers are separately listed as receivables.Method for determining expected credit losses of contract assets: the method for determining expected creditlosses of contract assets is consistent with the method for determining expected credit losses of accounts
receivable.Accounting treatment method of expected credit losses of contract assets: if the contract assets are impaired, thecompany shall debit the "asset impairment loss" subject and credit the "contract asset impairment provision"subject according to the amount that should be written down. When reversing the provision for asset impairmentthat has already been withdrawn, make opposite accounting entries.
17.Assets held for sale
The Company classifies non-current assets or disposal groups that meet all of the following conditions as held-for-sale: according to the practice of selling this type of assets or disposal groups in a similar transaction, the non-current assets or disposal group can be sold immediately at its current condition; The sale is likely to occur, that is,the Company has made resolution on the selling plan and obtained definite purchase commitment, the selling isestimated to be completed within one year. Those assets whose disposal is subject to approval from relevantauthority or supervisory department under relevant requirements are subject to that approval.Where the Company loses control over its subsidiary due to disposal of investment in the subsidiary, whether ornot the Company retains part equity investment after such disposal, investment in the subsidiary shall be classifiedin its entirety as held for sale in the separate financial statement of the parent company subject to that theinvestment in the subsidiary proposed to be disposed satisfies the conditions for being classified as held for sale,and all the assets and liabilities of the subsidiary shall be classified as held for sale in consolidated financialstatement.The purchase commitment identified refers to the legally binding purchase agreement entered into between theCompany and other parties, which sets out certain major terms relating to transaction price, time and adequatelystringent punishment for default, which render an extremely minor possibility for material adjustment orrevocation of the agreement.Assets held for sale are measured at the lower of heir carrying value and fair value less selling expense. If thecarrying value is higher than fair value less selling expense, the excess shall be recognized as impairment loss andrecorded in profit or loss for the period, and allowance for impairment shall be provided for in respect of theassets. In respect of impairment loss recognized for disposal group held for sale, carrying value of the goodwill inthe disposal group shall be deducted first, and then deduct the carrying value of the non-current assets within thedisposal group applicable to this measurement standard on a pro rata basis according to the proportion taken bytheir carrying value.If the net amount of fair value of non-current assets held for sale less sales expense on subsequent balance sheetdate increases, the amount previously reduced for accounting shall be recovered and reverted from the impairmentloss recognized after the asset is classified under the category of held for sale, with the amount reverted recordedin profit or loss for the period. Impairment loss recognized before the asset is classified under the category of heldfor sale shall not be reverted.If the net amount of fair value of the disposal group held for sale on the subsequentbalance sheet date less sales expenses increases, the amount reduced for accounting in previous periods shall berestored, and shall be reverted in the impairment loss recognized in respect of the non-current assets which are
applicable to relevant measurement provisions after classification into the category of held for sale, with thereverted amount charged in profit or loss for the current period. The written-off carrying value of goodwill shallnot be reverted.The non-current assets in the non-current assets or disposal group held for sale is not depreciated or amortized,and the debt interests and other fees in the disposal group held for sale continue to be recognized.If the non-current assets or disposal group are no longer classified as held for sale since they no longer meet thecondition of being classified as held for sale or the non-current assets are removed from the disposal group heldfor sale, they will be measured at the lower of the following:
(i)The amount after their book value before they are classified as held for sale is adjusted based on thedepreciation, amortization or impairment that should have been recognized given they are not classified as heldfor sale;(ii) The recoverable amount.
18. Long-term equity investment
Long-term equity investments refer to long-term equity investments in which the Company has control, jointcontrol or significant influence over the invested party. Long-term equity investment without control or jointcontrol or significant influence of the Group is accounted for as available-for-sale financial assets or financialassets measured by fair value and with variation reckoned into current gains/losses. As for other accountingpolicies found more in “10. Financial instrument” in Note V.
(1) Determination of initial investment cost
Investment costs of the long-term equity investment are recognized by the follow according to different way ofacquirement:
① For a long-term equity investment acquired through a business combination involving enterprises undercommon control, the initial investment cost of the long-term equity investment shall be the absorbing party’sshare of the carrying amount of the owner’s equity under the consolidated financial statements of the ultimatecontrolling party on the date of combination. The difference between the initial cost of the long-term equityinvestment and the cash paid, non-cash assets transferred as well as the book value of the debts borne by theabsorbing party shall offset against the capital reserve. If the capital reserve is insufficient to offset, the retainedearnings shall be adjusted. If the consideration of the merger is satisfied by issue of equity securities, the initialinvestment cost of the long-term equity investment shall be the absorbing party’s share of the carrying amount ofthe owner’s equity under the consolidated financial statements of the ultimate controlling party on the date ofcombination. With the total face value of the shares issued as share capital, the difference between the initial costof the long-term equity investment and total face value of the shares issued shall be used to offset against thecapital reserve. If the capital reserve is insufficient to offset, the retained earnings shall be adjusted. For businesscombination resulted in an enterprise under common control by acquiring equity of the absorbing party undercommon control through a stage-up approach with several transactions, these transactions will be judged whetherthey shall be treat as “transactions in a basket”. If they belong to “transactions in a basket”, these transactions will
be accounted for a transaction in obtaining control. If they are not belong to “transactions in a basket”, the initialinvestment cost of the long-term equity investment shall be the absorbing party’s share of the carrying amount ofthe owner’s equity under the consolidated financial statements of the ultimate controlling party on the date ofcombination. The difference between the initial cost of the long-term equity investment and the aggregate of thecarrying amount of the long-term equity investment before merging and the carrying amount the additionalconsideration paid for further share acquisition on the date of combination shall offset against the capital reserve.If the capital reserve is insufficient to offset, the retained earnings shall be adjusted. Other comprehensive incomerecognized as a result of the previously held equity investment accounted for using equity method on the date ofcombination or recognized for available-for-sale financial assets will not be accounted for.
② For the long-term equity investment obtained by business combination not under the same control, the fairvalue of the assets involved, the equity instruments issued and the liabilities incurred or assumed on thetransaction date, plus the combined cost directly related to the acquisition is used as the initial investment cost ofthe long-term equity investment. The identifiable assets of the combined party and the liabilities (includingcontingent liabilities) assumed by the combined party on the combining date are all measured at fair value,regardless of the amount of minority shareholders’ equity. The amount of the combined cost exceeding the fairvalue of the identifiable net assets of the combined party obtained by the Company is recorded as goodwill, andthe amount below the fair value of the identifiable net assets of the combining party is directly recognized in theconsolidated income statement.(For business combination resulted in an enterprise not under common control byacquiring equity of the acquire under common control through a stage-up approach with several transactions,these transactions will be judged whether they shall be treat as “transactions in a basket”. If they belong to“transactions in a basket”, these transactions will be accounted for a transaction in obtaining control. If they arenot belonging to “transactions in a basket”, the initial investment cost of the long-term equity investmentaccounted for using cost method shall be the aggregate of the carrying amount of equity investment previouslyheld by the acquire and the additional investment cost. For previously held equity accounted for using equitymethod, relevant other comprehensive income will not be accounted for. For previously held equity investmentclassified as available-for-sale financial asset, the difference between its fair value and carrying amount, as well asthe accumulated movement in fair value previously included in the other comprehensive income shall betransferred to profit or loss for the current period.)
③ Long-term investments obtained through other ways:
A. Initial investment cost of long-term equity investment obtained through cash payment is determined accordingto actual payment for purchase;B. Initial investment cost of long-term equity investment obtained through issuance of equity securities isdetermined at fair value of such securities;C. Initial investment cost of long-term equity investment (exchanged-in) obtained through exchange with non-monetary assets, which is of commercial nature, is determined at fair value of the assets exchanged-out; otherwisedetermined at carrying value of the assets exchanged-out if it is not of commercial nature;D. Initial investment cost of long-term equity investment obtained through debt reorganization is determined atfair value of such investment.
(2) Subsequent measurement on long-term equity investment
① Presented controlling ability on invested party, the investment shall use cost method for measurement.
② Long-term equity investments with joint control (excluding those constitute joint ventures) or significantinfluence on the invested party are accounted for using equity method.Under the equity method, where the initial investment cost of a long-term equity investment exceeds theinvestor’s interest in the fair value of the invested party’s identifiable net assets at the acquisition date, noadjustment shall be made to the initial investment cost. Where the initial investment cost is less than the investor’sinterest in the fair value of the invested party’s identifiable net assets at the acquisition date, the difference shall becharged to profit or loss for the current period, and the cost of the long term equity investment shall be adjustedaccordingly.Under the equity method, investment gain and other comprehensive income shall be recognized based on theGroup’s share of the net profits or losses and other comprehensive income made by the invested party,respectively. Meanwhile, the carrying amount of long-term equity investment shall be adjusted. The carryingamount of long-term equity investment shall be reduced based on the Group’s share of profit or cash dividenddistributed by the invested party. In respect of the other movement of net profit or loss, other comprehensiveincome and profit distribution of invested party, the carrying value of long-term equity investment shall beadjusted and included in the capital reserves. The Group shall recognize its share of the invested party’s net profitsor losses based on the fair values of the invested party’s individual separately identifiable assets at the time ofacquisition, after making appropriate adjustments thereto. In the event of in-conformity between the accountingpolicies and accounting periods of the invested party and the Company, the financial statements of the investedparty shall be adjusted in conformity with the accounting policies and accounting periods of the Company.Investment gain and other comprehensive income shall be recognized accordingly. In respect of the transactionsbetween the Group and its associates and joint ventures in which the assets disposed of or sold are not classified asoperation, the share of unrealized gain or loss arising from inter-group transactions shall be eliminated by theportion attributable to the Company. Investment gain shall be recognized accordingly. However, any unrealizedloss arising from inter-group transactions between the Group and an invested party is not eliminated to the extentthat the loss is impairment loss of the transferred assets. In the event that the Group disposed of an asset classifiedas operation to its joint ventures or associates, which resulted in acquisition of long-term equity investment by theinvestor without obtaining control, the initial investment cost of additional long-term equity investment shall bethe fair value of disposed operation. The difference between initial investment cost and the carrying value ofdisposed operation will be fully included in profit or loss for the current period. In the event that the Group sold anasset classified as operation to its associates or joint ventures, the difference between the carrying value ofconsideration received and operation shall be fully included in profit or loss for the current period. In the eventthat the Company acquired an asset which formed an operation from its associates or joint ventures, relevanttransaction shall be accounted for in accordance with “Accounting Standards for Business Enterprises No. 20“Business combination”. All profit or loss related to the transaction shall be accounted for.The Group’s share of net losses of the invested party shall be recognized to the extent that the carrying amount ofthe long-term equity investment together with any long-term interests that in substance form part of the investor’s
net investment in the invested party are reduced to zero. If the Group has to assume additional obligations, theestimated obligation assumed shall be provided for and charged to the profit or loss as investment loss for theperiod. Where the invested party is making profits in subsequent periods, the Group shall resume recognizing itsshare of profits after setting off against the share of unrecognized losses.
③Acquisition of minority interest
Upon the preparation of the consolidated financial statements, since acquisition of minority interest increased oflong-term equity investment which was compared to fair value of identifiable net assets recognized which aremeasured based on the continuous measurement since the acquisition date (or combination date) of subsidiariesattributable to the Group calculated according to the proportion of newly acquired shares, the difference of whichrecognized as adjusted capital surplus, capital surplus insufficient to set off impairment and adjusted retainedearnings.
④ Disposal of long-term equity investments
In these consolidated financial statements, for disposal of a portion of the long-term equity investments in asubsidiary without loss of control, the difference between disposal cost and disposal of long-term equityinvestments relative to the net assets of the subsidiary is charged to the owners’ equity. If disposal of a portion ofthe long-term equity investments in a subsidiary by the parent company results in a change in control, it shall beaccounted for in accordance with the relevant accounting policies as described in Note V-6 “Preparation Methodof the Consolidated Financial Statements”.On disposal of a long-term equity investment otherwise, the difference between the carrying amount of theinvestment and the actual consideration paid is recognized through profit or loss in the current period.In respect of long-term equity investment accounted for using equity method with the remaining equity interestafter disposal also accounted for using equity method, other comprehensive income previously under owners’equity shall be accounted for in accordance with the same accounting treatment for direct disposal of relevantasset or liability by invested party on pro rata basis at the time of disposal. The owners’ equity recognized for themovement of other owners’ equity (excluding net profit or loss, other comprehensive income and profitdistribution of invested party) shall be transferred to profit or loss for the current period on pro rata basis.In respect of long-term equity investment accounted for using cost method with the remaining equity interest afterdisposal also accounted for cost equity method, other comprehensive income measured and reckoned under equitymethod or financial instrument before control of the invested party unit acquired shall be accounted for inaccordance with the same accounting treatment for direct disposal of relevant asset or liability by invested partyon pro rata basis at the time of disposal and shall be transferred to profit or loss for the current period on pro ratabasis; among the net assets of invested party unit recognized by equity method (excluding net profit or loss, othercomprehensive income and profit distribution of invested party) shall be transferred to profit or loss for the currentperiod on pro rata basis.In the event of loss of control over invested party due to partial disposal of equity investment by the Group, inpreparing separate financial statements, the remaining equity interest which can apply common control or imposesignificant influence over the invested party after disposal shall be accounted for using equity method. Such
remaining equity interest shall be treated as accounting for using equity method since it is obtained andadjustment was made accordingly. For remaining equity interest which cannot apply common control or imposesignificant influence over the invested party after disposal, it shall be accounted for using the recognition andmeasurement standard of financial instruments. The difference between its fair value and carrying amount as atthe date of losing control shall be included in profit or loss for the current period. In respect of othercomprehensive income recognized using equity method or the recognition and measurement standard of financialinstruments before the Group obtained control over the invested party, it shall be accounted for in accordance withthe same accounting treatment for direct disposal of relevant asset or liability by invested party at the time whenthe control over invested party is lost. Movement of other owners’ equity (excluding net profit or loss, othercomprehensive income and profit distribution under net asset of invested party accounted for and recognizedusing equity method) shall be transferred to profit or loss for the current period at the time when the control overinvested party is lost. Of which, for the remaining equity interest after disposal accounted for using equity method,other comprehensive income and other owners’ equity shall be transferred on pro rata basis. For the remainingequity interest after disposal accounted for using the recognition and measurement standard of financialinstruments, other comprehensive income and other owners’ equity shall be fully transferred.In the event of loss of common control or significant influence over invested party due to partial disposal of equityinvestment by the Group, the remaining equity interest after disposal shall be accounted for using the recognitionand measurement standard of financial instruments. The difference between its fair value and carrying amount asat the date of losing common control or significant influence shall be included in profit or loss for the currentperiod. In respect of other comprehensive income recognized under previous equity investment using equitymethod, it shall be accounted for in accordance with the same accounting treatment for direct disposal of relevantasset or liability by invested party at the time when equity method was ceased to be used. Movement of otherowners’ equity (excluding net profit or loss, other comprehensive income and profit distribution under net asset ofinvested party accounted for and recognized using equity method) shall be transferred to profit or loss for thecurrent period at the time when equity method was ceased to be used.The Group disposes its equity investment in subsidiary by a stage-up approach with several transactions until thecontrol over the subsidiary is lost. If the said transactions belong to “transactions in a basket”, each transactionshall be accounted for as a single transaction of disposing equity investment of subsidiary and loss of control. Thedifference between the disposal consideration for each transaction and the carrying amount of the correspondinglong-term equity investment of disposed equity interest before loss of control shall initially recognized as othercomprehensive income, and subsequently transferred to profit or loss arising from loss of control for the currentperiod upon loss of control.
(3) Impairment test method and withdrawal method for impairment provision
Found more in Note V-25 “impairment of long-term assets”.
(4) Criteria of joint control and significant influence
Joint control is the Company’s contractually agreed sharing of control over an arrangement, which relevantactivities of such arrangement must be decided by unanimously agreement from parties who share control. All theparticipants or participant group whether have controlling over such arrangement as a group or not shall be judge
firstly, then judge that whether the decision-making for such arrangement are agreed unanimity by the participantsor not.Significant influence is the power of the Company to participate in the financial and operating policy decisions ofan invested party, but to fail to control or joint control the formulation of such policies together with other parties.While recognizing whether have significant influence by invested party, the potential factors of voting power ascurrent convertible bonds and current executable warrant of the invested party held by investors and other partiesshall be thank over.
19.Investment real estate
Measurement model of investment real estateCost measurementDepreciation or amortizationInvestment real estate is stated at cost. During which, the cost of externally purchased properties held-for-investment includes purchasing price, relevant taxes and surcharges and other expenses which are directlyattributable to the asset. Cost of self construction of properties held for investment is composed of necessaryexpenses occurred for constructing those assets to a state expected to be available for use. Properties held forinvestment by investors are stated at the value agreed in an investment contract or agreement, but those undercontract or agreement without fair value are stated at fair value.The Company adopts cost methodology amid subsequent measurement of properties held for investment, whiledepreciation and amortization is calculated using the straight-line method according to their estimated useful lives.The basis of provision for impairment of properties held for investment is referred to Note V- 25 “Impairment oflong-term assets”.
20. Fixed assets
(1) Recognition conditions
Fixed assets refer to the tangible assets for production of products, provision of labor, lease or operation, with aservice life excess one year and has more unit value.
(2) Depreciation methods
| Category | Depreciation method | Years of depreciation | Scrap value rate | Yearly depreciation rate |
| House and Building | Straight-line depreciation | 20~35 | 5% | 2.71~4.75 |
| Machinery equipment | Straight-line depreciation | 10 | 5% | 9.50 |
| Transportation equipment | Straight-line depreciation | 4~5 | 5% | 19.00~23.75 |
| Electronic and other | Straight-line depreciation | 3～10 | 5% | 9.50～31.67 |
equipment
equipment
For the fixed assets with impairment provision, the depreciation amount shall be calculated after deducting theaccumulated amount of impairment provision for fixed assets
(3) Recognition basis, valuation and depreciation method for financial lease assetsThe Company affirms those that conform to below one or several criteria as the finance lease fixed assets:
① Agreed in the lease contract (or made a reasonable judgment according to the correlated conditions on the leasecommencement date), the ownership of lease fixed assets can be transferred to the Company after the expiry ofthe lease period;
② The Company has the option to purchase or lease the fixed assets, and the purchase price is estimated to bemuch less than the fair value of the lease of fixed assets when exercises the options, so whether the Company willexercise the option can be reasonably determined on the lease commencement date;
③ Even though the fixed asset ownership is not transferred, the lease term accounts for 75% of the service life ofthe lease fixed assets;
④ The present value of the Company’s of minimum lease payment on the lease commencement date is equivalentto 90% or more of the fair value of the lease fixed assets on the lease commencement date; the present value of theleaser’s of minimum lease payment on the lease commencement date is equivalent to 90% or more of the fairvalue of the lease fixed assets on the lease commencement date;
⑤ The leased assets with special properties can only be used by the Company without major modifications. Thefixed assets rented by finance leases is calculated as the book value according to the lower one between the fairvalue of leased assets on the lease commencement date and the present value of the minimum lease payments.
(4) The impairment test method and provision for impairment of fixed assets
The impairment test method and provision for impairment of fixed assets found more in Note V-25.“Impairmentof long-term assets”.
21.Construction in progress
From the date on which the fixed assets built by the Company come into an expected usable state, the constructionin progress are converted into fixed assets on the basis of the estimated value of project estimates or pricing orproject actual costs, etc. Depreciation is calculated from the next month. Further adjustments are made to thedifference of the original value of fixed assets after final accounting is completed upon completion of projects.The basis of provision for impairment of properties held for construction in process is referred to Note V-“25.Impairment of long-term assets”
22. Borrowing costs
(1) Recognition of capitalization of borrowing costs
Borrowing costs comprise interest occurred, amortization of discounts or premiums, ancillary costs and exchangedifferences in connection with foreign currency borrowings. The borrowing costs of the Company, which incurfrom the special borrowings occupied by the fixed assets that need more than one year (including one year) forconstruction, development of investment properties or inventories or from general borrowings, are capitalized andrecorded in relevant assets costs; other borrowing costs are recognized as expenses and recorded in the profit orloss in the period when they are occurred. Relevant borrowing costs start to be capitalized when all of thefollowing three conditions are met:
①Capital expenditure has been occurred;
②Borrowing costs have been occurred;
③ Acquisition or construction necessary for the assets to come into an expected usable state has been carried out.
(2) Period of capitalization of borrowing costs
Borrowing costs arising from purchasing fixed asset, investment real estate and inventory, and occurred after suchassets reached to its intended use of status or sales, than reckoned into assets costs while satisfy the abovementioned capitalization condition; capitalization of borrowing costs shall be suspended and recognized as currentexpenditure during periods in which construction of fixed assets, investment real estate and inventory areinterrupted abnormally, when the interruption is for a continuous period of more than 3 months, until theacquisition, construction or production of the qualifying asset is resumed; capitalization shall discontinue whenthe qualifying asset is ready for its intended use or sale, the borrowing costs occurred subsequently shall reckonedinto financial expenses while occurring for the current period.
(3) Measure of capitalization for borrowing cost
In respect of the special borrowings borrowed for acquisition, construction or production and development of theassets qualified for capitalization, the amount of interests expenses of the special borrowings actually occurred inthe period less interest income derived from unused borrowings deposited in banks or less investment incomederived from provisional investment, are recognized.With respect to the general borrowings occupied for acquisition, construction or production and development ofthe assets qualified for capitalization, the capitalized interest amount for general borrowings is calculated andrecognized by multiplying a weighted average of the accumulated expenditure on the assets in excess of theexpenditure on the assets of the special borrowings, by a capitalization rate for general borrowings. Thecapitalization rate is determined by calculation of the weighted average interest rate of the general borrowings.
23. Right-of-use assets
The right-of-use asset refers to the right of the Company, as the lessee, to use the leased asset during the leaseterm.On the commencement date of the lease term, the Company recognizes the right-of-use assets for leases other thanshort-term leases and leases of low-value assets. Right-of-use assets are initially measured at cost. The costincludes the initial measurement amount of the lease liability; the lease payments made on or before thecommencement date of the lease term, deduct the relevant amount of the lease incentive already enjoyed if there is
a lease incentive; the initial direct expenses incurred by the lessee; the cost expected to be incurred by the lessee todismantle and remove the leased assets, restore the site where the leased assets locate, or restore the leased assetsto the condition agreed upon in the lease terms, but this does not include the cost attributable to the production ofinventory.The Company subsequently uses the straight-line method to depreciate the right-of-use assets. If it can bereasonably determined that the ownership of the leased asset can be obtained at the expiration of the lease term,the Company shall accrue depreciation over the remaining useful life of the leased asset. If it cannot be reasonablydetermined that the ownership of the leased asset can be obtained at the expiration of the lease term, the Companyshall accrue depreciation within the shorter of the lease term and the remaining useful life of the leased asset.When the recoverable amount is lower than the book value of the right-of-use asset, the Company shall writedown its book value to the recoverable amount.
24. Intangible assets
(1) Measurement, use of life and impairment testing
① Measurement of intangible assets
The intangible assets of the Company including land use rights, patented technology and non-patents technologyetc.The cost of a purchased intangible asset shall be determined by the expenditure actually occurred and other relatedcosts.The cost of an intangible asset contributed by an investor shall be determined in accordance with the valuestipulated in the investment contract or agreement, except where the value stipulated in the contract or agreementis not fair.The intangible assets acquired through exchange of non-monetary assets, which is commercial in substance, iscarried at the fair value of the assets exchanged out; for those not commercial in substance, they are carried at thecarrying amount of the assets exchanged out.The intangible assets acquired through debt reorganization, are recognized at the fair value.
② Amortization methods and time limit for intangible assets:
Land use right of the company had average amortization by the transfer years from the beginning date of transfer(date of getting land use light); Patented technology, non-patented technology and other intangible assets of theCompany are amortized by straight-line method with the shortest terms among expected useful life, benefit yearsregulated in the contract and effective age regulated by the laws. The amortization amount shall count in relevantassets costs and current gains/losses according to the benefit object.As for the intangible assets as trademark, with uncertain benefit terms, amortization shall not be carried.Impairment testing methods and Accrued for depreciation reserves for the intangible assets found more in Note V-25 “Impairment of long-term assets”.
(2) Internal accounting policies relating to research and development expendituresExpenses incurred during the research phase are recognized as profit or loss in the current period; expensesincurred during the development phase that satisfy the following conditions are recognized as intangible assets(patented technology and non-patents technology):
① It is technically feasible that the intangible asset can be used or sold upon completion;
② There is intention to complete the intangible asset for use or sale;
③ The products produced using the intangible asset has a market or the intangible asset itself has a market;
④ There is sufficient support in terms of technology, financial resources and other resources in order to completethe development of the intangible asset, and there is capability to use or sell the intangible asset;
⑤ The expenses attributable to the development phase of the intangible asset can be measured reliably.If the expenses incurred during the development phase did not qualify the above mentioned conditions, suchexpenses incurred are accounted for in the profit or loss for the current period. The development expenditurereckoned in gains/losses previously shall not be recognized as assets in later period. The capitalized expenses indevelopment stage listed as development expenditure in balance sheet, and shall be transfer as intangible assetssince such item reached its expected conditions for service.
25. Impairment of long-term assets
The Company will judge if there is any indication of impairment as at the balance sheet date in respect of non-current non-financial assets such as fixed assets, construction in progress, intangible assets with a finite useful life,investment properties measured at cost, and long-term equity investments in subsidiaries, joint controlled entitiesand associates. If there is any evidence indicating that an asset may be impaired, recoverable amount shall beestimated for impairment test. Goodwill, intangible assets with an indefinite useful life and intangible assetsbeyond working conditions will be tested for impairment annually, regardless of whether there is any indication ofimpairment.If the impairment test result shows that the recoverable amount of an asset is less than its carrying amount, theimpairment provision will be made according to the difference and recognized as an impairment loss. Therecoverable amount of an asset is the higher of its fair value less costs of disposal and the present value of thefuture cash flows expected to be derived from the asset. An asset’s fair value is the price in a sale agreement in anarm’s length transaction. If there is no sale agreement but the asset is traded in an active market, fair value shall bedetermined based on the bid price. If there is neither sale agreement nor active market for an asset, fair value shallbe based on the best available information. Costs of disposal are expenses attributable to disposal of the asset,including legal fee, relevant tax and surcharges, transportation fee and direct expenses incurred to prepare theasset for its intended sale. The present value of the future cash flows expected to be derived from the asset overthe course of continued use and final disposal is determined as the amount discounted using an appropriatelyselected discount rate. Provisions for assets impairment shall be made and recognized for the individual asset. If itis not possible to estimate the recoverable amount of the individual asset, the Group shall determine the
recoverable amount of the asset group to which the asset belongs. The asset group is the smallest group of assetscapable of generating cash flows independently.For the purpose of impairment testing, the carrying amount of goodwill presented separately in the financialstatements shall be allocated to the asset groups or group of assets benefiting from synergy of businesscombination. If the recoverable amount is less than the carrying amount, the Group shall recognize an impairmentloss. The amount of impairment loss shall first reduce the carrying amount of any goodwill allocated to the assetgroup or set of asset groups, and then reduce the carrying amount of other assets (other than goodwill) within theasset group or set of asset groups, pro rata on the basis of the carrying amount of each asset.An impairment loss recognized on the aforesaid assets shall not be reversed in a subsequent period in respect ofthe part whose value can be recovered.
26. Long-term deferred expenses
Long-term expenses to be amortized of the Company the expenses that are already charged and with the beneficialterm of more than one year are evenly amortized over the beneficial term. For the long-term deferred expenseitems cannot benefit the subsequent accounting periods, the amortized value of such items is all recorded in theprofit or loss during recognition.
27. Contract liability
The Company lists the obligation to transfer goods or provide labor services to customers for the considerationreceived or receivable from customers as contractual liabilities, such as the amount that the company has receivedbefore the transfer of the promissory goods.
28. Employee compensation
(1) Accounting treatment for short-term compensation
During the accounting period when the staff providing service to the Company, the short-term remuneration actualoccurred shall recognized as liability and reckoned into current gains/losses. During the accounting period whenstaff providing service to the Company, the actual short-term compensation occurred shall recognized as liabilitiesand reckoned into current gains/losses, except for those in line with accounting standards or allow to reckonedinto capital costs; the welfare occurred shall reckoned into current gains/losses or relevant asses costs whileactually occurred. The employee compensation shall recognize as liabilities and reckoned into current gains/lossesor relevant assets costs while actually occurred. The employee benefits that belong to non-monetary benefits aremeasured in accordance with the fair value; the social insurances including the medical insurance, work-injuryinsurance and maternity insurance and the housing fund that the enterprise pays for the employees as well as thelabor union expenditure and employee education funds withdrawn by rule should be calculated and determined asthe corresponding compensation amount and determined the corresponding liabilities in accordance with the
specified withdrawing basis and proportion, and reckoned in the current profits and losses or relevant asset costsin the accounting period that the employees provide services.
(2) Accounting treatment for post-employment benefit
The post-employment benefit included the defined contribution plans and defined benefit plans. Post-employmentbenefits plan refers to the agreement about the post-employment benefits between the enterprise and employees,or the regulations or measures the enterprise established for providing post-employment benefits to employees.Thereinto, the defined contribution plan refers to the post-employment benefits plan that the enterprise doesn’tundertake the obligation of payment after depositing the fixed charges to the independent fund; the defined benefitplans refers to post-employment benefits plans except the defined contribution plan.
(3) Accounting treatment for retirement benefits
When the Company terminates the employment relationship with employees before the end of the employmentcontracts or provides compensation as an offer to encourage employees to accept voluntary redundancy, theCompany shall recognize employee compensation liabilities arising from compensation for staff dismissal andincluded in profit or loss for the current period, when the Company cannot revoke unilaterally compensation fordismissal due to the cancellation of labor relationship plans and employee redundant proposals; and the Companyrecognize cost and expenses related to payment of compensation for dismissal and restructuring, whichever isearlier.The early retirement plan shall be accounted for in accordance with the accounting principles forcompensation for termination of employment. The salaries or wages and the social contributions to be paid for theemployees who retire before schedule from the date on which the employees stop rendering services to thescheduled retirement date, shall be recognized (as compensation for termination of employment) in the currentprofit or loss by the Group if the recognition principles for provisions are satisfied.
(4) Accounting treatment for other long-term employee benefits
Except for the compulsory insurance, the Company provides the supplementary retirement benefits to theemployees satisfying some conditions, the supplementary retirement benefits belong to the defined benefit plans,and the defined benefitliability confirmed on the balance sheet is the value by subtracting the fair value of planassets from the present value of defined benefit obligation. The defined benefit obligation is annually calculated inaccordance with the expected accumulated welfare unit method by the independent actuary by adopting thetreasury bond rate with similar obligation term and currency. The service charges related to the supplementaryretirement benefits (including the service costs of the current period, the previous service costs, and the settlementgains or losses) and the net interest are reckoned in the current profits and losses or other asset costs, the changesgenerated by recalculating the net liabilities of defined benefit plans or net assets should be reckoned in otherconsolidated income.
29. Lease liability
Substantial On the commencement date of the lease term, the Company recognizes the present value of the unpaidlease payments as lease liabilities. Lease payments include the following five items: fixed payments and in-substance fixed payments, if there is a lease incentive, deduct the amount related to the lease incentive; variablelease payments that depend on an index or ratio, which are determined at the initial measurement according to theindex or ratio determination on the commencement date of lease term; exercise price for a purchase optionprovided that the lessee is reasonably certain that the option shall be exercised; payments for exercising the optionto terminate the lease provided that the lease term reflects that the lessee shall exercise the option to terminate thelease option; estimated payments due based on guaranteed residual value provided by the lessee.When calculating the present value of lease payments, the interest rate implicit in the lease is used as the discountrate. If the interest rate implicit in the lease cannot be determined, the company’s incremental borrowing rate isused as the discount rate. The Company calculates the interest expense of the lease liability in each period of thelease term according to the fixed periodic interest rate, and includes it in the current profit and loss, unless it isotherwise stipulated to be included in the cost of the relevant assets. Variable lease payments that are not includedin the measurement of lease liabilities are included in the current profit and loss when they are actually incurred,unless otherwise stipulated to be included in the cost of the relevant assets. After the commencement date of thelease term, when there is a change in the in-substance fixed payment, or a change in the estimated amount payablefor the guaranteed residual value, or a change in the index or ratio used to determine the lease payment, or achange in the evaluation results of the purchase option, renewal option or termination option or when the actualexercise situation changes, the Company shall re-measure the lease liability according to the present value of thechanged lease payments.
30. Accrued liability
(1) Recognition principle
An obligation related to a contingency, such as guarantees provided to outsiders, pending litigation or arbitration,product warranties, redundancy plans, onerous contracts, reconstructing, expected disposal of fixed assets, etc.shall be recognized as an estimated liability when all of the following conditions are satisfied:
① the obligation is a present obligation of the Company;
② it is Contingent that an outflow of economic benefits will be required to settle the obligation;
③ the amount of the obligation can be measured reliably.
(2) Measurement method: Measure on the basis of the best estimates of the expenses necessary for paying off thecontingencies
31. Share-based payment
The Company’s share-based payment is a transaction that grants equity instruments or assumes liabilitiesdetermined on the basis of equity instruments in order to obtain services provided by employees or other parties.
The Company’s share-based payment is classified as equity-settled share-based payment and cash-settled share-based payment.
(1) Equity-settled share-based payment and equity instruments
Equity-settled share-based payment in exchange for services provided by employees shall be measured at the fairvalue of the equity instruments granted to employees. If the Company uses restricted stocks for share-basedpayment, employees contribute capital to subscribe for stocks, and the stocks shall not be listed for circulation ortransfer until the unlocking conditions are met and unlocked; if the unlocking conditions specified in the finalequity incentive plan are not met, the Company shall repurchase the stocks at the pre-agreed price. When theCompany obtains the payment for the employees to subscribe for restricted stocks, it shall confirm the sharecapital and capital reserve (share capital premium) according to the obtained subscription money, and at the sametime recognize a liability in full for the repurchase obligation and recognize treasury shares. On each balance sheetdate during the waiting period, the Company makes the best estimate of the number of vesting equity instrumentsbased on the changes in the latest obtained number of vested employees, whether they meet the specifiedperformance conditions, and other follow-up information. On this basis, the services obtained in the current periodare included in related costs or expenses based on the fair value on the grant date, and the capital reserve shall beincreased accordingly.For share-based payments that cannot be vested in the end, costs or expenses shall not be recognized, unless thevesting conditions are market conditions or non-vesting conditions. At this time, regardless of whether the marketconditions or the non-vesting conditions are met, as long as all non-market conditions in the vesting conditions aremet, it is deemed as vesting.If the terms of equity-settled share-based payment are modified, at least the services obtained should be confirmedin accordance with the unmodified terms. In addition, any modification that increases the fair value of the equityinstruments granted, or a change that is beneficial to employees on the modification date, is recognized as anincrease in services received.If the equity-settled share payment is canceled, it will be treated as an accelerated vesting on the cancellation day,and the unconfirmed amount will be confirmed immediately. If an employee or other party can choose to meet thenon-vesting conditions but fails to meet within the waiting period, it shall be treated as cancellation of equity-settled share-based payment. However, if a new equity instrument is granted and it is determined on the date ofgrant of the new equity instrument that the new equity instrument granted is used to replace the cancelled equityinstrument, the granted substitute equity instruments shall be treated in the same way as the modification of theoriginal equity instrument terms and conditions.
(2) Cash-settled share-based payment and equity instruments
Cash-settled share-based payments are measured at the fair value of the liabilities calculated and determined onthe basis of shares or other equity instruments undertaken by the Company. If it’s vested immediately after thegrant, the fair value of the liabilities assumed on the date of the grant is included in the cost or expense, and theliability is increased accordingly. If the service within the waiting period is completed or the specifiedperformance conditions are met, the service obtained in the current period shall be included in the relevant costsor expenses based on the best estimate of the vesting situation within the waiting periodand the fair value of the
liabilities assumed to increase the corresponding liabilities. On each balance sheet date and settlement date beforethe settlement of the relevant liabilities, the fair value of the liabilities is remeasured, and the changes are includedin the current profit and loss.
32. Revenue
Accounting policies used in revenue recognition and measurement
1)Revenue recognition principle
On the starting date of the contract, the company evaluates the contract, identifies each individual performanceobligation contained in the contract, and determines whether each individual performance obligation is performedwithin a certain period of time or at a certain point in time.When one of the following conditions is met, it belongs to the performance obligation within a certain period oftime, otherwise, it belongs to the performance obligation at a certain point in time: ① The customer obtains andconsumes the economic benefits brought by the company's performance while the company performs the contract;
② The customer can control the goods or services in progress during the company’s performance; ③ The goodsor services produced during the company’s performance have irreplaceable uses, and the company has the right tocollect payment for the performance part that has been completed so far during the entire contract period.For performance obligations performed within a certain period of time, the company recognizes revenue inaccordance with the performance progress during that period. When the performance progress cannot bereasonably determined, if the cost incurred is expected to be compensated, the revenue shall be recognizedaccording to the amount of the cost incurred until the performance progress can be reasonably determined. Forperformance obligations performed at a certain point in time, revenue is recognized at the point when thecustomer obtains control of the relevant goods or services. When judging whether the customer has obtainedcontrol of the goods, the company considers the following signs:① The company has the current right to receivepayment for the goods, that is, the customer has the current payment obligation for the goods; ② The companyhas transferred the legal ownership of the goods to the customer, that is, the customer has the legal ownership ofthe goods; ③ The company has transferred the goods to the customer in kind, that is, the customer has physicallytaken possession of the goods; ④ The company has transferred the main risks and rewards of the ownership ofthe goods to the customer, that is, the customer has obtained the main risks and rewards of the ownership of thegoods; ⑤ The customer has accepted the goods; ⑥ Other signs that the customer has obtained control of thegoods.
2)Revenue measurement principle
① The company measures revenue based on the transaction price allocated to each individual performanceobligation. The transaction price is the amount of consideration that the company expects to be entitled to receivedue to the transfer of goods or services to customers, and does not include payments collected on behalf of thirdparties and payments expected to be returned to customers.
② If there is variable consideration in the contract, the company shall determine the best estimate of the variableconsideration according to the expected value or the most likely amount, but the transaction price including thevariable consideration shall not exceed the amount of cumulatively recognized revenue that is unlikely to be
significantly turned back when the relevant uncertainty is eliminated.
③ If there is a significant financing component in the contract, the company shall determine the transaction pricebased on the amount payable that the customer is assumed to pay in cash when obtaining the control of the goodsor services. The difference between the transaction price and the contract consideration shall be amortized by theeffective interest method during the contract period. On the starting date of the contract, if the company expectsthat the customer pays the price within one year after obtaining control of the goods or services, the significantfinancing components in the contract shall not be considered.
④If the contract contains two or more performance obligations, the company will allocate the transaction price toeach individual performance obligation based on the relative proportion of the stand-alone selling price of thegoods promised by each individual performance obligation on the starting date of the contract.
(2) The Company's criteria for the recognition of commodity income and specific criteria for the recognition time:
The Company's domestic sales revenue recognition time: The company shall deliver the goods according to theagreement of the order, and check with the buyer the goods received and inspected by the buyer from the previousreconciliation date to the current reconciliation date. After the check by both parties, the risks and rewards shall betransferred to the buyer. The Company shall issue invoices to the buyer according to the varieties, quantities andamounts confirmed by the reconciliation and confirm the realization of sales income on the reconciliation date.The Company's foreign sales revenue recognition time: after the completion of the customs audit, the company inaccordance with the export date specified in the customs declaration, to confirm the realization of sales revenue.Differences in accounting policies for revenue recognition due to different operating models for the same type ofbusinessN/A
33. Government grants
(1) Types
Government grants are transfer of monetary assets or non-monetary assets from the government to the Group atno consideration. Government grants are classified into government grants related to assets and government grantsrelated to income.As for the assistance object not well-defined in government’s documents, the classification criteria for assets-related or income-related grants are as: whether the grants turn to long-term assets due to purchasing forconstruction or other means.
(2) Recognition and measure
The government grants shall be recognized while meet the additional conditions of the grants and amount isactually can be obtained.If a government grant is in the form of a transfer of monetary asset, the item shall be measured at the amountreceived or receivable. If a government grant is in the form of a transfer of non-monetary asset, the item shall bemeasured at fair value. If the fair value can not be reliably acquired, than measured by nominal amount.
(3) Accounting treatment
A government grant related to an asset shall be recognized as deferred income, and reckoned into currentgains/losses according to the depreciation process in use life of such assets.A government grant related to income, if they making up relevant expenses and losses for later period, thanrecognized deferred income, and should reckoned into current gain/loss during the period while relevant expensesare recognized; if they making up relevant expenses and losses that occurred, than reckoned into currentgains/losses.A government grant related to daily operation activity of the Company should reckoned into other income; thosewithout related to daily operation activity should reckoned into non-operation income and expenses.The financial discount funds received by the Company shall write down relevant borrowing costs.
34. Deferred income tax assets/Deferred income tax liabilities
(1) Deferred income tax assets or deferred income tax liabilities are realized based on the difference between thecarrying values of assets and liabilities and their taxation bases (as for the ones did not recognized as assets andliability and with taxation basis recognized in line with tax regulations, different between tax base and its bookvalue) at the tax rates applicable in the periods when the Company recovers such assets or settles such liabilities.
(2) Deferred income tax assets are realized to the extent that it is probable to obtain such taxable income which isused to set off the deductible temporary difference. As at the balance sheet date, if there is obvious evidenceshowing that it is probable to obtain sufficient taxable income to set off the deductible temporary difference infuture periods, deferred income tax assets not realized in previous accounting periods shall be realized.
(3) On balance sheet date, re-review shall be made in respect of the carrying value of deferred income tax assets.If it is impossible to obtain sufficient taxable income to set off the benefits of deferred income tax assets in futureperiods, then the carrying value of deferred income tax assets shall be reduced accordingly. If it is probable toobtain sufficient taxable income, then the amount reduced shall be switched back.
(4) Current income tax and deferred income tax considered as income tax expenses or incomes reckoned intocurrent gains/losses, excluding the follow income tax:
① Enterprise combination;
② Transactions or events recognized in owner’s equity directly
35. Lease
(1) Accounting for operating lease
Lease refers to a contract in which the lessor transfers the right to use assets to the lessee for consideration withina certain period of time. On the commencement date of the contract, the company evaluates whether the contractis a lease or includes a lease. If one party in the contract transfers the right to control the use of one or moreidentified assets within a certain period in exchange for consideration, the contract is a lease or includes a lease. Ifthe contract includes multiple separate leases at the same time, the company will split the contract and conductaccounting treatment for each separate lease. If the contract includes both the leased and non leased parts, the
lessee and the lessor shall separate the leased and non leased parts.
(1) The company as lessee
For the general accounting treatment of the company as the lessee, see Note III, 20 “Right-to-use assets” and NoteIII-26 “Lease liabilities”.For short-term leases with a lease term of no more than 12 months and low value asset leases with a lower valuewhen a single asset is new, the company chooses not to recognize the right to use assets and lease liabilities, andthe relevant rental expenses are included in the current profit and loss or the cost of relevant assets according tothe straight-line method in each period of the lease term.If the lease changes and meets the following conditions at the same time, the company will treat the lease changeas a separate lease for Accounting: the lease change expands the lease scope by adding the right to use one ormore leased assets; The increased consideration is equivalent to the amount adjusted according to the conditionsof the contract at the separate price for most of the expansion of the lease scope. If the lease change is notaccounted for as a separate lease, on the effective date of the lease change, the company will re allocate theconsideration of the contract after the change, re determine the lease term, and re measure the lease liabilityaccording to the present value calculated by the lease payment after the change and the revised discount rate.
(2) The company as lessor
On the lease commencement date, the company classifies leases that have substantially transferred almost all therisks and rewards related to the ownership of the leased assets as financial leases, and all other leases are operatingleases.
1) Operating lease
During each period of the lease term, the company recognizes the lease receipts as rental income according to thestraight-line method, and the initial direct expenses incurred are capitalized, amortized on the same basis as therecognition of rental income, and included in the current profit and loss by stages. The variable lease paymentsobtained by the company related to operating leases that are not included in the lease receipts are included in thecurrent profits and losses when actually incurred.
2) Finance lease
On the beginning date of the lease term, the company recognizes the financial lease receivables according to thenet amount of the lease investment (the sum of the unsecured residual value and the present value of the leasecollection not received on the beginning date of the lease term discounted according to the embedded interest rateof the lease), and terminates the recognition of the financial lease assets. During each period of the lease term, thecompany calculates and recognizes the interest income according to the interest rate embedded in the lease. Theamount of variable lease payments obtained by the company that are not included in the measurement of net leaseinvestment shall be included in the current profit and loss when actually incurred.
(3) Sale leaseback
The company evaluates and determines whether the asset transfer in the sale and leaseback transaction is a sale inaccordance with the accounting standards for Business Enterprises No. 14 - revenue.
1) The company as lessee
If the asset transfer in the sale and leaseback transaction is sales, the company measures the right to use assets
formed by the sale and leaseback according to the part of the book value of the original assets related to the rightto use obtained by the leaseback, and only recognizes the relevant gains or losses on the rights transferred to thelessor.If the asset transfer in the sale and leaseback transaction does not belong to sales, the company will continue torecognize the transferred asset, recognize a financial liability equal to the transfer income, and carry outaccounting treatment for the financial liability in accordance with the accounting standards for BusinessEnterprises No. 22 - recognition and measurement of financial instruments.
2) The company as lessor
If the asset transfer in the sale and leaseback transaction belongs to sales, the company will conduct accountingtreatment for asset purchase in accordance with other applicable accounting standards for business enterprises,and accounting treatment for asset lease in accordance with accounting standards for Business Enterprises No. 21- leasing.If the asset transfer in the sale and leaseback transaction does not belong to sales, the company does not recognizethe transferred asset, but recognizes a financial asset equal to the transfer income, and carries out accountingtreatment for the financial asset in accordance with the accounting standards for Business Enterprises No. 22 -recognition and measurement of financial instruments.
(2) Accounting treatment for financing lease
Not applicable
36. Other major accounting policy and estimation
In the process of applying the Company's accounting policies, due to the inherent uncertainty of business activities,the Company needs to judge, estimate and assume the book value of the report items cannot be accuratelymeasured. These judgments, estimates and assumptions are made on the basis of the historical experience of theCompany’s management and by considering other relevant factors, which shall impact the reported amounts ofincome, expenses, assets and liabilities and the disclosure of contingent liabilities on the balance sheet date.However, the actual results caused by the estimated uncertainties may differ from the management's currentestimates of the Company so as to carry out the significant adjustments to the book value of the assets or liabilitiesto be affected.The Company regularly reviews the aforementioned judgments, estimates and assumptions on the basis ofcontinuing operations, the changes in accounting estimates only affect the current period, of which the impacts arerecognized in the current period; the changes in accounting estimates not only affect the current period but alsothe future periods, of which the impacts are recognized in the current and future periods.On the balance sheet date, the important areas of the financial statements that the Company needs to judge,estimate and assume are as follows:
(1) Provision for bad debts
The Company has used the expected credit loss model to assess the impairment of financial instruments. Theapplication of the expected credit loss model requires significant judgement and estimates, and must consider all
reasonable and evidence-based information, including forward-looking information. In making such judgmentsand estimates, the Company infers the expected changes in debtors’ credit risks based on historical repayment datacombined with economic policies, macroeconomic indicators, industry risks and other factors.
(2) Inventory falling price reserves
According to the inventory accounting policies, the Company measures by the comparison between the cost andthe net realizable value, if the cost is higher than the net realizable value and the old and unsalable inventories, theCompany calculates and withdraws the inventory impairment. The inventory devalues to the net realizable valueby evaluating the inventory’s vendibility and net realizable value. To identify the inventory impairment, themanagement needs to obtain the unambiguous evidences, and consider the purpose to hold the inventory, andjudge and estimate the impacts of events after the balance sheet date. The actual results and the differencesbetween the previously estimated results shall affect the book value of inventory and the provision or return of theinventory impairment during the period estimated to be changed.
(3) Preparation for the impairment of non-financial and non-current assets
The Company checks whether the non-current assets except for the financial assets may decrease in value at thebalance sheet date. For the intangible assets with indefinite service life, in addition to the annual impairment test,the impairment test is also needed when there is a sign of impairment. For the other non-current assets except forthe financial assets, the impairment test is needed when it indicates that the book amounts may not be recoverable.When the book value of the asset or group of assets exceeds its recoverable amount, i.e. the higher between thenet amount by subtracting the disposal costs from the fair value and the present value of expected future cashflows, it indicates the impairment.As for the net amount by subtracting the disposal costs from the fair value, refer to the sales agreement pricesimilar to the assets in the fair trade or the observable market price, and subtract the incremental costsdetermination directly attributable to the disposal of the asset.When estimating the present value of the future cash flow, the Company needs to make significant judgments tothe output, price, and related operating expenses of the asset (or asset group) and the discount rate used forcalculating the present value. When estimating the recoverable amount, the Company shall adopt all the relevantinformation can be obtained, including the prediction related to the output, price, and related operating expensesbased on the reasonable and supportable assumptions.The Company tests whether its business reputation decreases in value every year, which requires to estimating thepresent value of the asset group allocated with goodwill or the future cash flow combined by the asset group.When estimating the present value of the future cash flow, the Company needs to estimate the future cash flowsgenerated by the asset group or the combination of asset group, and select the proper discount rate to determinethe present value of the future cash flows.
(4) Depreciation and amortization
The Company depreciates and amortizes the investment property, fixed assets and intangible assets according tothe straight-line method in the service life after considering the residual value. The Company regularly reviewsthe service life to determine the depreciation and amortization expense amount to be reckoned in each reporting
period. The service life is determined by the Company based on the past experience of similar assets and theexpected technological updating. If the previous estimates have significant changes, the depreciation andamortization expense shall be adjusted in future periods.
(5) Fair value of financial instrument
Financial instruments that do not have active markets to provide quotes need to use valuation techniques todetermine fair value.Valuation techniques include the latest transaction information, discounted cash flow methods,and option pricing models.The Company has established a set of work processes to ensure that qualified personnelare responsible for the calculation, verification and review of fair value.The valuation model used by theCompany uses the market information as much as possible and uses the Company-specific information as little aspossible.It should be noted that part of the information used in the valuation model requires management’sestimation (such as discount rate, target exchange rate volatility, etc.).The Company regularly reviews the aboveestimates and assumptions and makes adjustments if necessary.
(6) Income tax
In the Company’s normal business activities, the final tax treatment and calculation of some transactions havesome uncertainties. Whether some projects can be disbursed from the cost and expenses before taxes requiresneeds to get approval from the tax authorities. If the final affirmation of these tax matters differs from the initiallyestimated amount, the difference shall have an impact on its current and deferred income taxes during the finalidentification period.
37.Changes of important accounting policies and estimation
(1) Changes of important accounting policies
?Applicable □Not applicable
| Content and reasons for changes in accounting policies | Approval process | Note |
| On Dec. 30, 2021, the Ministry of Finance issued Interpretation No. 15 of the Accounting Standards for Business Enterprises | Not applicable | |
| On Nov. 30, 2021, the Ministry of Finance issued Interpretation No. 16 of the Accounting Standards for Business Enterprises | Not applicable |
(1) Significant changes in accounting policy
1) On Dec. 30, 2021, the Ministry of Finance issued Interpretation No. 15 of the Accounting Standards forBusiness Enterprises (Cai Kuai [2021] No. 35, hereinafter referred to as “Interpretation No. 15”).
① Accounting treatment for trial operation sales
Interpretation No. 15 stipulates the accounting treatment and presentation of products or by-products generatedduring the development process or before fixed assets reach their intended usable state for external sales byenterprises. It also stipulates that the net amount of trial operation sales revenue after offsetting costs should notbe offset against fixed asset costs or research and development expenses. This regulation came into effect fromJanuary 1, 2022, and retrospective adjustments shall be made to trial sales that occurred between the beginning ofthe earliest period for financial statement presentation and January 1, 2022. The implementation of this regulationhas not had a significant impact on the company’s financial condition and operating results.
② Judgment on loss contracts
Interpretation No. 15 clarifies that the “cost of performing the contract” considered by enterprises in determiningwhether the contract constitutes a loss contract should include both the incremental cost of performing the contractand the allocation amount of other costs directly related to performing the contract. This regulation came intoeffect on January 1, 2022, and the Company shall implement such provision for contracts whose obligation hasn’tbeen fulfilled by January 1, 2022. The cumulative impact shall be adjusted to the retained earnings and otherrelated financial statement accounts at the beginning of the year on the implementation date, without adjusting thecomparative financial statement data in the previous period. The implementation of this regulation has not had asignificant impact on the company’s financial condition and operating results.
2) On Nov. 30, 2022, the Ministry of Finance issued Interpretation No. 16 of the Accounting Standards forBusiness Enterprises (Cai Kuai [2022] No. 31, hereinafter referred to as “Interpretation No. 16”).
① Accounting treatment for the income tax impact of dividends related to financial instruments classified asequity instruments by the issuerInterpretation No. 16 stipulates that for financial instruments classified as equity instruments by enterprises, if therelevant dividend expenses are deducted before corporate income tax in accordance with relevant tax policies, theincome tax impact related to the dividends should be recognized when determining the payable dividends, and theaccounting treatment should be consistent with the accounting treatment used in past transactions or events thatgenerate distributable profits. The impact of dividend income tax shall be booked into the current period’s profitor loss or owner’s equity (including other comprehensive income items). This regulation came into effect from thedate of promulgation. The relevant dividends payable, in case of occurring between January 1, 2022 and theimplementation date, shall be adjusted in accordance with this regulation; If the relevant dividends were paidbefore January 1, 2022 and the relevant financial instruments have not been derecognized on January 1, 2022,retrospective adjustments should be made. The implementation of this regulation has not had a significant impacton the company's financial condition and operating results.
② Accounting treatment for enterprises to modify cash settled share-based payments to equity settled share-basedpaymentsInterpretation No. 16 clarifies that if an enterprise modifies the terms and conditions of a cash settled share-basedpayment agreement to become an equity settled share-based payment, on the modification date (whether occurringduring the waiting period or after the end), the equity settled share-based payment shall be measured at the fairvalue of the granted equity instrument on the date of modification, and the services obtained shall be included inthe capital reserve and meanwhile, the recognition of cash settled share-based payments that have been recognizedas liabilities on the modification date shall be terminated, and the difference between the two is recorded in thecurrent profit and loss. This regulation shall come into effect from the date of promulgation, and any newtransactions occurring from January 1, 2022 to the implementation date shall be adjusted in accordance with suchregulation; If the relevant transactions that occurred before January 1, 2022 were not processed in accordance withthis regulation, retrospective adjustments should be made, and the cumulative impact should be adjusted to theretained earnings and other related items as of January 1, 2022, without adjusting the comparative financial
statement data in the previous period. The implementation of this regulation has not had a significant impact onthe company’s financial condition and operating results.
(2) Changes of important accounting estimations
□Applicable ?Not applicable
38.Others
Nil
VI. Taxation
1.Major taxes and tax rates
| Tax | Basis | Tax rate |
| VAT | The output tax is calculated based on the taxable income, and VAT is calculated based on the difference after deducting the input tax available for deduction for the current period | 25%(IRD,Denmark), 22%(VHIT，Italy),21%(Borit,Belgium), 13%, 9%, 6%, Collection rate 5% |
| City maintaining & construction tax | Turnover tax payable | 7%.5% |
| Corporation income tax | Taxable income | 15%, 20%, 21% (IRD America, Borit America), 22% (IRD,Denmark), 24%(VHIT，Italy), 25%(Borit,Belgium) |
| Educational surtax | Turnover tax payable | 5% |
Disclose reasons for different taxpaying body
| Taxpaying body | Income tax rate |
| WFCA, WFTR, WFAS, WFLD(Nanchang), WFDT, Borit | 25% |
| The Company, WFJN, WFLD, WFTT, WFLD(Chongqing), WFAM,WFMA,WFSC | 15% |
| WFLD(Wuhan) | 20% |
| IRD America, Borit America | 21% |
| SPV.IRD | 22% |
2.Tax incentives
The Company, WFJN, WFLD, WFTT and WFMA are recognized as high-tech enterprises in 2020 and enjoy apreferential income tax rate of 15% from January 1, 2020 to December 31, 2022. WFAM is recognized as a high-tech enterprise in 2021 and will enjoy a preferential income tax rate of 15% from January 1, 2021 to December 31,2023. WFSC is recognized as a high-tech enterprise in 2022 and will enjoy a preferential income tax rate of 15%from January 1, 2022 to December 31, 2024.According to the “Continuation of the Enterprise Income Tax Policies for Western Development ” No.23 (Year of2020) issued together by Ministry of Finance, SAT and NDRC, from January 1, 2011 to December 31, 2030, theenterprises located in the west region and mainly engaged in the industrial projects stipulated in the Catalogue ofEncouragement Industries in Western China, and whose main business income accounting for more than 60% of
the total income of the enterprise in the current year can pay the corporate income tax at the tax rate of 15%. In thefirst half year of 2022, WFLD (Chongqing) paid its corporate income tax at the tax rate of 15%.In 2022, WFLD (Wuhan) was a qualified small and low-profit enterprises, and the part of taxable income that didnot exceed 1 million Yuan was included in the taxable income at a reduced rate of 12.5%, and the corporateincome tax was paid at the tax rate of 20%; while the part of the taxable income exceeding 1 million Yuan but notexceeding 3 million Yuan was included in the taxable income at a reduced rate of 25%, and the corporate incometax was paid at the tax rate of 20%.
3. Other
Nil
VII. Notes to major items in consolidated financial statements
1. Monetary funds
In RMB
| Item | Ending balance | Opening balance |
| Cash on hand | 51,818.51 | 150,438.79 |
| Cash in bank | 2,304,848,889.90 | 1,864,868,497.94 |
| Other Monetary funds | 84,651,222.35 | 31,044,328.96 |
| Total | 2,389,551,930.76 | 1,896,063,265.69 |
| Including: total amount of funds deposited overseas | 324,409,336.06 | 69,969,414.25 |
| The total amount of funds restricted on use due to mortgage, pledge, or freezing | 51,080,295.65 | 31,044,328.96 |
Other explanationThe ending balance of other monetary fund includes RMB 32,216,896.41 deposited in the stock repurchase account and RMB24,368,385.65 deposited in the bank acceptance deposit，cash deposit for Mastercard RMB 199,660.00, in-transit dividends RMB1,262,280.00, IRD performance bond RMB 7,487,250.00, the foreign exchange contract margin RMB 188,400,000.00, in-transitforeign exchange fund RMB 91,750.29, judicial frozen fund RMB 180,000.00, and ETC freezing RMB 5,000.00. The in-transitdividends RMB 1,262,280.00 was a portion of the dividend distributed by Miracle Automation (002009), a trading financial assetheld by the company, from 2017 to 2022, which was not transferred to the company’s current account due to account issues.
2.Trading financial asset
In RMB
| Item | Ending balance | Opening balance |
| Financial assets measured at fair value and whose changes are included in current profit or loss | 2,718,820,654.87 | 6,076,436,069.42 |
| Including: | ||
| SNAT | 78,834,732.00 | 153,643,308.00 |
| Miracle Automation | 66,693,600.00 | 113,793,600.00 |
| Lifan Technology | 48,516.34 | 77,802.11 |
Toyze Auto
| Toyze Auto | 462,414.48 | |
| Foreign exchange contracts | 74,734,940.30 | |
| Other debt and equity instrument investments | 2,572,781,392.05 | 5,734,186,419.01 |
| Including： | ||
| Total | 2,718,820,654.87 | 6,076,436,069.42 |
3. Note receivable
(1) Classification of notes receivable
In RMB
| Item | Ending balance | Opening balance |
| Bank acceptance bill | 968,022,652.08 | |
| Trade acceptance bill | 135,559,024.27 | 148,527,534.13 |
| Total | 135,559,024.27 | 1,116,550,186.21 |
In RMB
| Category | Ending balance | Opening balance | ||||||||
| Book balance | Bad debts reserve | Book value | Book value | Bad debts reserve | Book value | |||||
| Amount | Ratio | Amount | Accrued ratio | Amount | Ratio | Amount | Accrued ratio | |||
| Including: | ||||||||||
| Note receivable with bad debt provision Accrued on portfolio | 135,559,024.27 | 100.00% | 135,559,024.27 | 1,116,550,186.21 | 100.00% | 1,116,550,186.21 | ||||
| Including: | ||||||||||
| Portfolio 1: bank acceptance bill | 968,022,652.08 | 86.70% | 968,022,652.08 | |||||||
| Portfolio 2: trade acceptance bill | 135,559,024.27 | 100.00% | 135,559,024.27 | 148,527,534.13 | 13.30% | 148,527,534.13 | ||||
| Total | 135,559,024.27 | 100.00% | 135,559,024.27 | 1,116,550,186.21 | 100.00% | 1,116,550,186.21 | ||||
If the provision for bad debts of note receivable is made in accordance with the general model of expected credit losses, pleaserefer to the disclosure of other receivables to disclose related information about bad-debt provisions:
□Applicable ?Not applicable
(2) Bad debt provision Accrued, collected or reversal
Provision for bad debts in the current period:
□ Applicable ? Not applicable
(3) Notes receivable already pledged by the Company at the end of the period
In RMB
| Item | Amount pledge at period-end |
| Trade acceptance bill | 82,908,186.94 |
| Total | 82,908,186.94 |
(4) Notes endorsement or discount and undue on balance sheet date
In RMB
| Item | Amount derecognized at period-end | Amount not derecognized at period-end |
| Trade acceptance bill | 1,214,398.69 | |
| Total | 1,214,398.69 |
(5) Notes transfer to account receivable due for failure implementation by drawer at period-end
In RMB
| Item | Amount transfer to account receivable at period-end |
| Trade acceptance bill | 7,201,691.00 |
| Total | 7,201,691.00 |
Other explanationThe trade acceptance bill that the company transferred to the accounts receivable due to in 2018 the failure of the drawer to performthe agreement at the end of the period were the bills of the subsidiaries controlled by Baota Petrochemical Group Co., Ltd. and thebills accepted by Baota Petrochemical Group Finance Co., Ltd. (hereinafter referred to as “BD bills”); In 2018, the amounttransferred to account receivable was 7 million yuan, and 1.7 million yuan and 2 million yuan were respectively recovered in 2019and 2020. and enforced money 98,309 yuan was received in the year.
(6) Note receivable actually written-off in the period
Nil
4. Account receivable
(1) Classification of account receivable
In RMB
| Category | Ending balance | Opening balance | ||||
| Book balance | Bad debt reserve | Book | Book balance | Bad debt reserve | Book | |
Amount
| Amount | Ratio | Amount | Accrued ratio | value | Amount | Ratio | Amount | Accrued ratio | value | |||||
| Account receivable with bad debt provision Accrued on a single basis | 57,806,705.14 | 1.80% | 57,806,705.14 | 100.00% | 61,361,142.44 | 2.87% | 61,361,142.44 | 100.00% | ||||||
| Including: | ||||||||||||||
| Account receivable with bad debt provision Accrued on portfolio | 3,149,157,700.73 | 98.20% | 21,667,523.48 | 0.69% | 3,127,490,177.25 | 2,076,986,857.82 | 97.13% | 23,186,564.05 | 1.12% | 2,053,800,293.77 | ||||
| Including: | ||||||||||||||
| Total | 3,206,964,405.87 | 100% | 79,474,228.62 | 2.48% | 3,127,490,177.25 | 2,138,348,000.26 | 100.00% | 84,547,706.49 | 3.95% | 2,053,800,293.77 | ||||
Bad debt provision Accrued on single basis: 57,806,705.14
In RMB
| Name | Ending balance | |||||
| Book balance | Bad debt reserve | Accrued ratio | Accrued causes | |||
| Hubei Meiyang Auto Industry Co., Ltd. | 20,139,669.45 | 20,139,669.45 | 100.00% | Have difficulty in collection | ||
| Hunan Leopaard Auto Co., Ltd. | 8,367,245.47 | 8,367,245.47 | 100.00% | Have difficulty in collection | ||
| BD bills | 7,201,691.00 | 7,201,691.00 | 100.00% | Have difficulty in collection | ||
| Linyi Zotye Automobile Components Manufacturing Co., Ltd. | 6,193,466.77 | 6,193,466.77 | 100.00% | Have difficulty in collection | ||
| Tongling Ruineng Purchasing Co., Ltd. | 4,320,454.34 | 4,320,454.34 | 100.00% | Have difficulty in collection | ||
| Brilliance Automotive Group Holdings Co., Ltd. | 3,469,091.33 | 3,469,091.33 | 100.00% | Have difficulty in collection | ||
| Dongfeng Chaoyang Diesel Co., Ltd. | 1,823,262.64 | 1,823,262.64 | 100.00% | Have difficulty in collection | ||
| Jiangsu Kawei Auto Industrial Group Co., Ltd. | 1,932,476.26 | 1,932,476.26 | 100.00% | Have difficulty in collection | ||
| Jiangsu Jintan Automobile Industry Co., Ltd. | 1,059,798.43 | 1,059,798.43 | 100.00% | Have difficulty in collection | ||
| Tianjin Levol Engine Co., Ltd. | 1,018,054.89 | 1,018,054.89 | 100.00% | Have difficulty in collection | ||
| Other clients | 2,281,494.56 | 2,281,494.56 | 100.00% | Have difficulty in collection | ||
| Total | 57,806,705.14 | 57,806,705.14 | ||||
Bad debt provision Accrued on portfolio:：3,149,157,700.73
In RMB
| Name | Ending balance | ||
| Book balance | Bad debt reserve | Accrued ratio | |
| Within 6 months | 3,024,862,168.01 | -- | |
| 6 months to one year | 92,819,798.57 | 9,281,979.84 | 10.00% |
| 1-2 years | 18,948,517.89 | 3,789,703.59 | 20.00% |
If the provision for bad debts of accounts receivable is made in accordance with the general model of expected credit losses, pleaserefer to the disclosure of other receivables to disclose related information about bad-debt provisions:
□ Applicable ? Not applicable
By account age
In RMB
| Account age | Book balance |
| Within one year (One year included) | 3,118,871,487.62 |
| Including: within 6 months | 3,025,753,558.24 |
| 6 months to one year | 93,117,929.38 |
| 1-2 years | 19,350,208.92 |
| 2-3 years | 8,919,358.15 |
| Over 3 years | 59,823,351.18 |
| 3-4 years | 59,823,351.18 |
| Total | 3,206,964,405.87 |
(2) Bad debt provision Accrued collected or reversal
Bad debt provision Accrued in the period:
In RMB
| Category | Opening balance | Amount changed in the period | Ending balance | |||
| Accrued | Collected or reversal | Charged off | Other | |||
| Bad debt provision | 84,547,706.49 | 2,904,080.14 | 2,676,427.23 | 5,608,467.36 | 307,336.58 | 79,474,228.62 |
| Total | 84,547,706.49 | 2,904,080.14 | 2,676,427.23 | 5,608,467.36 | 307,336.58 | 79,474,228.62 |
Important bad debt provision collected or reversal: Nil
(3) Account receivable actually charged off in the Period
In RMB
| Item | Amount charged off |
| Zhejiang Zotye Automobile Co., Ltd. | 3,059,115.67 |
| Ruili Jifeng Import and Export Co., Ltd | 1,091,409.60 |
| Chonqqing Branch of Hunan Jiangnan Auto Co., Ltd | 935,638.55 |
| Sporadic clients | 522,303.54 |
| Total | 5,608,467.36 |
2-3 years
| 2-3 years | 6,552,293.67 | 2,620,917.46 | 40.00% |
| Over 3 years | 5,974,922.59 | 5,974,922.59 | 100.00% |
| Total | 3,149,157,700.73 | 21,667,523.48 |
(4) Top 5 receivables at ending balance by arrears party
In RMB
| Name | Ending balance of account receivable | Ratio in total ending balance of account receivables | Ending balance of bad debt reserve |
| RBCD | 461,493,652.46 | 14.39% | 174,766.71 |
| Client 2 | 376,840,900.77 | 11.75% | 70,035.30 |
| Robert Bosch Company | 363,021,724.83 | 11.32% | 882,016.11 |
| Client 4 | 142,812,092.97 | 4.45% | 60,548.15 |
| Client 5 | 130,978,870.40 | 4.09% | 2,955,417.69 |
| Total | 1,475,147,241.43 | 46.00% | 4,142,783.96 |
(5) Account receivable derecognition due to financial assets transfer
Nil
(6) Assets and liabilities resulted by account receivable transfer and continues involvementNil
5. Receivable financing
(1) Category of receivable financing:
In RMB
| Item | Ending balance | Opening balance |
| Bill receivable- bank acceptance bill | 1,918,368,845.21 | 713,017,014.50 |
| Total | 1,918,368,845.21 | 713,017,014.50 |
Increase and decrease in current period and changes in fair value of receivables financing
□ Applicable ? Not applicable
If the bad debt provision for account receivable is calculated and withdrawn according to the general model of expected credit loss,please refer to the disclosure method of other account receivables in aspect of impairment provision:
□ Applicable ? Not applicable
Other explanation:
During the management of enterprise liquidity, the company will discount or endorse transfers before the maturity of some bills, thebusiness model for managing bills receivable is to collect contractual cash flows and sell the financial asset, so it is classified asfinancial assets measured at fair value and whose changes are included in other comprehensive income, which is listed in receivablesfinancing.
(2)Notes receivable already pledged by the Company at period-end：
| Item | Amount pledge at period-end |
| Bank acceptance bill | 530,337,600.45 |
Trade acceptance bill
| Trade acceptance bill | -- |
| Total | 530,337,600.45 |
(3) Notes endorsement or discount and undue on balance sheet date
| Item | Amount derecognized at period-end | Amount not derecognized at period-end |
| Bank acceptance bill | 269,050,791.15 | -- |
| Trade acceptance bill | -- | -- |
| Total | 269,050,791.15 | -- |
6. Account paid in advance
(1) Account age of account paid in advance
In RMB
| Account age | Ending balance | Opening balance | ||
| Amount | Ratio | Amount | Ratio | |
| Within one year | 88,207,782.70 | 93.51% | 172,019,278.72 | 96.61% |
| 1-2 years | 5,066,837.28 | 5.37% | 3,318,636.20 | 1.86% |
| 2-3 years | 778,819.68 | 0.83% | 1,140,843.34 | 0.64% |
| Over 3 years | 270,414.21 | 0.29% | 1,580,491.73 | 0.89% |
| Total | 94,323,853.87 | 178,059,249.99 | ||
Explanation of the reasons why prepayments with an aging of over 1 year and significant amounts were not settled in a timelymannerNil
(2) Top 5 accounts paid in advance at ending balance by prepayment objectTotal year-end balance of top five account paid in advance by prepayment object amounted to 45,793,646.66 yuan,takes 48.55 percent of the total advance payment at year-end.Other explanation: Nil
7. Other account receivables
In RMB
| Item | Ending balance | Opening balance |
| Dividend receivable | 147,000,000.00 | |
| Other account receivables | 1,117,507,456.47 | 17,908,078.54 |
| Total | 1,264,507,456.47 | 17,908,078.54 |
(1) Interest receivable
1) Category of interest receivable
Nil
2) Significant overdue interest
Nil
3) Accrued of bad debt provision
□ Applicable √ Not applicable
(2) Dividend receivable
1) Category of dividend receivable
In RMB
| Item (or invested enterprise) | Ending balance | Opening balance |
| Wuxi WFEC Catalyst Co., Ltd. | 147,000,000.00 | |
| Total | 147,000,000.00 |
2） Important dividend receivable with account age over one yearNil
3)Accrued of bad debt provision
□Applicable ?Not applicable
(3) Other accounts receivable
1) Classify other accounts receivable by nature
In RMB
| Nature | Ending book balance | Opening book balance |
| Intercourse funds from units | 1,894,818.08 | 1,991,247.85 |
| Cash deposit | 9,087,881.41 | 6,212,842.61 |
| Staff loans and petty cash | 1,823,842.27 | 555,076.61 |
| Social security and provident fund paid | 11,341,820.83 | 10,547,050.70 |
| WFTR “platform trade” business portfolio | 2,741,499,131.95 | |
| Other | 66,663.56 | 1,952,403.17 |
| Total | 2,765,714,158.10 | 21,258,620.94 |
2)Accrued of bad debt provision
In RMB
| Bad debt reserve | Phase I | Phase II | Phase III | Total |
| Expected credit losses over next 12 months | Expected credit losses for the entire duration (without credit impairment occurred) | Expected credit losses for the entire duration (with credit impairment occurred) | ||
| Balance on Jan. 1, 20222 | 3,318,719.00 | 31,823.40 | 3,350,542.40 | |
| Balance of Jan. 1, 2022 in the period | ||||
| Current Accrued | 1,785,811.16 | 1,644,068,327.93 | 1,645,854,139.09 | |
| Current reversal | 200,553.00 | 96.60 | 200,649.60 | |
| Current charge off | 1,774,500.00 | 1,774,500.00 | ||
| Other changes | 977,169.74 | 977,169.74 | ||
| Balance on Dec. 31, 2021 | 4,106,646.90 | 1,644,100,054.73 | 1,648,206,701.63 |
Change of book balance of loss provision with amount has major changes in the period
□ Applicable ? Not applicable
By account age
In RMB
| Account age | Book balance |
| Within one year (One year included) | 2,758,812,664.93 |
| Within 6 months | 1,919,096,046.09 |
| 6 months to one year | 839,716,618.84 |
| 1-2 years | 1,358,405.20 |
| 2-3 years | 2,962,710.00 |
| Over 3 years | 2,580,377.97 |
| 3-4 years | 2,580,377.97 |
| Total | 2,765,714,158.10 |
3) Bad debt provision Accrued, collected or reversal
Bad debt provision Accrued in the period:
In RMB
| Category | Opening balance | Change in current period | Ending balance | |||
| Accrued | Collected or reversal | Charge off | Other | |||
| Bad debt provision | 3,350,542.40 | 1,645,854,139.09 | 200,649.60 | 1,774,500.00 | 977,169.74 | 1,648,206,701.63 |
| Total | 3,350,542.40 | 1,645,854,139.09 | 200,649.60 | 1,774,500.00 | 977,169.74 | 1,648,206,701.63 |
Including the important bad debt provision reversal or collected in the period: nil
4) Other accounts actually charged off during the reporting period
In RMB
| Item | Amount charged off |
Ningbo Jiangbei High-Tech Industry Park Development Construction Co., Ltd.
| Ningbo Jiangbei High-Tech Industry Park Development Construction Co., Ltd. | 1,767,000.00 |
| Other sporadic | 7,500.00 |
| Total | 1,774,500.00 |
Note of important other receivables of written-off:
Nil
5) Top 5 other accounts receivable at ending balance by arrears party
In RMB
| Enterprise | Nature | Ending balance | Account age | Ratio in total ending balance of other accounts receivables | Ending balance of bad debt reserve |
| WFTR “platform trade” business portfolio | See “Other explanations” | 2,741,499,131.95 | Within one year | 99.12 | 1,644,068,327.93 |
| Wuxi China Resources Gas Co. LTD | Deposit margin | 1,364,750.00 | Within 3 years | 0.05 | 492,910.00 |
| Zhenkunxing Industrial Supermarket (Shanghai) Co., LTD | Deposit margin | 1,000,000.00 | 2-3 years | 0.04 | 400,000.00 |
| Wuxi Xingzhou Energy Development Co. LTD | Deposit margin | 887,227.72 | Within one year | 0.03 | 28,176.35 |
| Wuxi Youlian Thermoelectric Co. LTD | Deposit margin | 750,000.00 | Over 3 years | 0.03 | 750,000.00 |
| Total | 2,745,501,109.67 | 99.27 | 1,645,739,414.28 |
Other explanations: For details of WFTR “platform trade” business portfolio, please refer to the description in Note-XVI, 7 "OtherSignificant Transactions and Matters Affecting Investors' Decisions".
6) Other account receivables related to government grants
Nil
7) Other accounts receivable derecognized due to the transfer of financial assetsNil
8) The amount of assets and liabilities formed by transferring other receivables and continuing to beinvolved
Nil
8. Inventory
Does the Company need to comply with disclosure requirements in the real estate industry?No
(1) Category of inventory
In RMB
Item
| Item | Ending balance | Opening balance | ||||
| Book balance | Inventory depreciation reserve or provision for impairment of contract performance costs | Book value | Book balance | Inventory depreciation reserve or provision for impairment of contract performance costs | Book value | |
| Stock materials | 796,941,337.63 | 160,326,360.21 | 636,614,977.42 | 693,636,748.61 | 84,791,307.00 | 608,845,441.61 |
| Goods in process | 437,653,321.23 | 31,641,606.69 | 406,011,714.54 | 406,224,039.14 | 18,593,866.28 | 387,630,172.86 |
| Finished goods | 1,382,835,104.89 | 142,342,140.58 | 1,240,492,964.31 | 2,578,635,721.74 | 129,714,961.12 | 2,448,920,760.62 |
| Total | 2,617,429,763.75 | 334,310,107.48 | 2,283,119,656.27 | 3,678,496,509.49 | 233,100,134.40 | 3,445,396,375.09 |
(2) Inventory depreciation reserve or provision for impairment of contract performance costs
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance | ||
| Accrued | Other | Reversal or write-off | Other | |||
| Stock materials | 84,791,307.00 | 84,615,829.62 | 13,105,601.77 | 22,186,378.18 | 160,326,360.21 | |
| Goods in process | 18,593,866.28 | 20,325,267.14 | 3,015,928.19 | 10,293,454.92 | 31,641,606.69 | |
| Finished goods | 129,714,961.12 | 76,669,336.36 | 2,399,284.44 | 66,441,441.34 | 142,342,140.58 | |
| Total | 233,100,134.40 | 181,610,433.12 | 18,520,814.40 | 98,921,274.44 | 334,310,107.48 | |
① Net realizable value of inventory is equal to during the day-to-day activities, the estimated sale price ofinventory less costs which are going to happen by estimation till works completed, sales price estimated andrelevant taxes.
② Accrued basis for inventory depreciation reserve:
| Cash on hand | Accrued basis for inventory impairment provision | Specific basis for recognition |
| Materials in stock | The materials sold due to finished goods manufactured, its net realizable value is lower than the book value | Results from the estimated sale price of such inventory less the cost what will happen, estimated sales expenses and relevant taxes till the goods completed |
| Goods in process | The goods in process sold due to finished goods manufactured, its net realizable value is lower than the book value | Results from the estimated sale price of such inventory less the cost what will happen, estimated sales expenses and relevant taxes till the goods completed |
| Cash on hand | Accrued basis for inventory impairment provision | Specific basis for recognition |
③ Reasons of inventory falling price reserves written off in current period:
| Cash on hand | Reasons of written off |
| Materials in stock | Used for production and the finished goods are realized sales |
| Goods in process | Goods in process completed in the Period and corresponding finished goods are realized sales in the Period |
| Finished goods | Sales in the Period |
(3) Explanation on capitalization of borrowing costs at ending balance of inventoryNil
(4) Explanation of the current amortization amount of contract performance cost
Nil
9. Other current assets
In RMB
| Item | Ending balance | Opening balance |
| Receivable export tax rebates | 14,325,020.52 | 6,457,803.72 |
| VAT refund receivable | 25,444,657.63 | 3,985,115.26 |
| Prepaid taxes and VAT retained | 364,556,192.43 | 204,700,549.12 |
| Input tax to be deducted and certification | 1,192,752.68 | 6,274.43 |
| Other | 25,028,577.98 | 5,171,179.97 |
| Total | 430,547,201.24 | 220,320,922.50 |
10.Long-term equity investment
In RMB
| The invested entity | Opening balance (book value) | Current changes (+/ -) | Ending balance (book value) | Ending balance of depreciation reserves | |||||||
| Additional investment | Capital reduction | Investment gain/loss recognized under equity | Other comprehensive income adjustment | Other equity change | Cash dividend or profit announced to issued | Impairment Accrued | Other | ||||
| I. Joint venture | |||||||||||
| II. Associated enterprise | |||||||||||
| Wuxi WFEC Catalyst Co., Ltd. | 794,489,840.10 | 177,038,969.79 | 147,000,000.00 | 824,528,809.89 | |||||||
| Robert Bosch Powertrain Ltd. | 3,340,114,235.45 | 1,085,484,785.75 | 765,837,710.23 | 3,659,761,310.97 | |||||||
| Zhonglian Automobile Electronic Co., Ltd. | 1,378,575,785.77 | 375,237,528.28 | 194,400,000.00 | 1,559,413,314.05 | |||||||
| Wuxi Weifu Precision Machinery Manufacturing Co., Ltd. | 46,014,272.27 | 18,815,540.24 | 10,000,000.00 | 54,829,812.51 | |||||||
| Changchun Xuyang Weifu | 10,348,819.93 | -727,085.10 | 9,621,734.83 | ||||||||
AutomobilecomponentsTechnology Co.,Ltd.
| Automobile components Technology Co., Ltd. | |||||||||||
| Precors GmbH | 5,345,878.98 | 20,698.24 | 151,347.34 | 5,517,924.56 | |||||||
| Wuxi Chelian Tianxia Information Technology Co., Ltd. | 143,055,955.62 | 37,000,000.00 | -10,910,753.47 | 169,145,202.15 | |||||||
| Subtotal | 5,717,944,788.12 | 37,000,000.00 | 1,644,959,683.73 | 1,117,237,710.23 | 151,347.34 | 6,282,818,108.96 | |||||
| Total | 5,717,944,788.12 | 37,000,000.00 | 1,644,959,683.73 | 1,117,237,710.23 | 151,347.34 | 6,282,818,108.96 |
Other explanationExplanation on those holding less than 20% of the voting rights but with significant influence:
(1) Precors GmbH:
The wholly-owned subsidiary of the Company, Borit, holds 8.11% equity of Precors GmbH. Borit appointed a director to PrecorsGmbH. Though the representative, Borit can participate in the operation policies formulation of Precors GmbH, and thus exercise asignificant influence over Precors GmbH.
(2) Wuxi Chelian Tianxia Information Technology Co., Ltd. (Hereinafter referred to as "Chelian Tianxia"):
The Company holds 9.8452% equity of Chelian Tianxia, and appointed a director to Chelian Tianxia. Though the representative, theCompany can participate in the operation policies formulation of Chelian Tianxi, and thus exercise a significant influence overChelian Tianxi.
11.Other equity instrument investment
In RMB
| Item | Ending balance | Opening balance |
| Wuxi Xidong Science & Technology Industrial Park | 5,000,000.00 | 5,000,000.00 |
| Beijing Zhike Industry Investment Holding Group Co., Ltd. | 75,940,000.00 | 75,940,000.00 |
| Rare earth Catalysis Innovation Research Institute (Dongying) Co., Ltd. | 4,108,000.00 | 4,108,000.00 |
| Wuxi Xichang Microchip Semi-Conductor | 592,742,690.00 | 200,000,000.00 |
| Total | 677,790,690.00 | 285,048,000.00 |
12.Other non-current financial assets
In RMB
| Item | Ending balance | Opening balance |
| Guolian Securities | 186,608,914.00 | 208,795,178.00 |
| Investments in other debt instruments and equity instruments held for more than one year | 1,140,000,000.00 | 1,482,000,000.00 |
| Total | 1,326,608,914.00 | 1,690,795,178.00 |
13. Investment real estate
(1) Investment real estate measured by cost
? Applicable □ Not applicable
In RMB
| Item | House and Building | Land use right | Construction in progress | Total |
| I. Original book value | ||||
| 1.Opening balance | 65,524,052.61 | 65,524,052.61 | ||
| 2.Current increased | 41,662,196.86 | 41,662,196.86 | ||
| (1) Outsourcing | ||||
| (2) Inventory\fixed assets\construction in process transfer-in | 41,662,196.86 | 41,662,196.86 | ||
| (3) Increased by combination | ||||
| 3.Current decreased | 9,494,473.20 | 9,494,473.20 | ||
| (1) Disposal | ||||
| (2) Other transfer-out | ||||
| (3)Transfer from rental to self use | 9,494,473.20 | 9,494,473.20 | ||
| 4.Ending balance | 97,691,776.27 | 97,691,776.27 | ||
| II. Accumulated depreciation and accumulated amortization | ||||
| 1.Opening balance | 46,136,306.05 | 46,136,306.05 | ||
| 2.Current increased | 7,278,108.90 | 7,278,108.90 | ||
| (1) Accrued or amortization | 2,331,022.21 | 2,331,022.21 | ||
| (2)Transferred from inventory, fixed assets, and construction in progress | 4,947,086.69 | 4,947,086.69 | ||
| 3.Current decreased | 5,019,508.41 | 5,019,508.41 | ||
| (1) Disposal | ||||
| (2) Other transfer-out | ||||
| (3)Transfer from rental to self use | 5,019,508.41 | 5,019,508.41 | ||
| 4.Ending balance | 48,394,906.54 | 48,394,906.54 | ||
| III. Depreciation reserves | ||||
| 1.Opening balance | ||||
| 2.Current increased | ||||
| (1) Accrued | ||||
| 3. Current decreased | ||||
| (1) Disposal | ||||
| (2) Other transfer-out | ||||
| 4.Ending balance | ||||
| IV. Book value | ||||
| 1.Ending Book value | 49,296,869.73 | 49,296,869.73 | ||
| 2.Opening Book value | 19,387,746.56 | 19,387,746.56 |
(2) Investment real estate measured at fair value
□ Applicable ? Not applicable
(3) Investment real estate without property certification held
Nil
14. Fixed assets
In RMB
| Item | Ending balance | Opening balance |
| Fixed assets | 3,769,984,185.94 | 2,932,210,452.51 |
| Total | 3,769,984,185.94 | 2,932,210,452.51 |
(1) Fixed assets
In RMB
| Item | House and Building | Machinery equipment | Transportation equipment | Electronic and other equipment | Land | Total |
| I. Original book value: | ||||||
| 1.Opening balance | 1,570,238,484.44 | 3,540,288,690.19 | 32,772,506.07 | 714,328,321.31 | 5,857,628,002.01 | |
| 2.Current increased | 414,184,200.80 | 1,105,926,860.71 | 7,106,091.81 | 385,478,644.98 | 29,446,173.31 | 1,942,141,971.61 |
| (1) Purchase | 244,898.40 | 7,530,517.28 | 367,371.68 | 713,097.76 | 8,855,885.12 | |
| (2) Construction in progress transfer-in | 282,682,532.87 | 743,087,427.45 | 6,738,720.13 | 91,270,299.75 | -- | 1,123,778,980.20 |
| (3)Investment real estate transfer-in | 8,639,863.02 | 8,639,863.02 | ||||
| (4) Financial lease transfer in | 12,268,137.32 | 12,268,137.32 | ||||
| (5)Increased by combination | 122,616,906.51 | 343,040,778.66 | 293,495,247.47 | 29,446,173.31 | 788,599,105.95 | |
| 3.Current decreased | 54,225,619.75 | 48,213,762.73 | 1,332,428.09 | 64,336,862.53 | 168,108,673.10 | |
| (1) Disposal or scrapping | 12,563,422.89 | 48,213,762.73 | 1,332,428.09 | 64,336,862.53 | 126,446,476.24 | |
| (2)Transfer to investment real estate | 41,662,196.86 | 41,662,196.86 | ||||
| 4.Conversion of foreign currency financial statement | 4,328,995.47 | 15,503,048.12 | 66,093.39 | 10,831,183.40 | 1,037,118.74 | 31,766,439.12 |
| 5.Ending balance | 1,934,526,060.96 | 4,613,504,836.29 | 38,612,263.18 | 1,046,301,287.16 | 30,483,292.05 | 7,663,427,739.64 |
| II. Accumulated depreciation | ||||||
| 1.Opening balance | 439,825,229.29 | 1,952,082,761.65 | 20,404,183.79 | 422,378,184.50 | 2,834,690,359.23 | |
| 2.Current increased | 110,150,684.48 | 535,453,321.58 | 2,253,579.24 | 283,691,538.26 | -- | 931,549,123.56 |
| (1) Accrued | 52,819,069.57 | 255,295,980.54 | 2,253,579.24 | 110,637,163.27 | 421,005,792.62 | |
| (2)Investment real estate transfer-in | 4,699,630.83 | 4,699,630.83 | ||||
| (3)Financial lease transfer in | 10,448,678.64 | 10,448,678.64 | ||||
| (4)increased by | 52,631,984.08 | 269,708,662.40 | 173,054,374.99 | 495,395,021.47 |
combination
| combination | ||||||
| 3.Current decreased | 15,056,913.30 | 27,569,646.38 | 1,038,351.23 | 49,907,798.40 | 93,572,709.31 | |
| (1) Disposal or scrapping | 10,109,826.61 | 27,569,646.38 | 1,038,351.23 | 49,907,798.40 | 88,625,622.62 | |
| (2) Transfer to investment real estate | 4,947,086.69 | 4,947,086.69 | ||||
| 4.Conversion of foreign currency financial statement | 1,891,138.02 | 11,005,788.81 | 1,956.45 | 7,892,977.17 | 20,791,860.45 | |
| 5.Ending balance | 536,810,138.49 | 2,470,972,225.66 | 21,621,368.25 | 664,099,659.92 | 3,693,503,392.32 | |
| III. Depreciation reserves | ||||||
| 1.Opening balance | 84,541,933.61 | 73,319.90 | 6,111,936.76 | 90,727,190.27 | ||
| 2.Current increased | 13,624,811.05 | 76,592,762.00 | 17,270,992.75 | 14,639,472.46 | 122,128,038.26 | |
| (1) Accrued | ||||||
| (2)Increased by combination | 13,624,811.05 | 76,592,762.00 | 17,270,992.75 | 14,639,472.46 | 122,128,038.26 | |
| 3.Current decreased | 7,045.42 | 14,338,942.29 | 2,101,139.20 | 16,447,126.91 | ||
| (1) Disposal or scrapping | 7,045.42 | 14,338,942.29 | 2,101,139.20 | 16,447,126.91 | ||
| 4.Conversion of foreign currency financial statement | 479,554.86 | 2,107,885.69 | 429,004.80 | 515,614.41 | 3,532,059.76 | |
| 5.Ending balance | 14,097,320.49 | 148,903,639.01 | 73,319.90 | 21,710,795.11 | 15,155,086.87 | 199,940,161.38 |
| IV. Book value | ||||||
| 1.Ending Book value | 1,383,618,601.98 | 1,993,628,971.62 | 16,917,575.03 | 360,490,832.13 | 15,328,205.18 | 3,769,984,185.94 |
| 2.Opening Book value | 1,130,413,255.15 | 1,503,663,994.93 | 12,295,002.38 | 285,838,200.05 | 2,932,210,452.51 |
(2) Temporarily idle fixed assets
Nil
(3) Fixed assets acquired by operating lease
Nil
(4) Fixed assets without property certification held
In RMB
| Item | Book value | Reasons for without the property certification |
| Plant and office building of Weifu Chang’an | 32,165,954.92 | Still in process of relevant property procedures |
Other explanation: Nil
(5) Disposal of fixed assets
Nil
15. Construction in progress
In RMB
| Item | Ending balance | Opening balance |
| Construction in progress | 509,105,587.49 | 387,429,933.08 |
| Total | 509,105,587.49 | 387,429,933.08 |
(1) Construction in progress
In RMB
| Item | Ending balance | Opening balance | |||||||
| Book balance | Depreciation reserves | Book value | Book balance | Depreciation reserves | Book value | ||||
| Technical transformation of parent company | 132,814,463.95 | 132,814,463.95 | 88,688,772.85 | 88,688,772.85 | |||||
| Lot 103 phase V of the parent company | 89,599,174.42 | 89,599,174.42 | |||||||
| WFMS rebuilding of the parent company | 20,562,758.75 | 20,562,758.75 | 12,185,858.74 | 12,185,858.74 | |||||
| Renovation of Xinan Branch, No. 6 Huashan Road of Parent Company | 41,493,029.41 | 41,493,029.41 | |||||||
| Technical transformation of WFAM | 69,450,019.06 | 69,450,019.06 | 72,318,870.79 | 72,318,870.79 | |||||
| Technical transformation of WFLD | 16,739,199.84 | 16,739,199.84 | 13,368,288.81 | 13,368,288.81 | |||||
| Technical transformation of Denmark RID | 82,081,060.63 | 82,081,060.63 | 23,293,601.39 | 23,293,601.39 | |||||
| Technical transformation of Italy VHIT | 47,822,275.01 | 47,822,275.01 | |||||||
| Other projects | 98,142,780.84 | 98,142,780.84 | 87,975,366.08 | 87,975,366.08 | |||||
| Total | 509,105,587.49 | 509,105,587.49 | 387,429,933.08 | 387,429,933.08 | |||||
(2) Changes of major construction in progress
In RMB
| Item | Budget | Opening balance | Current increased | Fixed assets transfer-in in the Period | Other decreased in the Period | Ending balance | Proportion of project investment in budget | Progress | Accumulated amount of interest capitalization | including: interest capitalized amount of the year | Interest capitalization rate of the year | Source of funds |
| Technical transformation of parent company | 88,688,772.85 | 530,483,541.73 | 484,206,373.45 | 2,151,477.18 | 132,814,463.95 | Company accumulation funds | ||||||
| Lot 103 phase V of | 89,599,174.4 | 25,082,992.3 | 114,682,166. | Company |
the parentcompany
| the parent company | 2 | 8 | 80 | accumulation funds | ||||||||
| WFMS rebuilding of the parent company | 12,185,858.74 | 8,376,900.01 | 20,562,758.75 | Company accumulation funds | ||||||||
| Renovation of Xinan Branch, No. 6 Huashan Road of Parent Company | 41,493,029.41 | 41,493,029.41 | Company accumulation funds | |||||||||
| Technical transformation of WFAM | 72,318,870.79 | 142,114,233.06 | 144,334,625.25 | 648,459.54 | 69,450,019.06 | Company accumulation funds | ||||||
| Technical transformation of WFLD | 13,368,288.81 | 74,672,106.28 | 71,074,193.84 | 227,001.41 | 16,739,199.84 | Company accumulation funds | ||||||
| Technical transformation of Denmark RID | 23,293,601.39 | 60,594,550.01 | 1,807,090.77 | 82,081,060.63 | Company accumulation funds | |||||||
| Technical transformation of Italy VHIT | 59,336,857.04 | 11,514,582.03 | 47,822,275.01 | Company accumulation funds | ||||||||
| Other projects | 299,454,567.00 | 942,154,209.92 | 827,619,032.14 | 3,026,938.13 | 410,962,806.65 |
(3) The provision for impairment of construction projects
Nil
(4) Engineering materials
Nil
16. Right-of-use assets
In RMB
| Item | Building | Mechanical equipment | Total |
| I. Original book value: | |||
| 1.Opening balance | 17,604,684.01 | 21,763,912.85 | 39,368,596.86 |
| 2.Current increased | 15,589,326.89 | 15,206,270.58 | 30,795,597.47 |
| (1)Increased lease | 13,711,753.69 | 15,206,270.58 | 28,918,024.27 |
(2)Increased by combination
| (2)Increased by combination | 1,877,573.20 | 1,877,573.20 | |
| 3.Current decreased | 12,268,137.32 | 12,268,137.32 | |
| (1) Transfer to own assets | 12,268,137.32 | 12,268,137.32 | |
| 4. Conversion of foreign currency financial statement | 1,222,038.96 | 319,399.52 | 1,541,438.48 |
| 5.Ending balance | 34,416,049.86 | 25,021,445.63 | 59,437,495.49 |
| II. Accumulated depreciation | |||
| 1.Opening balance | 4,140,756.41 | 12,079,434.87 | 16,220,191.28 |
| 2.Current increased | 6,596,209.61 | 4,961,207.02 | 11,557,416.63 |
| (1) Accrued | 5,526,140.33 | 4,961,207.02 | 10,487,347.35 |
| (2)increased by combination | 1,070,069.28 | 1,070,069.28 | |
| 3.Current decreased | 10,448,678.64 | 10,448,678.64 | |
| (1) Disposal | |||
| (2) Transfer to own assets | 10,448,678.64 | 10,448,678.64 | |
| 4. Conversion of foreign currency financial statement | 298,972.97 | -55,507.13 | 243,465.84 |
| 5.Ending balance | 11,035,938.99 | 6,536,456.12 | 17,572,395.11 |
| III. Depreciation reserves | |||
| 1.Opening balance | |||
| 2.Current increased | |||
| (1) Accrued | |||
| 3.Current decreased | |||
| (1) Disposal | |||
| 4.Ending balance | |||
| IV. Book value | |||
| 1.Ending Book value | 23,380,110.87 | 18,484,989.51 | 41,865,100.38 |
| 2.Opening Book value | 13,463,927.60 | 9,684,477.98 | 23,148,405.58 |
17. Intangible assets
(1) Intangible assets
In RMB
| Item | Land use right | Patent | Non-patent technology | Computer software | Trademark and trademark license | Total |
| I. Original book value | ||||||
| 1.Opening balance | 381,012,520.44 | 181,889,330.47 | 123,152,207.22 | 41,597,126.47 | 727,651,184.60 | |
| 2.Current increased | 854,610.18 | 59,548,754.53 | 35,211,964.82 | 95,615,329.53 | ||
| (1) Purchase | 3,804,434.00 | 1,689,742.12 | 5,494,176.12 | |||
| (2)Construction in progress | 25,168,225.22 | 25,168,225.22 | ||||
| (3) Increased by combination | 50,744,320.53 | 8,353,997.48 | 59,098,318.01 | |||
| (4) Shareholders' capital contribution | 5,000,000.00 | 5,000,000.00 | ||||
| (5)Transfer from rental to self use | 854,610.18 | 854,610.18 | ||||
| 3.Current decreased | 2,578,043.96 | 2,578,043.96 | ||||
| (1)disposal or scrapping | 2,578,043.96 | 2,578,043.96 | ||||
| 4.Conversion of foreign currency financial statement | 6,297,657.07 | 545,533.29 | 6,843,190.36 | |||
| 5.Ending balance | 381,867,130.62 | 247,735,742.07 | 156,331,661.37 | 41,597,126.47 | 827,531,660.53 |
II. accumulatedamortization
| II. accumulated amortization | ||||||
| 1.Opening balance | 103,617,738.03 | 64,204,353.94 | 92,880,072.81 | 9,709,000.00 | 270,411,164.78 | |
| 2.Current increased | 8,701,768.78 | 15,612,492.50 | 28,089,883.82 | 52,404,145.10 | ||
| (1)Amortization | 8,381,891.20 | 15,612,492.50 | 23,420,202.87 | 47,414,586.57 | ||
| (2)Transfer from rental to self use | 319,877.58 | 319,877.58 | ||||
| (3)increased by combination | 4,669,680.95 | 4,669,680.95 | ||||
| 3.Current decreased | 2,578,043.96 | 2,578,043.96 | ||||
| (1)Disposal or scrapping | 2,578,043.96 | 2,578,043.96 | ||||
| 4.Conversion of foreign currency financial statement | 2,326,306.00 | 251,033.39 | 2,577,339.39 | |||
| 5.Ending balance | 112,319,506.81 | 82,143,152.44 | 118,642,946.06 | 9,709,000.00 | 322,814,605.31 | |
| III. Depreciation reserves | ||||||
| 1.Opening balance | 16,646,900.00 | 16,646,900.00 | ||||
| 2.Current increased | 427,123.63 | 427,123.63 | ||||
| (1)Accrued | ||||||
| (2)Increased by combination | 427,123.63 | 427,123.63 | ||||
| 3.Current decreased | ||||||
| (1)Disposal or scrapping | ||||||
| 4.Conversion of foreign currency financial statement | 15,043.67 | 15,043.67 | ||||
| 5.Ending balance | 442,167.30 | 16,646,900.00 | 17,089,067.30 | |||
| IV. Book value | ||||||
| 1.Ending Book value | 269,547,623.81 | 165,592,589.63 | 37,246,548.01 | 15,241,226.47 | 487,627,987.92 | |
| 2.Opening Book value | 277,394,782.41 | 117,684,976.53 | 30,272,134.41 | 15,241,226.47 | 440,593,119.82 |
(2) Land use right without property certification held
Nil
18. Goodwill
(1) Original book value of goodwill
In RMB
| The invested entity or matters forming goodwill | Opening balance | Current increased | Current decreased | Ending balance | ||
| Formed by business combination | Translation of foreign currency statements | Disposal | ||||
| Merged with WFTT | 1,784,086.79 | 1,784,086.79 | ||||
Merged withBorit
| Merged with Borit | 229,470,928.96 | 6,427,359.97 | 235,898,288.93 | |||
| Total | 231,255,015.75 | 6,427,359.97 | 237,682,375.72 |
(2) Goodwill depreciation reserves
1) Goodwill generated by merging Weifu TT:
In 2010, the company consolidated Weifu Tianli through a cash capital increase, and the goodwill is the part ofthe merger cost greater than the fair value share of Weifu Tianli's identifiable net assets. At the end of the period,the Company conducted an impairment test on goodwill to estimate the recoverable amount of the asset grouprelated to goodwill based on the present value of future cash flows, that is, estimating the present value of futurecash flows base on the financial budget for the next 5 years set by management and 12.39% discount rate, cashflows remain stable for years beyond the five-year budget. The asset group identified at the time of goodwillimpairment test did not change.The key parameters determined by goodwill impairment test are as follows: 18%-19% gross profit rate and 8%-11% growth rate of operating revenue in the forecast period are used as key parameters to calculate the presentvalue of expected future cash flows of the asset group related to goodwill. Management determines theseparameters based on historical conditions prior to the forecast period and its forecast of market development.After the test above, the Company's goodwill does not need to draw impairment reserves.
2) Goodwill generated by merging Borit:
In 2020, the Company acquired 100.00% of Borit's equity by cash purchase, and goodwill is the amount ofmerger cost greater than the fair value share of Borit's identifiable net assets. According to the Asset AppraisalReport issued by Wanlong (Shanghai) Asset Appraisal Co., LTD. (Wanlong Appraisal Word (2023) No. 40032).The recoverable value of the company's goodwill combined with Borit in the asset group is RMB 32,4221,500,which is higher than the book value of RMB 311,238,500, so there is no impairment loss of goodwill.
19.Long-term deferred expense
In RMB
| Item | Opening balance | Current increased | Amortized in the Period | Other decrease | Ending balance |
| Remodeling costs etc. | 15,304,783.57 | 18,957,732.21 | 5,676,279.94 | 28,586,235.84 | |
| Total | 15,304,783.57 | 18,957,732.21 | 5,676,279.94 | 28,586,235.84 |
20. Deferred income tax assets/Deferred income tax liabilities
(1) Deferred income tax assets that are not offset
In RMB
| Item | Ending balance | Opening balance | ||
| Deductible temporary difference | Deferred income tax assets | Deductible temporary difference | Deferred income tax assets | |
| Unrealized profit from insider transactions | 43,939,348.59 | 8,056,161.37 | 65,251,129.55 | 10,531,677.19 |
| Deductible loss | 942,706,826.57 | 142,138,790.82 | 53,658,338.05 | 11,465,129.69 |
| Bad debt provision | 79,078,766.93 | 11,972,961.27 | 87,681,266.17 | 13,383,420.21 |
| Inventory depreciation reserve | 299,752,548.93 | 46,412,618.47 | 224,955,223.94 | 37,688,819.01 |
Depreciation reserves offixed assets
| Depreciation reserves of fixed assets | 70,008,612.21 | 12,701,929.36 | 57,218,038.14 | 8,677,481.50 |
| Depreciation reserves of intangible assets | 16,646,900.00 | 2,497,035.00 | 16,646,900.00 | 2,497,035.00 |
| Deferred income | 222,850,907.79 | 33,668,167.75 | 295,502,674.12 | 44,620,545.44 |
| Payable salary, accrued expenses etc. | 849,436,667.00 | 139,593,056.66 | 1,236,037,621.62 | 188,472,847.67 |
| Depreciation assets, amortization difference | 25,570,352.82 | 4,153,581.52 | 54,047,597.49 | 8,868,412.34 |
| Equity incentive | 3,066,582.11 | 459,987.32 | 80,742,533.73 | 12,498,678.30 |
| Fiscal and tax differences for leasing business | 1,345,462.74 | 234,721.68 | 378,997.84 | 72,554.36 |
| Total | 2,554,402,975.69 | 401,889,011.22 | 2,172,120,320.65 | 338,776,600.71 |
(2) Deferred income tax liabilities that are not offset
In RMB
| Item | Ending balance | Opening balance | ||
| Taxable temporary differences | Deferred income tax liabilities | Taxable temporary differences | Deferred income tax liabilities | |
| The difference between the fair value and taxation basis of WFTT assets in a merger not under the same control | 10,192,264.15 | 1,528,839.60 | 10,660,027.75 | 1,599,004.14 |
| The difference between the fair value and taxation basis of IRD assets in a merger not under the same control | 61,131,061.24 | 13,448,833.47 | 68,854,748.78 | 15,148,044.73 |
| The difference between the fair value and taxation basis of Borit assets in a merger not under the same control | 21,378,918.49 | 5,344,729.59 | 25,246,551.70 | 6,311,637.91 |
| The difference between the fair value and taxation basis of VH business in a merger not under the same control | 59,291,649.88 | 14,229,995.98 | ||
| Change of fair value of transaction financial asset | 161,415,403.78 | 24,226,534.89 | 318,337,329.74 | 47,794,985.96 |
| Accelerated depreciation of fixed assets | 700,548,497.31 | 107,631,856.23 | 294,934,456.08 | 48,772,268.60 |
| Total | 1,013,957,794.85 | 166,410,789.76 | 718,033,114.05 | 119,625,941.34 |
(3) Deferred income tax assets and deferred income tax liabilities listed after off-set
In RMB
| Item | Trade-off between the deferred income tax assets and liabilities | Ending balance of deferred income tax assets or liabilities after off-set | Trade-off between the deferred income tax assets and liabilities at period-begin | Opening balance of deferred income tax assets or liabilities after off-set |
| Deferred income tax assets | -126,261,238.77 | 275,627,772.45 | -96,528,406.14 | 242,248,194.57 |
| Deferred income tax liabilities | -126,261,238.77 | 40,149,550.99 | -96,528,406.14 | 23,097,535.20 |
(4) Details of unrecognized deferred income tax assets
In RMB
| Item | Ending balance | Opening balance |
| Bad debt reserve | 1,648,602,163.32 | 216,982.72 |
| Inventory depreciation reserve | 34,557,558.55 | 8,144,910.46 |
Loss from subsidiary
| Loss from subsidiary | 529,884,134.82 | 279,247,744.04 |
| Depreciation reserves of fixed assets | 129,931,549.17 | 33,509,152.13 |
| Depreciation reserves of intangible assets | 442,167.30 | |
| Other equity instrument investment | 13,600,000.00 | 13,600,000.00 |
| Equity incentive | 2,304,871.81 | |
| Total | 2,357,017,573.16 | 337,023,661.16 |
(5) Deductible losses of unrecognized deferred income tax assets expired in following years
In RMB
| Maturity year | Ending amount | Opening amount | Note |
| 2022 | 3,781,066.93 | Operating loss occurs in domestic subsidiaries | |
| 2023 | 2,380,501.89 | 1,171,973.53 | Operating loss occurs in domestic subsidiaries |
| 2024 | 12,087,441.12 | 18,520,699.71 | Operating loss occurs in domestic subsidiaries |
| 2025 | 12,140,693.54 | 12,151,503.80 | Operating loss occurs in domestic subsidiaries |
| 2026 | 46,418,486.83 | 22,596,818.84 | Operating loss occurs in domestic subsidiaries |
| 2027 and the following years | 160,833,781.13 | Operating loss occurs in domestic subsidiaries | |
| No expiration period | 296,023,230.31 | 221,025,681.23 | Operating loss occurs in overseas subsidiaries |
| Total | 529,884,134.82 | 279,247,744.04 |
21.Other non-current assets
In RMB
| Item | Ending balance | Opening balance | ||||
| Book balance | Provision for impairment | Book value | Book balance | Provision for impairment | Book value | |
| Contract acqusiiton cost | 19,855,422.27 | 19,855,422.27 | ||||
| Engineering equipment paid in advance | 239,775,014.10 | 239,775,014.10 | 267,941,354.57 | 267,941,354.57 | ||
| Large deposit certificates with a maturity of more than one year | 220,000,000.00 | 220,000,000.00 | ||||
| Total | 479,630,436.37 | 479,630,436.37 | 267,941,354.57 | 267,941,354.57 | ||
22. Short-term borrowings
(1) Category of short-term borrowings
In RMB
| Item | Ending balance | Opening balance |
| Guaranteed Loan | 89,074,800.00 | 72,197,000.00 |
| Credit loan | 3,511,504,373.65 | 1,264,241,086.57 |
Bill financing
| Bill financing | 100,000,000.00 | |
| Accrued interest | 3,797,354.17 | 1,520,119.98 |
| Total | 3,604,376,527.82 | 1,437,958,206.55 |
(2) Overdue short-term loans without payment
23.Derivative financial liabilities
In RMB
| Item | Ending balance | Opening balance |
| Forward settlement and sales of foreign exchange | 747,115.75 | |
| Total | 747,115.75 |
24.Note payable
In RMB
| Category | Ending balance | Opening balance |
| Bank acceptance bill | 1,411,089,606.00 | 1,760,032,216.30 |
| Total | 1,411,089,606.00 | 1,760,032,216.30 |
At the end of the current period, the total amount of matured but unpaid notes payable is 0.00 yuan.Other notes:
A deposit of 24,307,521.30 yuan and pledge notes receivable of 613,245,787.39 yuan have been paid for the issuance of thebanker's acceptance above.
25. Account payable
(1) Account payable
In RMB
| Item | Ending balance | Opening balance |
| Within one year | 3,165,855,712.48 | 3,066,299,727.36 |
| 1-2 years | 207,702,168.86 | 64,962,570.18 |
| 2-3 years | 31,919,163.40 | 52,067,026.49 |
| Over three years | 49,123,978.86 | 23,324,378.56 |
| Total | 3,454,601,023.60 | 3,206,653,702.59 |
(2) Important account payable with account age over one year
Nil
26. Accounts received in advance
(1) Accounts received in advance
In RMB
Item
| Item | Ending balance | Opening balance |
| Within 1 year | 3,633,878.33 | 2,854,518.96 |
| Total | 3,633,878.33 | 2,854,518.96 |
27.Contract liabilities
In RMB
| Item | Ending balance | Opening balance |
| Within one year | 60,916,157.84 | 132,406,102.56 |
| 1-2 years | 31,275,903.90 | 2,681,086.39 |
| 2-3 years | 1,518,759.78 | 132,196.85 |
| Over three years | 1,139,261.71 | 1,208,250.59 |
| Total | 94,850,083.23 | 136,427,636.39 |
28.Wage payable
(1) Wage payable
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
| I. Short-term compensation | 207,822,331.67 | 1,204,097,708.74 | 1,170,045,281.42 | 241,874,758.99 |
| II. Post-employment welfare- defined contribution plans | 20,279,307.31 | 185,708,871.69 | 178,310,062.19 | 27,678,116.81 |
| III. Dismissed welfare | 1,245,327.09 | 1,396,110.65 | 1,668,237.41 | 973,200.33 |
| IV. Incentive funds paid within one year | 93,880,000.00 | 63,140,000.00 | 30,740,000.00 | |
| V. Other short-term welfare-Housing subsidies, employee benefits and welfare funds | 16,661,536.63 | 4,526,219.46 | 5,019,445.98 | 16,168,310.11 |
| Total | 339,888,502.70 | 1,395,728,910.54 | 1,418,183,027.00 | 317,434,386.24 |
(2) Short-term compensation
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
| 1. Wages, bonuses, allowances and subsidies | 197,176,934.90 | 956,189,963.48 | 925,104,100.52 | 228,262,797.86 |
| 2. Welfare for workers and staff | 72,058.92 | 71,285,245.35 | 71,357,304.27 | |
| 3. Social insurance | 192,691.73 | 70,075,762.32 | 69,988,910.42 | 279,543.63 |
| Including: Medical insurance | 172,605.50 | 57,511,916.86 | 57,441,697.79 | 242,824.57 |
| Work injury insurance | 16,653.30 | 6,718,325.13 | 6,707,580.23 | 27,398.20 |
| Maternity insurance | 3,432.93 | 5,845,520.33 | 5,839,632.40 | 9,320.86 |
| 4. Housing accumulation fund | 656,874.00 | 83,027,391.00 | 82,898,538.00 | 785,727.00 |
| 5. Labor union expenditure and personnel education expense | 9,611,229.93 | 16,982,993.17 | 16,634,110.11 | 9,960,112.99 |
| 6. Other short-term compensation - social security | 112,542.19 | 6,536,353.42 | 4,062,318.10 | 2,586,577.51 |
| Total | 207,822,331.67 | 1,204,097,708.74 | 1,170,045,281.42 | 241,874,758.99 |
(3) Define contribution plans
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
| 1. Basic endowment premium | 416,445.06 | 133,875,890.13 | 127,462,957.24 | 6,829,377.95 |
2. Unemployment
insurance
| 2. Unemployment insurance | 25,533.44 | 4,031,116.95 | 4,020,171.98 | 36,478.41 |
| 3. Enterprise annuity | 19,837,328.81 | 47,801,864.61 | 46,826,932.97 | 20,812,260.45 |
| Total | 20,279,307.31 | 185,708,871.69 | 178,310,062.19 | 27,678,116.81 |
Other explanation:
1.Explanation to decrease in incentive funds paid within a year
The decrease of incentive funds paid within a year in the current period of 63.14 million yuan includes a reclassification of employeecompensation payable to long-term employee compensation payable of 34,501,427.39 yuan, which is determined based on thecompany's future payment plan.
2. Dismiss welfare
The wages payable results from the implementation of inner retirement plan, and the amount paid in the next year is booked into suchitem.
3. Post-employment welfare- defined contribution plans:
The Company participates in the pension insurance and unemployment insurance plans established by government authorities bylaws, a certain percentage of the social security fee regulated by the government will pay by the Company monthly for the plans.Other than the aforesaid monthly contribution, the Company takes no further payment obligation. The relevant expenditure isincluded in current profit or loss or cost of relevant assets when occurs. Found more of enterprise annuity in Note XIV-4 “Annuityplan”.
29.Tax payable
In RMB
| Item | Ending balance | Opening balance |
| Value-added tax | 27,961,474.84 | 24,533,584.80 |
| Corporation income tax | 7,847,731.79 | 2,317,331.81 |
| Individual income tax | 6,846,289.60 | 3,528,037.22 |
| City maintaining & construction tax | 1,546,043.92 | 1,750,188.23 |
| Educational surtax | 1,105,937.33 | 1,250,134.44 |
| Other (including stamp tax and local funds) | 9,278,838.05 | 6,726,372.38 |
| Total | 54,586,315.53 | 40,105,648.88 |
30.Other account payable
In RMB
| Item | Ending balance | Opening balance |
| Interest payable | 6,184.14 | |
| Dividends payable | 25,671,100.00 | |
| Other accounts payable | 198,990,948.23 | 334,228,033.32 |
| Total | 198,990,948.23 | 359,905,317.46 |
(1) Interest payable
In RMB
| Item | Ending balance | Opening balance |
| Other | 6,184.14 | |
| Total | 6,184.14 |
Major overdue interest: Nil
(2) Dividend payable
In RMB
| Item | Ending balance | Opening balance |
| Common stock dividend | 25,671,100.00 | |
| Total | 25,671,100.00 |
Other explanations, including important dividends payable that have not been paid for more than one year, disclose the reason fornot paying: Nil
(3) Other account payable
1) Classification of other accounts payable according to nature of account
In RMB
| Item | Ending balance | Opening balance |
| Deposit and margin | 15,452,400.65 | 24,601,774.89 |
| Social insurance and reserves funds that withholding | 1,967,741.92 | 1,695,074.09 |
| Intercourse funds of unit | 25,512,145.98 | 33,562,145.98 |
| Restricted stock repurchase obligations | 138,495,060.00 | 269,101,020.00 |
| Payable unpaid investment funds | 13,308,176.65 | |
| Other | 4,255,423.03 | 5,268,018.36 |
| Total | 198,990,948.23 | 334,228,033.32 |
2) Significant other payable over one year
In RMB
| Item | Ending balance | Reasons for non-repayment or carry-over |
| Nanjing Jidian Industrial Group Co., Ltd. | 4,500,000.00 | Intercourse funds |
| Restricted stock repurchase business | 138,495,060.00 | Restricted stock repurchase business |
| Total | 142,995,060.00 |
Other explanation: Nil
31.Non-current liabilities due within one year
In RMB
| Item | Ending balance | Opening balance |
| Long-term borrowings due within one year | 2,000,000.00 | 27,744,527.80 |
| Lease payments due within one year | 12,044,793.34 | 6,318,273.66 |
| Interest payable | 240,555.56 | 25,972.22 |
| Total | 14,285,348.90 | 34,088,773.68 |
32.Other current liabilities
In RMB
Item
| Item | Ending balance | Opening balance |
| Rebate payable | 201,734,082.52 | 198,936,922.68 |
| Pending sales tax | 8,815,298.56 | 14,032,348.87 |
| Undue bill endorsed/discounted | 1,214,398.69 | |
| Total | 211,763,779.77 | 212,969,271.55 |
Changes in short-term bonds payable: Nil
33. Long-term borrowings
(1) Category of Long-term borrowings
In RMB
| Item | Ending balance | Opening balance |
| Guaranteed loan | 238,000,000.00 | |
| Total | 238,000,000.00 |
34.Lease liability
In RMB
| Item | Ending balance | Opening balance |
| Lease Payments | 31,589,277.20 | 15,795,469.25 |
| Total | 31,589,277.20 | 15,795,469.25 |
35.Long-term account payable
In RMB
| Item | Ending balance | Opening balance |
| Long-term account payable | 12,520,000.00 | 13,750,000.00 |
| Special accounts payable | 18,265,082.11 | 18,265,082.11 |
| Total | 30,785,082.11 | 32,015,082.11 |
(1) Long-term account payable listed by nature
In RMB
| Item | Ending balance | Opening balance |
| Hi-tech Branch of Nanjing Finance Bureau (note ①) Financial support funds (2007) | 1,230,000.00 | |
| Hi-tech Branch of Nanjing Finance Bureau (note ②) Financial support funds (2008) | 2,750,000.00 | 2,750,000.00 |
| Hi-tech Branch of Nanjing Finance Bureau (note ③) Financial support funds (2009) | 1,030,000.00 | 1,030,000.00 |
| Hi-tech Branch of Nanjing Finance Bureau (note ④) Financial support funds (2010) | 960,000.00 | 960,000.00 |
| Hi-tech Branch of Nanjing Finance Bureau (note ⑤) Financial support funds (2011) | 5,040,000.00 | 5,040,000.00 |
| Hi-tech Branch of Nanjing Finance Bureau (note ⑥) Financial support funds (2013) | 2,740,000.00 | 2,740,000.00 |
| Total | 12,520,000.00 | 13,750,000.00 |
Other explanation:
Note ①: To encourage WFJN to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital isallotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from 17 September 2007 to 17September 2022. Provided that the operation period in the zone is less than 15 years, financial supporting capital will bereimbursed. This support capital has been in use for 15 years in this period, so it has been transferred to other income.Note ②: To encourage WFJN to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital isallotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from 10 November 2008 to 10 November2023. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.Note ③: To encourage WFJN to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital isallotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from 27 October 2009 to 27 October 2024.Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.Note ④: To encourage WFJN to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital isallotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from 27 December 2010 to 27 December2025. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.Note ⑤: To encourage WFJN to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital isallotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from 28 December 2011 to 28 December2026. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.Note ⑥: To encourage WFJN to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital isallotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from 18 December 2013 to 18 December2028. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.
(2) Special accounts payable
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance | Cause of formation |
| Removal compensation of subsidiary WFJN | 18,265,082.11 | 18,265,082.11 | |||
| Total | 18,265,082.11 | 18,265,082.11 |
Other explanationIn line with regulation of the house acquisition decision of People’s government of Xuanwu District, Nanjing City, Ning Xuan FuZheng Zi (2012) No.001, part of the lands and property of WFJN needs expropriation in order to carry out the comprehensivelyimprovement of Ming Great Wall. According to the house expropriation and compensation agreement in state-owned lands signedbetween WFJN and House Expropriation Management Office of Xuanwu District, Nanjing City, 19.7067 million yuan in total arecompensate, including operation losses from lessee 1.4416 million yuan in total. The above compensation was received in lastperiod and is making up for the losses from lessee, and the above lands and property have not been collected up to 31 December2022.
35. Long-term wages payable
(1) Long-term wages payable
In RMB
| Item | Ending balance | Opening balance |
I.Post-employment benefits - Definedbenefit plan net liabilities
| I.Post-employment benefits - Defined benefit plan net liabilities | 20,380,744.73 | |
| II. Dismiss welfare | 12,028,538.66 | 4,829,589.69 |
| III. Other long-term welfare | 121,683,760.89 | 103,482,333.50 |
| Total | 154,093,044.28 | 108,311,923.19 |
(2) Defined benefit plan
Present value of defined benefit plan
In RMB
| Item | Current period | Last period |
| I. Opening balance | 19,594,011.39 | |
| II. Cost of defined benefit plan booked into current profit and loss | 38,706.27 | |
| 1.Current service cost | 38,706.27 | |
| III. Cost of defined benefit plan booked into other comprehensive income | 399,165.06 | |
| 1.Actuarial gains (losses are represented by “-”) | 399,165.06 | |
| IV. Other changes | 348,862.01 | |
| 1.Welfare paid | -345,481.69 | |
| 2.Translation difference of foreign currency statements | 694,343.70 | |
| V. Ending balance | 20,380,744.73 |
Other explanation:
According to relevant regulations in Italy, the Trattamento di Fine Rapporto (TFR) system is established. VHIT shall calculate andoffer severance to employees in accordance with employees’ employment period and taxable base salary when they leave or aredismissed. The plan predicts future cash outflows at the inflation rate and determines its present value at the discount rate. Theabove-mentioned benefit plan poses actuarial risks to VHIT, mainly including interest rate risk and inflation risk. The decrease ininterest rates will lead to an increase in the present value of the defined benefit plan obligations. In addition, the present value ofbenefit plan obligations is related to the future payment standards of the plan, which are determined based on inflation rates.Therefore, an increase in inflation rate will also lead to an increase in planned liabilities.
37.Anticipated liability
In RMB
| Item | Ending balance | Opening balance | Formation cause |
| Pending litigation total | 246,653.02 | ||
| Product quality assurance | 8,695,322.61 | ||
| Investment losses in joint ventures | 13,750.00 | ||
| Environmental Protection Commitment | 1,150,543.24 | ||
| Total | 10,106,268.87 |
Other explanations, including important assumptions and estimation explanations related to significant estimated liabilities: Nil
38.Deferred income
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance | Cause of formation |
| Government grant | 298,052,867.56 | 3,084,179.93 | 78,013,068.71 | 223,123,978.78 | |
| Total | 298,052,867.56 | 3,084,179.93 | 78,013,068.71 | 223,123,978.78 | -- |
Item with government grants involved:
In RMB
| Items of liabilities | Opening balance | New grants in the Period | Amount reckoned in non-operation revenue | Amount reckoned into other income in the period | Cost reduction in the period | Other changes | Ending balance | Assets related/Income related |
| Industrialization project for injection VE pump system with electronically controlled high pressure for less-emission diesel used | 721,000.26 | 721,000.26 | Asset/Income related | |||||
| Appropriation on reforming of production line technology and R&D ability of common rail system for diesel by distributive high-voltage | 6,318,348.62 | 781,651.38 | 5,536,697.24 | Assets related | ||||
| Fund of industry upgrade (2013) | 60,520,000.00 | 41,809,808.31 | 18,710,191.69 | Income related | ||||
| R&D and industrialization of the high-pressure variable pump of the common rail system of diesel engine for automobile | 3,817,474.67 | 1,117,613.70 | 2,699,860.97 | Assets related | ||||
| Research institute of motor vehicle exhaust after-treatment technology | 648,660.17 | 530,870.24 | 117,789.93 | Assets related | ||||
| Fund of industry upgrade (2014) | 36,831,000.00 | 36,831,000.00 | Income related | |||||
| New-built assets compensation after the removal of parent company | 83,134,428.94 | 19,691,341.21 | 63,443,087.73 | Assets related | ||||
| Fund of industry upgrade (2016) | 40,000,000.00 | 40,000,000.00 | Income related | |||||
| Guiding capital for the technical reform from State Hi-Tech Technical Commission | 5,057,667.33 | 1,270,553.36 | 3,787,113.97 | Assets related | ||||
| Implementation of the variable cross-section turbocharger for diesel engine | 5,882,788.71 | 1,628,355.53 | 4,254,433.18 | Assets related |
Demonstration projectfor intelligentmanufacturing
| Demonstration project for intelligent manufacturing | 652,381.50 | 220,493.70 | 431,887.80 | Assets related | ||||
| The 2nd batch of provincial special funds for industry transformation of industrial and information in 2019 | 3,446,350.12 | 1,596,505.99 | 1,849,844.13 | Assets related | ||||
| Municipal technological reform fund allocation in 2020 | 4,143,406.07 | 616,309.46 | 3,527,096.61 | Assets related | ||||
| Strategic cooperation agreement funding for key enterprise of smart manufacturing in high-tech zone | 4,450,869.59 | 1,076,250.73 | 3,374,618.86 | Assets related | ||||
| The 3rd batch of provincial special funds for industry transformation of industrial and information in 2021 | 13,500,000.00 | 13,500,000.00 | Assets related | |||||
| Other | 28,928,491.58 | 3,109,983.11 | 6,952,314.84 | -25,803.18 | 25,060,356.67 | Assets related/Income related | ||
| Total | 298,052,867.56 | 3,109,983.11 | 78,013,068.71 | -25,803.18 | 223,123,978.78 |
Other explanation:
(1) Appropriation on industrialization project of electrical control and high voltage jet VE system of low emissions diesel: inSeptember 2009, WFJN signed “Project Contract of Technology Outcome Transferring Special Capital in Jiangsu Province” withNanjing Technical Bureau, according to which WFJN received appropriation 6.35 million yuan in 2009, 4.775 million yuan receivedin 2010 and 0.875 million yuan received in 2011. According to the contract, the attendance date of this project was: from October of2009 to March of 2012. This contract agreed 62% of newly increased investment in project would be spent in fixed assets investmentwhich are belongs to the government grand with assets/income concerned. In 2013, accepted by the science & technology agency ofJiangsu Province, and 4,789,997.04 yuan with income related was reckoned into current operation revenue directly; the 7,210,002.96yuan with assets related was amortized during the predicted service period of the assets, and 721,000.26 yuan was written off in thePeriod.
(2) The appropriation for research and development ability of distributive high-pressure common rail system for diesel engine useand production line technological transformation project: according to XCJ No. [2010] 59, the Company has received special fundsof 7.1 million yuan appropriated by Finance Bureau of Wuxi New District in 2011 and used for the Company’s research anddevelopment ability of distributive high-pressure common rail system for diesel engine use and production line technologicaltransformation project; this appropriation belongs to government grants related to assets, amount of 781,651.38 yuan was written offbased on the depreciation schedule of the related assets during the period.
(3) Industry upgrading funds (2013): In accordance with the document Xi Xin Guan Jing Fa [2013] No.379, Xi Xin Guan Jing Fa[2013] No.455, Xi Xin Guan Cai Fa [2013] No.128 and Xi Xin Guan Cai Fa [2013] No.153, the Company received funds of 60.52million yuan appropriated for industry upgrading in 2013 and amount of 41,809,808.31 yuan was written off in the year.
(4) R&D and industrialization of the high pressure variable pump of the common rail system of diesel engine for automobile: theCompany received appropriated for the project in 2013 with 8.05 million yuan in line with documents of Xi Ke Ji [2013] No.186, XiKe Ji [2013] No.208, Xi Cai Gong Mao [2013] No.104, Xi Cai Gong Mao [2013] No.138, Xi Ke Ji [2014] No.125, Xi Cai Gong
Mao [2014] No.58, Xi Ke Ji [2014] No. 246 and Xi Cai Gong Mao [2014] No.162. the company received 8.05 million yuan, 3million yuan and 0.45 million yuan respectively in 2013, 2014 and 2015; such funds belong to government grant with assetsconcerned, and shall be written off according to the depreciation process, amount of 1,117,613.70 yuan was written off in the year.
(5) Vehicle exhaust after-treatment technology research institute project: in 2012, the subsidiary WFLD has applied for equipmentpurchase assisting funds to Wuxi Huishan Science and Technology Bureau and Wuxi Science and Technology Bureau for the vehicleexhaust after-treatment technology research institute project. This declaration has been approved by Wuxi Huishan Science andTechnology Bureau and Wuxi Science and Technology Bureau in 2012, and the company has received appropriation of 2.4 millionyuan in 2012, and received appropriation of 1.6 million yuan in 2013. This appropriation belongs to government grants related toassets and will be written off according to the depreciation process, amount of 530,870.24 yuan was written off in the year.
(6) Industry upgrading funds (2014): In accordance with the document Xi Xin Guan Jing Fa [2014] No.427 and Xi Xin Guan CaiFa [2014] No.143, the Company received funds of 36.831 million yuan appropriated for industry upgrading in 2014.
(7) New-built assets compensation after the removal of parent company: policy relocation compensation received by the Company,and will be written off according to the depreciation of new-built assets, amount of 19,691,341.21 yuan was written off in the year.
(8) Fund of industry upgrade (2016): In accordance with the document Xi Xin Guan Jing Fa [2016] No.585 and Xi Xin Fa [2016]No.70, the Company received funds of 40 million yuan appropriated for industry upgrading in 2016.
(9) Guiding capital for the technical reform from State Hi-Tech Technical Commission: In accordance with the document Xi JingXin ZH [2016] No.9 and Xi Cai GM [2016] No.56, the Company received a 9.74 million yuan for the guiding capital of technicalreform (1st batch) from Wuxi for year of 2016, and belongs to government grant with assets concerned, and shall be written offaccording to the depreciation process, amount of 1,270,553.36 yuan was written off in the year.
(10) Implementation of the variable cross-section turbocharger for diesel engine: In accordance with the document YCZ Fa[2016]No.623 and “Strong Industrial Base Project Contract for year of 2017”, subsidiary WFTT received a specific subsidy of 16.97million yuan in 2016 and of 760,000 yuan in 2018, the fund supporting strong industrial base project (made-in-China 2025) ofcentral industrial transformation and upgrading 2016 from Ministry of Industry and Information Technology; It belongs togovernment grant with assets concerned, and shall be written off according to the depreciation process. Amount of 1,628,355.53yuan was written off in the year.
(11) Demonstration project for intelligent manufacturing: under the Notice Relating to Selection of the Intelligent ManufacturingModel Project in Huishan District in 2016 (HJXF[2016]No.36), a fiscal subsidy of 3,000,000 yuan was granted by relevantgovernment authority in Huishan district to our subsidiary WFLD in 2017 to be utilized for transformation and upgrade of WFLD’sintelligent manufacturing facilities. This subsidy belongs to government grant related to assets which shall be written off based on thedepreciation progress of the assets. Amount of 220,493.70 yuan was written off in the year.
(12) The 2
nd
batch of provincial special funds for industry transformation of industrial and information in 2019: according to XCGM[2019] No. 121, the Company received a special fund of 5 million yuan in 2020. This subsidy was related to the “Weifu High-Technology New Factory Internet Construction” projects, and belonged to government grants related to assets. and shall be writtenoff according to the depreciation process, amount of 1,596,505.99 yuan was written off in the year.
(13) Municipal technological reform fund allocation in 2020: according to XGXZH [2020] No. 16, the Company received 4.77million yuan of municipal technological transformation fund project allocation in 2020, which was related to key technologicaltransformation projects and belonged to government grants related to assets. and shall be written off according to the depreciationprocess. Amount of 616,309.46 yuan was written off in the year.
(14) Strategic cooperation agreement funding for key enterprise of smart manufacturing in high-tech zone: according to XXGXF[2020] No. 61, the Company received a related grant of 4.06 million yuan in 2020 and 0.7 million yuan received in the year, thisgrant was related to the intelligent transformation project and belonged to the government grants related to assets. and shall bewritten off according to the depreciation process, amount of 1,076,250.73 yuan was written off in the year.
(15) The 3rd batch of provincial special funds for industry transformation of industrial and information in 2021: according to theSCGM [2021] No.92, the government grant 13.5 million yuan received in 2021 was for the research, development and
industrialization of membrane electrodes for high-performance automotive proton exchange membrane fuel cells, which was anassets related government grants.
39.Share
In RMB
| Opening balance | Change during the year (+/-) | Ending balance | |||||
| New shares issued | Bonus share | Shares transferred from capital reserve | Other | Subtotal | |||
| Total shares | 1,008,659,570.00 | -56,277.00 | -56,277.00 | 1,008,603,293.00 | |||
Other explanation:
Decreased in share capital was due to the buy-back and cancellation of 56,277 restricted shares initially granted under the RestrictedShares Incentive Plan for year of 2020.
40.Capital reserve
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
| Capital premium (Share capital premium) | 3,238,990,188.72 | 81,051,840.00 | 1,092,500.74 | 3,318,949,527.98 |
| Other Capital reserve | 132,353,984.10 | 28,116,895.55 | 81,051,840.00 | 79,419,039.65 |
| Total | 3,371,344,172.82 | 109,168,735.55 | 82,144,340.74 | 3,398,368,567.63 |
Other explanation, including changes in the period and reasons for changes;
(1) Share capital premium has increased RMB 81,051,840.00 in the Period, mainly because the capital reserves (other capitalreserves) of the restricted stock unlocked during the waiting period are transferred into the capital premium；Share capitalpremium has decreased RMB 1,092,500.74 in the Period, mainly because the 56,277.00 shares for restricted stock incentive planwere repurchased and cancellation by the Company.
(2) Other capital reserve has increased RMB 28,116,895.55 in the Period, which is a net amount after deducting RMB 826,610.83attributable to minority from RMB 28,943,506.38, the expenses of share-based payment settled by equity; Other capital reservehas decreased RMB 81,051,840.00 in the Period, which is because the amount of capital reserves (other capital reserves)recognized during the waiting period of the restricted stock unlocked in this period is transferred to the equity premium.
41.Treasury stock
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
| Stock repurchases | 1,148,777.74 | 397,804,542.63 | 1,148,777.74 | 397,804,542.63 |
| Repurchase obligation of restricted stock incentive plan | 269,101,020.00 | 125,282,560.00 | 143,818,460.00 | |
| Total | 270,249,797.74 | 397,804,542.63 | 126,431,337.74 | 541,623,002.63 |
Other explanations, including changes in the current period and explanations of the reasons for the changes:
Share buy-back: the increase of 397,804,542.63 yuan due to share buy-back by way of centralized bidding in 2022; Thedecrease of RMB 1,148,777.74 in the current period was caused by the cancellation of 56277.00 shares remaining in the specialsecurities account repurchased by the company’s Restricted Stock Incentive Plan.
Repurchase obligation of restricted stock incentive plan: has RMB 125,282,560.00 decreased in the Period, mainly includingtwo parts: ① RMB 30,798,400.00 cash dividends received by restricted stock incentive recipients during the period; and ② RMB94,484,160.00 is the repurchase and cancellation of 7,632,000.00 restricted shares, the first batch of unlocked in the company’srestricted stock incentive plan by the Company as treasury stock.
42.Other comprehensive income
In RMB
| Item | Opening balance | Current period | Ending balance | |||||
| Account before income tax in the year | Less: written in other comprehensive income in previous period and carried forward to gains and losses in current period | Less: written in other comprehensive income in previous period and carried forward to retained earnings in current period | Less: income tax expense | Belong to parent company after tax | Belong to minority shareholders after tax | |||
| I. Other comprehensive income that cannot be reclassified to profit or loss | 16,008.80 | -399,165.06 | -399,165.06 | -383,156.26 | ||||
| Including:Remeasure changes in defined benefit plans | -399,165.06 | -399,165.06 | -399,165.06 | |||||
| Other comprehensive income that cannot be transferred to profit or loss under the equity method | 16,008.80 | 16,008.80 | ||||||
| II. Other comprehensive income items which will be reclassified subsequently to profit or loss | -36,762,353.40 | 36,234,199.53 | 36,234,199.53 | -528,153.87 | ||||
| Conversion difference of foreign currency financial statement | -36,762,353.40 | 36,234,199.53 | 36,234,199.53 | -528,153.87 | ||||
| Total other comprehensive income | -36,746,344.60 | 35,835,034.47 | 35,835,034.47 | -911,310.13 | ||||
43.Reasonable reserve
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
| Safety production costs | 712,215.31 | 26,087,086.34 | 24,679,500.70 | 2,119,800.95 |
Total
| Total | 712,215.31 | 26,087,086.34 | 24,679,500.70 | 2,119,800.95 |
Other explanation, including changes and reasons for changes:
(1) Instructions for the withdrawing of special reserves (safe production cost): According to the CZ [2022] No.136-Administrative Measures on the Withdrawing and Use of Enterprise Safety Production Expenses jointly issued by the Ministry ofFinance and the State Administration of Work Safety, in the current period, the Company adopted excess retreat method for quarterlywithdrawal by taking the actual operating income of the previous period as the withdrawing basis.
(2) Among the above safety production costs, including the safety production costs Accrued by the Company in line withregulations and the parts enjoy by shareholders of the Company in safety production costs Accrued by subsidiary in line withregulations.
44.Surplus reserve
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
| Statutory surplus reserves | 510,100,496.00 | 510,100,496.00 | ||
| Total | 510,100,496.00 | 510,100,496.00 |
Other explanation, including changes and reasons for changes:
Withdrawal of the statutory surplus reserves: Pursuit to the Company Law and Article of Association, the Company withdrawsstatutory surplus reserve on 10% of the net profit. No more amounts shall be withdrawal if the accumulated statutory surplus reservetakes over 50% of the registered capital.
45.Retailed profit
In RMB
| Item | Current period | Last period |
| Retained profits at the end of last year before adjustment | 14,814,787,377.86 | 13,756,102,424.62 |
| Retained profits at the beginning of the year after adjustment | 14,814,787,377.86 | 13,756,102,424.62 |
| Add: The net profits belong to owners of patent company of this period | 118,819,836.30 | 2,575,371,419.80 |
| Common stock dividends converted into capital stock | ||
| Less: Cash dividends payable | 1,609,059,668.80 | 1,513,341,439.50 |
| Less: Withdraw employee rewards and welfare funds | 4,526,219.46 | 4,081,359.92 |
| Add: Net effect of disposal other equity instrument investment | 736,332.86 | |
| Retained profit at period-end | 13,320,021,325.90 | 14,814,787,377.86 |
Details about adjusting the retained profits at the beginning of the period:
1) The retroactive adjustments to Accounting Standards for Business Enterprises and its relevant new regulations affect theretained profits at the beginning of the period amounting to 0 yuan.
2) The changes in accounting policies affect the retained profits at the beginning of the period amounting to 0 yuan.
3) The major accounting error correction affects the retained profits at the beginning of the period amounting to 0 yuan
4) Merge scope changes caused by the same control affect the retained profits at the beginning of the period amounting to 0 yuan.
5) Other adjustments affect the retained profits at the beginning of the period amounting to 0 yuan
46.Operating income and cost
In RMB
| Item | Current period | Last Period | ||
| Income | Cost | Income | Cost | |
| Main operating | 12,333,099,421.87 | 10,658,281,929.91 | 13,184,138,129.88 | 10,822,600,520.90 |
| Other business | 396,535,495.16 | 358,103,558.89 | 498,288,581.07 | 397,767,192.67 |
| Total | 12,729,634,917.03 | 11,016,385,488.80 | 13,682,426,710.95 | 11,220,367,713.57 |
Whether the lower of the audited net profit before and after deduction of non-recurring gains and losses is negative
□Yes ?No
47.Operating tax and extra
In RMB
| Item | Current period | Last Period |
| City maintaining & construction tax | 22,771,182.73 | 19,681,944.17 |
| Educational surtax | 16,273,199.41 | 14,058,531.57 |
| Property tax | 18,009,579.96 | 17,669,096.06 |
| Land use tax | 4,517,681.71 | 4,507,402.14 |
| Vehicle use tax | 19,195.41 | 27,218.52 |
| Stamp duty | 8,187,585.86 | 3,834,974.65 |
| Other taxes | 797,159.81 | 477,566.62 |
| Total | 70,575,584.89 | 60,256,733.73 |
48.Sales expenses
In RMB
| Item | Current period | Last Period |
| Salary and wage related expense | 59,134,720.55 | 56,098,840.97 |
| Consumption of office materials and business travel charge | 7,978,020.25 | 9,301,927.42 |
| Warehouse charge | 12,489,955.81 | 17,101,049.13 |
| Three guarantees and quality cost | 73,394,539.28 | 138,960,972.56 |
| Business entertainment fee | 16,300,099.96 | 28,210,881.07 |
| Other | 20,230,754.86 | 14,977,761.41 |
| Total | 189,528,090.71 | 264,651,432.56 |
49.Administration expenses
In RMB
| Item | Current period | Last Period |
| Salary and wage related expense | 312,885,696.17 | 322,167,980.30 |
| Depreciation charger and long-term assets amortization | 80,103,136.06 | 71,899,617.49 |
| Consumption of office materials and business travel charge | 20,460,578.25 | 24,870,963.21 |
| Share-based payment | 18,889,058.87 | 48,352,297.07 |
| Other | 154,048,004.97 | 144,581,292.17 |
| Total | 586,386,474.32 | 611,872,150.24 |
50.R&D expenses
In RMB
| Item | Current period | Last Period |
| Technological development expenses | 581,488,711.88 | 595,406,951.64 |
| Total | 581,488,711.88 | 595,406,951.64 |
51.Financial expenses
In RMB
| Item | Current period | Last Period |
| Interest expenses | 107,737,432.78 | 38,698,621.09 |
| Note discount interest expenses | 19,837,754.67 | |
| Less: interest income | 41,020,724.48 | 41,478,845.32 |
| Gains/losses from exchange | 10,099,986.41 | -1,982,034.19 |
| Handling charges | 5,510,921.05 | 4,987,752.59 |
| Total | 82,327,615.76 | 20,063,248.84 |
52.Other income
In RMB
| Sources of income generated | Current period | Last Period |
| Government grants with routine operation activity concerned | 111,670,734.77 | 69,734,194.44 |
| VAT instant refund | 2,460.01 | |
| Refund of individual income tax handling fee | 994,662.50 | 1,540,317.23 |
| Total | 112,665,397.27 | 71,276,971.68 |
53.Investment income
In RMB
| Item | Current period | Last period |
| Income of long-term equity investment calculated based on equity method | 1,636,986,684.96 | 1,632,117,748.78 |
| Investment income from disposal of long-term equity investments | 8,701,134.99 | |
| Investment income from holding financial assets available for sales | 216,491,612.58 | 314,664,249.00 |
| Dividend income obtained from other equity instrument investments during the holding period | 683,455.00 | |
| Investment income from the disposal of trading financial assets | 137,682.59 | |
| Recognition of profit and loss from financing discount of receivables | -5,153,934.63 | |
| Interest payments on discounted bills | -959,296.18 | |
| Total | 1,849,145,500.50 | 1,954,523,836.59 |
54.Income from change of fair value
In RMB
| Sources | Current period | Last period |
Changes in the fair value of wealth managementproducts
| Changes in the fair value of wealth management products | -12,803,609.57 | -380,318.88 |
| Changes in the fair value of the stocks of listed companies held-excluding the stocks of listed companies that are included in other equity instrument investments | -144,072,026.77 | -38,709,334.89 |
| Changes in fair value of foreign exchange contracts | -747,115.75 | -1,180,680.04 |
| Total | -157,622,752.09 | -40,270,333.81 |
55.Credit impairment loss
In RMB
| Item | Current period | Last period |
| Bad debt loss | -1,645,881,142.40 | 4,059,750.80 |
| Total | -1,645,881,142.40 | 4,059,750.80 |
56.Asset impairment loss
In RMB
| Item | Current period | Last period |
| Loss of inventory falling price and loss of contract performance cost impairment | -181,610,433.12 | -134,434,667.54 |
| Impairment loss of fixed assets | -3,682,648.26 | |
| Total | -181,610,433.12 | -138,117,315.80 |
57.Income form assets disposal
In RMB
| Sources | Current period | Last period |
| Income from disposal of non-current assets | 3,687,970.49 | 6,580,346.41 |
| Losses from disposal of non-current assets | -1,701,165.96 | -2,648,002.34 |
| Total | 1,986,804.53 | 3,932,344.07 |
58.Non-operating income
In RMB
| Item | Current period | Last Period | Amount reckoned into current non-recurring gains/losses |
| Payables that do not require payment | 2,048,698.72 | 2,048,698.72 | |
| Price difference for business combinations not under the same control | 3,181,563.57 | 3,181,563.57 | |
| Liquidated damages and compensation income | 281,760.53 | 397,361.84 | 281,760.53 |
| Other | 187,745.22 | 258,840.23 | 187,745.22 |
| Total | 5,699,768.04 | 656,202.07 | 5,699,768.04 |
Government grants included in the current profit and loss: Nil
59.Non-operating expense
In RMB
Item
| Item | Current period | Last Period | Amount reckoned into current non-recurring gains/losses |
| Donation | 5,013,500.00 | 237,041.06 | 5,013,500.00 |
| Non-current assets disposal losses | 2,135,371.43 | 24,984,204.92 | 2,135,371.43 |
| Including: loss on scrapping of fixed assets | 2,135,371.43 | 24,615,193.78 | 2,135,371.43 |
| Loss on scrapping of intangible assets | 369,011.14 | ||
| Other | 562,788.63 | 288,323.89 | 562,788.63 |
| Total | 7,711,660.06 | 25,509,569.87 | 7,711,660.06 |
60.Income tax expense
(1) Income tax expense
In RMB
| Item | Current period | Last period |
| Payable tax in current period | 11,061,046.36 | 140,397,942.05 |
| Adjusted the previous income tax | 2,032,113.63 | 941,390.84 |
| Increase/decrease of deferred income tax assets | -56,032,739.30 | -54,019,435.84 |
| Increase/decrease of deferred income tax liability | 31,608,004.40 | 3,675,792.90 |
| Total | -11,331,574.91 | 90,995,689.95 |
(2) Adjustment on accounting profit and income tax expenses
In RMB
| Item | Current period |
| Total profit | 179,614,433.34 |
| Income tax measured by statutory/applicable tax rate | 26,942,165.00 |
| Impact by different tax rate applied by subsidies | -178,056,001.37 |
| Adjusted the previous income tax | 2,032,113.63 |
| Impact by non-taxable revenue | -249,319,108.30 |
| Impact on cost, expenses and losses that unable to deducted | 11,515,020.27 |
| Impact by the deductible losses of the un-recognized previous deferred income tax | -3,778,371.61 |
| The deductible temporary differences or deductible losses of the un-recognized deferred income tax assets in the Period | 455,617,403.14 |
| Impact on additional deduction | -104,482,259.45 |
| Other | 28,197,463.78 |
| Income tax expense | -11,331,574.91 |
61.Other comprehensive income
See Note V-42 “Other comprehensive income”.
62.Items of cash flow statement
(1) Other cash received in relation to operation activities
In RMB
| Item | Current period | Last period |
| Interest income | 41,020,724.48 | 41,478,845.32 |
Government grants
| Government grants | 32,507,707.23 | 38,578,031.24 |
| Margin on operation bill | 170,000.00 | 3,237,920.90 |
| Capital inflow of WFTR “platform trade” business portfolio | 3,604,252,294.46 | |
| Other | 4,898,138.17 | 2,873,765.53 |
| Total | 3,682,848,864.34 | 86,168,562.99 |
Explanation to other cash received in relation to operation activities: Nil
(2) Other cash paid in relation to operation activities
In RMB
| Item | Current period | Last period |
| Cash cost | 571,583,226.93 | 628,017,019.32 |
| Capital outflow of WFTR “platform trade” business portfolio | 6,345,751,426.41 | |
| Other | 37,760,946.39 | 20,190,804.06 |
| Total | 6,955,095,599.73 | 648,207,823.38 |
Explanation to other cash paid in relation to operation activities: Nil
(3) Cash received from other investment activities
In RMB
| Item | Current period | Last period |
| The contingent consideration received for the purchase of Borit’s equity | 1,136,214.91 | |
| Other | 544,552.00 | |
| Total | 1,680,766.91 |
Explanation to cash received from other investment activities: Nil
(4) Cash paid related with investment activities
In RMB
| Item | Current period | Last period |
| Deposit paid for the purchase of VHCN | 136,739,145.73 | |
| Payment of foreign exchange contract deposit | 9,492,968.77 | |
| Total | 146,232,114.50 |
Explanation to cash paid related with investment activities: Nil
(5) Other cash received in relation to financing activities
In RMB
| Item | Current period | Last period |
| Borrowings received by WFLD | 5,470,000.00 | |
| Total | 5,470,000.00 |
Explanation to other cash received in relation to financing activities: Nil
(6) Cash paid related with financing activities
In RMB
| Item | Current period | Last period |
| Repayment loan of RBIT | 163,470,112.06 | |
| National debt paid transfer to loans | 339,090.00 | |
| Borrowing return by WFLD | 5,470,000.00 | 5,470,000.00 |
| Lease payments | 19,302,140.88 | 7,718,867.54 |
| Repurchase of A shares | 397,804,542.63 | |
| Shares repurchase and cancellation for restricted stock incentive plan and handling charge | 5,323,400.00 | 4,068,729.06 |
| Total | 591,370,195.57 | 17,596,686.60 |
Explanation to other cash paid related with financing activities: Nil
63.Supplementary information to statement of cash flow
(1) Supplementary information to statement of cash flow
In RMB
| Supplementary information | Current period | Last Period |
| 1. Net profit adjusted to cash flow of operation activities: | ||
| Net profit | 190,946,008.25 | 2,649,364,676.15 |
| Add: Assets impairment provision | 1,827,491,575.52 | 134,057,565.00 |
| Depreciation of fixed assets, consumption of oil assets and depreciation of productive biology assets | 423,381,573.22 | 399,184,362.08 |
| Depreciation of right-of-use assets | 10,487,347.35 | 8,672,462.76 |
| Amortization of intangible assets | 47,414,586.57 | 42,460,206.35 |
| Amortization of long-term deferred expenses | 5,676,279.94 | 4,800,457.79 |
| Loss from disposal of fixed assets, intangible assets and other long-term assets | -1,986,804.53 | -3,932,344.07 |
| Losses on scrapping of fixed assets | 2,135,371.43 | 24,984,204.92 |
| Gain/loss of fair value changes | 157,622,752.09 | 40,270,333.81 |
| Financial expenses | 106,707,239.68 | 31,368,748.20 |
| Investment loss | -1,874,322,320.27 | -1,944,475,801.41 |
| Decrease of deferred income tax asset | -56,032,739.30 | -54,019,435.84 |
| Increase of deferred income tax liability | 31,608,004.40 | 3,675,792.90 |
| Decrease of inventory | 1,073,359,311.32 | -723,297,146.60 |
| Decrease of operating receivable accounts | -3,936,816,340.90 | 1,615,814,968.48 |
| Increase of operating payable accounts | -608,366,974.35 | -1,676,121,153.69 |
| Other | 24,952,480.15 | 74,904,696.58 |
| Net cash flows arising from operating activities | -2,575,742,649.43 | 627,712,593.41 |
| 2. Major investments and financing activities that do not involve cash receipts and payments | ||
| debt-to-capital | ||
| Convertible bonds maturing within one year | ||
| Financing to lease fixed assets | ||
| 3. Net change of cash and cash equivalents: | ||
| Balance of cash at period end | 2,277,117,604.82 | 1,094,018,936.73 |
| Less: Balance of cash equivalent at year-begin | 1,094,018,936.73 | 944,946,018.70 |
| Add: Balance at year-end of cash equivalents | ||
| Less: Balance at year-begin of cash equivalents | ||
| Net increase of cash and cash equivalents | 1,183,098,668.09 | 149,072,918.03 |
(2) Net cash payment for the acquisition of subsidiaries in the period
In RMB
| Amount | |
| Cash or cash equivalents paid in the current period for the business acquisition in the current period | 182,950,038.25 |
| Including: | |
| Less: Cash and cash equivalents held by subsidiaries at the purchase date | 112,759,708.54 |
| Including: | |
| Add: Cash or cash equivalents paid in the current period for the business acquisition that occurred in previous periods | |
| Including: | |
| Net cash payment for the acquisition of subsidiaries | 70,190,329.71 |
Other explanation: Nil
(3) Net cash received from the disposal of subsidiaries
In RMB
| Amount | |
| Cash or cash equivalents received in the current period for the disposal of subsidiaries in the current period | |
| Including: | |
| Less：Cash and cash equivalents held by subsidiaries at the loss control date | |
| Including: | |
| Add: Cash or cash equivalents received in the current period for the disposal of subsidiaries in the previous period | 136,787,298.86 |
| Including: | |
| Net cash received from the disposal of subsidiaries | 136,787,298.86 |
Other explanation:
Net cash received for disposal of subsidiaries during the period is that VHIT disposed its subsidiary before October 31, 2022and received the equity disposal payment in December 2022.
(4) Constitution of cash and cash equivalent
In RMB
| Item | Ending balance | Opening balance |
| I. Cash | 2,277,117,604.82 | 1,094,018,936.73 |
| Including: Cash on hand | 51,818.51 | 150,438.79 |
| Bank deposit available for payment at any time | 2,277,065,786.31 | 1,093,868,497.94 |
| II. Balance of cash and cash equivalents at the period-end | 2,277,117,604.82 | 1,094,018,936.73 |
Other explanation:
The difference between bank deposits available for payment at any time and the bank deposits in Note V-1 “Monetary Funds” is thecompany's fixed deposits in the bank.
64.Note of the changes of owners’ equity
Explain the items and amount at period-end adjusted for “Other” at end of the last year: Nil
65.Assets with ownership or use right restricted
In RMB
| Item | Ending book value | Restriction reason |
| Monetary funds | 18,840,000.00 | Forex Contracts USD Margin |
| Monetary funds | 24,368,385.65 | Notes pledge for bank acceptance |
| Monetary funds | 7,487,250.00 | IRD performance bond |
| Monetary funds | 199,660.00 | Cash deposit for Mastercard |
| Monetary funds | 180,000.00 | Court freezing |
| Monetary funds | 5,000.00 | ETC freezing |
| Note receivable | 82,908,186.94 | Notes pledge for bank acceptance |
| Receivables financing | 530,337,600.45 | Notes pledge for bank acceptance |
| Total | 664,326,083.04 |
66.Item of foreign currency
(1) Item of foreign currency
In RMB
| Item | Closing balance of foreign currency | Rate of conversion | Ending RMB balance converted |
| Monetary funds | |||
| Including: USD | 21,346,973.12 | 6.9646 | 148,673,128.99 |
| EUR | 48,296,719.62 | 7.4229 | 358,501,720.07 |
| HKD | 17,293,992.68 | 0.89327 | 15,448,204.84 |
| JPY | 46,929,606.00 | 0.052358 | 2,457,140.31 |
| DKK | 111,164,111.86 | 0.9983 | 110,975,132.87 |
| Account receivable | |||
| Including: USD | 4,732,628.22 | 6.9646 | 32,960,862.50 |
| EUR | 27,066,494.35 | 7.4229 | 200,911,880.92 |
| JPY | 13,084,572.00 | 0.052358 | 685,082.02 |
| DKK | 6,966,207.98 | 0.9983 | 6,954,365.43 |
| Long-term borrowings | |||
| Including: USD | |||
| EUR | |||
| HKD | |||
| Other account receivables | |||
| Including: DKK | 2,035,772.98 | 0.9983 | 2,032,312.17 |
| Short-term borrowings | |||
| Including: USD | 457,403.05 | 6.9646 | 3,185,629.28 |
EUR
| EUR | 18,989,418.64 | 7.4229 | 140,956,555.62 |
| Account payable | |||
| Including: USD | 885,151.79 | 6.9646 | 6,164,728.16 |
| EUR | 36,055,545.43 | 7.4229 | 267,636,708.17 |
| JPY | 50,362,512.00 | 0.052358 | 2,636,880.41 |
| DKK | 6,081,507.53 | 0.9983 | 6,071,168.97 |
| GBP | 2,450.00 | 8.3941 | 20,565.55 |
| Other account payable | |||
| Including: EUR | 5,172.58 | 7.4229 | 38,395.54 |
| DKK | 151,513.30 | 0.9983 | 151,255.73 |
| Non-current liabilities due within one year | |||
| Including: USD | 156,513.08 | 6.9646 | 1,090,051.00 |
| EUR | 496,988.78 | 7.4229 | 3,689,098.02 |
| DKK | 575,121.48 | 0.9983 | 574,143.77 |
| Leasing liabilities | |||
| Including: USD | 386,008.72 | 6.9646 | 2,688,396.33 |
| EUR | 1,285,051.24 | 7.4229 | 9,538,806.85 |
| DKK | 11,525,669.67 | 0.9983 | 11,506,076.03 |
(2) Explanation on foreign operational entities, including as for the major foreign operational entity,disclosed main operation place, book-keeping currency and basis for selection; if the book-keepingcurrency changed, explain reasons
?Applicable □Not applicableSubsidiary of the Company, IRD, was established in Denmark in 1996. The 66% equity of IRD were acquired by the Companyin cash in April 2019. In October 2020, the company acquired the remaining 34.00% equity of IRD in cash, thus the Company holds100% equity of IRD. IRD is denominated in Danish krone, and IRD is mainly engaged in R&D, production and sales of fuel cellcomponents.Subsidiary Borit was established in Belgium in 2010. The Company acquired 100% equity of Borit in cash in November 2020.Borit is denominated in Euro and engaged in R&D, production and sales of fuel cell components.
Subsidiary VHIT was established in Italy in 2000. The Company acquired 100.00% equity of VHIT in cash in October 2022.The company is denominated in Euro and engaged in R&D, production, and sales of vacuum and hydraulic pumps.
67.Government grants
(1) Government grants
In RMB
| Category | Amount | Item | Amount reckoned in current gain/loss |
| Development of variable nozzle turbochargers that meet the requirements of National VI B | 950,000.00 | Deferred income, other income | 424,674.33 |
| 2022 Technical Transformation Fund Allocation | 990,000.00 | Deferred income | |
| Development of Turbochargers for Automotive Hybrid Engines | 120,000.00 | Deferred income |
Subsidy funds for water-saving enterprises in theconstruction of water-saving carriers in Nanjing
| Subsidy funds for water-saving enterprises in the construction of water-saving carriers in Nanjing | 110,000.00 | Deferred income | |
| Borit R&D subsidy | -22,124.54 | Deferred income, other income | 35,419.76 |
| Annual output of 150,000 gasoline engine turbochargers | -40,300.00 | Deferred income, other income | 282,056.24 |
| Neptune | 250,509.22 | Deferred income, other income | 357,572.17 |
| 3 R | 751,898.43 | Other income | 751,898.43 |
| Job stabilization and expanding subsidy | 3,820,755.20 | Other income | 3,820,755.20 |
| Training subsidy | 432,575.00 | Other income | 432,575.00 |
| Talent policy subsidy | 1,135,000.00 | Other income | 1,135,000.00 |
| 2021 Industrial Development Fund for Investment Attracting Enterprises in Tongliang District | 6,913,300.00 | Other income | 6,913,300.00 |
| BORIT withholding refund | 1,400,901.38 | Other income | 1,400,901.38 |
| Industrial upgrading fund | 5,649,800.00 | Other income | 5,649,800.00 |
| Special funds for high-quality development | 1,000,000.00 | Other income | 1,000,000.00 |
| Development funds for small and medium-sized enterprises | 2,000,000.00 | Other income | 2,000,000.00 |
| Selection of Top 50 Enterprises in Jiangbei District, Ningbo | 1,030,000.00 | Other income | 1,030,000.00 |
| Other | 5,706,368.00 | Other income | 5,706,368.00 |
| Financial discount | 246,600.00 | Financial expense | 246,600.00 |
| Total | 32,445,282.69 |
(2) Government grants rebate
?Applicable □Not applicable
In RMB
| Item | Amount | Reason |
| Borit R&D subsidy | 22,124.54 | The company transferred out government subsidies expected to be refunded |
| Annual output of 150,000 gasoline engine turbochargers | 40,300.00 | Government recovery of duplicate subsidy funds |
| Total | 62,424.54 |
68.Others
NoneVIII. Changes of consolidation scope
1. Enterprise combine not under the same control
(1) Enterprise combines not under the same control occurred in the period
In RMB
| Name of the purchased party | Date of equity acquisition | Cost of equity acquisition | Equity acquisition ratio | Method of acquiring equity | Purchase date | Basis for determining the purchase | Income of the purchased party from | Net profit of the purchased party from |
date
| date | the purchase date to the end of the period | the purchase date to the end of the period | ||||||
| VHIT/VHCN(Collectively known as vacuum and hydraulic pump business) | Oct. 31, 2022 | 196,258,214.90 | 100.00% | Cash acquisition | Oct. 31, 2022 | Transfer of control right | 177,911,433.07 | 1,516,124.59 |
(2) Consolidation cost
In RMB
| Consolidation cost | |
| --Cash | 196,258,214.90 |
| --Fair value of non-cash assets | |
| --Fair value of debt issued or assumed | |
| --Fair value of equity securities issued | |
| --Fair value of contingent consideration | |
| --Fair value of equity held before the purchase date at the purchase date | |
| --Other | |
| Total consolidated costs | 196,258,214.90 |
| Less: Fair value share of identifiable net assets obtained | 199,439,778.47 |
| The amount of goodwill/merger cost less than the fair value share of identifiable net assets obtained | 3,181,563.57 |
Method for determining the fair value of merger costs, explanation of contingent consideration and its changes: NilThe main reason for the formation of large goodwill: NilOther explanation: Nil
(3) Book value of assets and liabilities of the merged party on the merger date
In RMB
| vacuum and hydraulic pump | ||
| Fair value on merge date | Book value on merge date | |
| Assets: | ||
| Monetary funds | 112,759,708.54 | 112,759,708.54 |
| Accounts receivable | 176,472,824.41 | 176,472,824.41 |
| Inventory | 75,714,864.30 | 75,193,955.32 |
| Fixed assets | 171,076,046.21 | 163,063,849.08 |
| Intangible assets | 54,001,513.43 | 3,227,177.74 |
| Prepayments | 30,000.00 | 30,000.00 |
| Other receivables | 139,400,701.37 | 139,400,701.37 |
| Other current assets | 24,017,677.49 | 24,017,677.49 |
| Construction in progress | 64,268,995.00 | 64,268,995.00 |
| Right-of-use assets | 810,420.49 | 810,420.49 |
Deferred tax assets
| Deferred tax assets | 7,079,671.21 | 7,079,671.21 |
| Other non-current assets | 19,478,954.99 | 19,478,954.99 |
| Liabilities: | ||
| Loan | ||
| Payables | 234,320,004.21 | 234,320,004.21 |
| Deferred Tax Liability | 14,239,001.21 | |
| Contractual liabilities | 3,921,267.48 | 3,921,267.48 |
| Payable employee compensation | 33,153,750.99 | 33,153,750.99 |
| Taxes and fees payable | 2,552,462.68 | 2,552,462.68 |
| Other payables | 304,829,051.67 | 304,829,051.67 |
| Non-current liabilities due within one year | 324,718.81 | 324,718.81 |
| Other current liabilities | 12,987,488.80 | 12,987,488.80 |
| Lease liabilities | 539,932.04 | 539,932.04 |
| Long term employee compensation payable | 27,863,535.89 | 27,863,535.89 |
| Anticipated liabilities | 10,940,385.19 | 10,940,385.19 |
| Net assets | 199,439,778.47 | 154,371,337.88 |
| Less: Minority shareholders' equity | ||
| Net assets acquired | 199,439,778.47 | 154,371,337.88 |
Method for determining the fair value of identifiable assets and liabilities: NilContingent liabilities assumed by the acquiree in a business merger: NilOther instructions: Nil
(4) Gains or losses arising from re-measured by fair value for the equity held before purchasing dateWhether it is a business combination realized by two or more transactions of exchange and a transaction of obtained control rightsin the Period or not
□Yes ?No
(5) Notes relating to the merge date or the end of the period in which the merger consideration or the fairvalue of the purchasee’s identifiable assets and liabilities cannot be reasonable determinedNil
(6) Other explanation
Nil
2. Enterprise combines under the same control
(1) Business combinations under the same control that occurred in the current periodNil
(2) Consolidation cost
Nil
(3) Book value of assets and liabilities of the merged party on the merger dateNil
3. Reverse purchase
NA
4. Disposal of subsidiaries
Whether there is a single disposal of an investment in a subsidiary that resulted in a loss of control
□Yes ?No
Whether there is a step-by-step disposal of investment in a subsidiary through multiple transactions and loss ofcontrol during the period
□Yes ?No
5.Changes in the scope of consolidation due to other reasons
Explanation on changes in the scope of consolidation due to other reasons (e.g. new establishment of a subsidiary, subsidiaryliquidation, etc.) and related information:
In the Period, Wuxi Weifu Qinglong Power Technology Co., Ltd was jointly funded by the Company with IRD FUELCELLS A/S, BORIT NV, ROBERT BOSCH INTERNATIONALE BETEILIGUNGEN AG and Wuxi High-Tech Zone NewDynamic Industrial Development Fund (Limited Partnership). The Company holds 45% equity directly and 30% equity indirectlyvia IRD and Borit. The Company is the actual controller of Wuxi Weifu Qinglong Power Technology Co., Ltd.
6.Others
Nil
IX. Equity in other entity
1.Equity in subsidiary
(1) Constitute of enterprise group
| Subsidiary | Main operation place | Registered place | Business nature | Share-holding ratio | Acquired way | ||
| Directly | Indirectly | ||||||
| WFJN | Nanjing | Nanjing | Spare parts of internal-combustion engine | 80.00% | Enterprise combines under the same control | ||
| WFLD | Wuxi | Wuxi | Automobile exhaust purifier, muffler | 94.81% | Enterprise combines under the same control | ||
| WFMA | Wuxi | Wuxi | Spare parts of internal-combustion engine | 100.00% | Investment | ||
| WFCA | Wuxi | Wuxi | Spare parts of internal-combustion engine | 100.00% | Investment | ||
| WFTR | Wuxi | Wuxi | Trading | 100.00% | Enterprise combines under the same control | ||
| WFSC | Wuxi | Wuxi | Spare parts of internal-combustion engine | 66.00% | Investment | ||
| WFTT | Ningbo | Ningbo | Spare parts of internal-combustion engine | 98.83% | 1.17% | Enterprise combines not under the same control | |
WFAM
| WFAM | Wuxi | Wuxi | Spare parts of internal-combustion engine | 51.00% | Enterprise combines not under the same control | |
| WFLD (Wuhan) | Wuhan | Wuhan | Automobile exhaust purifier, muffler | 60.00% | Investment | |
| WFLD (Chongqing) | Chongqing | Chongqing | Automobile exhaust purifier, muffler | 100.00% | Investment | |
| WFLD (Nanchang) | Nanchang | Nanchang | Automobile exhaust purifier, muffler | 100.00% | Investment | |
| WFAS | Wuxi | Wuxi | Smart car equipment | 66.00% | Investment | |
| WFDT | Wuxi | Wuxi | Hub Motor | 80.00% | Enterprise combines not under the same control | |
| WFQL | Wuxi | Wuxi | Fuel cell components | 45.00% | 30.00% | Investment |
| VHCN | Wuxi | Wuxi | Vacuum and hydraulic pump | 100.00% | Enterprise combines not under the same control | |
| SPV | Denmark | Denmark | Investment | 100.00% | Investment | |
| IRD | Denmark | Denmark | Fuel cell components | 100.00% | Enterprise combines not under the same control | |
| IRD America | America | America | Fuel cell components | 100.00% | Enterprise combines not under the same control | |
| Borit | Belgium | Belgium | Fuel cell components | 100.00% | Enterprise combines not under the same control | |
| Borit America | America | America | Fuel cell components | 100.00% | Enterprise combines not under the same control | |
| VHIT | Italy | Italy | Vacuum and hydraulic pump | 100.00% | Investment |
Explanation on share-holding ratio in subsidiary different from ratio of voting right: NilBasis for holding half or less of the voting rights but still controlling the investee, and holding more than half of the voting rightsbut not controlling the investee: NilBasis for inclusion in the scope of consolidation of significant structured entities, control: NilBasis for determining whether a company is an agent or a principal: NilOther explanation
(2) Important non-wholly-owned subsidiary
In RMB
| Subsidiary | Share-holding ratio of minority | Gains/losses attributable to minority in the Period | Dividend announced to distribute for minority in the Period | Ending equity of minority |
| WFJN | 20.00% | 17,248,806.27 | 66,468,437.62 | 210,600,503.32 |
| WFSC | 34.00% | 5,564,553.15 | 26,591,139.14 | |
| WFLD | 5.19% | 7,744,005.93 | 147,668,021.86 | |
| WFAM | 49.00% | 42,540,064.71 | 32,680,000.00 | 216,555,779.48 |
| Total | 73,097,430.06 | 99,148,437.62 | 601,415,443.80 |
Explanation on holding ratio different from the voting right ratio for minority shareholders: Nil
(3) Main finance of the important non-wholly-owned subsidiary
In RMB
| Subsidiary | Ending balance | Opening balance | ||||||||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | |
| WFJN | 858,41 | 577,35 | 1,435, | 346,383 | 35,181, | 381,564 | 1,163,2 | 312,639 | 1,475,8 | 403,140 | 39,065, | 442,206 |
9,058.
| 9,058.16 | 9,266.26 | 778,324.42 | ,138.63 | 853.60 | ,992.23 | 44,507.43 | ,160.97 | 83,668.40 | ,636.22 | 672.06 | ,308.28 | |
| WFSC | 204,138,588.74 | 48,627,033.79 | 252,765,622.53 | 174,162,086.64 | 174,162,086.64 | 216,066,879.24 | 46,302,741.60 | 262,369,620.84 | 200,467,446.49 | 200,467,446.49 | ||
| WFLD | 4,869,373,661.60 | 1,412,237,671.12 | 6,281,611,332.72 | 3,512,116,686.68 | 218,075,518.79 | 3,730,192,205.47 | 4,503,223,903.30 | 1,354,614,615.10 | 5,857,838,518.40 | 3,558,321,743.41 | 21,480,042.25 | 3,579,801,785.66 |
| WFAM | 434,472,654.85 | 554,774,642.02 | 989,247,296.87 | 449,094,531.03 | 99,748,081.81 | 548,842,612.84 | 413,380,063.83 | 483,832,825.41 | 897,212,889.24 | 450,194,211.90 | 59,932,162.99 | 510,126,374.89 |
| Total | 6,366,403,963.35 | 2,592,998,613.19 | 8,959,402,576.54 | 4,481,756,442.98 | 353,005,454.20 | 4,834,761,897.18 | 6,295,915,353.80 | 2,197,389,343.08 | 8,493,304,696.88 | 4,612,124,038.02 | 120,477,877.30 | 4,732,601,915.32 |
In RMB
| Subsidiary | Current period | Last Period | ||||||
| Operation Income | Net profit | Total comprehensive income | Cash flow from operation activity | Operation Income | Net profit | Total comprehensive income | Cash flow from operation activity | |
| WFJN | 732,361,563.72 | 83,150,768.43 | 83,150,768.43 | 62,087,338.85 | 825,822,469.06 | 96,549,390.54 | 96,549,390.54 | 79,645,579.97 |
| WFSC | 387,505,622.39 | 16,361,964.13 | 16,361,964.13 | -23,846,712.63 | 350,165,714.10 | 12,839,649.76 | 12,839,649.76 | 38,135,056.28 |
| WFLD | 5,937,549,034.42 | 265,352,997.31 | 265,352,997.31 | 87,740,237.63 | 6,527,268,564.43 | 337,097,184.96 | 337,114,070.10 | -323,189,683.23 |
| WFAM | 704,346,941.59 | 90,524,389.14 | 90,524,389.14 | 145,137,886.56 | 641,120,626.61 | 81,627,198.42 | 81,627,198.42 | 53,533,412.73 |
| Total | 7,761,763,162.12 | 455,390,119.01 | 455,390,119.01 | 271,118,750.41 | 8,344,377,374.20 | 528,113,423.68 | 528,130,308.82 | -151,875,634.25 |
(4) Significant restrictions on the use of enterprise group assets and pay off debts of the enterprise groupNil
(5) Financial or other supporting offers to the structured entity included in consolidated financialstatement rangeNil
2. Transaction that has owners’ equity shares changed in subsidiary but still with controlling rights
(1) Owners’ equity shares changed in subsidiary
Nil
(2) Impact on minority’s interest and owners’ equity attributable to parent companyNil
3. Equity in joint venture and associated enterprise
(1) Important joint venture and associated enterprise
| Joint venture or associated enterprise | Main operation place | Registered place | Business nature | Share-holding ratio | Accounting treatment on investment for joint venture and associated enterprise | |
| Directly | Indirectly | |||||
| Wuxi Weifu Environmental Catalysts. Co., Ltd. | Wuxi | Wuxi | Catalyst | 49.00% | Equity method | |
| RBCD | Wuxi | Wuxi | Internal-combustion engine accessories | 32.50% | 1.50% | Equity method |
| Zhonglian Automobile Electronics Co., Ltd. | Shanghai | Shanghai | Internal-combustion engine accessories | 20.00% | Equity method | |
| Wuxi Weifu Precision Machinery Manufacturing Co., Ltd. | Wuxi | Wuxi | Internal-combustion engine accessories | 20.00% | Equity method | |
| Changchun Xuyang Weifu Automobile Components Technology Co., Ltd. | Changchun | Changchun | Automobile components | 34.00% | Equity method | |
| PrecorsGmbH | Germany | Germany | Fuel cell components | 8.11% | Equity method | |
| Wuxi ChelianTianxia Information Technology Co., Ltd. | Wuxi | Wuxi | Telematics services | 8.83% | Equity method | |
| Lezhuo Bowei Hydraulic Technology (Shanghai) Co., Ltd | Shanghai | Shanghai | Automobile components | 50.00% | Equity method | |
Holding shares ratio different from the voting right ratio: nilHas major influence with less 20% voting rights hold, or has minor influence with over 20% (20% included) voting rights hold:
(1) Precors GmbH:
Wholly-owned subsidiary of the Company - Borit, holds 8.11% equity of Precors, Borit appointed a director to Precors. Though therepresentative, Borit can participate in the operation policies formulation of Precors, and thus exercise a significant influence overPrecors.
(2) ChelianTianxia:
The Company holds 9.8452% equity of Chelian Tianxia, and appointed a director to Chelian Tianxia. Though the representative, theCompany can participate in the operation policies formulation of Chelian Tianxia, and thus exercise a significant influence overChelian Tianxi.
(2) Main financial information of the important joint venture
Nil
(3) Main financial information of the important associated enterprise
In RMB
| Ending balance/Current period | Opening balance/Last Period | |||||
| WFEC | RBCD | Zhonglian Automobile | WFEC | RBCD | Zhonglian Automobile | |
Current assets
| Current assets | 3,507,976,754.16 | 15,426,523,373.99 | 241,595,079.15 | 4,359,756,878.88 | 14,697,384,325.87 | 71,871,241.06 |
| Non -current assets | 333,764,427.43 | 3,421,035,986.82 | 7,557,124,612.32 | 344,385,727.94 | 3,080,929,311.51 | 6,819,520,183.89 |
| Total assets | 3,841,741,181.59 | 18,847,559,360.81 | 7,798,719,691.47 | 4,704,142,606.82 | 17,778,313,637.38 | 6,891,391,424.95 |
| Current liabilities | 1,665,411,123.81 | 8,810,309,639.09 | 6,171,780.23 | 2,858,118,635.51 | 8,623,318,592.84 | 2,970,685.68 |
| Non-current liabilities | 493,618,200.85 | 2,517,670.77 | 224,616,134.38 | 2,578,140.19 | ||
| Total liabilities | 2,159,029,324.66 | 8,810,309,639.09 | 8,689,451.00 | 3,082,734,769.89 | 8,623,318,592.84 | 5,548,825.87 |
| Including: cash and cash equivalent | 813,874,175.27 | 10,773,921.81 | 225,052,854.96 | 158,561,233.69 | 10,186,961.74 | 68,250,913.00 |
| Minority interests | ||||||
| Attributable to parent company shareholders’ equity | 1,682,711,856.93 | 10,037,249,721.72 | 7,790,030,240.47 | 1,621,407,836.93 | 9,154,995,044.54 | 6,885,842,599.08 |
| Share of net assets calculated by shareholding ratio | 824,528,809.90 | 3,412,664,905.38 | 1,558,006,048.09 | 794,489,840.10 | 3,112,698,315.15 | 1,377,168,519.82 |
| Adjustment matters | ||||||
| --Goodwill | 267,788,761.35 | 1,407,265.96 | 267,788,761.35 | 1,407,265.96 | ||
| --Unrealized profit of internal trading | -20,692,355.48 | -40,372,840.77 | ||||
| --Other | -0.28 | -0.28 | -0.01 | |||
| Book value of equity investment in associated enterprise | 824,528,809.90 | 3,659,761,310.97 | 1,559,413,314.05 | 794,489,840.10 | 3,340,114,235.45 | 1,378,575,785.77 |
| Fair value of equity investment for the affiliates with consideration publicly | ||||||
| Operation income | 4,983,370,807.15 | 13,443,929,728.58 | 26,913,563.07 | 7,595,559,889.80 | 15,712,821,656.32 | 24,479,957.39 |
| Net profit | 354,097,545.31 | 3,059,444,530.82 | 1,876,187,641.39 | 432,505,306.32 | 3,237,912,797.87 | 1,699,134,647.28 |
| Net profit from discontinued operations | ||||||
| Other comprehensive income | 34,459.46 | |||||
| Total comprehensive income | 354,097,545.31 | 3,059,444,530.82 | 1,876,187,641.39 | 432,539,765.78 | 3,237,912,797.87 | 1,699,134,647.28 |
| Financial expense | 37,298,423.01 | -12,919,599.29 | -3,814,000.75 | 108,452,297.18 | -56,513,383.09 | -3,139,306.82 |
| Income tax expense | 43,882,305.71 | 494,166,513.51 | 4,465,983.95 | 51,379,165.70 | 674,071,693.78 | 3,579,421.41 |
| Dividends received from | 147,000,000.00 | 765,837,710.23 | 194,400,000.00 | 98,000,000.00 | 558,125,544.30 | 198,800,000.00 |
associatedenterprise in theyear
associatedenterprise in theyear
Other explanationAdjustment item for other “-0.28”: the differential tail;
(4) Financial summary for non-important Joint venture and associated enterprise
In RMB
| Ending balance/Current period | Opening balance/Last period | |
| Joint venture: | ||
| Amount based on share-holding ratio | ||
| Associated enterprise: | ||
| Total book value of investment | 239,114,674.05 | 204,764,926.80 |
| Amount based on share-holding ratio | ||
| --Net profit | 7,198,399.91 | -13,039,885.78 |
| --Total comprehensive income | 7,198,399.91 | -13,039,885.78 |
(5) Major limitation on capital transfer ability to the Company from joint venture or associatedenterpriseNil
(6) Excess loss occurred in joint venture or associated enterprise
Nil
(7) Unconfirmed commitment with joint venture investment concerned
Nil
(8) Intangible liability with joint venture or associated enterprise investment concernedNil
4. Major conduct joint operation
Nil
5. Structured body excluding in consolidate financial statement
Relevant explanations for structured entities not included in the scope of the consolidated financial statements: nil
6. Other
Nil
X. Risk related with financial instrumentMain financial instrument of the Company including monetary funds, structured deposits, account receivable,equity instrument investment, financial products, loans, and account payable etc., more details of the financialinstrument can be found in relevant items of Note VII. Risks concerned with the above-mentioned financialinstrument, and the risk management policy takes for lower the risks are as follow:
Aims of engaging in the risk management is to achieve equilibrium between the risk and benefit, lower theadverse impact on performance of the Company to minimum standards, and maximized the benefit forshareholders and other investors. Base on the risk management targets, the basic tactics of the risk management isto recognized and analyzed the vary risks that the Company counted, established an appropriate risk exposurebaseline and caring risk management, supervise the vary risks timely and reliably in order to control the risk in alimited range.In business process, the risks with financial instrument concerned happen in front of the Company mainlyincluding credit exposure, market risk and liquidity risk. BOD of the Company takes full charge of the riskmanagement target and policy-making, and takes ultimate responsibility for the target of risk management andpolicy. Compliance department and financial control department manager and monitor those risk exposures toensuring the risks are control in a limited range.
1. Credit Risk
Credit risk refers to the risk that one party of a financial instrument fails to perform its obligations, and resultingin the financial loss of other party. The company's credit risk mainly comes from monetary funds, structureddeposits, note receivable, account receivable, other account receivables. The management has established anappropriate credit policy and continuously monitors the exposure to these credit risks.The monetary funds and structured deposits held by the Company are mainly deposited in financial institutionssuch as commercial banks, the management believes that these commercial banks have higher credit and assetstatus, and have lower credit risks. The Company adopts quota policies to avoid credit risks to any financialinstitutions.For accounts receivable, other receivables and bills receivable, the Company sets relevant policies to control thecredit risk exposure. To prevent the risks, the company has formulated a new customer credit evaluation systemand an existing customer credit sales balance analysis system. The new customer credit evaluation system aims atnew customers, the company will investigate a customer’s background according to the established process todetermine whether to give the customer a credit line and the credit line size and credit period. Accordingly, thecompany has set a credit limit and a credit period for each customer, which is the maximum amount that does notrequire additional approval. The analysis system for credit sales balance of existing customers means that afterreceiving a purchase order from an existing customer, the company will check the order amount and the balanceof the accounts owed by the customer so far, if the total of the two exceeds the credit limit of the customer, thecompany can only sell to the customer on the premise of additional approval, otherwise the customer must be
required to pay the corresponding amount in advance. In addition, for the credit sales that have occurred, thecompany analyzes and audits the monthly statements for risk warning of accounts receivable to ensure that thecompany’s overall credit risk is within a controllable range.The maximum credit risk exposure of the Company is the carrying amount of each financial asset on the balancesheet.
2.Market risk
Market risk of the financial instrument refers to the fair value of financial instrument or future cash flow due tofluctuations in the market price changes and produce, mainly includes the IRR, FX risk and other price risk.
(1) Interest rate risk (IRR)
IRR refers to the fluctuate risks on Company’s financial status and cash flow arising from rates changes in market.IRR of the Company mainly related with the bank loans. In order to lower the fluctuate of IRR, the Company, inline with the anticipative change orientation, choose floating rate or fixed rate, that is the rate in future period willgoes up prospectively, then choose fixed rate; if the rate in future period will decline prospectively, than choosethe floating rate. In order to minor the bad impact from difference between the expectation and real condition,loans for liquid funds of the Company are choose the short-term period, and agreed the terms of prepayment inparticular.
(2) Foreign exchange (FX) risk
FX risks refer to the losses arising from exchange rate movement. The FX risk sustain by the Company mainlyrelated with the USD, EUR, SF, JPY, HKD, DKK except for the USD, EUR, SF, JPY, HKD and DKK carried outfor the equipment purchasing of parent company and Autocam, material purchasing of parent company, technicalservice and trademark usage costs of parent company, the import and export of Weifu International Trade,operation of IRD, operation of Borit, and operation of VHIT and other main business of the Company are pricingand settle with RMB (yuan). In consequence of the foreign financial assets and liabilities takes minor ratio in totalassets, the Company has small FX risk of the financial instrument, considered by management of the Company.End as 31st December 2022, except for the follow assets or liabilities listed with foreign currency, assets andliabilities of the Company are carried with RMB
① Foreign currency assets of the Company till end of 31st December 2022:
| Item | Ending foreign currency balance | Convert rate | Ending RMB balance converted | Ratio in assets (%) |
| Monetary funds | ||||
| Including: USD | 21,346,973.12 | 6.9646 | 148,673,128.99 | 0.52 |
| EUR | 48,296,719.62 | 7.4229 | 358,501,720.07 | 1.26 |
| HKD | 17,293,992.68 | 0.89327 | 15,448,204.84 | 0.05 |
| JPY | 46,929,606.00 | 0.052358 | 2,457,140.31 | 0.01 |
| DKK | 111,164,111.86 | 0.9983 | 110,975,132.87 | 0.39 |
| Account receivable | ||||
| Including: USD | 4,732,628.22 | 6.9646 | 32,960,862.50 | 0.12 |
| EUR | 27,066,494.35 | 7.4229 | 200,911,880.92 | 0.70 |
| JPY | 13,084,572.00 | 0.052358 | 685,082.02 | 0.00 |
| DKK | 6,966,207.98 | 0.9983 | 6,954,365.43 | 0.02 |
Item
| Item | Ending foreign currency balance | Convert rate | Ending RMB balance converted | Ratio in assets (%) |
| Other account receivables | ||||
| Including: DKK | 2,035,772.98 | 0.9983 | 2,032,312.17 | 0.01 |
| Total ratio in assets | 3.08 |
②Foreign currency liability of the Company till end of 31st December 2022:
| Item | Ending foreign currency balance | Convert rate | Ending RMB balance converted | Ratio in assets(%) |
| Short-term borrowings | ||||
| Including: USD | 457,403.05 | 6.9646 | 3,185,629.28 | 0.03 |
| EUR | 18,989,418.64 | 7.4229 | 140,956,555.62 | 1.40 |
| Account payable | ||||
| Including: USD | 885,151.79 | 6.9646 | 6,164,728.16 | 0.06 |
| EUR | 36,055,545.43 | 7.4229 | 267,636,708.17 | 2.65 |
| JPY | 50,362,512.00 | 0.052358 | 2,636,880.41 | 0.03 |
| DKK | 6,081,507.53 | 0.9983 | 6,071,168.97 | 0.06 |
| GBP | 2,450.00 | 8.3941 | 20,565.55 | 0.00 |
| Other account payable | ||||
| Including: EUR | 5,172.58 | 7.4229 | 38,395.54 | 0.00 |
| DKK | 151,513.30 | 0.9983 | 151,255.73 | 0.00 |
| Non-current liabilities due within one year | ||||
| Including: USD | 156,513.08 | 6.9646 | 1,090,051.00 | 0.01 |
| EUR | 496,988.78 | 7.4229 | 3,689,098.02 | 0.04 |
| DKK | 575,121.48 | 0.9983 | 574,143.77 | 0.01 |
| Leasing liabilities | ||||
| Including USD | 386,008.72 | 6.9646 | 2,688,396.33 | 0.03 |
| EUR | 1,285,051.24 | 7.4229 | 9,538,806.85 | 0.09 |
| DKK | 11,525,669.67 | 0.9983 | 11,506,076.03 | 0.11 |
| Total ratio in liabilities | 4.52 |
③ Other pricing risk
The equity instrument investment held by the Company with classification as transaction financial asset and othernon-current financial assets are measured on fair value of the balance sheet date. The fluctuation of expected pricefor these investments will affect the gains/losses of fair value changes for the Company.Furthermore, on the premise of deliberated and approved in 10
th meeting of 8
thsession of the BOD, theCompany exercise entrust financing with the self-owned idle capital; therefore, the Company has the risks ofcollecting no principal due to entrust financial products default. Aims at such risk, the Company formulated theManagement Mechanism of Capital Financing, and well-defined the authority to entrust financial management,audit process, reporting system, Choice of trustee, daily monitoring and verification and investigation ofresponsibility, etc. In order to lower the adverse impact from unpredictable factors, the Company choose short-term and medium period for investment and investment product’s term is up to 5 years in principle; The varietyof investment includes bank financial products, trust plans of trust companies, asset management plans of assetmanagement companies, various products issued by securities companies, fund companies and insurancecompanies, etc.
3. Liquidity risk
Liquidity risk refers to the capital shortage risk occurred during the clearing obligation implemented by theenterprise in way of cash paid or other financial assets. The Company aims at guarantee the Company has richcapital to pay the due debts, therefore, a financial control department is established for collectively controllingsuch risks. On the one hand, the financial control department monitoring the cash balance, the marketablesecurities which can be converted into cash at any time and the rolling forecast on cash flow in future 12 months,ensuring the Company, on condition of reasonable prediction, owes rich capital to paid the debts; on the otherhand, building a favorable relationship with the banks, rationally design the line of credit, credit products andcredit terms, guarantee a sufficient limit for bank credits in order to satisfy vary short-term financing requirements.XI. Disclosure of fair value
1. Ending fair value of the assets and liabilities measured by fair value
In RMB
| Item | Ending fair value | |||
| First level | Second level | Third level | Total | |
| I. Sustaining measured by fair value | -- | -- | -- | -- |
| (I) Financial assets measured at fair value and whose changes are included in current profit or loss | 146,039,262.82 | 186,608,914.00 | 3,712,781,392.05 | 4,045,429,568.87 |
| 1.Trading financial assets | 146,039,262.82 | 2,572,781,392.05 | 2,718,820,654.87 | |
| (1)Investment in equity instrument | 146,039,262.82 | 146,039,262.82 | ||
| (2)Investment in other liability instruments and equity instrument | 2,572,781,392.05 | 2,572,781,392.05 | ||
| 2. Other non-current financial assets | 186,608,914.00 | 1,140,000,000.00 | 1,326,608,914.00 | |
| (1)Equity instrument investment | 186,608,914.00 | 515,000,000.00 | 701,608,914.00 | |
| (2)Investment in other liability instruments and equity instrument | 625,000,000.00 | 625,000,000.00 | ||
| (II) Financial assets measured at fair value and whose changes are included in current profit or loss | 2,596,159,535.21 | 2,596,159,535.21 | ||
| 1. Receivable financing | 1,918,368,845.21 | 1,918,368,845.21 | ||
| 2. Other equity instrument investment | 677,790,690.00 | 677,790,690.00 | ||
| Total asset sustaining measured by fair value | 146,039,262.82 | 186,608,914.00 | 6,308,618,136.15 | 6,641,266,312.97 |
| (I) Financial liabilities measured at fair value and whose changes are included in current profit or loss | 747,115.75 | 747,115.75 | ||
| Derivative financial liability- foreign exchange contract | 747,115.75 | 747,115.75 | ||
| Total liability sustaining measured by fair value | 747,115.75 | 747,115.75 | ||
| II. Non-persistent measure | -- | -- | -- | -- |
2.Recognized basis for the market price sustaining and non-persistent measured by fair value on firstlevel
On 31 December 2022, the financial assets available for sale, equity instrument investments held by the Company include SNAT(stock code: 600841), Miracle Automation (Stock code: 002009), ifan Technology (Stock Code: 601777) and Zoyte Auto(000980).The fair value at the end of the period is determined at the closing price as of December 30, 2022
3.The qualitative and quantitative information for the valuation technique and critical parameter thatsustaining and non-persistent measured by fair value on second level
On 31 December 2022, other non-current financial assets, equity instrument investments held by the Company include GuolianSecurities (stock code: 601456). The fair value at the end of the period is determined at the closing price and liquidity discount asof December 30, 2022.The derivative financial liabilities that continue to be measured at the second level of fair value are forward foreign exchangesettlement and sales contracts, and the fair value is measured at the fair value of the forward foreign exchange settlement and salescontracts provided by the contracting bank.
4.The qualitative and quantitative information for the valuation technique and critical parameter that sustainingand non-persistent measured by fair value on third level
(1) Accounts receivable financing
For this part of financial assets, the Company uses discounted cash flow valuation techniques to determine its fair value. Amongthem, important unobservable input values mainly include discount rate and contractual cash flow maturity period. The cash flowwith a contract expiration period of 12 months (inclusive) shall not be discounted, and the cost shall be regarded as its fair value.
(2) Investment in other equity instruments
For this part of financial assets, due to the lack of market liquidity, the Company adopts replacement cost method to determine theirfair value. Among them, the important unobservable input values mainly include the financial data of the invested company.
(3) Investment in other debt instruments and equity instruments
For this part of financial assets, the company uses discounted cash flow valuation technology to determine. Among them, theimportant unobtainable input values mainly include expected annual return rate and risk coefficient.
5. Continuous third-level fair value measurement items, adjustment information between the openingand closing book value and sensitivity analysis of unobservable parametersNil
6. Continuous fair value measurement items, if there is a conversion between various levels in the currentperiod, the reasons for the conversion and the policy for determining the timing of the conversionNil
7. Changes in valuation technology during the current period and reasons for the changesNil
8. The fair value of financial assets and financial liabilities not measured by fair value
Nil
9. Other
NilXII. Related party and related party transactions
1. Parent company of the enterprise
| Parent company | Registration place | Business nature | Registered capital | Share-holding ratio on the enterprise for parent company | Voting right ratio on the enterprise |
| Wuxi Industry Group | Wuxi | Operation of state-owned assets | 5,496,785,600 | 20.23% | 20.23% |
Explanation on parent company of the enterpriseWuxi Industry Group is an enterprise controlled by the State-owned Assets Management Committee of Wuxi Municipal People’sGovernment. Its business scope includes foreign investment by using its own assets, house leasing services, self-operating and actingas an agent for the import and export business of various commodities and technologies (Except for goods and technologies that arerestricted by the state or prohibited for import and export), domestic trade (excluding national restricted and prohibited items).(Projects that are subject to approval in accordance with the law can be operated only after being approved by relevant departments).Ultimate controller of the Company is State-owned Assets Supervision & Administration Commission of Wuxi Municipality ofJiangsu Province.Other explanation:
Nil
2. Subsidiary of the Company
For more details of the Company’s subsidiaries, please refer to IX. 1. “Equity in subsidiary”
3. Joint venture and associated enterprise
For more details, please refer to Note IX.3. “Equity in joint venture and associated enterprise”Other associated enterprise or joint ventures which has related transaction with the Company in the period or occurred previous:
Nil
4. Other related party
| Other related party | Relationship with the Company |
| Robert Bosch Company | Second largest shareholder of the Company |
| Guokai Metals | Enterprises controlled by the parent company |
| Urban Public Distribution | Enterprises controlled by the parent company |
| Company A(Because it is still in the investigation stage of the public security organs, for the sake of case confidentiality, | Enterprises controlled by relatives of directors of the Company |
temporarily use “Company A” to indicate)
| temporarily use “Company A” to indicate) | |
| Key executive | Director, supervisor and senior executive of the Company |
5. Related transaction
(1) Goods purchasing, labor service providing and receiving
Goods purchasing/labor service receiving
In RMB
| Related party | Content of related transaction | Current period | Approved transaction limit | Whether more than the transaction limit (Y/N) | Last Period |
| WFPM | Goods and labor | 52,775,709.71 | 40,000,000.00 | Y | 49,839,916.90 |
| RBCD | Goods and labor | 301,077,307.73 | 450,000,000.00 | N | 359,903,131.37 |
| WFEC | Goods | 575,378,265.05 | 700,000,000.00 | N | 823,962,918.45 |
| Robert Bosch Company | Goods and labor | 232,163,763.73 | 300,000,000.00 | N | 216,576,637.98 |
| Changchun Xuyang | Goods | 342,520.00 | 1,500,000.00 | N | 1,712,596.87 |
| Guolai Metals | Goods | 14,516,381.84 | N | 57,991,174.20 |
Goods sold/labor service providing
In RMB
| Related party | Content of related transaction | Current period | Last Period |
| WFPM | Goods and labor | 980,889.25 | 29,501,561.74 |
| RBCD | Goods and labor | 2,220,345,511.60 | 3,137,245,415.70 |
| WFEC | Goods and labor | 944,537.87 | 7,630,155.96 |
| Robert Bosch Company | Goods and labor | 1,475,458,231.00 | 1,224,350,229.77 |
| Shinwell Automobile | Goods | 29,250.79 | |
| Changchun Xuyang | Goods and labor | 286,036.62 | 21,436,170.70 |
Description of related transactions in the purchase and sale of goods, provision and acceptance of labor servicesShinwell Automobile Technology (Wuxi) Co., Ltd., formerly an affiliated company of the subsidiary WFTR, was transferred in2021
(2) Related trusteeship management/contract & entrust management/ outsourcingNil
(3) Related lease
As a lessor for the Company:
In RMB
| Lessee | Assets type | Lease income recognized in the Period | Lease income recognized at last Period |
| WFEC | Workshop | 2,380,758.09 | 1,683,130.70 |
Explanation on related leaseWFLD entered into a house leasing contract with WFEC..,The plant locating at No.9 Linjiang Road, Wuxi Xinwu district, owed byWFLD, was rented out to WFEC. It is agreed that the rental from 1 January 2022 to 31 December 2022 was 2,380,758.09 yuan.
(4) Related guarantee
Nil
(5) Related party’s borrowed/lending funds
In RMB
| Related party | Loan amount | Start date | Maturity | Description |
| Lending | ||||
| Wuxi Industry Group | 5,470,000.00 | 2021-07-29 | 2023-07-20 | This year, WFLD paid lending funds to Wuxi Industry Group. |
(6) Related party’s assets transfer and debt reorganization
Nil
(7) Remuneration of key manager
In RMB
| Item | Current period | Last Period |
| Remuneration of key executives | 6,790,000 | 26,170,000.00 |
(8) Other related transactions
Equity related transactions
① During the report period, the Company and its wholly-owned subsidiary SPV acquired vacuum and hydraulic pump businessfrom Robert Bosch Company and its subsidiary Robert Bosch S.p.A. Society à Unipersonale at a consideration of RMB182,950,038.25. The net assets acquired are detailed in Note VI, 1 “Merger of Enterprises Not Under Common Control”.
② During the report period, the Company entered into a joint venture contract with Robert Bosch International BeteiligungenAG, a subsidiary of Robert Bosch Company, and Bosch (China) Investment Ltd., in which the three parties jointly invested toestablish Lezhuo Bowei Hydraulic Technology (Shanghai) Co., Ltd. (hereinafter referred to as “Lezhuo Bowei”). Robert BoschInternational Beteiligungen AG and Bosch (China) Investment Ltd. subscribed RMB 220 million, accounting for 50% of theregistered capital of Lezhuo Bowei.
③ During the report period, Wuxi Weifu Qinglong Power Technology Co., Ltd was jointly funded by the Company withIRD FUEL CELLS A/S, BORIT NV, ROBERT BOSCH INTERNATIONALE BETEILIGUNGEN AG (a subsidiary of RobertBosch Company) and Wuxi High-Tech Zone New Dynamic Industrial Development Fund (Limited Partnership). ROBERTBOSCH INTERNATIONALE BETEILIGUNGEN AG, a subsidiary of Robert Bosch Company, subscribed RMB 75.00 million,accounting for 15% of the registered capital of Wuxi Weifu Qinglong Power Technology Co., Ltd.
Other related transactions
| Related party | Contents of item | Current period | Last Period |
| WFPM | Purchase of fixed assets | 50,000.00 | -- |
| RBCD | Payable for technical services | -- | 455,591.30 |
| RBCD | Purchase of fixed assets | 4,503,484.90 | 528,378.37 |
| RBCD | Technology royalties paid etc. | 1,147,294.75 | 2,332,313.62 |
Related party
| Related party | Contents of item | Current period | Last Period |
| RBCD | Providing of technical services, etc. | 2,053,000.00 | -- |
| Robert Bosch Company | Technology royalties paid etc. | 2,316,825.65 | 5,577,508.74 |
| Robert Bosch Company | Purchase of fixed assets | 49,061,191.70 | 927,851.05 |
| WFEC | Purchase of fixed assets | -- | 20,353.98 |
| WFEC | Payable for technical services | 102,075.47 | 450,000.00 |
| WFEC | Utilities payable | 1,187,817.04 | -- |
| WFEC | Providing of technology service, etc. | 42,169.81 | 873,420.02 |
| Urban public distribution | Purchase canteen ingredients, etc | 1,392,464.33 |
6. Receivable/payable items of related parties
(1) Receivable item
In RMB
| Item | Related party | Ending balance | Opening balance | ||
| Book balance | Bad debt reserve | Book balance | Bad debt reserve | ||
| Account receivable | WFPM | 299,389.13 | 10,925.29 | 1,233,084.39 | |
| Account receivable | RBCD | 461,493,652.46 | 174,766.71 | 48,954,455.60 | 56,805.74 |
| Account receivable | Robert Bosch Company | 363,021,724.83 | 882,016.11 | 236,685,486.17 | 426,203.85 |
| Other account receivables | Robert Bosch Company | 692,995.30 | |||
| Account receivable | Changchun Xuyang | 5,464.91 | 995,215.93 | ||
| Account receivable | WFEC | 514,638.29 | 6,212,780.39 | ||
| Other account receivables | WFEC | 147,000,000.00 | |||
| Prepayments | Robert Bosch Company | 5,249,715.46 | 539,263.12 | ||
| Other non-current assets | Robert Bosch Company | 1,470,000.00 | 9,932,547.00 | ||
| Other non-current assets | Wuxi Industry Group | 5,452,800.00 | |||
(2) Payable item
In RMB
| Item | Related party | Ending book balance | Opening book balance |
| Account payable | WFPM | 17,783,464.23 | 11,634,159.55 |
| Other account payable | WFPM | 29,000.00 | 29,000.00 |
| Account payable | WFEC | 274,115,921.53 | 299,939,408.63 |
| Account payable | RBCD | 37,603,958.72 | 33,418,536.50 |
| Account payable | Robert Bosch Company | 49,500,046.68 | 16,412,385.58 |
| Account payable | Guokai Metals | 3.12 | 2.86 |
| Other current liabilities | RBCD | 0.05 | 120,466,375.78 |
| Other current liabilities | WFPM | 76,030.18 |
Other current liabilities
| Other current liabilities | Robert Bosch Company | 63,572.08 | 39,165.98 |
| Other account payable | Wuxi Industry Group | 5,476,184.14 | |
| Other account payable | Guokai Metals | 2,717,849.00 | |
| Other account payable | Robert Bosch Company | 13,308,176.65 | -- |
| Contract liability | RBCD | 0.36 | 0.36 |
| Contract liability | Robert Bosch Company | 510,212.12 | 796,325.77 |
| Contract liability | WFPM | 584,847.43 |
(3) Related claims of "platform trade" business
| Item | Related party | Ending balance | Opening balance |
| Other receivables | Company A | 2,415,151,888.80 | -- |
Note: Based on the principle of caution, Company A combines the balance of 4 companies that may be controlled by CompanyA into the following list. The balance is the difference between the "purchase fund" paid by WFTR based on the "platform trade"business and the "sales fund" received by WFTR. In accordance with the principle of substance over form, the company does nottreat the "platform trade" business of WFTR as normal trade business but as fund collection and payment business for accountingtreatment, so it is listed as other receivables.
7. Undertakings of related party
Nil
8. Other
NilXIII. Share-based payment
1. Overall situation of share-based payment
?Applicable □Not applicable
In RMB
| Total amount of various equity instruments granted by the Company in the current period | 0.00 |
| Total amount of various equity instruments exercised by the Company in the current period | 199,195,200.00 |
| Total amount of various equity instruments invalidated by the company in the current period | 157,213,350.00 |
| The scope of the exercise price of the stock options issued by the company at the end of the period and the remaining period of the contract | The grant price is 15.48 yuan per share; the exercise time is from the first trading day 24 months after the completion of the registration of the restricted stocks granted in the first tranche to the last trading day within 60 months from the date of completion of the registration of the restricted stock granted in the first tranche, so the remaining period of the contract is 3 years and 11 months. |
| The scope of the exercise price of other equity instruments issued by the company at | N/A |
the end of the period and the remainingperiod of the contract
the end of the period and the remainingperiod of the contract
.2. Share-based payment settled by equity?Applicable □Not applicable
In RMB
| Method for determining the fair value of equity instruments on the grant date | Determine based on the closing price of the restricted stock on the grant date |
| Basis for determining the number of vesting equity instruments | Unlocking conditions |
| Reasons for the significant difference between estimate in the current period and estimate in the prior period | Not Applicable |
| Cumulative amount of equity-settled share-based payments included in the capital reserve | 111,990,911.92 |
| Total amount of expenses confirmed by equity-settled share-based payments in the current period | 28,943,506.38 |
Other explanationsThis restricted stock incentive plan has been reviewed and approved by the company’s second extraordinary general meeting ofshareholders in 2020. The overview of this restricted stock incentive plan is as follows:
(1) Stock source: the company’s A-share common stock repurchased from the secondary market.
(2) Grant date: November 12, 2020.
(3) Grant objects and number of grants: 19,540,000 restricted stocks were granted to 601 incentive recipients of the company and itssubsidiaries.
(4) Grant price: 15.48 yuan/share.
(5) Grant registration completion date: December 4, 2020.
(6) Lifting the restrictions on sales:
| Unlock period | Unlock time | Ratio of unlocked quantity to granted quantity |
| Phase I unlocked | Starting from the first trading day 24 months after the completion of the registration of the first grant and ending on the last trading day within 36 months | 4/10 |
Phase II unlocked
| Phase II unlocked | Starting from the first trading day 36 months after the completion of the registration of the first grant and ending on the last trading day within 48 months | 3/10 |
| Phase III unlocked | Starting from the first trading day 48 months after the completion of the registration of the first grant and ending on the last trading day within 60 months | 3/10 |
(7) Performance appraisal requirements at the company level:
| Unlock conditions | Performance appraisal requirements |
| The first batch of unlock conditions | 1. the weighted average ROE for year of 2021 is not less than 10%; 2. the growth rate of self-operating profit in 2021 will not be less than 6% compared with the year of 2019, the absolute amount will not be less than 845 million yuan; 3. the cash dividends for year of 2021 shall be no less than 50% of the profit available for distribution of the current year. |
| The second batch of unlocking conditions | 1. the weighted average ROE for year of 2022 is not less than 10%; 2. the growth rate of self-operating profit in 2022 will not be less than 12% compared with the year of 2019, the absolute amount will not be less than 892 million yuan; 3. the cash dividends for year of 2022 shall be no less than 50% of the profit available for distribution of the current year. |
The third batch of unlockingconditions
| The third batch of unlocking conditions | 1. the weighted average ROE for year of 2023 is not less than 10%; 2. the growth rate of self-operating profit in 2023 will not be less than 20% compared with the year of 2019, the absolute amount will not be less than 958 million yuan; 3. the cash dividends for year of 2023 shall be no less than 50% of the profit available for distribution of the current year. |
Other explanation: self-operating profit refers to the net profit attributable to the owners of the parent company after deducting non-
recurring gains and losses, and deducting the investment income from RBCD and Zhonglian Electronics.
3. Share-based payment settled by cash
□ Applicable ? Not applicable
4. Modification and termination of share-based payment
Nil
5. Other
NilXIV. Undertakings or contingency
1. Important undertakings
Important undertakings on balance sheet dateNil
2. Contingency
(1) Contingency on balance sheet date
Nil
(2) For the important contingency not necessary to disclosed by the Company, explained reasonsThe Company has no important contingency that need to disclosed
(3) Other information required by the Guidelines for Information Disclosure of AutomobileManufacturing Related IndustriesThe Company need to comply with the disclosure requirement on related industry of automobile manufacturing in the ShenzhenStock Exchange Self-Regulatory Guidelines for Listed Companies No.3 - Disclosure of Industry InformationMortgage sales, financial leasing and other models of sales accounted for more than 10% of operating income
□ Applicable ? Not applicable
The company’s guarantee to the dealer
□ Applicable ? Not applicable
3. Other
Nil
XIV. Undertakings or contingency
1. Important undertakings
Important undertakings on balance sheet dateNil
2. Contingency
(1) Contingency on balance sheet date
Nil
(2) For the important contingency not necessary to disclosed by the Company, explained reasonsThe Company has no important contingency that need to disclosed
(3) Other information required by the Guidelines for Information Disclosure of AutomobileManufacturing Related IndustriesThe Company need to comply with the disclosure requirement on related industry of automobile manufacturing in the ShenzhenStock Exchange Self-Regulatory Guidelines for Listed Companies No.3 - Disclosure of Industry InformationMortgage sales, financial leasing and other models of sales accounted for more than 10% of operating income
□ Applicable √ Not applicable
The company's guarantee to the dealer
□ Applicable √ Not applicable
3. Other
Nil
XV. Events after balance sheet date
1. Important non-adjustment matters
Nil
2. Profit distribution
In RMB
| Profit or dividend plans to distributed | 98,317,329.30 |
| Profit or dividend declare to be | 98,317,329.30 |
distributed which have been approved
| distributed which have been approved | |
| Profit distribution plan | Based on the 983,173,293 shares which exclude the buy-back shares on buy-back account (25,000,000 A-stock) from total share capital 1,008,173,293 shares (According to the provisions of the The Company Law of the People's Republic of China, the listed company does not have the right to participate in the profit distribution and the conversion of the capital reserve into the share capital by repurchasing the shares held by the company through the special securities account), distributing 1.00 yuan (tax included) cash dividend for every 10 shares held, no bonus shares, without capitalization from capital reserves. The remaining undistributed profit is carried forward to the next year. The total amount of cash dividend to be paid is RMB 98,317,329.3 (tax included). If the total share capital of the Company changes before the implementation of the distribution plan, the Company will be allocated according to the principle of unchanged distribution proportion and adjustment of the total amount of distribution. The profit distribution plan will be submitted for consideration at the 2022 Annual General Meeting. |
3. Return of sales
Nil
4. Other events after balance sheet date
The company's wholly-owned subsidiary WFTR received the "case notice" issued by the Wuxi Public SecurityBureau Xinwu branch in April 12, 2023 evening. It was informed: Weifu TR contract fraud case, in line withthe conditions for filing criminal cases, has decided to file.XVI. Other important events
1. Previous accounting errors collection
Nil
2. Debt restructuring
Nil
3. Assets replacement
Nil
4. Pension plan
The Enterprise Annuity Plan under the name of WFHT has deliberated and approved by 8
th meeting of 7
thsessionof the BOD: in order to mobilize the initiative and creativity of the employees, established a talent long-termincentive mechanism, enhance the cohesive force and competitiveness in enterprise, the Company carried out theabove mentioned annuity plan since the date of reply of plans reporting received from labor securityadministration department. Annuity plans are: the annuity fund are paid by the enterprise and employees together;the enterprise’s contribution shall not exceed 8% of the gross salary of the employees of the enterprise per year,the combined contribution of the enterprise and the individual employee shall not exceed 12% of the total salary
of the employees of the enterprise. In accordance with the State’s annuity policy, the Company will adjusted theeconomic benefits in due time, in principle of responding to the economic strength of the enterprise, the amountpaid by the enterprise at current period control in the 8 percent of the total salary of last year, the maximum annualallocation to employees shall not exceed five times the average allocation to employees and the excess shall not becounted towards the allocation. The individual contribution is limited to 1% of one’s total salary for the previousyear. Specific paying ratio later shall be adjusted correspondingly in line with the operation condition of theCompany.In December 2012, the Company received the Reply on annuity plans reporting under the name of WFHT fromlabor security administration department, later, the Company entered into the Entrusted Management Contract ofthe Annuity Plan of WFHT with PICC.
5. Termination of operation
Not applicable
6. Segment
(1) Recognition basis and accounting policy for reportable segment
Determine the operating segments in line with the internal organization structure, management requirement andinternal reporting system. Operating segment of the Company refers to the followed components that have beensatisfied at the same time:
① The component is able to generate revenues and expenses in routine activities;
② Management of the Company is able to assess the operation results regularly, and determine resourcesallocation and performance evaluation for the component;
③ Being analyzed, financial status, operation results and cash flow of the components are able to require by theCompanyThe Company mainly engaged in the manufacture of fuel system of internal combustion engine and fuel cellcomponents products, auto components, muffler, purifier, vacuum pump and hydraulic pump, etc., based on theproduct segment, the Company determine four reporting segments as auto fuel injection system and fuel cellcomponents, automotive post processing system, air management system and vacuum pump and hydraulic pump.Also, as mentioned in Note XVI-7, WFTR launched a new "platform trade" business in 2022, WFTR wasdefrauded by contracts in its "platform trade" business and has been launched a criminal investigation on the caseby the security organs. The management of the company comprehensively judges that the business does notbelong to normal trade business with a high probability, in order to accurately present the normal operation of theCompany, the Company presents the "platform trade" business as a separate segment. The accounting policies foreach reporting segment are consistent with the describe in the Note III.Segment assets exclude transaction financial asset, other account receivables-dividend receivable, other non-current financial assets, other equity instrument investment, long term equity investment and other undistributedassets, since these assets are not related to products operation.
(2) Financial information for reportable segment
In RMB
| Item | auto fuel injection system and fuel cell component segment | Automotive post processing system segment | Air management system segment | Vacuum pump and hydraulic pump segment | "platform trade" business segment | Add: Investments accounted for by the equity method or Investment in income, debt and equity instruments or Gains /losses on undistributed assets such as income from holding and disposal | Offsetting between segments | Total |
| Revenue | 6,234,413,040.37 | 5,977,419,455.46 | 612,416,043.11 | 177,911,433.07 | 272,525,054.98 | 12,729,634,917.03 | ||
| Cost | 5,149,497,567.61 | 5,468,414,735.16 | 487,027,797.49 | 158,596,347.31 | 247,150,958.77 | 11,016,385,488.80 | ||
| Total Profit | -1,516,701,226.17 | 46,173,852.85 | -651,918.79 | -52,436,497.65 | -1,644,068,327.93 | 1,703,230,223.10 | 179,614,433.34 | |
| Net profit | -129,708,365.321 | 58,011,659.04 | 3,946,252.07 | -51,714,919.01 | -1,644,068,327.93 | 1,695,062,978.76 | 190,946,008.25 | |
| Asset | 10,783,021,465.98 | 5,302,347,622.37 | 941,428,806.01 | 914,361,224.61 | 1,097,430,804.02 | 11,133,227,006.24 | 1,642,903,864.22 | 28,528,913,065.01 |
| Liability | 5,889,731,119.01 | 3,784,419,888.22 | 501,890,891.17 | 709,572,116.76 | 38,848.42 | 791,446,647.95 | 10,094,206,215.63 |
(3) If the company has no reportable segments or is unable to disclose the total assets and liabilities ofeach reportable segment, it should state the reasons
Not applicable
(4) Other explanations
Nil
7. Major transaction and events influencing investor’s decision
（1）The security organs have launched a criminal investigation on the case that WFTR was defrauded bycontracts in its "platform trade" business. (For details, please refer to the company's announcement No. 2023-007 disclosed on www.cninfo.com.cn and other information disclosure websites on April 13, 2023). At present,the case is in the investigation stage, and the outcome of the case is uncertain in the future.
（2）Based on the "platform trade" business’s background, transaction chain, sales and purchase contractsigning, transaction process, physical flow and so on, the company carefully analyzed and made comprehensivejudgment, finds that the probability of this business not belonging to normal trade business is extremely high. Interms of accounting treatment, the company follows the principle of substance over form and does not treat it asnormal trade business, but according to the receipt and payment of funds，prudently counts as claims andliabilities, respectively, purchases actually paid to "suppliers" and sales collected from "customers"，Other
receivables are reported on a net basis in the financial statements as a "platform trading" portfolio.In the year2022, the outflow amount of the "platform trade" business is RMB 634,575.14 million, and the inflow amountis RMB 360,4.2523 million. As of December 31, 2022, the net outflow amount of RMB 2,741,499,100 isreported to other receivables. An expected credit loss of $164,068,300 has been accrued against the otherreceivables.
8. Other
NilXVII. Principal notes of financial statements of parent company
1. Account receivable
(1) Classification of account receivable
In RMB
| Category | Ending balance | Opening balance | ||||||||
| Book balance | Bad debt reserve | Book value | Book balance | Bad debt reserve | Book value | |||||
| Amount | Ratio | Amount | Accrued ratio | Amount | Ratio | Amount | Accrued ratio | |||
| Account receivable with bad debt provision Accrued on a single basis | 7,705,636.24 | 0.84% | 7,705,636.24 | 100.00% | 7,803,945.24 | 1.42% | 7,803,945.24 | 100.00% | ||
| Including: | ||||||||||
| Account receivable with bad debt provision Accrued on portfolio | 910,831,491.61 | 99.16% | 4,023,208.39 | 0.44% | 906,808,283.22 | 540,453,844.97 | 98.58% | 3,495,954.75 | 0.65% | 536,957,890.22 |
| Including: | ||||||||||
| Including: receivables from customers | 768,218,575.70 | 83.63% | 4,023,208.39 | 0.52% | 764,195,367.31 | 324,001,494.50 | 59.10% | 3,495,954.75 | 1.08% | 320,505,539.75 |
| Receivables from internal related parties | 142,612,915.91 | 15.53% | 142,612,915.91 | 216,452,350.47 | 39.48% | 216,452,350.47 | ||||
| Total | 918,537,127.85 | 100.00% | 11,728,844.63 | 1.28% | 906,808,283.22 | 548,257,790.21 | 100.00% | 11,299,899.99 | 2.06% | 536,957,890.22 |
Bad debt provision Accrued on single basis: 7,705,636.24
In RMB
| Name | Ending balance | |||
| Book balance | Bad debt reserve | Accrued ratio | Accrued causes | |
| BD bills | 7,201,691.00 | 7,201,691.00 | 100.00% | Have difficulty in collection |
| Tianjin Leiwo Engine Co., Ltd. | 503,945.24 | 503,945.24 | 100.00% | Have difficulty in collection |
| Total | 7,705,636.24 | 7,705,636.24 | ||
Bad debt provision Accrued on portfolio: 4,023,208.39
Unit:RMB/CNY
| Name | Ending balance |
Book balance
| Book balance | Bad debt reserve | Accurual ratio | |
| Within 6 months | 746,778,955.46 | ||
| 6 months to one year | 17,383,318.92 | 1,738,331.87 | 10.00% |
| 1-2 years | 1,042,800.24 | 208,560.05 | 20.00% |
| 2-3 years | 1,561,974.35 | 624,789.74 | 40.00% |
| Over 3 years | 1,451,526.73 | 1,451,526.73 | 100.00% |
| Total | 768,218,575.70 | 4,023,208.39 |
If the provision for bad debts of accounts receivable is made in accordance with the general model of expected credit losses, pleaserefer to the disclosure of other receivables to disclose related information about bad-debt provisions:
□ Applicable ? Not applicable
By account age
In RMB
| Account age | Book balance |
| Within one year (One year included) | 906,775,190.29 |
| Including: within 6 months | 889,181,770.09 |
| 6 months to one year | 17,593,420.20 |
| 1-2 years | 1,173,006.18 |
| 2-3 years | 1,935,713.65 |
| Over 3 years | 8,653,217.73 |
| 3-4 years | 8,653,217.73 |
| Total | 918,537,127.85 |
(2) Bad debt provision Accrued collected or reversal
Bad debt provision Accrued in the period:
In RMB
| Category | Opening balance | Amount changed in the period | Ending balance | |||
| Accrued | Collected or reversal | Written-off | Other | |||
| Bad debt provision | 11,299,899.99 | 428,948.14 | 3.50 | 11,728,844.63 | ||
| Total | 11,299,899.99 | 428,948.14 | 3.50 | 11,728,844.63 | ||
Important bad debt provision collected or reversal: nil
(3) Account receivable actual charged off in the Period
In RMB
| Item | Amount charged off |
| Sporadic difference | 3.50 |
| Total | 3.50 |
Major charge-off for the major receivable: nil
(4) Top 5 receivables at ending balance by arrears party
In RMB
| Name | Ending balance of | Ratio in total ending balance of account | Ending balance of bad |
account receivable
| account receivable | receivables | debt reserve | |
| RBCD | 461,437,152.46 | 50.24% | 174,766.71 |
| Robert Bosch Company | 78,085,229.03 | 8.50% | 0.01 |
| Client 3 | 60,026,741.00 | 6.53% | 737,492.51 |
| WFTR | 57,565,163.84 | 6.27% | |
| WFSC | 38,994,998.99 | 4.24% | |
| Total | 696,109,285.32 | 75.78% |
(5) Assets and liabilities resulted by account receivable transfer and continues involvementNil
(6) Account receivable derecognition due to financial assets transfer
Nil
2.Other accounts receivable
In RMB
| Item | Ending balance | Opening balance |
| Interest receivable | 206,325.34 | 113,055.56 |
| Dividend receivable | 26,718,900.00 | |
| Other account receivables | 1,471,896,113.93 | 177,293,562.07 |
| Total | 1,472,102,439.27 | 204,125,517.63 |
(1) Interest receivable
1) Category of interest receivable
In RMB
| Item | Ending balance | Opening balance |
| Interest receivable of subsidiary | 206,325.34 | 113,055.56 |
| Total | 206,325.34 | 113,055.56 |
2) Significant overdue interest
Nil
3) Accrued of bad debt provision
□Applicable ?Not applicable
(2) Dividend receivable
1) Category of dividend receivable
In RMB
| Item (or invested enterprise) | Ending balance | Opening balance |
| WFAM | 26,718,900.00 | |
| Total | 26,718,900.00 |
2) Important dividend receivable with account age over one year
Nil
3)Accrued of bad debt provision
□Applicable ?Not applicable
(3) Other account receivables
1)Other account receivables classification by nature
In RMB
| Nature | Ending book balance | Opening book balance |
| Staff loans and petty cash | 1,279,080.00 | 400,080.00 |
| Balance of related party in the consolidate scope | 3,106,006,521.72 | 169,746,521.72 |
| Margin | 3,738,299.33 | 1,518,640.00 |
| Social security and provident fund paid | 6,429,166.22 | 5,926,527.66 |
| Other | 16,781.83 | 9,364.69 |
| Total | 3,117,469,849.10 | 177,601,134.07 |
2) Accrued of bad debt provision
In RMB
| Bad debt reserve | Phase I | Phase II | Phase III | Total |
| Expected credit losses over next 12 months | Expected credit losses for the entire duration (without credit impairment occurred) | Expected credit losses for the entire duration (with credit impairment occurred) | ||
| Balance of Jan. 1, 2022 | 307,572.00 | 307,572.00 | ||
| Balance of Jan. 1, 2022 in the period | ||||
| Current Accrued | 1,228,175.24 | 1,644,068,327.93 | 1,645,296,503.17 | |
| Current reversal | 30,340.00 | 30,340.00 | ||
| Balance on Dec. 31, 2022 | 1,505,407.24 | 1,644,068,327.93 | 1,645,573,735.17 |
Change of book balance of loss provision with amount has major changes in the period
□Applicable ?Not applicable
By account age
In RMB
| Account age | Book balance |
| Within one year (One year included) | 3,114,813,019.10 |
| Including: within 6 months | 768,880,846.69 |
| 6 months to one year | 2,345,932,172.41 |
| 1-2 years | 588,300.00 |
| 2-3 years | 1,300,000.00 |
| Over 3 years | 768,530.00 |
| 3-4 years | 768,530.00 |
| Total | 3,117,469,849.10 |
3) Bad debt provision Accrued, collected or reversal
Bad debt provision Accrued in the period:
In RMB
| Category | Opening balance | Amount changed in the period | Ending balance | |||
| Accrued | Collected or reversal | Written-off | Other | |||
| Bad debt provision | 307,572.00 | 1,645,296,503.17 | 30,340.00 | 1,645,573,735.17 | ||
| Total | 307,572.00 | 1,645,296,503.17 | 30,340.00 | 1,645,573,735.17 | ||
Including the important bad debt provision reversal or collected in the period: nil
4) Other receivables actually charged off during the reporting period
Nil
5) Top 5 other receivables at ending balance by arrears party
In RMB
| Name of enterprise | Nature | Ending balance | Account age | Ratio in total ending balance of other receivables | Ending balance of bad debt reserve |
| WFTR | Balance of related party in the consolidate scope | 3,077,260,000.00 | Within 1 year | 98.71% | 1,644,068,327.93 |
| WFCA | Balance of related party in the consolidate scope | 28,193,906.00 | With six months | 0.91% | |
| Zhenkunxing Industrial Supermarket (Shanghai) Co., Ltd. | Margin | 1,000,000.00 | 2-3 years | 0.03% | 400,000.00 |
| Wuxi Youlian Thermal Power Co., Ltd | Margin | 750,000.00 | Over three years | 0.02% | 750,000.00 |
| Wuxi Xingzhou Energy Development Co., Ltd | Margin | 676,232.43 | Within 1 year | 0.02% | 28,176.35 |
| Total | 3,107,880,138.43 | 99.69% | 1,645,246,504.28 |
6) Other account receivables related to government grants
Nil
7) Other receivables derecognized due to the transfer of financial assets
Nil
8) The amount of assets and liabilities formed by transferring other receivables and continuing to beinvolvedNil
3. Long-term equity investments
In RMB
| Item | Ending balance | Opening balance | ||||
| Book balance | Depreciation reserves | Book value | Book balance | Depreciation reserves | Book value | |
| Investment for subsidiary | 3,080,762,302.11 | 3,080,762,302.11 | 2,106,415,908.37 | 2,106,415,908.37 | ||
| Investment for associates and joint venture | 5,289,081,048.99 | 5,289,081,048.99 | 4,760,866,320.19 | 4,760,866,320.19 | ||
| Total | 8,369,843,351.10 | 8,369,843,351.10 | 6,867,282,228.56 | 6,867,282,228.56 | ||
(1) Investment for subsidiary
In RMB
| The invested entity | Opening balance (book value) | Changes in Current Period | Ending balance (book value) | Ending balance of depreciation reserves | |||
| Additional Investment | Negative Investment | Provision for impairment loss | Other | ||||
| WFJN | 185,974,031.01 | 2,415,053.33 | 188,389,084.34 | ||||
| WFLD | 468,968,346.39 | 1,884,760.13 | 470,853,106.52 | ||||
| WFMA | 170,998,252.32 | 809,332.39 | 171,807,584.71 | ||||
| WFCA | 222,778,790.43 | 572,926.60 | 223,351,717.03 | ||||
| WFTR | 33,924,529.85 | 142,484.85 | 34,067,014.70 | ||||
| WFSC | 51,150,646.86 | 339,397.41 | 51,490,044.27 | ||||
| WFTT | 238,112,165.62 | 1,170,856.38 | 239,283,022.00 | ||||
| WFAM | 82,454,467.99 | 82,454,467.99 | |||||
| WFDT | 54,116,034.53 | -34,515.01 | 54,081,519.52 | ||||
| SPV | 597,938,643.37 | 597,341,580.60 | 1,195,280,223.97 | ||||
| WFLD(Chongqing) | 265,832.07 | 265,832.07 | |||||
| WFAS | 878,805.00 | 878,805.00 | |||||
| WFQL | 225,000,000.00 | 225,000,000.00 | |||||
VHCN
| VHCN | 143,559,879.99 | 143,559,879.99 | |||||
| Total | 2,106,415,908.37 | 965,901,460.59 | 8,444,933.15 | 3,080,762,302.11 |
(2) Investment for associates and joint venture
In RMB
| Enterprise | Opening balance (book value) | Current changes (+/ -) | Ending balance (book value) | Ending balance of depreciation reserves | ||||||||||||||
| Additional investment | Capital reduction | Investment gain/loss recognized under equity | Other comprehensive income adjustment | Other equity change | Cash dividend or profit announced to issued | Impairment Accrued | Other | |||||||||||
| I. Joint venture | ||||||||||||||||||
| II. Associated enterprise | ||||||||||||||||||
| RBCD | 3,193,389,537.44 | 1,019,943,798.76 | 732,050,752.43 | 3,505,746,633.77 | ||||||||||||||
| Zhonglian Automobile | 1,378,575,785.77 | 375,237,528.28 | 194,400,000.00 | 1,559,413,314.05 | ||||||||||||||
| WFPM | 45,845,041.36 | 18,930,857.66 | 10,000,000.00 | 54,775,899.02 | ||||||||||||||
| Chelian Tianxia | 143,055,955.62 | 37,000,000.00 | -10,910,753.47 | 169,145,202.15 | ||||||||||||||
| Subtotal | 4,760,866,320.19 | 37,000,000.00 | 1,403,201,431.23 | 936,450,752.43 | 5,289,081,048.99 | |||||||||||||
| Total | 4,760,866,320.19 | 37,000,000.00 | 1,403,201,431.23 | 936,450,752.43 | 5,289,081,048.99 | |||||||||||||
(3) Other explanations
Nil
4. Operating income and cost
In RMB
| Item | Current period | Last Period | ||
| Income | Cost | Income | Cost | |
| Main business | 3,524,971,219.66 | 2,995,507,161.73 | 4,392,019,155.83 | 3,267,569,244.02 |
| Other business | 339,533,776.14 | 268,487,790.90 | 440,321,634.62 | 337,773,263.46 |
| Total | 3,864,504,995.80 | 3,263,994,952.63 | 4,832,340,790.45 | 3,605,342,507.48 |
5.Investment income
In RMB
| Item | Current period | Last Period |
| Investment income from holding transaction financial asset | 201,399,105.37 | 309,089,065.06 |
| Investment income in subsidiaries | 69,841,550.10 | 82,600,029.25 |
| Investment income in joint ventures and associated enterprises | 1,427,651,731.23 | 1,366,704,678.23 |
| Total | 1,698,892,386.70 | 1,758,393,772.54 |
6.Others
Nil
XVIII. Supplementary Information
1.Current non-recurring gains/losses
?Applicable □Not applicable
In RMB
| Item | Amount | Note |
| Gains/losses from the disposal of non-current asset | -148,566.90 | |
| Governmental grants reckoned into current gains/losses (except for those with normal operation business concerned, and conform to the national policies & regulations and are continuously enjoyed at a fixed or quantitative basis according to certain standards) | 111,917,334.77 | |
| Profit and loss of assets delegation on others’ investment or management | 1,236,142.58 | |
| Except for the effective hedging operations related to normal business operation of the Company, the gains/losses of fair value changes from holding the trading financial assets and trading financial liabilities, and the investment earnings obtained from disposing the trading financial asset, trading financial liability and financial assets available for sale | -145,070,562.29 | |
| Reserve for impairment of receivables separately tested for impairment transfer back | 1,265,113.45 | |
| Other non-operating income and expenditure except for the aforementioned items | 39,799,099.77 | |
| Less: Impact on income tax | 1,952,583.99 | |
| Impact on minority shareholders’ equity | 8,192,690.71 | |
| Total | -1,146,713.32 | -- |
Specific information on other items of profits/losses that qualified the definition of non-recurring profit(gain)/loss
□Applicable ?Not applicable
The Company does not have other items of profits/losses that qualified the definition of non-recurring profit(gain)/lossInformation on the definition of non-recurring profit(gain)/loss that listed in the Q&A Announcement No.1 on InformationDisclosure for Companies Offering Their Securities to the Public --- Extraordinary (non-recurring) Profit(gain)/loss as therecurring profit(gain)/loss
□Applicable ?Not applicable
2.ROE and earnings per share
| Profits during report period | Weighted average ROE | Earnings per share | |
| Basic earnings per share | Diluted earnings per | ||
(RMB/Share)
| (RMB/Share) | share (RMB/Share) | ||
| Net profits belong to common stock stockholders of the Company | 0.64% | 0.09 | 0.09 |
| Net profits belong to common stock stockholders of the Company after deducting nonrecurring gains and losses | 0.65% | 0.09 | 0.09 |
3. Difference of the accounting data under accounting rules in and out of China
(1) Difference of the net profit and net assets disclosed in financial report, under both IAS (InternationalAccounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable ? Not applicable
(2) Difference of the net profit and net assets disclosed in financial report, under both foreign accountingrules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable ? Not applicable
(3) Explanation on data differences under the accounting standards in and out of China; as for thedifferences adjustment audited by foreign auditing institute, listed name of the instituteNil
4.Other
Nil
BOD of Weifu High-Technology Group Co., Ltd.
Chairman: _______________28 April 2023