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2020年半年度报告(英文版) 下载公告
公告日期:2020-10-16

Stock code: 600415 Stock short name: 小商品城

Zhejiang China Commodities City Group Co., Ltd.

Semi-annual Report 2020

Important Note

1. The Board of Directors, the Board of Supervisors, directors, supervisorsand senior officers of the Company warrant that the informationcontained in this Semi-annual Report is true, accurate and complete andthis Semi-annual Report is free from any misrepresentation, misleadingstatement or material omission, and agree to assume joint and severalliability therefor.

2. All directors of the Company attended the meeting of the Board ofDirectors.

3. This Semi-annual Report has not been audited.

4. ZHAO Wenge, head of the Company, WANG Dong, the person in charge of

accounting and ZHAO Difang, the person in charge of the accountingbody (head of accounting) represent that the financial statementscontained in this Semi-annual Report are true, accurate and complete.

5. Is there any profit distribution proposal or capital reserve conversion

proposal for the reporting period that has been deliberated by the Boardof Directors?No

6. Risk statement with forward-looking representations"√ Applicable" □N/AThe forward-looking representations involved in this Report such as future plansand development strategies do not constitute the Company’s substantialcommitments to investors. Investors shall watch out for the investment risks.

7. Is the Company’s cash occupied by its controlling shareholder or any ofits affiliates for non-operational purposes?No

8. Has the Company provided external guarantee in violation of theprescribed decision-making procedures?No

9. Reminder of major risks

The Company has described the risks that may exist in this Report in details.Please read “Potential Risks” in “Section IV Analysis of Business Status” of thisReport.

10. Others

□Applicable √N/A

Table of Contents

Section I Definitions ...... 5

Section II Company Profile and Financial Highlights ...... 6

Section III Operational Highlights ...... 10

Section IV Analysis of Business Status ...... 12

Section V Significant Matters ...... 37

Section VI Changes in common shares and shareholders ...... 54

Section VII Preferred Shares ...... 59

Section VIII Directors, Supervisors and Senior Officers ...... 60

Section IX Corporate Bonds ...... 62

Section X Financial Report ...... 67

Section XI Documents for Inspection ...... 214

Section I DefinitionsFor the purpose of this Report, unless otherwise stated in the context, the followingterms shall have the following meanings:

Definitions
Yiwu SASAOmeansState-owned Assets Supervision and Administration Office of the People’s Government of Yiwu
SCOmeansYiwu State-owned Capital Operation Co., Ltd.
MDGmeansYiwu Market Development Group Co., Ltd.
CCCHmeansYiwu China Commodities City Holdings Limited
CCCPmeansYiwu China Commodities City Property Development Co., Ltd.
CCCFmeansYiwu China Commodities City Financial Holdings Co., Ltd.
IT CompanymeansYiwu China Commodities City Information Technology Co., Ltd.
YiwugoumeansZhejiang Yiwugou E-commerce Co., Ltd.
Payment Network CompanymeansYiwu China Commodities City Payment Network Technology Co., Ltd.
Huishang Micro-financemeansYiwu Huishang Micro-finance Co., Ltd.
Haicheng CompanymeansHaicheng Yiwu China Commodities City Investment Development Co., Ltd.
Binjiang ShangbomeansHangzhou Binjiang Shangbo Property Development Co., Ltd.
Yiwu ShanglvmeansYiwu Shanglv Investment Development Co., Ltd.
Chouzhou Financial LeasemeansZhejiang Chouzhou Financial Lease Co., Ltd.
Yiwu ShangbomeansYiwu Shangbo Property Co., Ltd.
Gongchen ShangbomeansYiwu Gongchen Shangbo Property Co., Ltd.
Sunac XinhengmeansSunac Xinheng Investment Group Co., Ltd.
Huangyuan ShangbomeansYiwu Huangyuan Shangbo Property Co., Ltd.
YongtongchangmeansBeijing Dongxing Yongtongchang Investment Management Co., Ltd.
The Company, the Listed Company or the GroupmeansZhejiang China Commodities City Group Co., Ltd.

Section II Company Profile and Financial HighlightsI Company profile

Chinese name浙江中国小商品城集团股份有限公司
Chinese short name小商品城
English nameZhejiang China Commodities City Group Co.,Ltd
English short nameYIWUCCC
Legal representativeZHAO Wenge

II Contact information

Board SecretarySecurities Affairs Representative
NameXU HangRAO Yangjin
AddressHaiyang Business Building, No.105 Futian Road, YiwuHaiyang Business Building, No.105 Futian Road, Yiwu
Telephone0579-851828120579-85182812
Fax0579-851977550579-85197755
EmailHxu@cccgroup.com.cnHxu@cccgroup.com.cn

III Change of basic information

Registered addressHaiyang Business Building, No.105 Futian Road, Yiwu, Zhejiang Province
Postal code at the registered address322000
Office addressHaiyang Business Building, No.105 Futian Road, Yiwu, Zhejiang Province
Postal code at the office address322000
Corporate websitewww.cccgroup.com.cn
Email600415@cccgroup.com.cn
Search index for the change during the reporting periodwww.sse.com.cn

IV Change of media for information disclosure and place for keeping the

financial reports

Newspaper selected by the Company for information disclosureChina Securities Journal, Shanghai Securities News and Securities Times
Website designated by the CSRC for publishing the Semi-annual Reportwww.sse.com.cn
Place for keeping the Company’s Semi-annual ReportSecurities Department of the Company
Search index for the change during the reporting periodwww.sse.com.cn

V Stock profile

Type of stockExchangeStock short nameStock codeStock short name
before change
A shareShanghai Stock Exchange小商品城600415None

VI Other information

□Applicable √N/A

VII Major accounting data and financial indictors

1. Major accounting data

Unit: RMB

Major accounting dataCurrent reporting period (Jan-Jun 2020)Reporting period of Jan-Jun 2019YoY change (%)
Revenue2,121,448,794.311,803,596,554.7417.62
Net profits attributable to shareholders of the Listed Company719,595,308.66673,681,239.396.82
Net profits attributable to shareholders of the Listed Company with non-recurring items excluded602,193,801.96482,601,595.4624.78
Net cash flow from operating activities-703,066,700.16-75,834,031.89
Jun 30, 2020Jun 30, 2019YoY change (%)
Net assets attributable to shareholders of the Listed Company13,717,404,294.2813,020,619,449.365.35
Total assets31,974,312,343.6331,323,233,994.442.08

2. Major financial indictors

Major financial indicatorsCurrent reporting period (Jan-Jun 2020)Reporting period of Jan-Jun 2019YoY change (%)
Basic EPS (RMB)0.130.128.33
Diluted EPS (RMB)0.130.128.33
Basic EPS with non-recurring items excluded (RMB/share)0.110.0922.22
Weighted average ROE (%)5.385.54-0.16 percentage points
Weighted average ROE with non-recurring items excluded (%)4.503.97+0.53 percentage points

Illustration on major accounting data and financial indicators

√Applicable □N/A

1. The Company’s revenue increased by RMB318mn YoY, mainly due to YoYincrease in the revenue from the sales of goods by the supply chain and import &export companies during the current period.

2. The net profits attributable to shareholders of the Listed Company withnon-recurring items excluded grew by RMB120mn YoY, mainly due to the YoYincrease in the revenue from booth auction and admission fees and the YoY declinein depreciation and amortization.

3. The net cash flow from operating activities shrank by RMB627mn YoY, mainlydue to the YoY increase of RMB496mn in time deposit and the YoY increase ofRMB152mn in taxes paid.VIII Differences in accounting data between foreign and Chinese accounting

standards

□Applicable √N/A

IX Non-recurring items and amounts thereof

√Applicable □N/A

Unit: RMB

Non-recurring itemsAmountRemark (if applicable)
Gain or loss from the disposal of non-current assets57,619,261.54Mainly the investment income from the disposal of subsidiaries and related claims
Tax refund or credit due to approval beyond the authority or without official approval or contingent tax refund or credit
Government grants that are recognized in the current profit or loss, excluding the government grants that are closely related to the normal operation of the Company and are provided in a fixed amount or quantity continuously according to the national polices and certain standards13,526,949.49Employment stabilization subsidy and refund of RMB5.9167mn, additional VAT deduction (+10%) of RMB2.6042mn, amortization of the subsidy for the data construction and operation of the information center of RMB1.5mn, hardware exhibition subsidy of RMB0.6mn, new and high-tech award of RMB0.6mn in 2019, provincial service demonstration zone award of RMB0.55mn in 2019, additional R&D input deduction of RMB0.9781mn in 2018 and interest subsidy for the construction of the international exhibition center of RMB0.5774mn
Cash occupation fees charged from non-financial enterprises that are recognized in the current profit or loss48,341,409.06Cash occupation fees charged for the financial assistance provided to Yiwu Shanglv, Chengzhen Property and Gongchen Property
Gain or loss from changes in fair value of held-for-trading financial assets, derivative financial assets, financial liabilities held for trading and derivative financial liabilities, and investment income from the disposal of held-for-trading financial assets, derivative financial assets, financial liabilities held for trading, derivative financial liabilities41,552,057.16RMB20.1935mn of gains from changes in fair value of derivative financial assets, RMB20.5mn of investment income from the disposal of financial assets held for trading, RMB0.689mn of income from the purchase of wealth management products, and RMB0.1696mn of income from IPO subscription
and other debt instruments, except for effective hedging during the ordinary course of business
Net income from other non-operating activities-2,477,321.94Mainly external donation of RMB2.7314nm and confiscated margin and penalty of RMB0.3311mn
Effect of minority interest-1,082,219.35
Effect of income tax-40,078,629.26
Total117,401,506.70

X Others

□Applicable √N/A

Section III Operational Highlights

I Main business, business model and industry situation during thereporting periodAccording to the definitions in the Guidelines for Industry Classification of ListedCompanies (revised in 2012) released by the CSRC, the Company is engaged in“Business Service” (L72) in “Lease and Business Service” (L).II Material changes in major assets during the reporting period

□Applicable √N/A

III Analysis of core competencies during the reporting period

√Applicable □N/A

1. First-mover advantages

At the start of China’s reform and opening-up, Yiwu took the lead in establishing thecommodities market. During the recent forty years, the market has been upgradedfive times and expanded ten times and has been among the top comprehensivenational markets with the highest turnover, pointing to its remarkable first-moveradvantages. As the largest commodities distribution center in the world, the Yiwucommodities market provides more than 2mn products, which fall in 26 categoriesand supports one-stop purchase. The market boasts enormous resources and hugebusiness flow, goods flow, cash flow and information flow.

2. Brand advantages

“Yiwu China Commodities City” is the first market identified by the SAIC as awell-known trademark among the national commodities trading markets. TheCompany has taken multiple measures to give play to the brand of “Yiwu ChinaCommodities City” and is committed to improving its influence and leading role inthe industry. Its brand advantages and influence have kept enhancing.

3. Auxiliary services advantages

The People’s Government of Yiwu has been providing policy support for thedevelopment of the market for years, and the auxiliary industries are developingrapidly in Yiwu.

(1) Convenient logistics system

Yiwu has in place perfect commerce and trade auxiliary facilities and advantageouslogistics service. The logistics network has full coverage in Yiwu. A large number of

large-sized international and domestic express delivery and logistics companieshave regional distribution centers in Yiwu, and a world-oriented goods transport anddistribution network has been established. Yiwu has been listed among the“commerce and trade-oriented national logistics hubs” by the National Developmentand Reform Commission and the Ministry of Transport.

(2) Industry support

During the recent years, thanks to the Yiwu China Commodities City, theYiwu-centered manufacturing industry cluster has been developing fast, ancommodities industrial belt that is centered in Yiwu and covers Jinhua, Lishui,Quzhou, Hangzhou, Jiaxing, Taihu, Shaoxing, Ningbo, Wenzhou and Taizhou withan area of nearly 10,000 sq.m has been established, and a benign mechanismunder which the Yiwu wholesales market and the peripheral industry clusterdevelop together has been formed.

(3) Support from exhibition service

The major international trade exhibitions held by the Company’s exhibition businessdivision such as China Yiwu International Commodities Fair, China YiwuInternational Forest Products Fair, China Yiwu International Imported CommoditiesFair and China Yiwu Hardware and Electrical Expo support and cultivate verticalexhibition in multiple industries such as stationery and textiles, have developedmultiple professional and international exhibition brands, and are important nationalplatforms for the China Commodities City to lead industry development, develop thecity economy and maintain the clusters of traders and commodities.

(4) Diversified businesses

The Company has strengthened its presence in the related industries, made effortson financial investment, kept developing the exhibition business, created a newe-commerce model, developed the hotel business and also run international trade,modern logistics, advertising information, shopping and tourism businesses. It hascreated a group structure and profit-making model of shared and interactivedevelopment of market resources.

(5) Management advantages

In terms of personnel, management and technology, excellent operation andmanagement ability is one of the core competences of the Company as aprofessional market operating company. The Company has developed a series ofperfect management systems for market operation and management, accumulatedrich experience in operation and management, and has cultivated a professionalmanagement team with reasonable knowledge and expertise structures andstrategic development insights.

Section IV Analysis of Business StatusI Analysis of business statusDuring the reporting period, the Company generated revenue of RMB2.121bn, upRMB318mn or 17.62% YoY, profits before tax of RMB993mn, up RMB117mn or

13.34% YoY and net profits attributable to shareholders of parent company ofRMB720mn, up RMB46mn or 6.82% YoY from the RMB674mn during the sameperiod of 2019.1 Market operation

(1) Remarkable achievements in the development of domestic trade(a) Domestic purchasers have kept concentrating. The Company has actively “goneout” for purchasers and regularly matched merchants with downstream purchasersin line with the distribution of the domestic markets. Since the market was openedthis year, the Company has sent 20 teams to 27 provinces and cities across thecountry and attracted nearly 180,000 domestic purchasers. The average dailyincrease in the number of approved purchasers since Apr approaches 10,000. Theintroduction of purchasers is very productive.(b) The domestic trade system has been taking shape at an accelerating pace. TheCompany has selected the secondary markets with which it can deepencooperation and promoted the brands such as Yiwu Haohuo and ICMall importedgoods in the forms of brand licensing, resources swap and business cooperation.By far, it has reached a cooperation intent or agreement with 100 entities toformulate a domestic trade system which is led by the Yiwu market and supportedby downstream markets and features mutualism among all parties.(c) The new exhibition trade model has worked. The Company has organizedindustry associations to hold new products releases both online and offline, and 21of such releases have been held, covering 29 industries, 19,800 new products and615,000 professional purchasers. Especially, an epidemic prevention and controlcommodities exhibition was successfully held and attracted 308,000 purchasers.(d) The “Market Long March” campaign has been progressing steadily. Relying onthe networks of the secondary and tertiary markets, the Company has given play tothe role of commerce chambers as pacesetters in the development of domestictrade and launched the “Market Long March” and “Yiwu Haohuo Long March”campaigns to expand its share in domestic trade. It has successfully held 10 tradematchmaking events in Guiyang, Jingdezhen, Linyi and Huaihua and plans tocomplete 20 trade matchmaking events in 2020.

(2) Innovation and breakthroughs in the stabilization of foreign trade

(a) The trade matching function of overseas outlets has been strengthening. On thetop of outlets construction overseas, the Company has made use of its overseaswarehouses and “Bring You to China” exhibition halls and expanded thecommodities display function of its overseas warehouses and the export matchingfunction of “Bring You to China” exhibition halls to facilitate overseas purchasers’sample inspection, order placement and goods pickup and enable overseaspurchasers to make purchases locally. By far, nearly 10,000 SKUs of goods havebeen displayed in the Czech, Dubai and Rwanda exhibition halls, and fit-out is inprogress in the Japanese outlet.(b) The stocking-up program for overseas warehouses has been progressingsteadily. The Company has given play to its role as a market maker and its creditadvantages as a state-owned enterprise to actively cooperate with the overseaswarehouses and outstanding overseas Chinese in and outside Yiwu. It hastransported merchants’ goods to the overseas warehouses in advance on credit orsupplied goods to outstanding overseas Chinese on credit to achieve saleimmediately upon the recovery from the epidemic overseas. By far, it hascooperated with 224,000 sq.m of overseas warehouses and exported RMB1.1bnworth of goods.(c) Proprietary import trade has been developing at an accelerating pace. On thesupply side, the number of SKUs increased by more than 2,400 to over 10,000, andthe Company has signed contracts with 14 overseas brands; on the distribution side,the number of domestic offline distribution outlets increased by 52 to 258, theturnover of ICMall flagship store on Kaola Global exceeded RMB7mn, ICMallflagship stores on Chinagoods and Tmall Global were launched; on the service side,the Company signed import supply chain financial transactions of nearly RMB70mnin 1H20.

(3) Accelerating online and offline integration

(a) The construction of Yiwu CCC comprehensive trade services platform(Chinagoods) has been accelerated. The Company has been developing an onlinecomprehensive trade services platform that integrates online display and trade,smart warehousing and logistics, digital customs clearance, inspection, currencyexchange and tariff payment, online payment and settlement, supply chain financeand data-empowered production and puts all processes and scenarios online. Theproject was officially launched at the end of Feb. The Version 1.0 has been releasedfor testing and more than 18,000 merchants were invited to the first round of testing.By far, the platform has collected the information on more than 50,000 merchantsand nearly 900,000 products, and has been available for such trading functions asproduct display, livestreaming, navigation and payment, as well as the basicfunctions such as booth rent reduction, online application for business license,application for parking space and questionnaire. The Version 2.0 (web version) was

released for testing on Jun 8. The Company’s ability to empower small andmicro-sized enterprises across the world with digitalization has been improving atan accelerating pace.(b) E-commerce livestreaming has been penetrating into the market. The Companyhas strongly promoted livestreaming in the China Commodities Market. By far, themerchants have held 19,000 independent livestreaming shows and invited morethan 4,500 Internet influencers to make more than 33,000 livestreaming shows. TheCompany has built a 21-floor building with a total floor area of 25,000 sq.m. to serveas an Internet influencer livestreaming industry park. The park has accommodated268 suppliers and 30 Internet influencer livestreaming cooperation institutions. Ithas launched the online “trade lecture” cloud class, completed 513 trainingsessions on live commerce and provided offline or online training for more than

2.05mn persons.

(c) The online exhibition model has made substantial progress. The Company’sonline exhibition platform has been in place. It supports online negotiation, onlinetrading, zero touch and cloud signing via information tools such as data matching,information transfer and real-time communication and thereby puts the exhibitionsonline. The online hardware and electrical expo was successfully held with 1,095exhibitors, 145,000 purchasers, 398,000 visits and more than RMB12mn ofturnover.

(4) Breakthroughs in a batch of functional supporting projects

(a) The Company has been building a comprehensive bonded zone up to highstandards. The Company has focused on developing bonded exhibition and tradeand bonded logistics, innovated the data-driven, market-interactive andindustry-supported comprehensive bonded zone construction model andcooperated with Alibaba to build an eWTP digital comprehensive bonded zone. Itwill build a warehousing, exhibition and sale-integrated new-type bonded importmarket within the zone, develop a bonded industry belt in coordination with otherregions, and establish a digital trade ecosystem that connects the domestic andoverseas markets. Currently, it has completed the Phase I warehouse design and aclassified supervised warehousing business plan, formulated an electronic fencesupervision plan, preliminary planning for the electronic fence pilot area and adesign plan for the public area of the electronic fence pilot area, signed an eWTPYiwu joint venture cooperation agreement with Alibaba on worldwide developmentof digital trade, and introduced 80 traders into the bonded zone, new-type importmarket and pilot area.(b) The Company has been planning on building a “future market” in the east of thefifth section. It has been planning on developing a global digital free trade centerthat integrates R&D, design, brand incubation, sampling, customization, intelligentfashion, exhibition trade, Internet influencer livestreaming, new sale exhibition,

trade service, office and living. Currently, it has completed the overall planning ofthe project.(c) The Company has accelerated the construction of a temporary storage park inthe south of the fifth section. It has planned to build a supply chain base storagepark with a total area of 100,000 sq.m. The project is about to come underconstruction upon the approval of the local government.(d) The Company has been building a new Binwang commerce and trade complex.It has been developing a new-generation innovative commodities operation marketthat integrates “design innovation, new wholesale and new retail” in the Section Band E of the Binwang market and is going to make it a replicable and generalizablemodel. Currently, Section B has been open for business and has 64 merchants; theglobal living hall in the Section E has been renovated and will officially open on Sep1, 2020 according to the schedule.2 Active fulfillment of social responsibilities

(1) Progressive achievements in epidemic prevention and control(a) The Company has developed an epidemic prevention and control system thatcan be replicated and generalized. Led by the epidemic prevention and controlauthority and market authority of Yiwu, the Company has taken precision andintelligent prevention and control measures that are based on standardization,access control, prohibition, patrolling and informatization, built a “Party building +unit” combat system and developed an epidemic prevention and control networkconsisting of three-tier “pyramid” combat units and 1762 minimum combat units tosecure global purchase. Those practices have been praised by the leaders of theprovincial Party committee and provincial government, and the Ministry ofCommerce has published an article to promote them nationwide.(b) The Company has achieved orderly resumption and stable operation of the Yiwumarket. Subject to proper epidemic prevention and control, the Yiwu market hasbeen reopened in a stable and orderly manner in three batches. The first batch ofmerchants were reopened on Feb 18 and the entire market was reopened on Mar 1.The Yiwu market was among the first markets that reopened in China. On Mar 13,Premier Li Keqiang made a video call to the Yiwu market, praised its resumptionand hoped that the market could effectively expand the domestic demand, makeefforts to maintain its share in the global market and become a symbol of China’sforeign trade. Currently, the market is recovering strongly. The number of daily visitsis stably above 100,000, equivalent to around 70% of that during the same period ofthe previous years, and the opening rate is higher than 93% among the merchants.The merchants are generally confident.

(2) Implementation of enterprise benefiting policies

(a) The loan-to-value ratio for booth mortgage has been raised. Since the outbreakof the COVID-19 epidemic, the Company has raised the loan-to-value ratio to 100%for booth mortgage. Since the market was opened this year, it has handled 1815booth mortgage loans with a total amount of RMB1.04bn, further expanding thefinancing channels for the merchants.(b) Market resumption loans have been offered. It obtained RMB1bn marketresumption loans from the Zhejiang branch of the Import-Export Bank at apreferential rate of 3.5-3.9% to support work and production resumption by themerchants in the market, which eased the financing pressure on the merchantsduring the epidemic.(c) The merchants were exempted from booth rents for two months. With theincreasing impact of the epidemic on trade, the Company, following CCCH’s rentexemption policy, exempted the merchants from the booth rents for Feb and Mar.As a result, the merchants were exempted from nearly RMB350mn rents in total.The rent exemption has stabilized the market, trade and development.II Operating status during the reporting period1 Analysis of main business

(1) Analysis of the changes to the items in the financial statement

Unit: RMB10,000

ItemCurrent reporting period of Jan-Jun 2020Reporting period of Jan-Jun 2019YoY change (%)
Revenue212,144.88180,359.6617.62
Cost of sales86,922.7664,268.2835.25
Sales expenses8,788.714,737.5185.51
Administrative expenses13,045.0911,642.6212.05
Financial expenses9,127.198,770.554.07
R&D expenses1,708.12596.77186.23
Net cash flow from operating activities-70,306.67-7,583.40N/A
Net cash flow from investing activities61,702.57-261,498.15N/A
Net cash flow from financing activities13,001.06257,231.06-94.95

Reasons for the change to revenue: mainly YoY increase in the revenue from salesof goods by the supply chain and import and export companies during the currentperiod, as well as the increased recognized revenue from auction from the previousyear and the increased admission fees.Reasons for the change to cost of sales: mainly YoY increase in the cost of sales ofthe supply chain and import and export companies during the current period.Reasons for the change to sales expenses: increased expenses on informatization

construction, advertising and epidemic prevention and control.Reasons for the change to administrative expenses: increased amortization ofintangible assets, salaries and office expenses.Reasons for the change to financial expenses: increased interest expenses.Reasons for the change to R&D expenses: increased spending on R&D.Reasons for the change to net cash flow from operating activities: mainly the YoYincrease of RMB496mn in time deposit and the YoY increase of RMB152mn intaxes paid.Reasons for the change to net cash flow from investing activities: YoY decline ofRMB2.518bn in the purchase of wealth management products, YoY decline ofRMB1.006bn in lending to joint ventures, and YoY increase of RMB683mn in thepurchase and construction of long-term assets.Reasons for the change to net cash flow from financing activities: YoY decline ofRMB1.034bn in borrowing, YoY decline of RMB1.8bn in bond issuance, YoY declineof RMB225mn in debt repayment and YoY decline of RMB167mn in dividenddistribution and interest payment.

(2) Others

(a) Material changes to the components or sources of profits

√Applicable □N/A

Unit: RMB

ItemJan-Jun 2020Jan-Jun 2019YoY changePercentage change ±%
Market operation1,009,159,906.85833,798,603.24175,361,303.6121.03
Sales of goods-5,694,034.94-710,273.07-4,983,761.87N/A
Real estate sales-5,656,548.4654,118,896.23-59,775,444.69-110.45
Hotel service-21,014,757.95-12,079,021.78-8,935,736.17N/A
Exhibition and advertising-23,032,242.66-7,305,354.72-15,726,887.94N/A
Other businesses39,266,533.268,317,866.2030,948,667.06372.07
Profits before tax993,028,856.10876,140,716.10116,888,140.0013.34

i. The profits of market operation grew by RMB175mn YoY, mainly due to the YoYincreased revenue from booth auction and admission fees and the YoY decreaseddepreciation and amortization.ii. The profits of real estate sales shrank by RMB60mn, mainly due to the YoYdeclined delivery of He Tang Yue Se, Pujiang Lv Gu and Jiangxi Shangbo.

(b) Others

□Applicable √N/A

2 Material changes to profits caused by non-main businesses

□Applicable √N/A

3 Analysis of assets and liabilities

√Applicable □N/A

(1) Assets and liabilities

Unit: RMB10,000

ItemAmount at the end of the current period% of total assets at the end of the current periodAmount at the end of the same period of 2019% of total assets at the end of the same period in 2019YoY change (%)Reasons for change
Cash and cash equivalents718,017.5522.46648,640.8720.7110.70
Held-for-trading financial assets3,209.250.103,807.770.12-15.72
Accounts receivable22,923.470.721,603.110.051,329.94Mainly the YoY increase in the accounts receivable from the sales of goods by the import and export company
Prepayments18,382.170.574,467.820.14311.43Mainly the increased prepayments by the import and export company
Other receivables250,124.137.82139,722.844.4679.01Mainly the recovery of lending to Gongcheng Shangbo during the current period
Inventory453,268.8014.18429,606.1413.725.51
Other current assets87,205.612.73309,995.599.90-71.87Changeover of the prepaid land fees for Chezhan Road after full payment
Long-term receivables9,365.040.296,125.000.2052.90Better Silk Road’s lending of RMB32.4mn to the joint venture
Long-term equity investment190,672.885.96177,142.015.667.64
Other equity instruments investment63,340.811.9864,218.802.05-1.37
Other non-current financial assets155,741.864.87151,944.944.852.50
Property investment233,518.167.30186,321.845.9525.33
Fixed assets530,689.8016.60478,381.9115.2710.93
Construction in progress33,657.921.0586,575.462.76-61.12Mainly the recognition of the auxiliary project in western Yiwu as fixed assets
Intangible assets383,607.2512.00345,613.7211.0310.99
Long-term prepaid expenses10,589.460.3313,950.240.45-24.09
Deferred income tax assets17,041.730.5318,040.480.58-5.54
Other non-current assets16,075.330.5066,164.872.11-75.70Mainly the recognition of the prepaid land fees for Zhongfu Square as property investment
Short-term borrowings357,747.4211.19417,890.3713.34-14.39
Notes payable0.000.000.000.000.00
Accounts payable69,047.722.1652,524.151.6831.46Mainly the increased accounts payable by the supply chain company during the current period
Advances from customers1,867.300.06450,845.5114.39-99.59Reclassification of the items under the new principles
Payroll payable7,102.620.2219,717.440.63-63.98Mainly the payment of payroll payable recognized at the end of the previous period during the current period
Tax payable8,648.250.2728,018.430.89-69.13Payment of some taxes for 2019 during the current period
Other payables75,947.422.3890,948.312.90-16.49
Contract liabilities440,375.5013.770.000.00N/AReclassification of the items under the new principles
Non-current liabilities due within one year32,036.481.0027,033.240.8618.51
Other current liabilities304,282.079.52202,301.216.4650.41Mainly the issuance of RMB2bn of super-short-term commercial paper and repayment of RMB1bn during the current period
Long-term borrowings37,044.881.1653,069.431.69-30.20Mainly the repayment of long-term borrowings due during the current period
Bonds payable462,515.0214.47456,429.1414.571.33
Estimated liabilities11,062.030.3511,062.000.350.00
Deferred income2,875.600.092,796.680.092.82
Deferred income tax liabilities11,585.410.3611,257.430.362.91

Other statementsNone

(2) Encumbrances on major assets as of the end of the reporting period

√Applicable □N/A

Unit: RMB

ItemAt the end of Jun 2020At the end of 2019
Cash and cash equivalents209,493,305.8056,196,102.62
Long-term equity investment102,918,559.00102,918,559.00
Other non-current financial assets617,511,352.00617,511,352.00
Total929,923,216.80776,626,013.62

1. On Jun 30, 2020, its title or use right of the bank deposit with book value ofRMB209,493,305.80 (RMB56,196,102.62 on Dec 31, 2019) was restricted sincethe deposit was used as security for house mortgage loans and as funds for thesupervision of advance sales of houses.

2. On Jun 30, 2020, its long-term equity investment with book value of RMB102,918,559.00 (RMB102,918,559.00 on Dec 31, 2019) and other non-currentfinancial assets with book value of RMB617,511,352.00 (RMB617,511,352.00 onDec 31, 2019) were frozen by Shanghai Municipal Bureau of Public Security. Fordetails, please see XIV-2. Contingencies.

(3) Other statements

□Applicable √N/A

4 Analysis of investments

(1) Overview of external equity investment

√Applicable □N/A

At the end of Jun 2020, the Company’s external investment totaledRMB4.129648bn (including RMB32.0925mn of held-for-trading financial assets,RMB633.4081mn of investment in other equity instruments, RMB1.5574186bn ofother non-current financial assets and RMB1.9067288bn of long-term equityinvestment), increasing by RMB158.5128mn or 3.99% from the RMB3.9711352bnat the end of 2019 (including RMB38.0777mn of held-for-trading financial assets,RMB642.188mn of investment in other equity instruments, RMB1.5194494bn ofother non-current financial assets and RMB1.7714201bn of long-term equityinvestment). The main changes are as follows.(a) During this reporting period, the Company made new long-term equityinvestment of RMB125.3859mn, including RMB90mn in Yiwu Hongyi EquityInvestment Fund Partnership (limited partnership), RMB20mn in Yiwu GuoshenShangbo Property Co., Ltd., RMB13.8859mn in Jebel Ali Free Zone TraderMarket Development and Operation FZCO and RMB1.5mn in Cheng Jian Bao(Beijing) Consulting Services Co., Ltd.(b) During this reporting period, the Company recovered long-term equity

investment of RMB2.6542mn in Zhongyi International Expo (Yiwu) Co., Ltd.(c) The Company recognized RMB14.6499mn of net investment income from

long-term equity investment by the equity method.(d) During this reporting period, the Company made new investment in financial

assets of RMB20.0148mn, including RMB20mn in Yiwu Shanyue Equity

Investment Partnership (limited partnership) and RMB14,800 in offline IPO

subscription.(e) During this reporting period, the change in fair value increased by

RMB20.1935mn due to the adoption of the new international financial reporting

standards for financial instruments.

Main investments: Unit: RMB10,000

TargetMain businessCost of investmentBook value at the end of Jun 2020Shareholding ratio (%)
Yiwu Shanglv Investment Development Co.,Industry investment, investment management (excluding financial businesses such as securities and futures), property service, design, production39,200.0034,931.4449.00
Ltd.and agency of domestic advertising, operation and management of parking garages, marketing planning, operation and management consulting, operation and management of shopping malls and business management consulting
Yiwu Rongshang Property Co., Ltd.Real estate development and operation, landscape engineering and decoration engineering5,000.001,962.7349.00
Yiwu Chuangcheng Property Co., Ltd.Real estate development and sale; lease of proprietary houses; real estate brokerage service; interior decoration service; and landscaping service2,000.001,544.8624.00
Yiwu Guoshen Shangbo Property Co., Ltd.Real estate development, sale and lease; real estate brokerage service, interior decoration service; and landscaping service2,000.00894.2049.00
Yiwu Huishang Zijing Capital Management Co., Ltd.Asset management (excluding the assets subject to special state regulation such as state-owned assets), investment management (excluding financial businesses such as securities and futures), and investment consulting service140.00203.1620.00
Jiangsu Jin’an Hefeng Network Technology Co., Ltd.Wholesale and retail; and e-commerce technology development and technical services200.00100.7640.00
Yiwu China Commodities City Creative Design and Development Services Co., Ltd.Design of industrial goods; development of computer software (excluding electronic publications); online sale and offline sale of electronic products (excluding electronic publications), artware, accessories and daily necessities; and exhibition and display services98.0096.8949.00
Zhejiang Commodities City China Olympic Sports Industry Co., Ltd.Organization and planning consulting of sports events, operation of sports venues, operation of sports activities (excluding dangerous sports activities), design, production and sale of sports goods440.00364.9445.00
Hangzhou Binjiang Shangbo Property Development Co., Ltd.Real estate development and operation2,450.0015,266.0549.00
Yiwu Huishang Micro-finance Co., Ltd.Micro-loans in Yiwu, and consulting services in connection with the development, management and finance for small-sized enterprises13,800.007,554.5923.00
Zhejiang Chouzhou Financial Lease Co., Ltd.Financial lease service; transfer of financial lease assets; fixed-income securities investment; acceptance of lessees’ lease margin; absorption of time deposit with a term no shorter than three months from non-bank shareholders; inter-financial institutional lending; borrowing from financial institutions; overseas borrowing; sale and disposal of leased items; and economic consulting26,000.0035,114.3626.00
Yiwu China Commodities City Fuxing Investment Center (limited partnership)Equity investment, investment management and investment consulting10,291.8610,291.8649.90
Yiwu Huishang Zijing Equity Investment Co., Ltd.Equity investment and related consulting services (without approval of the industry regulatory authorities such as the finance regulatory authority, the company warrants that it will not be engaged in the absorption of deposits, financial5,000.007,470.9110.41
guarantee, agency wealth management, fundraising (financing) from the public and other financial businesses)
Yiwu Huishang Zijing Phase II Investment Partnership (limited partnership)Investment management, asset management (excluding the assets subject to special state regulation such as state-owned assets) (the above business scope excludes financial businesses such as securities and futures; and without approval of the industry regulatory authorities such as the finance regulatory authority, the company shall not be engaged in the absorption of deposits, financial guarantee, agency wealth management, fundraising (financing) from the public and other financial businesses)2,000.001,864.329.43
Yiwu Meipinshu Supply Chain Management Co., Ltd.Supply chain management service, software development, and business management consulting1,820.141,868.4020.57
Hangzhou MicroAnts Co., Ltd.Services: technology development, technical consulting, technical services and achievements transfer of computer hardware and software and network information technologies and webpage design; wholesale and retail: computer software1,275.00908.7149.04
Zhejiang Yemai Data Technology Co., Ltd.Services: technology development, technical consulting, technical services and achievements transfer of data technologies, computer hardware and software, and information technologies, webpage design, processing of computer data, integration of computer systems, design of industrial goods; and business information consulting (excluding commodities agency)600.00173.1140.00
Zhejiang Zhiku Co., Ltd.Market planning and design, marketing planning, brand management service, enterprise consulting and management, economic information consulting and training service (excluding training classes)180.00107.3945.00
Zhejiang YXE Supply Chain Management Co., Ltd.Supply chain management service; global trade & domestic trade; and wholesale & retail80.0039.0925.00
Hunan Shang Yun Zhonghe Scientific Research and Trade Co., Ltd.Wholesale & retail; and development of e-commerce platforms and related services350.0035.00
Henan Yiwugou Technology Development Co., Ltd.Wholesale & retail; and development, business expansion and technical service of e-commerce200.0040.00
Yiwu China Commodities City Investment Management Co., Ltd.Investment management980.0049.00
Yiwu Hongyi Equity Investment Fund Partnership (limited partnership)Investment management, equity investment, asset management and investment consulting (without approval of the industry regulatory authorities such as the finance regulatory authority, the company shall not be engaged in the absorption of deposits, financial guarantee, agency wealth management, fundraising (financing) from the public and other69,000.0068,221.8649.98
financial businesses)
Shenwan Hongyuan Securities Co., Ltd.Securities brokerage, securities investment consulting and securities underwriting & sponsorship55,362.5463,340.810.50
Yiwu Water Resources Development Co., Ltd.Development, deployment and comprehensive utilization of water resources in the northern areas of Yiwu, and operation, management and maintenance of the water diversion works for Badu reservoir and Hengbin reservoir200.001,915.0010.00
Zhejiang Yiwu Tap Water Co., Ltd.Centralized water supply, and construction of the auxiliary pipe network for tap water supply207.292,264.002.83
Beijing Yiyun Clean Technology Venture Capital Co., Ltd.Venture capital, agency of other VC institutions or individuals’ VC business1,891.82300.0015.00
Suzhou Yiyun Venture Capital Center (limited partnership)Venture capital and related consulting business1,273.5122,465.7311.78
Shenzhen Tiantu Investment Management Co., Ltd.PE investment management in the consumer goods industry11,438.625,052.441.54
Beijing Redbud Huarong Equity Investment PartnershipAsset management, investment management and investment consulting10,000.0016,526.1512.36
Mashang Consumer Finance Co., Ltd.Granting of personal consumption loans; acceptance of deposits from shareholders’ domestic subsidiaries and domestic shareholders; lending to domestic financial institutions; issuance of financial bonds upon approval; inter-financial institution lending in China; consumption finance-related consulting; agency sale of insurance products related to consumption loans; and fixed-income securities investment3,000.003,772.500.75
Jiaxing Zhehua Zijing Investment Partnership (limited partnership)Industry investment, venture capital, investment management, business management, social and economic consulting. (Operating activities subject to approval in accordance with laws shall only be conducted after approval from related authority) [it shall not be engaged in the absorption of deposits, financial guarantee, agency wealth management, fundraising (financing) from the public and other financial businesses]10,000.0013,787.0417.51
Beijing Wudaokou Education Technology Co., Ltd.Technology promotion service; computer system service; basic software service, application software service (excluding medical software); software development; product design; model design; packaging and decoration design; and education consulting (excluding overseas studying consulting and intermediary service)500.0067.329.91
Nantong Redbud Huatong Equity Investment Partnership (limited partnership)Equity investment; investment consulting; and investment management20,000.0023,120.5521.05
Yiwu Shangfu Chuangzhi Investment CenterAsset management, investment management, and investment consulting service61,751.1461,751.1475.00
(limited partnership)
Yiwu Shanfeng Investment Partnership (limited partnership)Investment management, asset management and investment consulting2,600.002,600.0056.40
Yiwu Smart Transport Co., Ltd.Technology development, technical service, technical consulting, technology promotion and achievements transfer120.00120.0012.00
Fujian Zongteng Network Co., Ltd.Network information technology service; computer system integration service; development and technical service of computer hardware and software; wholesale, agency purchase and agency sale of maternal and infant products; online operation of electronic products and components and accessories thereof, household supplies and components and accessories thereof, and outdoor goods and components and accessories thereof; market research; business management consulting; enterprise marketing planning; international freight forwarding; and domestic trade agency service; and foreign trade3,000.003,207.65Convertible bond
Yiwu Guoshen Shangbo Property Co., Ltd.Real estate development, sale and lease; real estate brokerage service, interior decoration service; and landscaping service2,000.00894.2049.00
Cheng Jian Bao (Beijing) Consulting Services Co., Ltd.Economic and trade consulting; market research; business management consulting; public relations service; and enterprise planning design150.00138.5115.00

(1) Major equity investments

√Applicable □N/A

TargetMain businessActual investment amount during the reporting period (RMB10,000)% of the equity of the target as of the end of the reporting periodRemarks
Yiwu Shanyue Equity Investment Partnership (limited partnership)Equity investment; equity investment fund management, investment consulting, and operation and management of state-owned assets200039.6It subscribed for RMB20mn of capital contribution and had contributed RMB20mn of paid-in capital as of the end of the reporting period
Yiwu Hongyi Equity Investment Fund Partnership (limited partnership)Investment management, equity investment, asset management, investment consulting (without approval of the industry regulatory authorities such as the finance regulatory authority, the company shall not be engaged in the absorption of900049.98It subscribed for RMB1bn of capital contribution and had contributed RMB690mn of paid-in capital as of the end of the reporting period
deposits, financial guarantee, agency wealth management, fundraising (financing) from the public and other financial businesses)
Yiwu Guoshen Shangbo Property Co., Ltd.Real estate development, sale and lease; real estate brokerage service, interior decoration service; and landscaping service2,00049It subscribed for RMB20mn of capital contribution and had contributed RMB20mn of paid-in capital as of the end of the reporting period
Cheng Jian Bao (Beijing) Consulting Services Co., Ltd.Economic and trade consulting; market research; business management consulting; public relations service; and enterprise planning design150.0015It subscribed for RMB1.5mn of capital contribution and had contributed RMB1.5mn of paid-in capital as of the end of the reporting period
Jebel Ali Free Zone Trader Market Development and Operation FZCOLease and management of proprietary properties; and lease and management of the properties owned by othersDHS7.2mn30It subscribed for DHS50.4mn of capital contribution and had contributed DHS7.2mn of paid-in capital as of the end of the reporting period

(2) Major non-equity investments

√Applicable □N/A

Unit: RMB10,000

ProjectTotal investment amountProgressAmount invested during the current periodAccumulative invested amount
West Yiwu International Means of Production Market Auxiliary Project133,916.00The office building has been delivered, the underground space has been recognized as fixed assets, and design of the decoration for the hotel is in progress6,110.1491,362.99
Haicheng Yiwu China Commodities City Commerce Phase I Project—Hotel Project180,000.00The main work is under construction03,229.05
Binwang Market Culture Creative Industry Park Project50,756.00The renovation of Section A, B, C, D and E has been completed, and the renovation of the central square has been completed by 50%4,808.5712,218.00
Yiwu Comprehensive Bonded Zone Project624,250.0080% of the earthwork has been completed, the overpass works have come under construction, and invitations have been made for the bidding for Phase I project of the comprehensive1,028.091,028.09

(3) Financial assets measured with fair value

√Applicable □N/A

Unit: RMB10,000

bonded zone (civil works ofcustoms supervision facilities)Name

NameInitial investment costOpening book valueClosing book valueGains or losses during the reporting periodChange in shareholders’ equity during the reporting periodAccounting itemSource of funds
Wuxi DK Electronic Materials Co., Ltd.0.380.380.38Held-for-trading financial assetsSelf-owned funds
Shenzhen Crastal Technology Co., Ltd.0.190.190.19Held-for-trading financial assetsSelf-owned funds
Beijing Capital Online Data Service Co., Ltd.0.130.130.13Held-for-trading financial assetsSelf-owned funds
Shenglan Technology Co., Ltd.0.270.270.27Held-for-trading financial assetsSelf-owned funds
Zhengzhou Jie’an Hi-Tech Co., Ltd.0.310.310.31Held-for-trading financial assetsSelf-owned funds
HG Technologies Co., Ltd.0.320.320.32Held-for-trading financial assetsSelf-owned funds
Fujian Zongteng Network Co., Ltd.3,000.003207.653207.65Held-for-trading financial assetsSelf-owned funds
Shenyin & Wanguo Securities Co., Ltd.55,362.5464,218.8063,340.81-877.99Investment in other equity instrumentsSelf-owned funds
Jiaxing Zhehua Zijing Investment Partnership (limited partnership)10,000.0012,148.2013,787.041,638.84Other non-current financial assetsSelf-owned funds
Beijing Redbud Huarong Equity Investment Co., Ltd.10,000.0015,275.4516,526.151,250.70Other non-current financial assetsSelf-owned funds
Nantong Redbud Huatong Equity Investment Partnership (limited partnership)20,000.0022,809.2123,120.55311.34Other non-current financial assetsSelf-owned funds
Beijing Wudaokou Education Technology Co., Ltd.50067.3267.32Other non-current financial assetsSelf-owned funds
Zhejiang Yiwu Tap Water Co.,1002,264.002,264.00Other non-currentSelf-owned funds
Ltd.financial assets
Yiwu Water Resources Development Co., Ltd.2001,915.001,915.00Other non-current financial assetsSelf-owned funds
Suzhou Yiyun Venture Capital Center (limited partnership)4,000.0022,336.5122,465.73129.22Other non-current financial assetsSelf-owned funds
Beijing Yiyun Clean Technology Venture Capital Co., Ltd.6,091.82480.00300.00-180.00Other non-current financial assetsSelf-owned funds
Mashang Consumer Finance Co., Ltd.3,000.003,772.503,772.50Other non-current financial assetsSelf-owned funds
Shenzhen Tiantu Investment Management Co., Ltd.11,802.006,405.635,052.44-1,353.19Other non-current financial assetsSelf-owned funds
Yiwu Shanfeng Investment Partnership (limited partnership)2,600.0026002,600.00Other non-current financial assetsSelf-owned funds
Yiwu Smart Transport Co., Ltd.120120120Other non-current financial assetsSelf-owned funds
Yiwu Shangfu Chuangzhi Investment Center (limited partnership)61,751.1461,751.1461,751.14Other non-current financial assetsSelf-owned funds
Yiwu Shanyue Equity Investment Partnership (limited partnership)2,000.002,000.00Other non-current financial assetsSelf-owned funds

5 Sale of major assets and equity

□Applicable √N/A

6 Analysis of major subsidiaries and associates

√Applicable □N/A

Unit: RMB10,000

CompanyBusinessRegistered capitalTotal assets at the end of Jun 2020Net assets at the end of Jun 2020Net profits in Jan-Jun 2020
Yiwu China Commodities City Property Development Co., Ltd.Real estate development and sale250,000.00445,800.20333,795.27-198.17
Pujiang Lvgu Property Co., Ltd.Real estate development and sale70,000.00154,977.6671,469.92-528.46
Hangzhou Shangbo Nanxing Property Co., Ltd.Real estate development and sale5,000.001,243.849,217.25-107.92
Haicheng Yiwu China Commodities City Investment and Development Co., Ltd.Industry investment, investment management, property service, market development and operation, market auxiliary service, real estate development, sale and lease, design, production and agency of domestic advertising, and operation and management of parking garages60,000.00219,546.60-65,544.09-7,510.97
Yiwu Shangbo Property Co., Ltd.Real estate development and sale30,000.0050,886.9334,541.84-2,085.83
Yiwu Commodities City Gonglian Property Co., Ltd.Real estate development and sale20,000.0015,920.9315,774.98-6.43
Zhejiang Shangbo Property Co., Ltd.Real estate development and sale5,000.0010,881.347,985.56771.17
Jiangxi Shangbo Property Co., Ltd.Real estate development and sale50,000.0063,377.7952,832.57593.18
Yiwu China Commodities City Property Service Co., Ltd.Property service and landscaping300.002,283.801,411.15626.23
Jiangxi Commodities City Property Management Co., Ltd.Property management50.00112.6239.12-9.80
Yiwu Suxi Shangbo Property Co., Ltd.Real estate development and sale10,000.00105,022.579,888.37-367.80
Yiwu China Commodities City Information Technology Co., Ltd.R&D of computer and multimedia software20,000.0028,708.7320,740.81550.73
Zhejiang Yiwu E-commerce Co., Ltd.Computer software, multimedia technologies, computer network and application, and wholesale & retail10,000.0011,159.218,553.14735.05
Yiwu China Commodities City Payment Network Technology Co., Ltd.R&D of computer and multimedia software15,000.0012,355.6412,338.9045.20
Yiwu China Commodities City Credit Investigation Co., Ltd.Business credit investigation and related businesses; information market1,000.001,111.18782.9294.80
consulting, investment consulting, and information technology service (excluding Internet information service)
Yiwu China Commodities City (Germany) Co., Ltd.Business consulting; trade of import and export commodities (excluding the commodities subject to approval, hazardous goods and prohibited goods); organization of international visit projects and tourism projects; organization of expos, exhibitions and cultural exchange activities 100.00246.58240.66-87.38
Yiwu International Trade Comprehensive Service Co., Ltd.Supply chain management service; and supply chain information consulting service10,000.001,686.881,674.24-68.36
Yiwu China Commodities City Exhibition Co., Ltd.Exhibition service1,800.004,288.762,913.04-161.16
China Yiwu International Commodities Fair Co., Ltd.Exhibition service1,000.000.000.003.26
Yiwu China Commodities City Logistics and Warehousing Co., Ltd.Ordinary cargo transport and goods warehousing1,900.001,902.18602.90-325.94
Yiwu China Commodities City Advertising Co., Ld.Design, production, and publication and agency of advertisements in China1,000.005,467.853,192.231,414.07
Yiwu China Commodities City Supply Chain Management Co., Ltd.Supply chain management service10,000.0024,195.13-2,049.25-451.39
Yiwu China Commodities City Import and Export Co., Ltd.Domestic trade and international trade10,000.0013,987.823,426.34-544.79
Yiwu China Commodities City Financial Holdings Co., Ltd.Enterprise free capital investment, asset management, investment consulting service, and investment management service400,000.00273,372.20205,465.293,852.21
Yiwu China Commodities City Internet Finance Information Service Co., Ltd.Financial information service, technology development and technical service of computer software (excluding electronic publications), investment consulting and economic information consulting1,000.00902.33902.33-0.03
Yiwu China Commodities City Currency Exchange Co., Ltd.Exchange between RMB and foreign currencies1,000.00104.62103.27-8.43
Yiwu China Commodities City Tourism Development Co., Ltd.Development of tourism resources and tourism projects; domestic tourism business, inbound tourism business; tourism information consulting; and wholesale of fruits, vegetables, aquatic products and primary edible agricultural products10,000.009,306.279,150.68-90.26
Yiwu China Commodities City Commerce and Trade Service Training Center Co., Ltd.Cultural education and training for adults; business information consulting service; and marketing planning500.0020.5719.8914.21
Yiwu China Commodities City Overseas Investment and Development Co., Ltd.Overseas industry investment, and construction and operation of overseas shopping malls10,000.009,332.889,304.72-198.07
Yiwu ICMall Supply Chain Management Co., Ltd.Supply chain management service; simple processing and value-added service of bonded goods; and global procurement and international distribution500.0040.6837.01-33.55
Yiwu China Commodities City Assets Operation and Management Co., Ltd.Assets operation and management, real estate property management, and consulting service1,000.001,664.67463.65-13.67
Yiwu China Commodities City (Hong Kong) International Trade Co., Ltd.International trade, wholesale of commodities, and agency procurement of commoditiesHKD1.003,690.6728.058.94
Ningxia Yiwu Commodities CitySupply chain management service2,000.00223.71-77.11-72.08
Supply Chain Management Co., Ltd.
Yiwu Shanglv Investment and Development Co., Ltd.Industry investment, investment management, property service, operation and management of parking garages, business marketing planning, operation and management consulting, and operation and management of shopping malls80,000.00188,607.5874,482.13239.73
Hangzhou Binjiang Shangbo Property Development Co., Ltd.Real estate development and sale5,000.0047,273.8531,732.863,169.81
Yiwu Rongshang Property Co., Ltd.Real estate development and sale10,204.08591,447.394,005.57-747.26
Yiwu Chuangcheng Property Co., Ltd.Real estate development and sale8,333.33435,437.486,436.92-1014.11
Jiangsu Jin’an Hefeng Network Technology Co., Ltd.Wholesale and retail of textiles, clothing and household supplies; technology development and technical service for e-commerce; and design, construction and technical service of interior decoration works500.00260.19251.91-0.05
Yiwu Huishang Micro-finance Co., Ltd.Micro loans60,000.0036,735.8936,249.46-3,372.35
Zhejiang Chouzhou Financial Lease Co., Ltd.Financial lease service, and transfer of financial lease assets100,000.001,000,448.50135,419.507,876.21
Yiwu Huishang Redbud Equity Investment Co., Ltd.Equity investment and related consulting services49,000.0078,980.3171,752.03480.38
Yiwu Huishang Redbud Phase II Investment Partnership (limited partnership)Investment management and asset management106,100.0047,302.0145,295.38-374.38
Yiwu Huishang Rebud Capital Management Co., Ltd.Asset management, investment management and investment consulting service1,000.001017.961015.81257.26
Yiwu Meipinshu Supply Chain Management Co., Ltd.Supply chain management service165.513,246.042,543.41-371.42
Yiwu Hongyi Equity Investment Fund Partnership (limited partnership)Investment management, equity investment, asset management and investment consulting200,100.00136,517.73136,511.95-1,636.99
Hangzhou MicroAnts Co., Ltd.Services: technology development, technical consulting, technical services and achievements transfer of computer hardware and software and network information technologies, webpage design; and wholesale and retail: computer software2,600.00935.76852.97-174.34
Zhejiang Yemai Data Technology Co., Ltd.Technical services, wholesale and retail1,500.00507.02281.0782.17
Zhejiang Commodities City China Olympic Sports Industry Co., Ltd.Organization and planning consulting of sports events, operation of sports venues, and operation of sports activities10,000.00396393.43-13.7
Yiwu China Commodities City Creative Design and Development Services Co., Ltd.Design of industrial goods; development of computer software (excluding electronic publications); online sale and offline sale of electronic products (excluding electronic publications), artware, accessories and daily necessities; and exhibition and display services200.00216.19198.18-31.93
Zhejiang YXE Supply Chain Management Co., Ltd.Supply chain management service2,000.00420.14291.37-43.77
Zhejiang Zhiku Co., Ltd.Market planning and design, marketing planning, brand management service, and enterprise consulting and management10,000.00238.65238.65-13.35
Zhejiang Huajie Investment and Development Co., Ltd.Industry investment, investment management, investment consulting, business information consulting, and asset management services50,000.006,473.786,326.28-68.34
Yiwu Guoshen Shangbo Property Co., Ltd.Real estate development, sale and lease; real estate brokerage service, interior decoration service; and landscaping service4,081.63457,248.431,824.89-2256.74
Cheng Jian Bao (Beijing) Consulting Services Co., Ltd.Economic and trade consulting; market research; business management consulting; public relations service; and enterprise planning design1,000.00633.88-160.08-76.63
Yiwu Global Yida Logistics Co., Ltd.Agency international air transport of cargoes; agency international land transport of cargoes; agency international transport of cargoes; advertising design and agency; and technical services5,000.00974.84967.87-32.13
Zhejiang Yindu Hotel Management Co., Ltd.Hotel management, property service, enterprise brand management, and enterprise image planning1,000.0071.0860-40
Yiwu China Commodities City Big Data Co., Ltd.Internet data service; professional design service; and computer information technology development10,000.001,653.78667.86-692.14
Hong Kong Better Silk Road Co., Ltd.International trade, import and export, investment and consultingHKD108004,880.784,880.78-0.12
Better Silk FZInvestment management; industrial investment and management; business investment and management; regular investment business operation and managementDHS50404,627.854,627.85-0.18
Jebel Ali Free Zone Trader Market Development and Operation FZCOLease and management of proprietary properties; and lease and management of the properties owned by othersDHS1680015,784.684,525.36-101.14
BETTER SILK ROAD RWANDA LtdContainer handling; land transport-related services; and land transport supportingRWF27000163.7854.05-156.89
activities-related business
Yiwu Comprehensive Bonded Zone Operation and Management Co., Ltd.Property management; low-temperature warehousing, ordinary goods warehousing service; information consulting service; and warehousing equipment lease service10,000.000.000.000.00
Yiwu China Commodities City Research Institute Co., Ltd.Consulting and planning services; information consulting service; marketing planning; market research; and business management1,000.000.000.000.00

7 Structured entities controlled by the Company

□Applicable √N/A

III Other matters to be disclosed1 Warning or statement that the estimated net profits for the period from thestart of the current year to the end of the next reporting period may benegative or vary greatly on a YoY basis

□Applicable √N/A

2 Potential risks

√Applicable □N/A

(1) Market operation risk

Large-sized shopping malls, hypermarkets, warehouse stores and e-commerceplatforms are strong competitors in the commodities trading market. Large-sizedshopping malls offer products of reliable quality and well-known brands;hypermarkets or warehouse stores supply diversified products at low prices;e-commerce platforms provide new trading means and facilitate consumers.Purchasers or consumers may also choose to make procurement or consumptionvia e-commerce platforms for convenience. Therefore, the Company may competewith other forms of business. In addition, affected by the rising specialized market,robust development of the industry market and rapid development of the central andwestern regions, the Company may also face competition from other similarspecialized markets.

(2) Risk of insufficient reserve of talents

With the development of retail sales, centralized procurement, warehousing,logistics and overseas businesses, the Company’s reserve of professional talentsand inter-disciplinary talents may be insufficient.3 Other matters to be disclosed

□Applicable √N/A

Section V Significant Matters

I Shareholders’ meetings

Session of meetingDateDesignated website on which the resolution is publishedDate of disclosure of the resolution
The first extraordinary shareholders’ meeting in 2020Jan 15, 2020www.sse.com.cnJan 16, 2020
The second extraordinary shareholders’ meeting in 2020Feb 24, 2020www.sse.com.cnFeb 25, 2020
The 2019 annual shareholders’ meetingMay 22, 2020www.sse.com.cnMay 23, 2020
The third extraordinary shareholders’ meeting in 2020Jun 29, 2020www.sse.com.cnJun 30, 2020

Statement on shareholders’ meetings

√Applicable □N/A

1. The first extraordinary shareholders’ meeting in 2020 deliberated on and adoptedthe following proposal:

(1) Proposal on the Payment of Remunerations of Some Directors in 2018

2. The second extraordinary shareholders’ meeting in 2020 deliberated on andadopted the following proposal:

(1) Proposal on External Donation

3. The 2019 annual shareholders’ meeting deliberated on and adopted the followingproposals:

(1) Work Report of the Board of Directors for 2019

(2) Work Report of the Board of Supervisors for 2019

(3) 2019 Annual Report and Summary

(4) 2019 Final Accounts Report

(5) 2020 Financial Budget Report

(6) 2019 Profits Distribution Plan

(7) Proposal on Renewing the Engagement of Accounting Firm

(8) Proposal on Issuing Debt Instruments within the Coming 12 Months

(9) Proposal on Adding Independent Directors

4. The third extraordinary shareholders’ meeting in 2020 deliberated on andadopted the following proposal:

(1) Proposal on the Transfer of Some Equity in Wholly-owned Subsidiaries andRelated-Party TransactionsII Proposal on profits distribution or capitalization of the capital reserve

1. Semi-annual proposals on profits distribution and capitalization of capitalreserve

Whether to distribute profits or capitalize the capital reserveNo
Number of bonus shares for every 10 shares0
Dividend payout for every 10 shares (tax inclusive)0
Number of shares converted from the capitalization of capital reserve for every 10 shares0
Statement on the proposal on profits distribution or capitalization of capital reserve
None

III Fulfillment of commitments

1. Commitments made by the actual controller, shareholders, affiliates and

acquirer of the Company, the Company itself and other related partiesduring the reporting period or as of the reporting period

□Applicable √N/A

IV Engagement and termination of engagement of accounting firmStatement on the engagement or termination of engagement of accounting firm

√Applicable □N/A

The 13

th meeting of the 8

thBoard of Directors of the Company held on Apr 28, 2020and the 2019 annual shareholders’ meeting held on May 22, 2020 deliberated onand adopted the Proposal on Renewing the Engagement of Accounting Firm,agreeing to keep engaging Ernst & Young Hua Ming Accounting Firm (LLP) as itsfinancial and internal control auditor. For details, please refer to the Temporary2020-028 Announcement dated Apr 30, 2020 and Temporary 2019-039Announcement dated May 23, 2020 on www.sse.com.cn.Statement on replacing the accounting firm during the audit

□Applicable √N/A

Statement on the “modified audit report” issued by the accounting firm

□Applicable √N/A

Statement on the “modified audit report” issued by the certified accountant for thefinancial report in the Company’s annual report for the last year.

□Applicable √N/A

V Matters relating to bankruptcy and reorganization

□Applicable √N/A

VI Material litigations and arbitrations

√The Company has been involved in material litigation or arbitration during thereporting period?The Company has not been involved in any material litigation or arbitration duringthe reporting period

1. Litigations and arbitrations have been disclosed in the temporaryannouncements and have had no further progresses

□Applicable √N/A

2. Litigations and arbitrations that have not been disclosed in the temporaryannouncements or have had further progresses

√Applicable □N/A

Unit: RMB10,000

During the reporting period:
Plaintiff (claimant)Defendant (respondent)Party Bearing Joint LiabilitiesLitigation or arbitrationBasic information of litigation (arbitration)Value involved in litigation (arbitration)Does the litigation (arbitration) cause estimated liabilities and the amount thereofStatus of litigation (arbitration)Results of litigation (arbitration) and effect thereofEnforcement of judgment (award)
The CompanyChangsha Ruinian Real Estate Development Co., Ltd.NoneLitigationSecond instance for the dispute over unfair competition and trademark right infringement [(2020) Xiang Min Zhi Zhong No.216]212NoJudgment has been made//
The CompanyGanglong Holdings Group Co., Ltd., Anshan Ganglong GuoxinNoneLitigationDispute over trademark right infringement212NoJudgment has been madeJudgment of second instance: appealCourt enforcement has been sought
Property Co., Ltd.and unfair competition [(2018) Su 05 Min Chu No.64]dismissed, and original judgment rectified
The CompanyGanglong Holdings Group Co., Ltd., Huai An Ganglong Building Materials and Home Furnishing City Management Co., Ltd., Huai An Ganglong Yiwu China Commodities City Operation and Management Co., Ltd.NoneLitigationDispute over trademark right infringement and unfair competition [(2018) Su 05 Min Chu No.65]612NoJudgment has been madeJudgment of second instance: appeal dismissed, and original judgment rectifiedCourt enforcement has been sought
The CompanyWenzhou Ganglong Property Co., Ltd., Ganglong Holdings Group Co., Ltd., Wenzhou Ganglong Yiwu Commodities City Operation and Management Co., Ltd.NoneLitigationDispute over trademark right infringement [(2018) Zhe 02 Min Chu No.25]300NoJudgment has been madeJudgment of second instance: appeal dismissed, and original judgment rectifiedCourt enforcement has been sought
The CompanyZhejiang Yiwu Chuanglian Market Investment and Management Co., Ltd., Suzhou Pingjiang Ganglong Real Estate Co., Ltd., Suzhou Ganglong Business Management Co., Ltd., Ganglong Holdings Group Co., Ltd.NoneLitigationDispute over trademark right infringement and unfair competition [(2018) Zhe 01 Min Chu No.47]310.94NoJudgment has been madeJudgment of second instance: appeal dismissed, and original judgment rectifiedCourt enforcement has been sought
The CompanyZhejiang Yiwu Chuanglian Market Investment and Management Co., Ltd., Changde Xinri Property Co., Ltd., Changde Xinri Yiwu International Trade City Co., Ltd.NoneLitigationDispute over trademark right infringement and unfair competition [(2018) Zhe 01 Min Chu No.50]161.17NoJudgment has been madeJudgment of second instance: appeal dismissed, and original judgment rectifiedThe Company has received the enforced amount of RMB649,000
The CompanyZhejiang Yiwu Chuanglian Market Investment and Management Co., Ltd., Hebei Jiangcheng Real Estate Development Co., Ltd., Handan Zheshang Yiwu China Commodities City Co., Ltd.NoneLitigationDispute over trademark right infringement and unfair competition [(2018) Zhe 01 Min Chu No.51]610.34NoJudgment has been madeJudgment of second instance: appeal dismissed, and original judgment rectifiedCourt enforcement has been sought
The CompanyZhejiang Yiwu ChuanglianNoneLitigationDispute over trademark610.58NoJudgment has been madeJudgment of secondCourt enforcement
Market Investment and Management Co., Ltd., Ningxiang Hengyuan Real Estate Development Co., Ltd., Hunan Zhong Zhi Ying Tou Holdings Group Co., Ltd.right infringement and unfair competition [(2018) Zhe 01 Min Chu No.48]instance: appeal dismissed, and original judgment rectifiedhas been sought
The CompanyYouxian Xinxing Real Estate Development Co., Ltd., Youxian Xiangdong Yiwu International Trade City Development Co., Ltd., Hunan Xiangdong Yiwu International Trade City Operation and Management Co., Ltd.NoneLitigationDispute over trademark right infringement and unfair competition [(2019) Zhe 01 Min Chu No.11]250NoJudgment has been madeJudgment of second instance: appeal dismissed, and original judgment rectifiedThe bank account of Youxian Xinxing Real Estate Development Co., Ltd. was seized and frozen
The CompanyZHANG Xizhong, CHEN Zhihua, Chuzhou Chuangda Yiwu International Trade City Co., Ltd.NoneLitigationDispute over trademark right infringement and unfair competition [(2019) Zhe 0782 Min Chu No. 10704]350NoJudgment has been made1. The defendant Chuzhou Chuangda Yiwu International Trade City Co., Ltd. shall immediately cease infringement of exclusive use right to the plaintiff’s No. 14115979 registered trademark, i.e. ceasing the use of “Chuzhou Chuangda Yiwu International Trade City” or “Chuzhou Yiwu International Trade City” marks on market signboards and in advertising, online advertising and other operating activities; 2. The defendants ZHANG Xizhong, CHEN Zhihua and Chuzhou Chuangda Yiwu International Trade City Co., Ltd. shall/
jointly and severally compensate RMB3.5mn (including reasonable expenses) for the plaintiff’s economic losses, which shall be fulfilled within ten days after effectiveness date of the judgment; 3. Other claims made by the plaintiff were rejected.
The CompanyZHANG Xizhong, CHEN Zhihua, Huai An Chuangda Yiwu International Trade City Co., Ltd., HUANG Keyu, CHEN JianzhongNoneLitigationDispute over trademark right infringement and unfair competition [(2019) Zhe 0782 Min Chu No. 10705]400NoJudgment has been made1. The defendant Huai An Chuangda Yiwu International Trade City Co., Ltd. shall immediately cease infringement of exclusive use right to the plaintiff’s No. 14115979 registered trademark, i.e. ceasing the use of “Huai An Chuangda Yiwu International Trade City” mark on market signboards and in advertising, online advertising and other operating activities; 2. The defendants ZHANG Xizhong, CHEN Zhihua, Huai An Chuangda Yiwu International Trade City Co., Ltd., HUANG Keyu and CHEN Jianzhong shall jointly and severally compensate RMB4mn (including reasonable expenses) for the plaintiff’s/
economic losses, which shall be fulfilled within ten days after effectiveness date of the judgment; 3. Other claims made by the plaintiff were rejected.
The CompanyXianning Luzhou Yiwu Small Commodities Wholesale City Co., Ltd.NoneLitigationDispute over unfair competition [(2019) Zhe 0782 Min Chu No. 18835]380NoJudgment has been made1. The defendant shall immediately cease infringement of the plaintiff’s service names with certain influence, i.e. “Yiwu International Trade City” and “Yiwu China Commodities City”, including but not limited to ceasing the use of “Xianning Yiwu International Trade City” and “Xianning Luzhou Yiwu Commodities Wholesale City” marks on market signboards and in advertising, online advertising and other operating activities; 2. The defendant shall compensate RMB3.8mn (including reasonable expenses on the protection of legal rights) for the plaintiff’s economic losses, which shall be fulfilled within fifteen days after effectiveness date of the judgment; 3. Other claims/
made by the plaintiff were rejected.
The CompanyHubei Xizi Property Co., Ltd., Huangshi Duolong Yiwu Small Commodities Wholesale City Management Co., Ltd.NoneLitigationDispute over unfair competition [(2019) Zhe 0782 Min Chu No. 18837]320NoJudgment has been made1. The defendant shall immediately cease infringement of the plaintiff’s service name with certain influence, i.e. “Yiwu International Trade City”, including but not limited to ceasing the use of “Huangshi Yiwu International Trade City” mark on market signboards and in advertising, online advertising and other operating activities; 2. The defendant shall compensate RMB3.2mn (including reasonable expenses on the protection of legal rights) for the plaintiff’s economic losses, which shall be fulfilled within fifteen days after effectiveness date of the judgment; 3. Other claims made by the plaintiff were rejected./
The CompanySanmenxia Zheshang Alliance Property Co., Ltd.NoneLitigationDispute over unfair competition [(2019) Zhe 0782 Min Chu No. 18839]410NoJudgment has been made1. The defendant shall immediately cease infringement of the plaintiff’s service name with certain influence, i.e. “Yiwu International Trade City”, including but/
not limited to ceasing the use of “Sanmenxia Yiwu International Trade City” and “Sanmenxia Yiwu Trade City” marks on market signboards and in advertising, online advertising and other operating activities; 2. The defendant shall compensate RMB4.1mn (including reasonable expenses on the protection of legal rights) for the plaintiff’s economic losses, which shall be fulfilled within fifteen days after effectiveness date of the judgment; 3. Other claims made by the plaintiff were rejected.
The CompanyHenan Zhongyi Property Group Co., Ltd., Zhumadian Zhongyi Shopping Mall Business Management Co., Ltd.NoneLitigationDispute over unfair competition [(2019) Zhe 0782 Min Chu No. 18842]492NoTrial has started, but no judgment has been made//
The CompanyAnhui Zhongheng Business Development Co., Ltd.NoneLitigationDispute over unfair competition [(2019) Zhe 0782 Min Chu No. 18844]492NoTrial has started, but no judgment has been made//
The CompanyGuangdong Duolong Enterprise Group Co., Ltd., Zhanjiang Yongsheng Industry Co., Ltd., Zhanjiang Duolong Yiwu Small Commodities Wholesale City Co., Ltd.NoneLitigationDispute over unfair competition and trademark right infringement [(2019) Yue 13 Min Chu No. 206]812NoTrial has started, but no judgment has been made//
The CompanyDongguan Qianyufa Small Commodities CityNoneLitigationDispute over trademark right1,212NoTrial has started, but no judgment has//
Co., Ltd., ZHANG Yuhui, LU Weijian, MA Wenbo, LEI Mingliang, ZHU Ruixiang, MO Zhenfeng, CHENG Aiguoinfringement and unfair competition [(2019) Yue 19 Min Chu No. 115]been made
Bank of ChinaThe Company and Commodities City TradeNoneLitigationDispute over letter of credit11,367.5711,062.03The case has been transferred to the Public Resources Trading Supervision and Administration Bureau of Yiwu, and the court acceptance fees have been refunded to the plaintiff

Note: during the reporting period, the Company initiated a series of brand protectioncases, including 6 cases for first instance, 8 cases for second instance and 4 casesfor which trials have started but no judgments have been made. For the firstinstance and second instance cases for which judgments have been made, theinfringing parties shall compensate RMB51.3903mn for the Company’s economiclosses in total.

3. Other statement

□Applicable √N/A

VII Punishments of and rectifications by the Listed Company and its

directors, supervisors, senior officers, actual controller and acquirers

□Applicable √N/A

VIII Credit standing of the Company and its controlling shareholder andactual controller

√Applicable □N/A

There was no outstanding court judgment or overdue debt of a large amountinvolving the Company or its controlling shareholder or actual controller during thereporting period.

IX Incentive stock option plans, employee stock ownership plans and other

employee incentives granted by the Company and the impact thereof1 Matters relating to incentive stock options that have been disclosed in

the temporary announcements and have had no further progresses orchanges

□Applicable √N/A

2 Incentives that have not been disclosed in the temporary

announcements or had further progressesIncentive stock option

□Applicable √N/A

Other statement

□Applicable √N/A

Employee stock ownership plans

□Applicable √N/A

Other incentives

□Applicable √N/A

X Material related-party transactions1 Related-party transactions relating to regular corporate operation

(1) Matters that have been disclosed in the temporary announcements andhad no further progresses or changes

□Applicable √N/A

(2) Matters that have been disclosed in the temporary announcements buthad further progresses or changes

□Applicable √N/A

(3) Matters that have not been disclosed in the temporary announcements

√Applicable □N/A

Unit: RMB10,000

Related counterpartyRelationshipType of related-party transactionContents of related-party transactionPricing principlePrice of related-party transactionAmount of related-party transaction% of the total amount of all related-party transactionsSettlement methodMarket priceReasons for the large difference between the price of the transaction and reference market price
Yourworld International Conference Center, subordinated to Yiwu Market Development GroupParent companyOther inflowEntrusted management fees and license feesNegotiated price45.3091.42Account transfer
Yiwu Security Service Co., Ltd.Wholly-owned subsidiary of the parent companyAcceptance of labor serviceCash security service for the business outlets of the currency exchange companyMarket price4.258.58Account transfer
Total//49.55100.00///
Return of large-value goods sales
Illustration on related-party transactions

2 Related-party transactions arising from the acquisition or sale of assetsor equity

(1) Matters that have been disclosed in the temporary announcements andhad no further progresses or changes

□Applicable √N/A

(2) Matters that have been disclosed in the temporary announcements but

had further progresses or changes

√Applicable □N/A

(a) The Company transferred 51% equity in its wholly-owned subsidiaries Yiwu

China Commodities City Property Development Co., Ltd. and Pujiang LvguProperty Co., Ltd. respectively to its controlling shareholder CCCH at the priceof RMB2.232bn. For details, please refer to the Announcement on the Transferof Some Equity in Wholly-owned Subsidiaries and Related-Party Transaction(Announcement No. Temporary 2020-048).By far, the Company has received RMB2.232bn from CCCH. CCCP and PujiangLvgu have completed the procedures for registration of change with theAdministration for Market Regulation.(b) The Company accepted the transfer of 35.72% equity held by ShanghaiYuantong Jiaolong Investment Development Group Co. Ltd. and 20.68% equityheld by Yiwu International LandPort Group Co., Ltd. in Zhejiang Huajie

Investment and Development Co., Ltd.. For details, please refer to theAnnouncement on the Progress of External Investment and Related-PartyTransactions (Announcement No. Temporary 2020-018).By far, Zhejiang Huajie Investment and Development Co., Ltd. has completedthe procedures for registration of change with the Administration for MarketRegulation.

(3) Matters not disclosed in the temporary announcements

□Applicable √N/A

(4) If any agreement on the operating results is involved, the achievement of

operating results during the reporting period shall be disclosed

□Applicable √N/A

3 Related-party transactions arising from joint external investment

(1) Matters that have been disclosed in the temporary announcements andhad no further progresses or changes

√Applicable □N/A

Overview of the matterQuery website
The Company’s wholly-owned subsidiaries CCC Logistics and Zhejiang Jicheng Yunchuang Technology Co., Ltd., and affiliates Yiwu Lugang Information Technology Co., Ltd. and Yiwu Security Co., Ltd. jointly invested in the establishment of Yiwu Smart Transport Co., Ltd.www.sse.com.cn

(2) Matters that have been disclosed in the temporary announcements but

had further progresses or changes

□Applicable √N/A

(3) Matters not disclosed in the temporary announcements

□Applicable √N/A

4 Related-party credits and debts

(1) Matters that have been disclosed in the temporary announcements andhad no further progresses or changes

□Applicable √N/A

(2) Matters that have been disclosed in the temporary announcements buthad further progresses or changes

□Applicable √N/A

(3) Matters not disclosed in the temporary announcements

□Applicable √N/A

5 Other material related-party transactions

□Applicable √N/A

6 Others

□Applicable √N/A

XI Material contracts and performance thereof1 Trusteeship, contracting and leases

□Applicable √N/A

2 Guarantees

√Applicable □N/A

Unit: RMB10,000

External guarantees provided by the Company (excluding those provided for the subsidiaries)
GuarantorRelationship between the guarantor and the Listed CompanyThe guaranteedAmount of guaranteeDate of guarantee (signing date of the agreement)Starting date of the guaranteeExpiry date of guaranteeType of guaranteeIs the guarantee fulfilled in fullIs the guarantee overdueOverdue amount of the guaranteeIs there a counter guaranteeIs it a related-party guaranteerelationship
CCCThe Company itselfHuangyuan Shangbo90,702.10Aug 13, 2019Aug 23, 2022Aug 22, 2024Joint and several liability guaranteeNoNo-NoNo
CCCThe Company itselfChengzhen Property20,145.44Nov 26, 2019Sep 22, 2022Sep 21, 2024Joint and several liability guaranteeNoNo-NoNo
CCCThe Company itselfYiwu Shanglv26,082.82Dec 16, 2015Jul 1, 2015Dec 15, 2026Joint and several liability guaranteeNoNo-YesNo
CCCPWholly-owned subsidiaryHouse purchaser90,283.94Joint and several liability guaranteeNoNo-NoNo
Amount of guarantees made during the reporting period (excluding the guarantees provided for subsidiaries)41,825.91
Balance of guarantees at the end of the reporting period (A) (excluding the guarantees provided for subsidiaries)227,214.30
Guarantees provided by the Company for its subsidiaries
Amount of guarantees provided for subsidiaries during the reporting period
Balance of guarantees provided for subsidiaries at the end of the reporting period (B)
Total guarantees provided by the Company (including those provided for the subsidiaries)
Total amount of guarantees (A+B)227,214.30
Ratio of the total amount of guarantees to the Company’s net assets (%)16.52
Among which:
Amount of guarantees provided for shareholders, actual controller and their related parties (C)
Amount of guarantees provided directly or indirectly for the debtors whose debt-to-asset ratio exceed 70% (D)
Portion of total amount of guarantees in excess of 50% of net assets (E)
Total (C+D+E)
Statement on the joint and several liability that may be assumed due to outstanding guarantees
Statement on guarantees1. According to the resolution of the 65th meeting of the 7th Board of Directors on Jul 23, 2019, the Group applied to the Yiwu Branch of ICBC and Yiwu Branch of SPDB for RMB1bn loans respectively for Huangyuan Shangbo and provided guarantees for the loans based on its shareholding ratio. The guarantees were joint and several liability guarantees, the maximum amounts of guarantees were RMB490mn and the terms were two years from the dates immediately following the maturities of the loans under corresponding loan contracts. As of Jun 30, 2020, Huangyuan Shangbo actually borrowed RMB887,170,875 from the Yiwu Branch of ICBC and RMB963,892,550 from the Yiwu Branch of SPDB (RMB700,923,611.11 and RMB981,198,055.56 by Dec 31, 2019). According to the guarantee contracts, the Group assumed guarantees of RMB434,713,728.75 to the Yiwu Branch of ICBC and RMB472,307,349.5 to the Yiwu Branch of SPDB (RMB343,452,569.44 and RMB480,787,047.22 by Dec 31, 2019). 2. According to the resolution of the fourth meeting of the 8th Board of Directors on Nov 4, 2019, the Group applied to the Yiwu Branch of Hengfeng Bank for a loan with a total amount no higher than RMB1.63bn for Chengzhen Property and provided guarantee based on its shareholding ratio. The guarantee was a joint and several liability guarantee, the maximum amount of guarantee was RMB391.2mn and the term was from the maturity date of the debt agreed under the corresponding loan contract until two years after the maturity date of the debt agreed in the loan contract with the latest expiration date among all loan contracts. As of Jun 30, 2020, Chengzhen Property actually borrowed RMB839,393,175 from the Yiwu Branch of Hengfeng Bank (RMB839,702,769.44 by Dec 31, 2019). According to the guarantee contract, the Group assumed guarantee of RMB201,454,362 to the Yiwu Branch of Hengfeng Bank (RMB201,528,664.67 by Dec 31, 2019). 3. According to the resolution of the 15th meeting of the 7th Board of Directors on Jul 1, 2015, the Group applied to the Yiwu Branch of ABC for an RMB750mn loan for Yiwu Shanglv and provided guarantee based on its shareholding ratio. The guarantee was a joint and several liability guarantee, the maximum amount of guarantee was RMB367.5mn and the term was 11 years. As of Jun 30, 2020, Yiwu Shanglv actually borrowed RMB532,302,406.56 from the Yiwu Branch of ABC (Dec 31, 2019: RMB587,412,606.21). According to the guarantee contract, the Group provided guarantee for RMB260,828,179.21 to the Yiwu Branch of ABC (RMB287,832,177.04 by Dec 31, 2019). Yiwu State-owned Capital Operation Co., Ltd. provided a counter guarantee for this guarantee. 4. According to relevant provisions, while selling houses, the Group shall provide guarantees for the mortgage loans of the buyers before they obtain the property ownership certificates. The outstanding amount of guarantees as of Jun 30, 2020 was RMB902,839,447.86 (RMB540,283,351.51 on Dec 31, 2019). Those guarantees would be released after the issuance of the property ownership certificates.

3 Other material contracts

√Applicable □N/A

No.Name of contractContracting partyContract price (RMB10,000)
1Lease Agreement for Floor 3-4 and 8-21 of Building No.4 (Shuangchuang Building 1) of CCC Europe and U.S. CenterZhejiang Jielian Network Technology Co., Ltd.1,117.15
2CCTV-4 Focus Today Advertisement Pre-sale ContractCTV Golden Bridge Advertising Co., Ltd.1,280.81
3Construction Contract for Renovation of the City Parlor of E2 Pavilion of Expo CenterZhejiang Baisha Construction Co., Ltd.2,252.33
4Construction Contract for Yiwu CCC Warehouse Park Trade Station (Construction of Warehouse 1# and 2#)Zhejiang Longsha Construction Group Co., Ltd.10,447.45
5Contract for Contracted Construction of the Auxiliary Overpass Works of Yiwu Comprehensive Bonded Zone ProjectTianyang Construction Group Co., Ltd.3,667.18

XII Poverty alleviation by the Listed Company

□Applicable √N/A

XIII Convertible corporate bonds

□Applicable √N/A

XIV Environmental issues1 Statement on the environmental issues of the company listed among thekey polluters announced by the environmental protection authority andits important subsidiaries

□Applicable √N/A

2 Statement on the environmental issues of the company not listed amongthe key polluters

□Applicable √N/A

3 Explanation for the failure of the company not listed among the keypolluters to disclose environmental issues

□Applicable √N/A

4 Further progress or change of the environmental issues disclosed duringthe reporting period

□Applicable √N/A

XV Other significant matters1 Changes in the accounting policies, accounting estimates and accountingmethod from those during the last accounting period and the reasons andimpact thereof

√Applicable □N/A

For details, please refer to Section X Financial Report-V Important AccountingPolicies and Accounting Estimates-(44) Changes in Important Accounting Policiesand Accounting Estimates-(a) Changes in Important Accounting Policies.

2 Retrospective restatement due to correction of material accounting errorsduring the reporting period, the corrected amount, the reasons andimpact

□Applicable √N/A

3 Others

□Applicable √N/A

Section VI Changes in common shares and shareholders

I Changes in capital stock1 Changes in shares

(1) Changes in shares

During the reporting period, the total number of shares and capital stock structure ofthe Company did not change.

(2) Explanation for the changes in shares

□Applicable √N/A

(3) Impact of the changes in shares between the end of the reporting periodand the disclosure date of the Semi-Annual Report on financial data such asEPS and BVPS (if any)

□Applicable √N/A

(4) Other matters the Company deems it necessary to disclose or required bythe securities regulatory authority to be disclosed

□Applicable √N/A

2 Changes in non-tradable shares

□Applicable √N/A

II ShareholdersTotal number of shareholders:

Number of common shareholders as of the end of the reporting period236,509
Total number of preferred shareholders whose voting rights had been restituted as of the end of the reporting period0

1 Shareholdings of the top 10 shareholders and top 10 holders of tradable

shares (or shareholders not subject to trading restrictions)

Unit: number of shares

Shares held by top 10 shareholders
Shareholder (full name)Change during the reporting periodNumber of shares held at the end of the reporting periodShareholding ratio (%)Number of non-tradable shares heldPledge or freezingOwnership of shareholder
Status of sharesQuantity
Yiwu China Commodities City Holdings Limited03,038,179,39255.820None0State-owned legal person
China Securities Finance Co., Ltd.0266,718,4854.900None0Unknown
Zhejiang Provincial Finance Development Ltd.0147,466,5282.710None0State-owned legal person
Central Huijin Investment Ltd.066,371,0001.220None0State-owned legal person
Bosera Funds-Agricultural Bank of China-Bosera China Securities Financial Assets Management Scheme027,672,8000.510None0Unknown
E Fund-Agricultural Bank of China-E Fund China Securities Financial Assets Management Scheme027,672,8000.510None0Unknown
Dacheng Fund-Agricultural Bank of China-Dacheng China Securities Financial Assets Management Scheme027,672,8000.510None0Unknown
Harvest Fund-Agricultural Bank of China-Harvest China Securities Financial Assets Management Scheme027,672,8000.510None0Unknown
GF Fund-Agricultural Bank of China-GF China Securities Financial Assets Management Scheme027,672,8000.510None0Unknown
Zhong Ou AMC-Agricultural Bank of China-Zhong Ou China Securities Financial Assets Management Scheme027,672,8000.510None0Unknown
Southern Asset Management-Agricultural Bank of China-Southern China Securities Financial Assets Management Scheme027,672,8000.510None0Unknown
ICBC Credit Suisse Asset Management-Agricultural Bank of China-ICBC Credit Suisse China Securities Financial Assets Management Scheme027,672,8000.510None0Unknown
Shares held by top 10 holders of tradable shares
ShareholderNumber of tradable shares heldType and quantity of shares
TypeQuantity
Yiwu China Commodities City Holdings Limited3,038,179,392RMB-denominated common share3,038,179,392
China Securities Finance Co., Ltd.266,718,485RMB-denominated common share266,718,485
Zhejiang Provincial Finance Development Ltd.147,466,528RMB-denominated common share147,466,528
Central Huijin Investment Ltd.66,371,000RMB-denominated common share66,371,000
Bosera Funds-Agricultural Bank of China-Bosera China Securities Financial Assets Management Scheme27,672,800RMB-denominated common share27,672,800
E Fund-Agricultural Bank of China-E Fund China Securities Financial Assets Management Scheme27,672,800RMB-denominated common share27,672,800
Dacheng Fund-Agricultural Bank of China-Dacheng China Securities Financial Assets Management Scheme27,672,800RMB-denominated common share27,672,800
Harvest Fund-Agricultural Bank of China-Harvest China Securities Financial Assets Management Scheme27,672,800RMB-denominated common share27,672,800
GF Fund-Agricultural Bank of China-GF China Securities Financial Assets Management Scheme27,672,800RMB-denominated common share27,672,800
Zhong Ou AMC-Agricultural Bank of China-Zhong Ou China Securities Financial Assets Management Scheme27,672,800RMB-denominated common share27,672,800
Southern Asset Management-Agricultural Bank of China-Southern China Securities Financial Assets Management Scheme27,672,800RMB-denominated common share27,672,800
ICBC Credit Suisse Asset Management-Agricultural Bank of China-ICBC Credit Suisse China Securities Financial Assets Management Scheme27,672,800RMB-denominated common share27,672,800
Explanation on the relationship or concerted action between the above shareholdersZhejiang Provincial Finance Development Ltd. had a stake of 10% in Yiwu Market Development Group Co., Ltd., which was the controlling shareholder of Yiwu China Commodities City Holdings Limited
Explanation on the preferred shareholders whose voting rights had been restituted and the quantity of shares held therebyNone

Number of shares held by the top 10 shareholders subject to trading restrictionsand the trading restrictions

□Applicable √N/A

2 Any strategic investor or ordinary legal person became one of the top 10

shareholders due to the allotment of new shares

□Applicable √N/A

III Changes in controlling shareholder or actual controller

√Applicable □N/A

New controlling shareholderYiwu China Commodities City Holdings Limited
New actual controllerState-owned Assets Supervision and Administration Office of the People’s Government of Yiwu
Date of changeMay 11, 2020
Designated website for query and datewww.sse.com.cn May 13, 2020

Section VII Preferred Shares

□Applicable √N/A

Section VIII Directors, Supervisors and Senior Officers

I Changes in shares held by directors, supervisors and senior officers1 Changes in shares held by incumbent directors, supervisors and seniorofficers and those leaving office during the reporting period

√Applicable □N/A

Unit: share

NameTitleOpening number of shares heldClosing number of shares heldChange in shares held during the reporting periodReasons for change
ZHAO WengeDirector40,00040,000
WANG DongDirector
WANG ChunmingDirector
LI ChengqunDirector
XU HangDirector
ZHU HangDirector
LIU ZhiyuanIndependent director
MA ShuzhongIndependent director
HONG JianqiaoIndependent director
JIN YanghuaIndependent director
WU YabinIndependent director
HUANG PingSupervisor
JIN XiaojiaSupervisor
WANG GaiyingSupervisor
ZHANG YuhuSupervisor
LIU ZhentingSupervisor50,00080,00030,000Buying shares in the secondary market
WU XiubinSenior officer
ZHANG QizhenSenior officer
WEI GangSenior officer
ZHAO DifangSenior officer50,10050,100

Statement on other matters

□Applicable √N/A

2 Stock option incentives granted to directors, supervisors and seniorofficers during the reporting period

□Applicable √N/A

□Applicable √N/A

II Changes in directors, supervisors and senior officers of the Company

√Applicable □N/A

NameTitleChange
HONG JianxiaoIndependent directorElection
JIN YanghuaIndependent directorElection
LIU ZhiyuanIndependent directorLeaving office
WU YabinIndependent directorLeaving office

Statement on the changes in directors, supervisors and senior officers of theCompany

□Applicable √N/A

III Others

□Applicable √N/A

Section IX Corporate Bonds

√Applicable □N/A

I Basic information on corporate bonds

Unit: RMB100mn

Name of bondAbbreviationCodeIssue dateMaturity dateOutstanding amountInterest rate (%)Method of principal repayment and interest paymentMarketplace
Publicly offered corporate bond 2019of Zhejiang China Commodities City Group Co.,Ltd (Phase I)19 CCC 01155450Jun 3, 2019Jun 5, 202284.3For the principal repayment and interest payment of the bond, the list of bondholders would be made according to the relevant provisions of the bond registration authority. The specific matters shall be handled according to the relevant provisions of the bond registration authority.Shanghai Stock Exchange
Publicly offered corporate bond 2019of Zhejiang China Commodities City Group Co.,Ltd (Phase II)19 CCC 02155750Sep 26, 2019Sep 27, 202273.99For the principal repayment and interest payment of the bond, the list of bondholders would be made according to the relevant provisions of the bond registration authority. The specific matters shall be handled according to the relevant provisions of the bond registration authority.Shanghai Stock Exchange

Principal repayment and interest payment of corporate bonds

√Applicable □N/A

On Jun 5, 2020, the Company paid interest to all holders of 19 CCC 01 for theperiod from Jun 5, 2019 to Jun 4, 2020.Other statement on corporate bonds

□Applicable √N/A

II Bond trustee, contact information of the trustee and contact information

of credit rating agency

Bond trusteeNameHaitong Securities Co., Ltd.
Office address15/F Yuanxiangtai Building, No.5 Anding Road, Chaoyang District, Beijing
Contact personZHANG Nan
Telephone010-88027267
Credit rating agencyNameShanghai Brilliance Credit Rating & Investors Service Co., Ltd.
Office address14/F Huasheng Tower, No.398 Hankou Road, Shanghai

Other statement:

□Applicable √N/A

III Use of funds raised from corporate bonds

√Applicable □N/A

RMB800mn of funds were raised from the 2019 corporate bond (Phase I). TheCompany has used the funds after deduction of issuance fees to repay itsinterest-bearing liabilities in accordance with the plan for the use of raised funds asagreed in the prospectus.RMB700mn of funds were raised from the 2019 corporate bond (Phase II). TheCompany has used the funds after deduction of issuance fees to repay itsinterest-bearing liabilities in accordance with the plan for the use of raised funds asagreed in the prospectus.

IV Credit ratings of corporate bonds

√Applicable □N/A

Shanghai Brilliance Credit Rating & Investors Service Co., Ltd. issued the CreditRating Surveillance Report on Zhejiang China Commodities City Group Co., Ltd.

and the 2019 CCC 01 and 2019 CCC 02 [Brilliance Surveillance (2020) 100930] onJun 29, 2020. The Company had an issuer rating of AAA with stable outlook, andthe bonds had a rating of AAA.V Credit enhancement mechanism for corporate bonds, bond repaymentplans and other related matters during the reporting period

√Applicable □N/A

During the reporting period, there was no change to the credit enhancementmechanism, bond repayment plans or other bond repayment protection measuresfor the corporate bonds issued by the Company. In order to fully and effectivelyprotect the bondholders’ interests, the Company has made a series of plans andarrangements for the timely and full repayment of the corporate bonds, includingdetermining the specific department and personnel to be in charge, opening aspecial bond repayment account, formulating and strictly implementing the cashmanagement plan, making proper organization and coordination, giving full play tothe role of the bond trustee and strictly performing the information disclosureobligation to develop a set of measures to ensure interest payment and principalrepayment for the bonds.VI Convention of bondholders’ meetings

□Applicable √N/A

VII Performance of duties by the bond trustee of the Company’s corporatebonds

√Applicable □N/A

The trustee of the Company’s corporate bonds, Haitong Securities Co., Ltd., duringthe reporting period, performed its duty as the trustee in compliance with theAdministrative Measures for the Issuance and Trading of Corporate Bonds, theRules for Listing of Corporate Bonds on Shanghai Stock Exchange, the Code ofConduct for Trustees of Corporate Bonds and other related laws and regulations,including but not limited to paying continuing attention to the Company’s creditstatus and supervising the receipt, deposit, transfer of the funds raised from thecorporate bonds, principal repayment and interest payment in the Company’sdesignated special account.VIII The following accounting data and financial indicators as of the end of thereporting period and the end of 2019 (or as of the end of the currentreporting period or the end of the same period in the previous year)

√Applicable □N/A

Unit: RMB

Major indicatorAs of the end of the current reporting periodAs of the end of 2019Change from the end of 2019 (%)Reasons for change
Current ratio119.74%120.44%-0.70 percentage points
Quick ratio84.80%87.12%-2.32 percentage points
Debt-to-asset ratio (%)56.9958.23-1.24 percentage points
Loan repayment rate (%)100.00100.00
Current reporting period (Jan-Jun)Same period in the previous yearYoY change (%)Reasons for change
EBITDA-to-interest coverage ratio5.235.99-0.76
Interest payment rate (%)100.00100.00

IX Overdue debts

□Applicable √N/A

X Payment of interest and repayment of principal for other bonds and debtfinancing instruments of the Company

√Applicable □N/A

1. The Company issued a 270-day super-short-term commercial paper of RMB1bnat an annual interest rate of 3.30% on Aug 29, 2019. The lead underwriter wasChina Merchants Bank Co., Ltd. and the joint underwriter was Industrial andCommercial Bank of China Co., Ltd.. The Company repaid the principal and paidthe interest for the bond upon its maturity on May 29, 2020.

2. The Company issued a 180-day super-short-term commercial paper of RMB1bnat an annual interest rate of 2.89% on Feb 18, 2020. The lead underwriter wasAgricultural Bank of China Co., Ltd. and the joint underwriter was Bank of NingboCo., Ltd.. The bond has not matured yet.

3. The Company issued a 120-day super-short-term commercial paper of RMB1bnat an annual interest rate of 1.97% on May 14, 2020. The lead underwriter wasChina Construction Bank Co., Ltd. and the joint underwriter was Export-Import Bankof China Co., Ltd.. The bond has not matured yet.XI Lines of credit from banks during the reporting period

√Applicable □N/A

As of the end of the reporting period, the Company had been granted by banks linesof credit with an aggregate amount of RMB10bn, RMB4.264bn of which was usedand RMB5.736bn was unused.

XII Execution of promises or commitments in the prospectus of the

Company’s corporate bonds during the reporting period

√Applicable □N/A

During the reporting period, the Company strictly fulfilled the promises orcommitments in the prospectus of the Company’s corporate bonds, used the raisedfunds in compliance therewith, and paid interest of the corporate bonds in time,without prejudice to the interests of bond investors.XIII Significant matters of the Company and impact thereof on the Company’soperation and solvency

√Applicable □N/A

The 22.667% equity in Hunan Provincial Asset Management Co., Ltd. held by theindustry fund Yiwu Shangfu Chuangzhi Investment Center (limited partnership), forwhich the Company’s wholly-owned subsidiary CCCF subscribed, was frozen bythe Public Security Bureau of Shanghai for a term from Sep 6, 2018 until Sep 6,2019. For details, please refer to the Announcement of China Commodities City onthe Freezing of the Investment Project of the Industry Fund Subscribed for by ChinaCommodities City Financial Holdings (Announcement code: Temporary 2018-045)disclosed on the website of Shanghai Stock Exchange www.sse.com.cn.In 2019, the 22.667% equity held by Yiwu Shangfu Chuangzhi Investment Center(limited partnership) in Hunan Provincial Asset Management Co., Ltd. kept beingfrozen by the Public Security Bureau of Shanghai for a term from Sep 6, 2019 untilMar 5, 2020. For details, please refer to the Announcement on the Progress of theFreezing of the Investment Project of the Industry Fund Subscribed for by ChinaCommodities City Financial Holdings (Announcement Code: Temporary 2019-067)disclosed on the website of Shanghai Stock Exchange www.sse.com.cn.On Mar 6, 2020, the 22.667% equity held by Yiwu Shangfu Chuangzhi InvestmentCenter (limited partnership) in Hunan Provincial Asset Management Co., Ltd. keptbeing frozen by the Public Security Bureau of Shanghai for a term from Mar 6, 2020until Sep 5, 2020. For details, please refer to the Announcement of ChinaCommodities City on the Freezing of the Investment Project of the Industry FundSubscribed for by China Commodities City Financial Holdings (Announcement code:

Temporary 2020-010) disclosed on the website of Shanghai Stock Exchangewww.sse.com.cn.The amount involved in the freezing of the investment project of the industry fundsubscribed for by CCCF occupied a small share in the Company’s total assets andrevenue. Therefore, it would not have materially adverse impact on the Company’soperation and solvency.

Section X Financial Report

I Auditor’s report

□Applicable √N/A

II Financial statements

Consolidated Balance Sheet

Jun 30, 2020Prepared by: Zhejiang China Commodities City Group Co., Ltd.

Unit: RMB

ItemNoteJun 30, 2020Dec 31, 2019
Current assets:
Cash and cash equivalents7,180,175,472.376,486,408,651.88
Held-for-trading financial assets32,092,542.4538,077,703.92
Accounts receivable229,234,716.0716,031,078.05
Prepayments183,821,744.6844,678,187.98
Other receivables2,501,241,301.061,397,228,398.98
In which: interest receivable136,159,029.06191,064,382.11
Inventory4,532,687,980.474,296,061,444.25
Other current assets872,056,057.973,099,955,902.50
Total current assets15,531,309,815.0715,378,441,367.56
Non-current assets:
Long-term receivables93,650,436.1561,250,000.00
long-term equity investment1,906,728,774.141,771,420,054.57
Other equity instruments investment633,408,055.13642,187,968.78
Other non-current financial assets1,557,418,628.601,519,449,439.02
Property investment2,335,181,557.641,863,218,356.40
Fixed assets5,306,898,046.334,783,819,070.71
Construction in progress336,579,220.70865,754,600.02
Intangible assets3,836,072,536.983,456,137,246.02
Long-term prepaid expenses105,894,632.01139,502,382.87
Deferred income tax assets170,417,324.88180,404,801.30
Other non-current assets160,753,316.00661,648,707.19
Total non-current assets16,443,002,528.5615,944,792,626.88
Total assets31,974,312,343.6331,323,233,994.44
Current liabilities:
Short-term borrowings3,577,474,227.224,178,903,704.82
Accounts payable690,477,218.81525,241,493.48
Advances from customers18,672,952.844,508,455,128.63
Contract liabilities4,403,754,987.450.00
Payroll payable71,026,158.06197,174,419.96
Tax payable86,482,536.21280,184,253.26
Other payables759,474,210.61909,483,132.47
Non-current liabilities due within one year320,364,833.35270,332,413.94
Other current liabilities3,042,820,666.592,023,012,118.22
Total current liabilities12,970,547,791.1412,892,786,664.78
Non-current liabilities:
Long-term borrowings370,448,777.78530,694,313.98
Bonds payable4,625,150,185.914,564,291,387.81
Estimated liabilities110,620,306.10110,620,306.10
Deferred income28,756,014.1427,966,750.98
Deferred income tax liabilities115,854,113.53112,574,338.69
Other non-current liabilities1,148.89
Total non-current liabilities5,250,829,397.465,346,148,246.45
Total liabilities18,221,377,188.6018,238,934,911.23
Owners’ equity (or shareholders’ equity)
Paid-in capital (or share capital)5,443,214,176.005,443,214,176.00
Capital reserve1,508,224,328.831,524,183,779.64
Other comprehensive income59,416,179.8166,267,192.74
Surplus reserve1,236,166,911.811,236,166,911.81
Undistributed profits5,470,382,697.834,750,787,389.17
Total equity attributable to owners (shareholders) of the parent company13,717,404,294.2813,020,619,449.36
Minority interest35,530,860.7563,679,633.85
Total owners’ equity (or shareholders’ equity)13,752,935,155.0313,084,299,083.21
Total liabilities and owners’ equity (or shareholders’ equity)31,974,312,343.6331,323,233,994.44

Legal representative: ZHAO Wenge Person in charge of accounting: WANG Dong Person incharge of the accounting body: ZHAO Difang

Balance Sheet of Parent Company

Jun 30, 2020Prepared by: Zhejiang China Commodities City Group Co., Ltd.

Unit: RMB

ItemNoteJun 30, 2020Dec 31, 2019
Current assets:
Cash and cash equivalents6,748,814,610.376,312,119,746.26
Held-for-trading financial assets16,049.671,211.14
Accounts receivable26,821,273.412,381,698.23
Accounts receivable financing0.000.00
Prepayments49,755,429.6811,914,907.36
Other receivables2,193,799,656.481,280,138,618.41
In which: interest receivable98,225,073.23134,543,859.25
Inventory10,102,415.366,622,207.78
Other current assets3,458,085,275.624,252,429,806.32
Total current assets12,487,394,710.5911,865,608,195.50
Non-current assets:
Long-term receivables61,250,000.0061,250,000.00
long-term equity investment7,394,353,341.946,886,096,995.77
Other equity instruments investment633,408,055.13642,187,968.78
Other non-current financial assets357,696,705.19371,736,330.52
Property investment1,553,272,163.711,062,037,085.45
Fixed assets4,472,530,982.433,929,018,558.56
Construction in progress226,954,881.00780,166,171.12
Intangible assets3,712,506,172.273,331,543,646.76
Long-term prepaid expenses43,495,273.4663,262,990.25
Deferred income tax assets69,376,871.6594,333,102.87
Other non-current assets15,500,000.00519,850,000.00
Total non-current assets18,540,344,446.7817,741,482,850.08
Total assets31,027,739,157.3729,607,091,045.58
Current liabilities:
Short-term borrowings3,577,474,227.224,178,903,704.82
Accounts payable153,082,065.62208,383,192.69
Advances from customers4,043,841.102,918,036,408.24
Contract liabilities1,569,052,064.600.00
Payroll payable59,895,491.96162,095,870.71
Tax payable160,025,080.54280,400,924.97
Other payables553,820,632.89618,839,560.98
In which: interest payable2,320,084.41602,658.03
Non-current liabilities due within one year320,364,833.35270,332,413.94
Other current liabilities6,076,747,752.003,044,639,789.79
Total current liabilities12,474,505,989.2811,681,631,866.14
Non-current liabilities:
Long-term borrowings370,448,777.78530,694,313.98
Bonds payable4,625,150,185.914,564,291,387.81
Estimated liabilities110,620,306.10110,620,306.10
Deferred income27,256,014.1427,966,750.98
Deferred income tax liabilities88,277,050.2392,975,854.98
Other non-current liabilities0.00187.73
Total non-current liabilities5,221,752,334.165,326,548,801.58
Total liabilities17,696,258,323.4417,008,180,667.72
Owners’ equity (or shareholders’ equity)
Paid-in capital (or share capital)5,443,214,176.005,443,214,176.00
Capital reserve1,488,096,614.191,489,516,614.19
Other comprehensive income59,836,968.1066,421,903.33
Surplus reserve1,236,113,435.981,236,113,435.98
Undistributed profits5,104,219,639.664,363,644,248.36
Total owners’ equity (shareholders’ equity)13,331,480,833.9312,598,910,377.86
Total liabilities and owners’ equity (or shareholders’ equity)31,027,739,157.3729,607,091,045.58

Legal representative: ZHAO Wenge Person in charge of accounting: WANG Dong Person incharge of the accounting body: ZHAO Difang

Consolidated Income Statement

Jan-Jun 2020

Unit: RMB

ItemNote1H201H19
I. Gross revenue2,121,448,794.311,803,596,554.74
In which: revenue2,121,448,794.311,803,596,554.74
II. Gross cost1,277,687,351.73989,226,948.18
In which: cost of sales869,227,556.47642,682,794.18
Taxes and surcharges81,768,664.4989,069,721.05
Sales expenses87,887,071.8647,375,102.54
Administrative expenses130,450,924.63116,426,201.46
R&D expenses17,081,225.945,967,667.36
Financial expenses91,271,908.3487,705,461.59
In which: interest expenses234,530,903.42223,018,844.81
Interest income120,683,282.59131,284,052.33
Plus: other income13,684,424.063,593,440.80
Investment income (loss is indicated by “-”)119,150,641.2556,649,194.91
In which: income from investment in associates and joint ventures13,185,907.4927,183,714.48
Changes in fair value (loss is indicated by “-”)20,193,509.585,642,525.18
Credit impairment loss (loss is indicated by “-”)-2,379,335.67-5,552,323.74
Assets impairment loss (loss is indicated by “-”)0.00639,659.42
Income from disposal of assets (loss is indicated by “-”)1,095,496.24-78,794.35
III. Operating profit (loss is indicated by “-”)995,506,178.04875,263,308.78
Plus: income from non-operating activities753,575.181,623,558.60
Less: expenses from non-operating activities3,230,897.12746,151.28
IV. Profits before tax (loss is indicated by “-”)993,028,856.10876,140,716.10
Less: income tax272,987,186.07207,057,697.90
V. Net profits (net loss is indicated by “-”)720,041,670.03669,083,018.20
(I) Categorized by continuity of operation
1. Net profits from continuing operation (net loss is indicated by “-”)720,041,670.03669,083,018.20
(II) Categorized by ownership
1. Net profits attributable to shareholders of the parent company (net loss is indicated by “-”)719,595,308.66673,681,239.39
2. Minority interest(net loss is indicated by “-”)446,361.37-4,598,221.19
VI. Other comprehensive income, net of tax-6,851,012.9388,455,940.29
(I) Other comprehensive income attributable to owners of the parent company, net of tax-6,851,012.9388,455,940.29
1. Other comprehensive income that cannot be reclassified as profits or loss-6,584,935.2388,426,273.04
(3) Changes in fair value of investments in other equity instruments-6,584,935.2388,426,273.04
2 . Other comprehensive income that will be reclassified as profits or loss-266,077.7029,667.25
(6) Difference arising from the translation of foreign currency financial statements-266,077.7029,667.25
VII. Total comprehensive income713,190,657.10757,538,958.49
(I) Total comprehensive income attributable to owners of the parent company712,744,295.73762,137,179.68
(II) Total comprehensive income attributable to minority shareholders446,361.37-4,598,221.19
VIII. Earnings per share:
(I) Basic earnings per share0.130.12
(II) Diluted earnings per share0.130.12

For merger of the enterprises under common control during the current period, net profits of themerged party prior to the merger were RMB 0, and net profits of the merged party during theprevious period were RMB 0.Legal representative: ZHAO Wenge Person in charge of accounting: WANG Dong Person incharge of the accounting body: ZHAO Difang

Income Statement of Parent Company

Jan-Jun 2020

Unit: RMB

ItemNote1H201H19
I. Revenue1,662,962,086.901,559,477,764.56
Less: cost of sales417,683,630.26473,294,334.89
Taxes and surcharges65,927,422.2763,338,458.90
Sales expenses71,698,416.1134,751,998.43
Administrative expenses68,180,551.7668,815,752.68
R&D expenses0.000.00
Financial expenses93,978,042.4389,545,189.66
In which: interest expenses234,530,903.42223,018,844.81
Interest income119,943,387.77130,758,727.73
Plus: other income8,427,874.931,921,576.37
Investment income (loss is indicated by “-”)43,373,764.99193,096,367.40
In which: income from investment in associates and joint ventures22,242,937.96164,367,325.33
Income from changes in fair value (loss is indicated by “-”)-11,815,305.335,642,525.18
Credit impairment loss (loss is indicated by “-”)-75,439.45-1,413,587.00
Income from disposal of assets (loss is indicated by “-”)-776.57-86,174.15
II. Operating profits (loss is indicated by “-”)985,404,142.641,028,892,737.80
Plus: income from non-operating activities469,374.661,472,052.72
Less: expenses from non-operating activities1,413,092.81703,390.17
III. Profits before tax (loss is indicated by “-”)984,460,424.491,029,661,400.35
Less: income tax243,885,033.19197,548,738.20
IV. Net profits (net loss is indicated by “-”)740,575,391.30832,112,662.15
(I) Categorized by continuity of operation(net loss is indicated by “-”)740,575,391.30832,112,662.15
V. Other comprehensive income, net of tax-6,584,935.2388,426,273.04
(I) Other comprehensive income that cannot be reclassified as profit or loss-6,584,935.2388,426,273.04
3. Changes in fair value of investments in other equity instruments-6,584,935.2388,426,273.04
VI. Total comprehensive income733,990,456.07920,538,935.19
VII. Earnings per share:
(I) Basic earnings per share0.140.15
(II) Diluted earnings per share0.140.15

Legal representative: ZHAO Wenge Person in charge of accounting: WANG Dong Person incharge of the accounting body: ZHAO Difang

Consolidated Cash Flow Statement

Jan-Jun 2020

Unit: RMB

ItemNote1H201H19
I. Cash flow from operating activities:
Cash received from sale of goods and rendering of services1,607,591,030.141,476,568,920.71
Other cash receipts relating to operating activities142,203,534.16259,877,358.98
Sub-total of cash inflow from operating activities1,749,794,564.301,736,446,279.69
Cash paid for goods and services728,107,752.48769,062,206.11
Cash paid to and on behalf of employees335,913,290.70284,631,678.65
Payments of taxes637,729,363.85486,166,592.02
Other cash payments relating to operating activities751,110,857.43272,419,834.80
Sub-total of cash outflow from operating activities2,452,861,264.461,812,280,311.58
Net cash flow from operating activities-703,066,700.16-75,834,031.89
II. Cash flow from investing activities:
Cash received from recovery of investment2,247,254,852.562,493,332,727.90
Cash received from investment income21,358,547.5828,724,313.19
Other cash receipts relating to investing activities192,154,897.34
Sub-total of cash inflow from investing activities2,460,768,297.482,522,057,041.09
Cash paid to acquire and construct fixed assets, intangible assets and other long-term assets1,193,403,588.05510,756,044.48
Cash paid to acquire investments650,338,982.384,626,282,489.59
Sub-total of cash outflow from investing activities1,843,742,570.435,137,038,534.07
Net cash flow from investing activities617,025,727.05-2,614,981,492.98
III. Cash flow from financing activities:
Cash received from borrowings4,490,000,000.005,523,718,080.00
Cash received from bond issuance1,999,200,628.923,800,000,000.00
Sub-total of cash inflow from financing activities6,489,200,628.929,323,718,080.00
Cash paid for debts repayment6,200,000,000.006,425,000,000.00
Cash paid for distribution of dividends or profits or payment of interest159,190,038.50326,407,444.27
In which: dividends or profits paid by subsidiaries to minority shareholders114,400.00
Sub-total of cash outflow from financing activities6,359,190,038.506,751,407,444.27
Net cash flow from financing activities130,010,590.422,572,310,635.73
IV. Effect of foreign exchange rate changes on cash and cash equivalents
V. Net increase in cash and cash equivalents43,969,617.31-118,504,889.14
Plus: opening balance of cash and cash equivalents3,426,712,549.262,632,160,386.99
VI. Closing balance of cash and cash equivalents3,470,682,166.572,513,655,497.85

Legal representative: ZHAO Wenge Person in charge of accounting: WANG Dong Person incharge of the accounting body: ZHAO Difang

Cash Flow Statement of Parent Company

Jan-Jun 2020

Unit: RMB

ItemNote1H201H19
I. Cash flow from operating activities:
Cash received from sale of goods and rendering of services215,927,804.72940,381,616.60
Other cash receipts relating to operating activities136,220,582.47226,993,031.71
Sub-total of cash inflow from operating activities352,148,387.191,167,374,648.31
Cash paid for goods and services244,988,576.96163,735,765.13
Cash paid to and on behalf of employees227,142,936.38214,599,730.27
Payments of taxes433,944,546.40357,990,217.95
Other cash payments relating to operating activities504,258,445.05137,556,845.36
Sub-total of cash outflow from operating activities1,410,334,504.79873,882,558.71
Net cash flow from operating activities-1,058,186,117.60293,492,089.60
II. Cash flow from investing activities:
Cash received from recovery of investments2,243,593,538.472,053,332,727.90
Cash received from investment income21,358,547.5827,987,874.83
Other cash receipts relating to investing activities135,595,485.59
Sub-total of cash inflow from investing activities2,400,547,571.642,081,320,602.73
Cash paid to acquire and construct fixed assets, intangible assets and other long-term assets1,114,320,349.50201,898,274.23
Cash paid to acquire investments415,508,687.714,996,518,435.13
Sub-total of cash outflow from investing activities1,529,829,037.215,198,416,709.36
Net cash flow from investing activities870,718,534.43-3,117,096,106.63
III. Cash flow from financing activities:
Cash received from borrowings4,490,000,000.005,523,718,080.00
Cash received from bond issuance1,999,200,628.923,800,000,000.00
Sub-total of cash inflow from financing activities6,489,200,628.929,323,718,080.00
Cash paid for debts repayment6,200,000,000.006,425,000,000.00
Cash paid for distribution of dividends or profits or payment of interest158,618,038.50326,407,444.27
Sub-total of cash outflow from financing activities6,358,618,038.506,751,407,444.27
Net cash flow from financing activities130,582,590.422,572,310,635.73
IV. Effect of foreign exchange rate changes on cash and cash equivalents
V. Net increase in cash and cash equivalents-56,884,992.75-251,293,381.30
Plus: opening balance of cash and cash equivalents3,305,541,700.682,516,202,566.17
VI. Closing balance of cash and cash equivalents3,248,656,707.932,264,909,184.87

Legal representative: ZHAO Wenge Person in charge of accounting: WANG Dong Person incharge of the accounting body: ZHAO Difang

Statement of Changes in Consolidated Owners’ Equity

Jan-Jun 2020

Unit: RMB

Item1H20
Equity attributable to owners of the parent companyMinority interestTotal owners’ equity
Paid-in capital (share capital)Capital reserveOther comprehensive incomeSurplus reserveUndistributed profitsSub-total
I. Closing balance of the previous year5,443,214,176.001,524,183,779.6466,267,192.741,236,166,911.814,750,787,389.1713,020,619,449.3663,679,633.8513,084,299,083.21
II. Opening balance of the current year5,443,214,176.001,524,183,779.6466,267,192.741,236,166,911.814,750,787,389.1713,020,619,449.3663,679,633.8513,084,299,083.21
III. YoY change (decrease is indicated by “-”)-15,959,450.81-6,851,012.93719,595,308.66696,784,844.92-28,148,773.10668,636,071.82
(I) Total comprehensive income-6,851,012.93719,595,308.66712,744,295.73446,361.37713,190,657.10
(II)Owners’ contribution to and reduction in capital-15,959,450.81-15,959,450.81-28,595,134.47-44,554,585.28
1.Common shares contributed by owners-4,000,000.004,000,000.00
4.Others-15,959,450.81-15,959,450.81-32,595,134.47-48,554,585.28
IV. Closing balance of the current period5,443,214,176.001,508,224,328.8359,416,179.811,236,166,911.815,470,382,697.8313,717,404,294.2835,530,860.7513,752,935,155.03
Item1H19
Equity attributable to owners of the parent companyMinority interestTotal owners’ equity
Paid-in capital (share capital)Capital reserveOther comprehensive incomeSurplus reserveUndistributed profitsSub-total
I. Closing balance of the previous year5,443,214,176.001,520,831,406.81-32,317,790.351,086,808,237.883,957,969,914.5411,976,505,944.8862,990,540.9712,039,496,485.85
II. Opening balance of the current year5,443,214,176.001,520,831,406.81-32,317,790.351,086,808,237.883,957,969,914.5411,976,505,944.8862,990,540.9712,039,496,485.85
III. YoY change (decrease is indicated-322,000.0088,421,605.57347,088,388.83435,187,994.40-4,598,221.19430,589,773.21
by “-”)
(I) Total comprehensive income-322,000.0088,421,605.57673,681,239.39761,780,844.96-4,598,221.19757,182,623.77
(III) Profits distribution-326,592,850.56-326,592,850.56-326,592,850.56
3.Distribution to owners (or shareholders)-326,592,850.56-326,592,850.56-326,592,850.56
IV. Closing balance of the current period5,443,214,176.001,520,509,406.8156,103,815.221,086,808,237.884,305,058,303.3712,411,693,939.2858,392,319.7812,470,086,259.06

Legal representative: ZHAO Wenge Person in charge of accounting: WANG Dong Person in charge of the accounting body: ZHAO Difang

Statement of Changes in Owners’ Equity of Parent Company

Jan-Jun 2020

Unit: RMB

Item1H20
Paid-in capital (share capital)Capital reserveOther comprehensive incomeSurplus reserveUndistributed profitsTotal owners’ equity
I. Closing balance of the previous year5,443,214,176.001,489,516,614.1966,421,903.331,236,113,435.984,363,644,248.3612,598,910,377.86
II. Opening balance of the current year5,443,214,176.001,489,516,614.1966,421,903.331,236,113,435.984,363,644,248.3612,598,910,377.86
III. YoY change (decrease is indicated by “-”)--1,420,000.00-6,584,935.23-740,575,391.30732,570,456.07
(I) Total comprehensive income---6,584,935.23-740,575,391.30733,990,456.07
(II)Owners’ contribution to and reduction in capital--1,420,000.00----1,420,000.00
4.Others-1,420,000.00----1,420,000.00
IV. Closing balance of the current period5,443,214,176.001,488,096,614.1959,836,968.101,236,113,435.985,104,219,639.6613,331,480,833.93
Item1H19
Paid-in capital (share capital)Capital reserveOther comprehensive incomeSurplus reserveUndistributed profitsTotal owners’ equity
I. Closing balance of the previous year5,443,214,176.001,489,516,614.19-32,352,125.071,086,754,762.053,329,531,950.8211,316,665,377.99
II. Opening balance of the current year5,443,214,176.001,489,516,614.19-32,352,125.071,086,754,762.053,329,531,950.8211,316,665,377.99
III. YoY change (decrease is indicated by “-”)88,426,273.04487,741,922.95576,168,195.99
(I) Total comprehensive income88,426,273.04832,112,662.16920,538,935.20
(III) Profits distribution-326,592,850.56-326,592,850.56
1.Withdrawal of surplus reserve-326,592,850.56-326,592,850.56
(VI) Others-17,777,888.65-17,777,888.65
IV. Closing balance of the current period5,443,214,176.001,489,516,614.1956,074,147.971,086,754,762.053,817,273,873.7711,892,833,573.98

Legal representative: ZHAO Wenge Person in charge of accounting: WANG Dong Person in charge of the accounting body: ZHAO Difang

III Basic information of the Company

1. Company profile

√Applicable □N/A

Zhejiang China Commodities City Group Co., Ltd. (the “Company”) is a companylimited by share and was incorporated on Dec 28, 1993 in Zhejiang province of thePeople’s Republic of China. The RMB-denominated common A shares issued bythe Company got listed on Shanghai Stock Exchange on May 9, 2002. TheCompany is headquartered at No.105 Futian Road, Yiwu, Zhejiang.The Group is mainly engaged in market development, operation and auxiliaryservices, development, sale and trade of real estate properties, provision of onlinetrading platforms and services, and development and operation of online tradingmarkets, and belongs to the comprehensive industry.The parent company of the Group is Yiwu China Commodities City Holdings Limited(hereinafter referred to as “CCCH”) and the final controller of the Group is theState-owned Assets Supervision and Administration Office of the People’sGovernment of Yiwu.

2. Consolidation scope of financial statements

√Applicable □N/A

The consolidation of financial statements is determined on the basis of control. Forthe changes in the current year, please refer to Note VIII.IV Basis of preparation of financial statements

1. Basis of preparation

The financial statements of the Company were prepared on a going-concern basis.The financial statements were prepared in accordance with the AccountingStandards for Enterprises-Basic Standards and the specific accounting standards,application guidelines, interpretations and other related regulations promulgatedand amended thereafter (collectively referred to as “Accounting Standards”).The financial statements were all prepared based on the valuation principle ofhistorical cost, except for certain financial instruments. In case of assets impairment,corresponding provision was made in accordance with relevant provisions.

2. Going concern

√Applicable □N/A

The Company prepared its financial statements on a going-concern basis. Themanagement of the Company expected that the Group would generate adequatecash inflow from the future day-to-day operation, which in combination with theGroup’s adequate lines of credit from banks could be sufficient to repay its duedebts.V Important Accounting Policies and Accounting EstimatesReminders on specific accounting policies and accounting estimates:

√Applicable □N/A

The Group has formulated specific accounting policies and accounting estimatesbased on the characteristics of actual production and operation, which are mainlyreflected in the bad debt provisions for receivables, inventory valuation methods,depreciation of fixed assets, amortization of intangible assets, income recognitionand measurement, recognition of property investments and fixed assets, andservice life and residual value of fixed assets.

1. Statement of compliance with the Accounting StandardsThe financial statements prepared by the Company comply with the requirements ofthe Accounting Standards, and truly and completely reflect the Company’s financialconditions, operating results, changes in shareholders’ equity, cash flows and otherrelated information.

2. Accounting period

The Company’s accounting year is from Jan 1 to Dec 31 of each calendar year.

3. Operating cycle

√Applicable □N/A

Except for the real estate business, the Company’s businesses have shortoperating cycles and the 12-month cycle is used to classify current assets andcurrent liabilities. The operating cycle of the real estate business is generally longerthan 12 months from the development to sale and monetization and the specificcycle depends on the development projects. The operating cycle of the real estatebusiness would be used to classify current assets and current liabilities of thisbusiness.

4. Functional currency

The Company’s functional currency is RMB. The Group uses RMB as its functionalcurrency and in the preparation of financial statements. Unless specifically stated,all amounts are expressed in RMB.The subsidiaries, joint ventures and associates of the Group determine theirfunctional currencies at their own discretion based on the main economicenvironments in their places of businesses and convert all amounts into RMB whilepreparing financial statements.

5. Accounting methods for merger of the enterprises under common control

and merger of the enterprises not under common control

√Applicable □N/A

The mergers of enterprises are divided into the mergers of the enterprises undercommon control and mergers of the enterprises not under common control.Mergers of the enterprises under common controlMerger of the enterprises under common control refers to the merger of theenterprises that are under ultimate control of the same party or parties before andafter the merger and the control is not temporary. For a merger of the enterprisesunder common control, the party obtaining control over the other(s) involved in themerger on the date of merger is the merging party and the other(s) is(are) themerged party. The date of merger refers to the date when the merging party actuallyobtains control over the merged party.The assets and liabilities acquired by the merging party in a merger of theenterprises under common control (including the goodwill formed through theacquisition of the merged party by the ultimate controller) are accounted accordingto the book value thereof in the ultimate controller’s financial statements on the dateof merger. For the difference between the book value of the net assets obtained bythe merging party and the book value of the consideration paid for the merger (orthe total nominal value of the shares issued), the share capital premium in thecapital reserve shall be adjusted; if the share capital premium is not sufficient toabsorb the difference, the retained earnings shall be adjusted.Mergers of the enterprises not under common controlMerger of the enterprises not under common control refers to the merger of theenterprises that are not under ultimate control of the same party or parties beforeand after the merger. For a merger of the enterprises not under common control, theparty obtaining control over the other(s) involved in the merger on the date ofacquisition is the acquirer and the other(s) is(are) the acquiree. The date of

acquisition refers to the date when the acquirer actually obtains control over theacquiree.The acquiree’s identifiable assets, liabilities and contingent liabilities obtained fromthe merger of the enterprises not under common control are measured at their fairvalues on the date of acquisition.If the sum of the fair value of the consideration paid for the merger (or fair value ofthe equity securities issued) and the fair value of the acquiree’s equity held beforethe date of acquisition is higher than the share in the fair value of the acquiree’sidentifiable net assets acquired from the merger, the difference between them isrecognized as goodwill, which will be subsequently measured by the cost lessaccumulated impairment loss. If the sum of the fair value of the consideration paidfor the merger (or fair value of the equity securities issued) and the fair value of theacquiree’s equity held before the date of acquisition is lower than the share in thefair value of the acquiree’s identifiable net assets acquired from the merger, themeasurement of the fair value of the acquiree’s identifiable assets, liabilities andcontingent liabilities, the fair value of the consideration paid for the merger (or fairvalue of the equity securities issued) and the fair value of the acquiree’s equity heldbefore the date of acquisition will be reviewed, and if the sum of the fair value of theconsideration paid for the merger (or fair value of the equity securities issued) andthe fair value of the acquiree’s equity held before the date of acquisition is still lowerthan the share in the fair value of the acquiree’s identifiable net assets acquiredfrom the merger after such review, the difference will be recognized in the profit orloss for the current period.For mergers of the enterprises not under common control that are executed throughmultiple transactions, the long-term equity investment of the acquiree before thedate of acquisition shall be re-measured based on the fair value thereof on the dateof acquisition and any difference between the fair value and book value thereofshall be recognized in the profit or loss for the current period; other comprehensiveincome from the long-term equity investment of the acquiree before the date ofacquisition under the equity method shall be accounted on the same basis as thatfor the direct disposal of related assets or liabilities by the investee, and otherchanges in shareholders’ equity than net gains or losses, other comprehensiveincome and profit distribution shall be recognized in the profit or loss for the periodwhere the date of acquisition falls.

6. Preparation method of consolidated financial statements

√Applicable □N/A

The financial statements to be consolidated is determined on the basis of control,including those of the Company and all of its subsidiaries. Subsidiaries refer to the

entities controlled by the Company (including the severable parts of enterprises andinvested entities, and the structured entities controlled by the Company).In the preparation of consolidated financial statements, the subsidiaries adopt thesame accounting year and accounting policies as those adopted by the Company.The assets, liabilities, equity, revenue, expenses and cash flows generated by alltransactions among the companies within the Group are offset in full when beingconsolidated.If the amount of loss for the current period attributable to the minority shareholdersof a subsidiary exceeds the minority shareholders’ share in the opening balance ofshareholders’ equity in the subsidiary, the excess will still be recognized againstminority interest.For a subsidiary acquired through the merger of enterprises not under commoncontrol, the operating results and cash flow of the acquiree will be consolidated asfrom the Group obtaining control over the acquiree until termination of such control.In the preparation of consolidated financial statements, adjustments will be made tothe financial statements of the subsidiary based on the fair value of its identifiableassets, liabilities or contingent liabilities determined on the date of acquisition.For a subsidiary acquired through the merger of enterprises under common control,the operating results and cash flow of the acquiree will be consolidated as from thestart of the reporting period when the merger happens. In the preparation ofconsolidated financial statements, adjustments will be made to the related items inits previous financial statements as if the reporting entity formed after the mergerhas been existing as from the ultimate controller starts to exercise control.In case of any change to one or more elements of the control due to the changes inrelated facts and circumstances, the Group will re-evaluate whether to control theinvestee.

7. Classification of joint arrangements and accounting treatment of jointoperations

√Applicable □N/A

Joint arrangements are divided into joint operations and joint ventures. Jointoperation refers to a joint arrangement in which the parties thereto enjoy the assetsrelating to such arrangement and assume the liabilities relating to sucharrangement. Joint venture refers to a joint arrangement in which the parties theretoonly enjoy rights to the net assets in this arrangement.Each party to a joint arrangement recognizes the following items relating to its sharein the joint operation: assets held individually by it and assets held jointly based onits share; liabilities assumed individually by it and liabilities assumed jointly based

on its share; revenue from the sale of its share in the output of the joint operation;revenue from the sale of the output of the joint operation based on its share;expenses incurred individually by it and expenses incurred by the joint operationbased on its share.

8. Criteria for the identification of cash and cash equivalentsCash equivalents refer to the short-term (generally three months from the date ofpurchase) and highly liquid investments that are readily convertible to knownamounts of cash and have a very low risk of change in value.

9. Foreign currency transactions and translation of foreign currencyfinancial statements

√Applicable □N/A

For foreign currency transactions, the Group will translate the foreign currencyamounts into its functional currency amounts.In the initial recognition of a foreign currency transaction, the foreign currencyamount is translated to a functional currency amount according to the spotexchange rate on the date of transaction. On the balance sheet date, the foreigncurrency monetary items are translated according to the spot exchange rate on thebalance sheet date. The translation difference between settlement and monetaryitems is recognized in the profit or loss for the current period, except for thedifference arising from the special foreign currency borrowing relating to theacquisition and construction of the assets qualified for capitalization, which will betreated based on the principles for the capitalization of borrowing expenses. Theforeign currency non-monetary items measured by historical cost are alsotranslated according to the spot exchange rate on the date of transaction, withoutchanging the functional currency amounts thereof. The foreign currencynon-monetary items measured by fair value are translated according to the spotexchange rate on the fair value determination date and the difference arisingtherefrom is recognized in the profit or loss or other comprehensive income for thecurrent period based on the nature of the items.The Group translates the functional currency of its foreign business into RMB whilepreparing the financial statements. The assets and liabilities items in the balancesheet are translated according to the spot exchange rate on the balance sheet date,the shareholders’ equity items are translated according to the spot exchange rate atthe occurrence of the items except for “undistributed profits”; revenue and expensesitems in the income statement are translated according to the average exchangerate during the period in which the transaction happens. The translation differencesof foreign currency statements arising from the above translations are recognizedas other comprehensive income. For the disposal of foreign business, other

comprehensive income relating to the foreign business is recognized in the profit orloss of the disposal for the current period and is calculated pro rata for partialdisposal.The foreign currency cash flow and cash flow of foreign subsidiaries are translatedaccording to the spot exchange rate on the occurrence date of cash flow/averageexchange rate during the period in which the cash flow occurs. The amount ofimpact of the changes in exchange rate on cash is separately stated in the cashflow statement as an adjustment item.

10. Financial instruments

√Applicable □N/A

Financial instruments refer to the contracts which form financial assets of anenterprise and form financial liabilities or equity instruments of other entities.Recognition and de-recognition of financial instrumentsThe Group recognizes a financial asset or financial liability at the time of becominga party to a financial instrument contract.The Group will derecognize a financial asset (or a part of the financial asset or apart of a group of similar financial assets), i.e. writing off the asset from its accountand balance sheet, if:

(1) the right to collect cash flow from the financial asset has expired;

(2) the right to collect cash flow from the financial asset has been transferred, or theGroup is obligated to pay the cash flow collected to a third party in full and in timeunder a “transfer agreement”; and (a) it has substantially transferred almost all risksand return in connection with the title of the financial asset, or (b) although it has notsubstantially transferred nor retained almost all risks and return in connection withthe title of the financial asset, it has waived control over the asset.If a financial liability has been fulfilled, revoked or expired, it will be derecognized. Ifan existing financial liability is replaced by the same creditor with another financialliability under substantially different terms or the terms of the existing liability aresubstantially modified in whole, the existing liability will be derecognized and thenew liability will be recognized, and the difference will be recognized in the profit orloss for the current period.For the transactions of financial assets in regular ways, the recognition andde-recognition thereof will be conducted based on the accounting on the transactiondate. Transactions of financial assets in regular ways refer to the collection ordelivery of financial assets within the time limit prescribed by laws and regulation or

prevailing practices in accordance with the contract terms. The transaction daterefers to the date when the Group promises to buy or sell the financial assets.Classification and measurement of financial assetsBased on the Group’s business model for the management of financial assets andthe features of the contractual cash flow of financial assets, the Group’s financialassets are classified at initial recognition into the financial assets that are measuredby fair value and of which the changes in fair value are recognized in the profit orloss for the current period, the financial assets measured by amortized cost and thefinancial assets that are measured by fair value and of which the changes in fairvalue are recognized in other comprehensive income.If a financial asset is measured by fair value at initial recognition, but the accountsreceivable or notes receivable from the sale of goods or rendering of service do notinclude significant financing components or the financing components with a termno longer than one year are not considered, the initial measurement will be madebased on the transaction price.For the financial assets that are measured by fair value and of which the changes infair value are recognized in the profit or loss for the current period, the relatedtransaction fees will be directly recognized in the profit or loss for the current period;the related transaction fees of other financial assets will be recognized in the initiallyrecognized amounts thereof.The subsequent measurement of financial assets depends on the classificationthereof:

Investment in debt instruments measured by amortized costA financial asset is classified into those measured by amortized cost, if the businessmodel for the management of the asset is for the purpose of collecting contractualcash flow; and the terms of the contract of the asset stipulate that the cash flowgenerated on the specific date is only the repayment of principal and the payment ofinterest on the outstanding principal. The interest income of such financial assets isrecognized with the effective interest method, and the gains or losses from thede-recognition, modification or impairment thereof are all recognized in the profit orloss for the current period.Investment in the equity instruments that are measured by fair value and ofwhich the changes in fair value are recognized in other comprehensiveincomeThe Group has irrevocably chosen to designate some non-trading equity instrumentinvestments as the financial assets that are measured by fair value and of which thechanges in fair value are recognized in other comprehensive income. Only the

related dividend income (except for the dividend income expressly acting as arecovery of investment cost) is recognized in the profit or loss for the current period,while the subsequent changes in fair value are recognized in other comprehensiveincome, and no provision is required for impairment. When the financial assets arederecognized, the accumulated gains or losses previously recognized in othercomprehensive income will be moved out of other comprehensive income andrecognized in retained earnings.Financial assets that are measured by fair value and of which the changes infair value are recognized in the profit or loss for the current periodThe financial assets other than the above financial assets measured by amortizedcost and the above financial assets that are measured by fair value and of which thechanges in fair value are recognized in other comprehensive income are classifiedas the financial assets that are measured by fair value and of which the changes infair value are recognized in the profit or loss for the current period. Those financialassets are subsequently measured by fair value and all changes in the fair valuethereof are recognized in the profit or loss for the current period.Classification and measurement of financial liabilitiesThe Group’s financial liabilities are classified at initial recognition into the financialliabilities that are measured by fair value and of which the changes in fair value arerecognized in the profit or loss for the current period and other financial assets. Forthe financial liabilities that are measured by fair value and of which the changes infair value are recognized in the profit or loss for the current period, the relatedtransaction fees are recognized directly in the profit or loss for the current period,while the related transaction fees of other financial liabilities are recognized in theinitially recognized amounts thereof.The subsequent measurement of financial liabilities depends on the classificationthereof:

Financial liabilities that are measured by fair value and of which the changesin fair value are recognized in the profit or loss for the current periodThe financial liabilities that are measured by fair value and of which the changes infair value are recognized in the profit or loss for the current period include financialliabilities held for trading (including the derivative instruments as financial liabilities)and the liabilities that are designated at initial recognition as the financial liabilitiesthat are measured by fair value and of which the changes in fair value arerecognized in the profit or loss for the current period. The financial liabilities held fortrading (including the derivative instruments as financial liabilities) are subsequentlymeasured by fair value and all changes in the fair value are recognized in the profitor loss for the current period.

Other financial liabilitiesThose financial liabilities are subsequently measured by amortized cost with theeffective interest method.Impairment of financial instrumentsThe Group has treated and recognized the impairment of the financial assetsmeasured by amortized cost based on the expected credit loss.For the accounts receivable and contract assets without material financingcomponents, the Group uses a simplified method and measures the provision forloss based on the amount of expected credit loss during the entire term.For the financial assets not measured with the simplified method, the Groupevaluates on each balance sheet date whether their credit risks have increasedsignificantly since the initial recognition. If the credit risk of a financial asset has notincreased significantly since the initial recognition, the asset is in the first stage andthe Group will make provision for loss based on the amount of expected credit losswithin the coming 12 months and calculate interest income based on the bookbalance and effective interest rate; if the credit risk has increased significantly sincethe initial recognition, but credit has not been impaired, the asset is in the secondstage and the Group will make provision for loss equivalent to the amount ofexpected credit loss during the entire term and calculate interest income based onthe book balance and effective interest rate; if credit has been impaired after theinitial recognition, the asset is in the third stage and the Group will make provisionfor loss equivalent to the amount of expected credit loss during the entire term andcalculate interest income based on the amortized cost and effective interest rate.The Group evaluates the expected credit losses of financial instruments on theindividual and group bases. It evaluates the expected credit loss of accountsreceivable by taking into account the credit risk characteristics of different clientsand based on the account aging-based asset groups.For the disclosure of the Group’s criteria for a significant increase in credit risk,definition of the assets whose credit has been impaired and assumptions for themeasurement of expected credit loss, please refer to Notes X-2.When the Group no longer reasonably expects that it can recover the contractualcash flow of a financial asset in whole or in part, it will directly write down the bookbalance of the asset.

11. Notes receivable

Determination and accounting treatment of the expected credit loss of notesreceivable

√Applicable □N/A

Due to a short term, a low default risk and strong ability to pay contractual cash flowwithin a short time of notes receivable, the Company deems notes receivable as afinancial instrument with a low credit risk and directly assumes that the credit riskthereof has not increased significantly since the initial recognition. Considering thezero default in history, the Company makes no bad debt provision for notesreceivable.

12. Accounts receivable

Determination and accounting treatment of the expected credit loss ofaccounts receivable

√Applicable □N/A

Please refer to Notes X-2. Risks of Financial Instruments

13. Accounts receivable financing

□Applicable √N/A

14. Other receivables

Determination and accounting treatment of the expected credit loss of otherreceivables

√Applicable □N/A

Please refer to Notes X-2. Risks of Financial Instruments

15. Inventory

√Applicable □N/A

Inventory includes raw materials, work-in-progress materials, finished goods, realestate development costs and real estate development products.Inventory is initially measured by cost. The costs of inventory except developmentcosts and development products include the procurement cost, processing cost andother costs. The actual costs of items out of inventory are determined with theweighted average method. Work-in-progress materials include low-value

consumables and packages, which are amortized with the one-off amortizationmethod.Development costs refer to the properties that have not been completed and aredeveloped for the purpose of being sold. Development products refer to theproperties that have been completed and are ready for sale.The actual costs of real estate development costs and development productsinclude the land acquisition cost, expenditures on construction and installationworks, capitalized interest and other direct and indirect development expenses. Theuse right of the land for development purpose at the development of a project isamortized and recognized as the development cost of the project based on the sitearea of the development product, and the development cost will be changed over todevelopment product after being completed.If the public auxiliary facilities are completed earlier than the related developmentproduct, the facilities will be allocated to and recognized in the development cost ofrelated development project based on the floor space of the project after finalaccounting of the facilities upon completion; if the public auxiliary facilities arecompleted later than the related development product, they will be recognized in thedevelopment cost of related development project based on the predicted cost of thepublic auxiliary facilities.Hotel, catering and fresh goods inventories are subject to onsite inventory, whileother inventories are subject to perpetual inventory.On the balance sheet date, inventory is measured by cost and net realizable value,whichever is lower. If the cost is higher than the net realizable value, provision willbe made for inventory depreciation, which will be recognized in the profit or loss forthe current period. If the impact of the previous provision for inventory depreciationhas disappeared and the net realizable value of the inventory becomes higher thanthe book value thereof, the amounts written down previously in the original provisionfor inventory depreciation will be restituted and recognized in the profit or loss forthe current period.Net realizable value is the estimated selling price of inventory less the costestimated to occur as of completion, estimated sales expenses and related taxes. Inprinciple, provisions for inventory depreciation shall be made for inventory itemsindividually. For the inventory with a large quantity and a low unit price, inventorydepreciation provision will be made based on the groups of items.

16. Contract assets

(1) Determination and criteria for contract assets

□Applicable √N/A

(2) Determination and accounting treatment of the expected credit loss ofcontract assets

□Applicable √N/A

17. Held-for-sale assets

□Applicable √N/A

18. Debt investments

Determination and accounting treatment of the expected credit loss of debtinvestments

□Applicable √N/A

19. Other debt investments

Determination and accounting treatment of the expected credit loss of otherdebt investments

□Applicable √N/A

20. Long-term receivables

Determination and accounting treatment of the expected credit loss oflong-term receivables

□Applicable √N/A

21. Long-term equity investment

√Applicable □N/A

Long-term equity investment includes equity investment in subsidiaries, jointventures and associates.Long-term equity investment is initially measured by the initial investment cost atthe time of being acquired. For the long-term equity investment acquired throughthe merger of the enterprises under common control, the initial investment cost isthe share of the book value of the owners’ equity of the acquiree in the consolidatedfinancial statements of the ultimate controller on the date of merger; for thedifference between the initial investment cost and the book value of the mergerconsideration, capital reserve will be adjusted ( if the capital reserve is insufficientfor the difference, retained earnings will be adjusted). In the disposal of aninvestment, the other comprehensive income before the date of merger will betreated on the same basis as that for the direct disposal of related assets or

liabilities by the investee, and the shareholders’ equity recognized due to theinvestee’s other changes in shareholders’ equity than net profits or loss, othercomprehensive income and profit distribution will be recognized in the profit or lossfor the current period; to be specific, the portion that remains long-term equityinvestment after the disposal will be changed over pro rata, while the portion that isconverted to financial instruments after the disposal will be changed over in full. Forlong-term equity investment acquired through the merger of the enterprises notunder common control, the initial investment cost is the merger cost (for themergers of the enterprises not under common control that are executed throughmultiple transactions, the initial investment cost is the sum of the book value of theequity investment in the acquireee before the date of acquisition and the newinvestment cost on the date of acquisition). The merger cost is the sum of the fairvalues of the assets paid by the acquirer, the liabilities incurred or assumed by theacquirer and the equity securities offered by the acquirer. In the disposal of aninvestment, the other comprehensive income held before the date of acquisitionand recognized due to the adoption of the equity method will be treated on thesame basis as that for the direct disposal of related assets or liabilities by theinvestee, and the shareholders’ equity recognized due to the investee’s otherchanges in shareholders’ equity than net profits or loss, other comprehensiveincome and profit distribution will be recognized in the profit or loss for the currentperiod; to be specific, the portion that remains long-term equity investment after thedisposal will be changed over pro rata, while the portion that is converted tofinancial instruments after the disposal will be changed over in full. The initialinvestment costs of the long-term equity investment acquired other than throughmerger are determined with the following methods: if an investment is acquiredthrough the payment of cash, its initial investment cost consists of the purchaseprice actually paid and the expenses, taxes and other necessary expenses directlyrelating to the acquisition of the investment; and if an investment is acquiredthrough the offering of equity securities, its initial investment cost is the fair value ofthe equity securities offered.For the accounting of the long-term equity investment through which the Companycan exercise control over the investees, the Company adopts the cost method inindividual financial statements. Control refers to the power over an investee, withwhich the investor enjoys variable return by participating in the investee’s relatedactivities and is able to exercise its power over the investee to affect the amount ofreturn.In the cost method, the long-term equity investment is measured by initialinvestment cost. If the investment is added or recovered, the cost of long-termequity investment will be adjusted. The cash dividend or profit declared by theinvestees to be distributed is recognized as the investment income for the currentperiod.

If the Group has joint control over or significant influence on the investee, thelong-term equity investment will be measured with the equity method. Joint controlrefers to joint control over an arrangement in accordance with related agreements,and decisions on the activities relating to the arrangement shall be made only afterthe parties sharing the control reach an agreement. Significant influence refers tothe power over the decision-making on the financial affairs and business policies ofthe investee, but the investor does not have control or joint control with others overthe formulation of those policies.In the equity method, if the initial investment cost of long-term equity investment ishigher than the share enjoyed by the Group in the fair value of the investee’sidentifiable net assets at investment, the excess will be recognized in the initialinvestment cost of the long-term equity investment; if the initial investment cost oflong-term equity investment is lower than the share enjoyed by the Group in the fairvalue of the investee’s identifiable net assets at investment, the difference will berecognized in the profit or loss for the current period and the cost of the long-termequity investment will be adjusted simultaneously.In the equity method, after long-term equity investment is acquired, the investmentgains or losses and other comprehensive income shall be recognized and the bookvalue of the long-term equity investment shall be adjusted based on the share in thenet gains or losses and other comprehensive income realized by the investees tobe enjoyed or assumed. The share in the investee’s net gains or losses to beenjoyed shall be determined based on the fair value of the investee’ s identifiableassets at the acquisition of investment, according to the Group’s accounting policiesand accounting periods and after net profits of the investee are adjusted with theportion of gains or losses from the internal transactions with its associates and jointventures that is attributable to the investor based on the share to be enjoyed by it(but if the loss from internal transactions falls in the assets impairment loss, it shallbe recognized in full) offset, except for the invested and sold assets that constitutebusinesses. The book value of long-term equity investment shall be reducedaccording to the share to be enjoyed by it in the profits or cash dividend declared bythe investees to be distributed. For an investee’s net losses recognized by theGroup, the book value of the long-term equity investment and other long-term equitythat substantially constitute net investment in the investee shall be written down tozero at maximum, except for the extra losses for which the Group is liable. For theinvestee’s other changes in shareholders’ equity other than net gains or losses,other comprehensive income and profit distribution, the book value of the long-termequity investment will be adjusted and the changes will be recognized in theshareholders’ equity.For the disposal of long-term equity investment, the difference between the bookvalue of long-term equity investment and the proceeds actually received from thedisposal thereof is recognized in the profits or loss for the current period. For the

long-term equity investment measured with the equity method, if the equity methodis terminated due to the disposal, the original related other comprehensive incomemeasured with the equity method will be accounted on the same basis as that forthe direct disposal of related assets or liabilities by the investees, and theshareholders’ equity recognized due to the investees’ other changes inshareholders’ equity than net gains or losses, other comprehensive income andprofit distribution will be recognized in the profits or loss for the current period in full;if the equity method is still adopted, the original related other comprehensiveincome measured with the equity method will be accounted on the same basis asthat for the direct disposal of related assets or liabilities by the investees andrecognized in the profits or loss for the current period pro rata, and the shareholders’equity recognized due to the investees’ other changes in shareholders’ equity thannet gains or losses, other comprehensive income and profit distribution will berecognized in the profit or loss for the current period pro rata.Where the Company loses control over a subsidiary due to step-by-step disposal ofits equity investment in the subsidiary through multiple transactions, if thetransactions constitute a package of deals, each transaction will be accounted as atransaction that disposes of the subsidiary and causes the loss of control over thesubsidiary; however, the difference between the proceeds from each disposal andthe book value of the corresponding long-term equity investment disposed of isrecognized as other comprehensive income in individual financial statementsbefore the Company loses control and is recognized in the profits or loss for theperiod in which the control is lost at the loss of control. If the transactions do notconstitute a package of deals, each transaction will be accounted separately. In theevent that the Company loses control, if the residual equity after the disposalenables the Company to have joint control over or significant influence on thesubsidiary, it will be recognized as long-term equity investment in individualfinancial statements and be accounted in accordance with the relevant rules forchanging the cost method to the equity method; otherwise, it will be recognized as afinancial instrument and the difference between its fair value on the date of the lossof control and its book value will be recognized in the profit or loss for the currentperiod.

22. Property investment

(1) If measured by cost

Depreciation or amortization methodsDepreciation or amortization methodsA property investment is a real estate property held with the intention of earningrents or of capital appreciation or both, including land use rights that have been

leased, land use rights that are held and ready to be transferred after appreciation,and buildings that have been leased.Property investments are initially measured by cost. The subsequent expensesrelating to an property investment will be recognized in the cost of the propertyinvestment if the economic benefits relating to the asset are very likely to flow in andthe cost thereof can be measured reliably. Otherwise, they will be recognized in theprofit or loss for the current period at the time of being incurred.The Group subsequently measures its property investments with the cost model.The depreciation/amortization of property investments is calculated on a straightline basis. The service life, estimated net residual value and annual depreciationrate of property investments are as follows:

TypeService lifeEstimated net residual valueAnnual depreciation rate
Buildings and structures20-30 years4%3.2%-4.8%
Land use right40-70 years-1.4%-2.5%

23. Fixed assets

(1) Recognition requirements

√Applicable □N/A

A fixed asset will be recognized only if the economic benefits relating thereto arevery likely to flow into the Group and its cost can be measured reliably. If meetingthe above recognition requirement, the subsequent expenses relating to a fixedasset will be recognized in the cost of the fixed asset, and the book value of thereplaced part will be deleted; otherwise, the subsequent expenses will berecognized in the profit or loss for the current period at the time of being incurred.Fixed assets are initially measured by cost. The costs of purchasing a fixed assetinclude the purchase price, related taxes and other expenses that are incurredbefore the fixed asset is made to the predetermined ready-for-use status and aredirectly attributable to the asset.The Group reviews and makes adjustment to, if necessary, the service life,estimated residual value and depreciation method of its fixed assets at least at theend of each year.

(2) Depreciation methods

√Applicable □N/A

TypeDepreciation methodDepreciation period (number of years)Residual value rateAnnual depreciation rate
Buildings andStraight-line method10-404%2.4%-9.6%
structures
General equipmentStraight-line method5-104%9.6%-19.2%
Transportation equipmentStraight-line method64%16%

(3) Identification basis, pricing and depreciation method of the fixed assets

under financial lease

√Applicable □N/A

The depreciation method for the fixed assets under financial lease are the same asthat for proprietary fixed assets. If it can be reasonably determined that theownership of a leased asset will be acquired upon expiry of the lease term, thedepreciation will be based on its service life; if it cannot be reasonably determinedthat the ownership of a leased asset can be acquired upon expiry of the lease term,the depreciation will be based on the lease term or the service life of the asset,whichever is shorter.

24. Construction in progress

√Applicable □N/A

The cost of construction in progress is determined based on the actual expenses,including the necessary expenses on the works incurred during the construction,the borrowing costs incurred before the works reach the predeterminedready-for-use status that shall be capitalized and other related expenses.The construction in progress will be recognized as fixed assets, property investmentand long-term prepaid expenses when reaching the predetermined ready-for-usestatus.

25. Borrowing costs

√Applicable □N/A

Borrowing costs refer to the interests incurred by the Group for its borrowings andother related costs, including interest, amortization of discounts or premiums,ancillary costs and exchange difference arising from foreign currency borrowings.Borrowing costs that are directly attributable to the acquisition, construction orproduction of the assets qualified for capitalization shall be capitalized, and otherborrowing costs shall be recognized in the profit or loss for the current period. Theassets qualified for capitalization refer to the fixed assets, property investment,inventory and other assets that can reach the predetermined ready-for-use or salestatus only after a quite long time of acquisition, construction or production.

Borrowing costs can start to be capitalized only if they meet the followingrequirements simultaneously:

(1) the expenses on assets have been incurred;

(2) the borrowing costs have been incurred;

(3) the acquisition, construction or production required for the assets to reach the

predetermined ready-for-use or sale status has started.The borrowing costs for the assets qualified for capitalization shall cease beingcapitalized when the assets reach the predetermined ready-for-use or sale statusafter the acquisition, construction or production. The borrowing costs incurredsubsequently will be recognized in the profit or loss for the current period.During capitalization, the amount of interest to be capitalized during eachaccounting period is determined as follows:

(1) For special borrowings, the amount of interest to be capitalized is the interest

expenses actually incurred during the current period less the temporary deposits

interest income or investment income.

(2) For the general borrowings occupied, the amount of interest to be capitalized is

the weighted average of the accumulated asset expenses in excess of special

borrowings multiplied by the weighted average interest rate of the general

borrowings occupied.If an asset qualified for capitalization is interrupted abnormally for more than threemonths during its acquisition, construction or production except due to thenecessary procedures for it to reach the predetermined ready-for-use or sale status,the capitalization of its borrowing costs will be suspended. The borrowing costsincurred during the interruption will be recognized as expenses and in the profit orloss for the current period until the acquisition, construction or production of theasset is resumed.

26. Biological assets

□Applicable √N/A

27. Oil and gas assets

□Applicable √N/A

28. Right-of-use assets

□Applicable √N/A

29. Intangible assets

(1) Measurement method, service life and impairment test

√Applicable □N/A

Intangible assets will be recognized only if the economic benefits relating theretoare very likely to flow into the Group and the costs thereof can be measured reliably,and will be initially measured by cost. However, the intangible assets acquired fromthe merger of the enterprises not under common control will be individuallyrecognized so long as the fair values thereof can be measured reliably, and will bemeasured by fair value.The service life of an intangible asset is determined based on the term during whichit can bring economic benefits to the Group. If the term during which an intangibleasset can bring economic benefits to the Group is unforeseeable, it will be deemedas an intangible asset with uncertain service life.The service life of intangible assets is as follows:

TypeService life
Land use right40-50 years
Software10 years

The land use rights acquired by the Group are generally accounted as intangibleassets. The buildings constructed by the Group itself, the related land use rightsand buildings are accounted as intangible assets and fixed assets respectively. Theprice paid for the land and buildings purchased externally shall be allocatedbetween the land use rights and buildings. If it is hard to reasonably allocate theprice, the price in full will be treated as fixed assets.The intangible assets with finite service life shall be amortized with the straight-linemethod during their service life. The Group reviews and makes adjustment to, ifnecessary, the service life and amortization method of its intangible assets withfinite service life at least at the end of each year.

(2) Accounting policies for internal R&D expenses

√Applicable □N/A

The Company’s expenses on internal R&D projects are divided into researchexpenses and development expenses.Research expenses are recognized in the profit or loss for the current period at thetime of being incurred.

Development expenses will be recognized as an intangible asset if meeting thefollowing requirements simultaneously, or will be recognized in the profit or loss forthe current period if failing to meet the following requirements:

1) The intangible asset has been completed and is technically feasible for use orsale;

2) There’s intention of completing and using or selling the intangible asset;

3) The way in which the intangible asset generates economic benefits, including insuch a way that is able to prove that the product produced using the intangibleasset has a market or the intangible asset itself has a market; or prove itsusefulness if the intangible asset is used internally;

4) There are adequate technology and financial resources and other resources tocomplete the development of the intangible asset, and the intangible asset is able tobe used or sold;

5) The development expenses attributable to the intangible asset can bemeasured reliably.The R&D expenses that cannot be differentiated between the research expensesand development expenses will be recognized in the profit or loss for the currentperiod in full.

30. Impairment of long-term assets

√Applicable □N/A

The Group determines the impairment of the assets other than inventory, deferredincome tax and financial assets with the following methods.The Group decides on the balance sheet date whether an asset has a sign ofimpairment. If it has a sign of impairment, the Group will estimate its recoverablevalue and carry out an impairment test. For the goodwill formed due to the mergerof enterprises and the intangible assets with uncertain service life, the Group carriesout impairment tests at least at the end of each year, regardless of the impairmentsigns. For the intangible assets that have not been ready for use, the Group alsocarries out impairment tests every year.The recoverable value of an asset is determined based on the fair value of the assetless the disposal expenses or the present value of the expected future cash flows ofthe asset, whichever is higher. The Group estimates the recoverable value of eachasset. For an asset whose recoverable value is hard to be estimated, the Groupestimates the recoverable value of the assets group which the asset belongs to. An

assets group is identified based on whether the main cash inflows from the groupare independent from the cash inflows from other assets or assets groups.When the recoverable value of an asset or assets group is lower than its book value,the Group will write down its book value to the recoverable value and the amountwritten down will be recognized in the profit or loss for the current period; meanwhile,it will make provision for the impairment thereof.The above assets impairment loss will not be reversed during the subsequentaccounting periods.

31. Long-term prepaid expenses

√Applicable □N/A

Long-term prepaid expenses are amortized with the straight-line method and theamortization periods are as follows:

TypeAmortization period
Architectural ornaments of buildings3-5 years
Advertising facilities3-5 years

32. Contract liabilities

Recognition of contract liabilities

√Applicable □N/A

The Group’s obligations to transfer goods or render service to the clients for theconsiderations received or receivable from the clients are recognized as contractliabilities.

33. Employee compensations

(1) Accounting treatment of short-term compensations

√Applicable □N/A

The short-term compensations actually incurred during the accounting period whenthe employees provide service for the Group are recognized as liabilities and arerecognized in the profit or loss for the current period or costs of related assets.

(2) Accounting treatment of post-employment benefits

√Applicable □N/A

The expenditures incurred in connection with the Group’s employees’ participationin local government-administered social security programs such as endowment

insurance and unemployment insurance are recognized in the costs of relatedassets or the profit or loss for the current period at the time of being incurred.

(3) Accounting treatment of severance benefits

√Applicable □N/A

Where the Group provides severance benefits to its employees, the employeecompensation liabilities arising from the severance benefits will be recognized, andthe amount will be recognized in the profit or loss for the current period on theearlier date below: the date when the Group cannot unilaterally withdraw theseverance benefits provided as a result of the employment termination plan ordownsizing proposal; or the date when the Group recognizes the costs or expensesrelating to the reorganization involving the payment of severance benefits.

(4) Accounting treatment of other long-term employee benefits

□Applicable √N/A

34. Lease liabilities

□Applicable √N/A

35. Estimated liabilities

√Applicable □N/A

Except for the contingent considerations and contingent liabilities assumed in themergers of enterprises not under common control, an obligation relating tocontingent matters will be recognized by the Group as estimated liabilities if meetingthe following requirements simultaneously:

(1) The obligation is a current obligation assumed by the Group;

(2) The performance of the obligation may result in the outflow of economic benefitsfrom the Group;

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

Estimated liabilities are initially measured based on the best estimate of theexpenses required for the performance of related current obligations, and the risks,uncertainties and time value of money relating to the contingent matters are alsofactored in. The book value of estimated liabilities is reviewed on each balancesheet date. If any conclusive evidence indicates that the book value cannot reflectthe current best estimate, the book value will be adjusted based on the current bestestimate.

36. Share-based payment

□Applicable √N/A

37. Preferred shares, perpetual bonds and other financial instruments

□Applicable √N/A

38. Revenue

(1) Accounting policies for the recognition and measurement of revenue

√Applicable □N/A

Revenue will be recognized if the economic benefits are very likely to flow into theGroup, the amount can be measured reliably and the following requirements aremet simultaneously.Revenue from the sales of goodsThe Group has transferred the main risks and compensations on the title of goodsto the buyers and no longer retains the continued management right associatedwith title or exercises effective control over the goods, the related costs incurred orto be incurred can be measured reliably, and then revenue can be recognized. Theamount of revenue from the sales of goods is determined based on the contractprice or agreed price received or receivable from the buyers, except that thecontract price or agreed price received or receivable from the buyers is unfair; if thecontract price or agreed price is collected in a deferred way and is a kind offinancing in nature, the amount shall be determined based on the fair value thereof.For the sales of real estate properties, a development product has completed andbeen accepted after inspection, the sales contract has been signed, the obligationsstipulated in the contract have been performed, i.e. the main risks andcompensations on the title of the development product have transferred to the buyer,the Group no longer exercises continued management right or actual control overthe project, the related revenue has been received or can be proved to be received,the costs relating to the project can be measured reliably, and then revenue can berecognized.Revenue from the rendering of serviceOn the balance sheet date, if the results of rendering service can be estimatedreliably, the revenue from the rendering of service will be recognized based on thepercentage of the service completed; otherwise, the revenue will be recognizedbased on the cost of the service that has been incurred and can be compensatedfor. The results of rendering service can be estimated reliably if the following

conditions are met simultaneously: the amount of the revenue can be measuredreliably, the related economic benefits are very likely to flow into the Group, theprogress of the transaction can be determined reliably, and the costs incurred andto be incurred during the transaction can be measured reliably. The Groupdetermines the progress of rendering service based on the percentage of theservice provided in the service that should be provided. The total revenue from therendering of service is determined based on the contract price or agreed pricereceived or receivable from the service recipients, except that the contract price oragreed price received or receivable from the service recipients is unfair.Interest incomeIt is determined based on the time of use by others of and effective interest rate ofthe cash and cash equivalents of the Group.Revenue from use feesIt is determined based on the charging periods and methods agreed in the relatedcontracts or agreements.Rental incomeFor operating lease, the rental income is recognized with the straight-line methodduring each period of the lease terms based on the lease dates and rentals agreedin the lease contracts or agreements when the rentals have been received or canbe proved to be received.

(2) Differences in the revenue recognition policies for the same businessunder different business models

□Applicable √N/A

39. Contract cost

□Applicable √N/A

40. Government grants

√Applicable □N/A

A government grant is recognized when it can meet the requirements and can bereceived. If a government grant falls in monetary assets, it will be measured by theamount received or receivable. If a government grant does not fall in monetaryassets, it will be measured by fair value. If the fair value of a grant cannot bedetermined reliably, it will be measured by its nominal amount.

A government grant prescribed by government documents to be used to acquire orconstruct or otherwise form long-term assets will be deemed as an asset-relatedgovernment grant; if no government documents have express provisions, the grantsthat are used to acquire or construct or otherwise form long-term assets will bedeemed as asset-related government grants and others as income-relatedgovernment grants.The Group treats the account of government grants with the total amount method.The income-related government grants that are used to compensate for the relatedcosts, expenses or losses during the subsequent periods are recognized asdeferred income and will be recognized in the profit or loss or against the relatedcosts for the period when the related costs, expenses or losses are recognized. Theincome-related government grants used to compensate for the related costs,expenses or losses that have been incurred are directly recognized in the profit orloss or against the related costs for the current period.The asset-related government grants can be recognized against the book value ofrelated assets. They can also be recognized as deferred income and recognized inthe profit or loss by installment with a reasonable and systematic method during theservice life of related assets (the government grants measured by the nominalamount are directly recognized in the profit or loss for the current period);if a relatedasset is sold, transferred, retired or damaged before the end of the service lifethereof, the undistributed balance of related deferred income will be recognized inthe profit or loss for the period when the asset is disposed of.

41. Deferred income tax assets and deferred income tax liabilities

√Applicable □N/A

Income tax consists of current income tax and deferred income tax. Except for theincome tax arising from the adjustment of goodwill caused by the mergers ofenterprises or the income tax that is related to the transactions or matters directlyrecognized in shareholders’ equity, which are recognized in the shareholders’equity, income tax will be recognized in the profit or loss for the current period asincome tax expenses or income.The Group measures the current income tax liabilities or assets formed during thecurrent period and the previous periods by the estimated amount of income tax tobe paid or refunded as calculated in accordance with the tax law.The Group recognizes deferred income tax with the balance sheet liability methodbased on the temporary difference between the book value of assets and liabilitieson the balance sheet date and the tax base and that between the book value of the

items that have not been recognized as assets and liabilities but whose tax basecan be determined according to the tax law and the tax base thereof.All taxable temporary differences will be recognized as deferred income taxliabilities, unless:

(1) The taxable temporary difference is generated from the following transactions:

initial recognition of goodwill; or initial recognition of the assets or liabilitiesarising from the transactions with the following characteristics: the transactionsare not mergers of enterprises, and the transactions affect neither theaccounting profits nor the taxable income or deductible losses at the occurrencethereof.

(2) For the taxable temporary differences relating to the investments in thesubsidiaries, joint ventures and associates, the time of reversing can becontrolled and the temporary differences are very unlikely to be reversed in theforeseeable future.For the deductible temporary differences and the deductible losses and taxdeductions that can be carried forward to the subsequent years, the Grouprecognizes the deferred income tax assets arising therefrom within the limit of thefuture taxable income that is very likely to be obtained and used to be offset againstthe deductible temporary differences, deductible losses and tax deductions, unless:

(1) The deductible temporary difference is generated from the transactions that arenot mergers of enterprises and affect neither the accounting profits nor thetaxable income or deductible losses at the occurrence thereof.

(2) The deductible temporary differences relating to the investments in the

subsidiaries, joint ventures and associates will be recognized as deferredincome tax assets correspondingly if meeting all the following requirements: thedifferences are very likely to be reversed in the foreseeable future and it is verylikely to obtain the taxable income that can be offset against the deductibletemporary differences in the future.The Group measures, on the balance sheet date, the deferred income tax assetsand liabilities based on the applicable tax rate for the period when the assets areexpected to be recovered or the liabilities are expected to be paid off, in accordancewith the tax law, which will also reflect the impact of the way of the expectedrecovery of assets or repayment of liabilities on the income tax on the balance sheetdate.The Group reviews the book value of deferred income tax assets on the balancesheet date. If it is very likely to be unable to acquire adequate taxable income to beoffset against the benefits of deferred income tax assets in the future, the book

value of deferred income tax assets will be written down. On the balance sheet date,the Group re-evaluates the unrecognized deferred income tax assets andrecognizes the same to the extent that it is very likely to acquire adequate taxableincome to reverse all or part of the deferred income tax assets.If all the following requirements are met, deferred income tax assets and liabilitieswill be presented in net amount after offsetting: the Group has the legal right tosettle the current income tax assets and liabilities in net amount; the deferredincome tax assets and liabilities are related to the income tax levied by an identicaltax authority on an identical taxpayer, or are related to the income tax levied by anidentical tax authority on different taxpayers, but during each important period whenthe deferred income tax assets and liabilities are reversed, the involved taxpayersintend to settle the current income tax assets and liabilities in net amount or acquireassets or pay off debts simultaneously.

42. Lease

(1) Accounting treatment of operating lease

√Applicable □N/A

The leases that substantially transfer all risks and compensations in connection withthe title of assets are financial leases, and others are operating leases.The Group as the lessee to operating leasesThe rental expenses under operating leases are recognized in the costs of assetsor the profit or loss for the current period with the straight-line method during eachperiod of the lease terms; contingent rentals are recognized in the profit or loss forthe period at the time of being actually incurred.The Group as the lessor to operating leasesThe rental income under operating leases are recognized in the profit or loss for thecurrent period with the straight-line method during each period of the lease terms;contingent rentals are recognized in the profit or loss for the period at the time ofbeing actually incurred.

(2) Accounting treatment of financial lease

√Applicable □N/A

The Group as the lessee to finance leasesFor an asset leased under a finance lease, the entry value of the leased asset onthe starting date of the lease team is the fair value of the asset on the starting dateof the lease or the present value of the minimum lease payment, whichever is lower;

and the amount of the minimum lease payment is taken as the entry value oflong-term accounts payable; the difference between them is unrecognized financingexpenses and will be amortized with the effective interest method during eachperiod of the lease term. Contingent rentals are recognized in the profit or loss forthe period at the time of being actually incurred.

(3) Determination and accounting treatment of leases under the new lease

standards

□Applicable √N/A

43. Other important accounting policies and accounting estimates

√Applicable □N/A

Distribution of profitsThe Company’s cash dividend is recognized as liabilities after approval by theshareholders’ meeting.Measurement of fair valueThe Group measures the fair values of equity instruments investments on eachbalance sheet date. Fair value refers to the price received from the sale of an assetor paid for the transfer of a liability by a market player in the orderly transactions onthe measurement date. The Group measures the related asset or liability by fairvalue, assuming that the orderly transaction of selling the asset or transferring theliability is executed in the principal market of related asset or liability, or if there is noprincipal market, assuming that the transaction is executed in the mostadvantageous market of related asset or liability. The principal market (or mostadvantageous market) is the marketplace which the Group can enter on themeasurement date. The Group adopts the assumptions used by market players tomaximize economic benefits in the pricing of the assets or liabilities.The Group adopts the valuation technique that is applicable under the currentconditions and is supported with sufficient available data and other information anduses the related observable inputs with priority. The unobservable inputs will beused only if the observable inputs are unavailable or it is unfeasible to acquire theobservable inputs.For the assets and liabilities which are measured or disclosed by fair value in thefinancial statements, the levels of fair value are determined based on thelowest-level input of important significance for the overall measurement of fairvalues: Level 1 input is the unadjusted offer price for an identical asset or liabilitythat can be obtained in an active market on the measurement date; Level 2 inputsare the inputs that are directly or indirectly observable for related assets or liabilities

other than Level 1 inputs; Level 3 inputs are the inputs that are observable forrelated assets or liabilities.On each balance date, the Group re-evaluates the assets and liabilities that arerecognized in the financial statements and keep being measured by fair value so asto determine whether to change the measurement levels of fair value.Significant accounting judgments and estimatesIn the preparation of financial statements, the management need to makejudgments, estimates and assumptions, which will affect the presented amountsand disclosure of revenue, expenses, assets and liabilities and the disclosure ofcontingent liabilities on the balance sheet date. However, the uncertainties of theseassumptions and estimates may cause material adjustment to the book value of theassets or liabilities that will be affected in the future.JudgmentsWhen applying the Group’s accounting policies, the management have made thefollowing judgments which have had significant influence on the amountsrecognized in the financial statements:

Operating lease—as the lessorThe Group has signed lease contracts for the property investments. The Groupthinks that according to the terms of the lease contracts, the Group retains all majorrisks and compensations on the titles of those real estate properties and thushandles them as operating leases.Partition between property investments and fixed assetsThe Group classifies the buildings and structures leased out other than for the mainbusinesses such as market and hotel services as well as the auxiliary land userights thereof as property investments, including but not limited to the auxiliarybanking and catering outlets for market operation and the auxiliary service outletsfor hotels. Other buildings and structures leased out are classified as fixed assets.Judgments on assets acquisition and mergers of enterprisesWhen determining whether an acquisition transaction constitutes a merger, theGroup assesses various factors, including whether the acquiree constitutes abusiness, in accordance with the Accounting Standards for Enterprises No. 20 –Merger of Enterprises. A business refers to a group of some production andoperation activities or assets and liabilities within an enterprise, which has the input,processing and output abilities and whose costs and expenses or revenue can becalculated independently, but an asset or a group of assets or liabilities can be

deemed as a business so long as it has the input and processing processes. TheGroup makes comprehensive judgments by combining the asset acquired and theprocessing process.Business modelThe classification of financial assets at initial recognition depends on the Group’sbusiness model for the management of financial assets. When judging the businessmodel, the Group factors in the enterprise evaluation, the way of reporting financialassets performance to key management personnel, the risks affecting theperformance of financial assets, the way of managing financial assets and the wayof related business management personnel obtaining remunerations. Whenassessing whether to aim at the collection of contractual cash flow, the Groupneeds to analyze the reasons, time, frequency and value for sale of the financialassets to be sold before the expiry dates thereof.Characteristics of contractual cash flowThe classification of financial assets at initial recognition depends on thecharacteristics of the contractual cash flow of the financial assets. For the judgmenton whether the contractual cash flow is the repayment of principal and the paymentof interest on outstanding principal, including the evaluation of the adjustment to thetime value of money, it should be judged whether it is significantly different from thebenchmark cash flow; for the financial assets with the early repaymentcharacteristic, it should be judged whether the fair value of the early repaymentcharacteristic is extremely low.Uncertainties of estimatesThe key assumptions on the balance sheet date for the future and other keysources of the uncertainties of estimates are shown below, which may causesignificant adjustments to the book values of assets and liabilities during the futureaccounting periods.Impairment of financial instrumentsThe Group evaluates the impairment of financial instruments with the expectedcredit loss model. To apply the model, the Group needs to make significantjudgments and estimates and take into account all reasonable and evidencedinformation, including forward-looking information. When making these judgmentsand estimates, the Group infers the expected changes in the debtors’ credit risksbased on their historical repayment data, in combination with the economic policies,macroeconomic indicators and industry risks. Different estimates may affect theprovisions for impairment and the provision that has been made for impairment maynot necessarily be equal to the actual amount of impairment loss in the future.

Net realizable value of property inventoryThe Group’s property inventory is measured by cost or net realizable value,whichever is lower. For the calculation of net realizable value, assumptions andestimates should be used. If the management adjust the estimated price and thecosts and expenses to be incurred until the completion, it will affect the estimate ofthe net realizable value of the inventory and the difference will affect the provisionfor inventory depreciation.Impairment of non-current assets other than financial assets (excluding goodwill)The Group determines, on the balance sheet date, whether the non-current assetsother than financial assets have a sign of being impaired. For a non-current assetother than financial asset, if it is indicated that its book value cannot be recovered,an impairment test will be made. When the book value of an asset or a group ofassets is higher than its recoverable value, i.e. fair value less the disposal expensesor the present value of expected future cash flow, whichever is higher, the asset orgroup has been impaired. For the fair value less the disposal expenses, the Grouprefers to the agreed selling price or observable market price of the similar asset in afair transaction, less the cost increase directly attributable to the disposal of theasset. When predicting the present value of future cash flows, the managementmust estimate the expected future cash flows of the asset or group of assets andselect an appropriate discount rate. When identifying a group of assets, themanagement consider whether the smallest identifiable group of assets cangenerate income and cash flows independently from other departments or units, orthe income and cash inflows generated thereby are mostly independent from otherdepartments or units, and also take into account the way of managing or monitoringproduction and operating activities and the way of making decisions on thecontinued use or disposal of the asset.Fair value of unlisted equity investmentValuation of the unlisted equity investment is the expected future cash flowsdiscounted at the current discount rate of other financial instruments with similarcontract terms and risk characteristics. This requires the Group to estimate theexpected future cash flows, credit risk, volatility and discount rate, which bringsuncertainties.Deferred income tax assetsTo the extent that it is very likely for the Group to have enough taxable income to beoffset against the deductible losses, the Group shall recognize deferred income taxassets in connection with the outstanding deductible losses. This requires themanagement to use lots of judgments to estimate the acquisition time and amountof the taxable income to be acquired in the future to determine the amount of

deferred income tax assets to be recognized, in consideration of the tax paymentplanning strategy.Service life and residual value of fixed assetsThe Group makes provisions for the depreciation of its fixed assets during theexpected service life thereof after considering their residual value. The Groupreviews the expected service life and residual value of related assets on a regularbasis to determine the amount of depreciation expenses to be recognized for eachreporting period. The Group determines the service life and residual value of assetsbased on its experience in similar assets and in combination with the expectedtechnology changes. If the previous estimates have material changes, thedepreciation expenses will be adjusted for the future periods.

44. Changes in important accounting policies and accounting estimates

(1) Changes in important accounting policies

√Applicable □N/A

Other statements:

On Jul 5, 2017, the Ministry of Finance released the Accounting Standards forEnterprises No.14—Revenue (amended in 2017) (Cai Hui [2017] No.22) (hereafterreferred to as the “New Revenue Standards”), which required the enterprises listedwithin China to implement the New Revenue Standards as from Jan 1, 2020.According to the requirements of the New Revenue Standards, the Company willadjust the amounts of related items in the financial statements at the start of 2020based on the cumulative effect of initial implementation of the New RevenueStandards, while not adjusting the data for comparable periods. The Company willimplement the new lease standards as from Jan 1, 2021.

(2) Changes in important accounting estimates

□Applicable √N/A

(3) Financial statements at the start of the initial year when the New Revenue

Standards are implemented from 2020 and when the new lease standardsare implemented

√Applicable □N/A

Consolidated Balance Sheet

Unit: RMB

ItemDec 31, 2019Jan 1, 2020Adjustment
Current assets:
Cash and cash equivalents6,486,408,651.886,486,408,651.88
Held-for-trading financial assets38,077,703.9238,077,703.92
Accounts receivable16,031,078.0516,031,078.05
Prepayment44,678,187.9844,678,187.98
Other receivables1,397,228,398.981,397,228,398.98
In which: Interest receivable191,064,382.11191,064,382.11
Inventory4,296,061,444.254,296,061,444.25
Other current assets3,099,955,902.503,099,955,902.50
Total current assets15,378,441,367.5615,378,441,367.56
Non-current assets:
Long-term receivables61,250,000.0061,250,000.00
long-term equity investment1,771,420,054.571,771,420,054.57
Other equity instruments investment642,187,968.78642,187,968.78
Other non-current financial assets1,519,449,439.021,519,449,439.02
Property investment1,863,218,356.401,863,218,356.40
Fixed assets4,783,819,070.714,783,819,070.71
Construction in progress865,754,600.02865,754,600.02
Intangible assets3,456,137,246.023,456,137,246.02
Long-term prepaid expenses139,502,382.87139,502,382.87
Deferred income tax assets180,404,801.30180,404,801.30
Other non-current assets661,648,707.19661,648,707.19
Total non-current assets15,944,792,626.8815,944,792,626.88
Total assets31,323,233,994.4431,323,233,994.44
Current liabilities:
Short-term borrowings4,178,903,704.824,178,903,704.82
Accounts payable525,241,493.48525,241,493.48
Advances from customers4,508,455,128.63250,436,393.04-4,258,018,735.59
Contract liabilities4,258,018,735.594,258,018,735.59
Payroll payable197,174,419.96197,174,419.96
Tax payable280,184,253.26280,184,253.26
Other payables909,483,132.47909,483,132.47
Non-current liabilities due within one year270,332,413.94270,332,413.94
Other current liabilities2,023,012,118.222,023,012,118.22
Total current liabilities12,892,786,664.7812,892,786,664.78
Non-current liabilities:
Long-term borrowings530,694,313.98530,694,313.98
Bonds payable4,564,291,387.814,564,291,387.81
Estimated liabilities110,620,306.10110,620,306.10
Deferred income27,966,750.9827,966,750.98
Deferred income tax liabilities112,574,338.69112,574,338.69
Other non-current liabilities1,148.891,148.89
Total non-current liabilities5,346,148,246.455,346,148,246.45
Total liabilities18,238,934,911.2318,238,934,911.23
Owners’ equity (or shareholders’ equity)
Paid-in capital (or share capital)5,443,214,176.005,443,214,176.00
Capital reserve1,524,183,779.641,524,183,779.64
Other comprehensive income66,267,192.7466,267,192.74
Surplus reserve1,236,166,911.811,236,166,911.81
Undistributed profits4,750,787,389.174,750,787,389.17
Total owners’ equity (shareholders’ equity) attributable to the parent company13,020,619,449.3613,020,619,449.36
Minority interest63,679,633.8563,679,633.85
Total owners’ equity (or shareholders’ equity)13,084,299,083.2113,084,299,083.21
Total liabilities and owners’ equity (or shareholders’ equity)31,323,233,994.4431,323,233,994.44

Statements on item adjustment:

√Applicable □N/A

None

Balance Sheet of Parent Company

Unit: RMB

ItemDec 31, 2019Jan 1, 2020Adjustment
Current assets:
Cash and cash equivalents6,312,119,746.266,312,119,746.26
Held-for-trading financial assets1,211.141,211.14
Accounts receivable2,381,698.232,381,698.23
Prepayment11,914,907.3611,914,907.36
Other receivables1,280,138,618.411,280,138,618.41
In which: Interest receivable134,543,859.25134,543,859.25
Inventory6,622,207.786,622,207.78
Other current assets4,252,429,806.324,252,429,806.32
Total current assets11,865,608,195.5011,865,608,195.50
Non-current assets:
Long-term receivables61,250,000.0061,250,000.00
long-term equity investment6,886,096,995.776,886,096,995.77
Other equity instruments investment642,187,968.78642,187,968.78
Other non-current financial assets371,736,330.52371,736,330.52
Property investment1,062,037,085.451,062,037,085.45
Fixed assets3,929,018,558.563,929,018,558.56
Construction in progress780,166,171.12780,166,171.12
Intangible assets3,331,543,646.763,331,543,646.76
Long-term prepaid expenses63,262,990.2563,262,990.25
Deferred income tax assets94,333,102.8794,333,102.87
Other non-current assets519,850,000.00519,850,000.00
Total non-current assets17,741,482,850.0817,741,482,850.08
Total assets29,607,091,045.5829,607,091,045.58
Current liabilities:
Short-term borrowings4,178,903,704.824,178,903,704.82
Accounts payable208,383,192.69208,383,192.69
Advances from customers2,918,036,408.24196,988,360.89-2,721,048,047.35
Contract liabilities2,721,048,047.352,721,048,047.35
Payroll payable162,095,870.71162,095,870.71
Tax payable280,400,924.97280,400,924.97
Other payables618,839,560.98618,839,560.98
Non-current liabilities due within one year270,332,413.94270,332,413.94
Other current liabilities3,044,639,789.793,044,639,789.79
Total current liabilities11,681,631,866.1411,681,631,866.14
Non-current liabilities:
Long-term borrowings530,694,313.98530,694,313.98
Bonds payable4,564,291,387.814,564,291,387.81
Estimated liabilities110,620,306.10110,620,306.10
Deferred income27,966,750.9827,966,750.98
Deferred income tax liabilities92,975,854.9892,975,854.98
Other non-current liabilities187.73187.73
Total non-current liabilities5,326,548,801.585,326,548,801.58
Total liabilities17,008,180,667.7217,008,180,667.72
Owners’ equity (or shareholders’ equity)
Paid-in capital (or share capital)5,443,214,176.005,443,214,176.00
Capital reserve1,489,516,614.191,489,516,614.19
Other comprehensive income66,421,903.3366,421,903.33
Surplus reserve1,236,113,435.981,236,113,435.98
Undistributed profits4,363,644,248.364,363,644,248.36
Total owners’ equity (shareholders’ equity)12,598,910,377.8612,598,910,377.86
Total liabilities and owners’ equity (or shareholders’ equity)29,607,091,045.5829,607,091,045.58

Statements on item adjustment:

√Applicable □N/A

None

(4) Retroactive adjustments to comparative data for the previous periods

after initial implementation of the New Revenue Standards from 2020 andinitial implementation of the new lease standards

□Applicable √N/A

45. Others

□Applicable √N/A

VI Taxes

1. Major taxes and tax rates

Major taxes and tax rates

√Applicable □N/A

TaxBase of taxationTax rate
VATSale of goods or rendering of taxable serviceThe Company is a general taxpayer. The output tax of its taxable revenue was levied at the rate of 16%, 10% and 6% before Apr 1, 2019, and at the rate of 13%, 9% and 6% as from Apr 1, 2019, and the VAT is levied with the deductible input tax deducted. In addition, the sale of old real estate projects developed by itself (the starting date of construction indicated in the Construction Permit for Construction Project was before Apr 30, 2016) and the lease of its real estate properties acquired before Apr 30, 2016 are subject to simple taxation, with a tax rate of 5%.
Urban maintenance and construction taxIndirect tax actually paid5% or 7%
Corporate income taxTaxable corporate income25%
Land appreciation taxRatio of appreciation value to deductable itemsFour-bracket progressive tax rate (30%~60%)
Real estate taxIf the tax is levied according to price, the amount is 1.2% of the balance of the original1.2% or 12%
value of the property after a 30% deduction; if the tax is levied according to rental, the amount is 12% of the rental income.
Education surchargeIndirect tax actually paid3%
Local education surchargeIndirect tax actually paid2%
Cultural undertaking development feeAdvertising turnover3%

Disclosure of taxpayers subject to different income tax rates

□Applicable √N/A

2. Tax preference

√Applicable □N/A

According to the Yi Di Shui Han [2017] No.56 Notification on the Yiwu’sImplementing Measures for Adjusting Urban Land Use Tax Policies to PromoteIntensive and Economic Utilization of Land, based on the calculation of per mu tax,the Company is entitled to a 90% reduction of the land use tax.

3. Others

□Applicable √N/A

VII Notes to items in consolidated financial statements1 Cash and cash equivalents

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Cash on hand369,439.29523,925.97
Bank deposits7,178,418,970.686,181,870,591.84
Other cash and cash equivalents1,387,062.40304,014,134.07
Total7,180,175,472.376,486,408,651.88
In which: amount deposited abroad19,522,661.865,282,591.84

Other notes:

For the cash and cash equivalents which are restricted in use, please refer to NotesVII-81 Assets with Restricted Title or Right of Use.

Interest income of demand deposits is accrued based on the demand deposit ratesof banks. The term of short-term time deposits ranges from three months to half ayear and depends on the Group’s cash demand, and the interest income thereof isaccrued based on the corresponding time deposit rates of banks.2 Held-for-trading financial assets

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Financial assets that are measured by fair value and of which the changes in fair value are recognized in the profit or loss for the current period32,092,542.4538,077,703.92
In which:
Convertible bonds investment32,076,492.7832,076,492.78
Wealth management products6,000,000.00
Others16,049.671,211.14
Total32,092,542.4538,077,703.92

Other notes:

□Applicable √N/A

3 Derivative financial assets

□Applicable √N/A

4 Notes receivable

(1) Categorized presentation of notes receivable

□Applicable √N/A

(2) Notes receivable having been pledged by the Company as of the close ofthe reporting period

□Applicable √N/A

(3) Notes receivable having been endorsed or discounted by the Company asof the close of the reporting period and having not been due as of the balancesheet date

□Applicable √N/A

(4) Notes turned into accounts receivable due to the drawers’non-performance at the close of the reporting period

□Applicable √N/A

(5) Categorized disclosure based on the bad debt provision method

□Applicable √N/A

(6) Provisions for bad debts

□Applicable √N/A

(7) Notes receivable actually written off during the current period

□Applicable √N/A

Other notes:

□Applicable √N/A

5 Accounts receivable

(1) Disclosure based on account age

√Applicable □N/A

Unit: RMB

Account ageClosing book balance
Within 1 year229,367,008.49
1 to 2 years
2 to 3 years
Over 3 years211,046.06
Less: bad debt provision for accounts receivable-343,338.48
Total229,234,716.07

(2) Categorized disclosure based on the bad debt provision method

√Applicable □N/A

Unit: RMB

CategoryClosing balanceOpening balance
Book balanceBad debt provisionBook valueBook balanceBad debt provisionBook value
AmountWeight (%)AmountProvision ratio (%)AmountWeight (%)AmountProvision ratio (%)
Accounts receivable for which bad debt provision is made individually31,912.970.0131,912.97100.0078,801.180.4878,801.18100.00
Accounts receivable for which bad debt provision is made by group229,546,141.5899.99311,425.510.14229,234,716.0716,258,851.2899.52227,773.231.4016,031,078.05
Total229,578,054.55/343,338.48/229,234,716.0716,337,652.46/306,574.41/16,031,078.05

Accounts receivable for which bad debt provision is made individually:

√Applicable □N/A

Unit: RMB

ItemClosing balance
Book balanceBad debt provisionProvision ratio (%)Reason for provision
Credit consumption of hotel31,912.9731,912.97100The amount is estimated to be unrecoverable
Total31,912.9731,912.97100/

Explanation for making bad debt provision for accounts receivable individually:

□Applicable √N/A

Explanation for making bad debt provision for accounts receivable by group:

□Applicable √N/A

If the bad debt provision is made according to the general model of expected creditloss, please refer to the disclosure of other receivables:

√Applicable □N/A

ItemClosing balance
Accounts receivableBad debt provisionProvision ratio (%)
Within 1 year229,335,095.52100,379.450.04
Over 3 years211,046.06211,046.06100.00
Total229,546,141.58311,425.510.14

(3) Bad debt provisions

√Applicable □N/A

Unit: RMB

CategoryOpening balanceAmount of change during the current periodClosing balance
ProvisionRecovery or reversalCharge-off or write-offOther changes
Bad debt provision for accounts receivable306,574.4136,764.07343,338.48
Total306,574.4136,764.070.000.00343,338.48

In which the recovered or reversed amount is important:

□Applicable √N/A

(4) Accounts receivable actually written off during the current period

□Applicable √N/A

(5) Accounts receivable from the five debtors with the highest closing

balance

√Applicable □N/A

DebtorBook balanceWeight %
HOUS GROUP CO.,LIMITED22,321,840.499.74
YOSICIL SRL SOS.17,114,079.627.47
GLOBAL MANDIRI SDN BHD14,668,326.536.40
LETOILE S.A.11,375,669.614.96
ALWAGEBAT AL-ALMEIA ADVANCED BUSINESS CO.,LTD8,242,222.433.60
Total73,722,138.6832.16

(6) Accounts receivable derecognized due to transfer of financial assets

□Applicable √N/A

(7) Amounts of assets and liabilities formed by the transfer of accountsreceivable and continuing involvement

□Applicable √N/A

Other notes:

□Applicable √N/A

6 Accounts receivable financing

□Applicable √N/A

7 Prepayment

(1) Presentation of prepayment by age

√Applicable □N/A

Unit: RMB

AgeClosing balanceOpening balance
AmountWeight (%)AmountWeight (%)
Within 1 year182,826,958.3199.4642,831,583.4695.87
1 to 2 years146,509.550.08503,472.231.13
2 to 3 years-413,870.290.93
Over 3 years848,276.820.46929,262.002.08
Total183,821,744.68100.0044,678,187.98100.00

Explanation for failure to settle the prepayments with an account age longer thanone year and in important amounts:

None

(2) Prepayments to the five suppliers with the highest closing balance

√Applicable □N/A

SupplierBook balanceWeight %
Yiwu Lanlan E-commerce Trading Company34,860,524.9718.96
Suzhou Zehai Wulian Intelligent Technology Co., Ltd.18,402,696.0010.01
Zhejiang Baisha Construction Co., Ltd.13,110,577.037.13
Zhejiang Hengfeng Group Co., Ltd.11,428,571.406.22
Zhejiang Jipeng Import and Export Trade Co., Ltd.4,819,276.002.62
Total82,621,645.4044.95

Other notes

□Applicable √N/A

8 Other receivablesPresentation of items

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Interest receivable136,159,029.06191,064,382.11
Other receivables2,365,082,272.001,206,164,016.87
Total2,501,241,301.061,397,228,398.98

Other notes:

□Applicable √N/A

Interest receivable

(1) Classification of interest receivable

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Cash occupation fee for receivables136,159,029.06191,064,382.11
Total136,159,029.06191,064,382.11

(2) Significant overdue interest

□Applicable √N/A

(3) Bad debt provision

□Applicable √N/A

Other notes:

√Applicable □N/A

1. The cash occupation fee for receivables is the cash occupation fee for thefinancial assistance receivable from joint ventures. For details, please refer to NotesXII-6 Accounts Receivable from and Payable to Related PartiesDividend receivable

(1) Dividend receivable

□Applicable √N/A

(2) Important dividend receivable with an account age longer than 1 year

□Applicable √N/A

(3) Bad debt provision

□Applicable √N/A

Other notes:

□Applicable √N/A

Other receivables

(1) Disclosure based on account age

√Applicable □N/A

Unit: RMB

AgeClosing book balance
Within 1 year
In which: sub-items
Sub-total of other receivables with the age within 1 year1,957,805,521.67
1 to 2 years355,591,035.53
2 to 3 years2,493,462.21
Over 3 years65,525,723.79
Less: bad debt provision-16,333,471.20
Total2,365,082,272.00

(2) Classification based on the nature of accounts

√Applicable □N/A

Unit: RMB

Nature of receivableClosing book balanceOpening book balance
Financial assistance receivable from joint ventures2,048,606,687.481,135,980,817.96
Reserve614,471.83791,675.95
Withholding, deposit and margin315,861,112.6969,391,522.96
Total2,365,082,272.001,206,164,016.87

(3) Bad debt provision

√Applicable □N/A

Unit: RMB

Bad debt provisionPhase 1Phase 2Phase 3Total
Expected credit loss in the coming 12 monthsExpected credit loss in the entire duration (credit has not been impaired)Expected credit loss in the entire duration (credit has been impaired)
Balance as of Jan 1, 202013,729,240.4413,729,240.44
Provision made in the current period2,604,230.762,604,230.76
Balance as of Jun 30, 202016,333,471.2016,333,471.20

Significant changes in the book balance of other receivables with changes in lossprovisions:

□Applicable √N/A

Basis for the bad debt provision made in the current period and for assessingwhether the credit risk of financial instruments has increased significantly:

□Applicable √N/A

(4) Bad debt provision

√Applicable □N/A

Unit: RMB

CategoryOpening balanceChange in the current periodClosing balance
ProvisionRecovery or reversalCharge-off or write-offOther changes
Bad debt13,729,240.442,604,230.7616,333,471.2
provision for other receivables0
Total13,729,240.442,604,230.7616,333,471.20

In which the recovered or reversed amount is important:

□Applicable √N/A

(5) Other receivables actually written off during the current period

□Applicable √N/A

(6) Other receivables from the five debtors with highest closing balance

√Applicable □N/A

Unit: RMB

DebtorNature of receivableClosing balanceAccount ageWeight in the total closing balance of other receivables (%)Closing balance of bad debt provision
Yiwu Gongchen Shangbo Property Co., Ltd.Financial assistance1,594,759,831.00Within 1 year67.76
Yiwu Huangyuan Shangbo Property Co., Ltd.Financial assistance228,464,117.96Within 1 year and 1 to 2 years9.71
Yiwu Chengzhen Property Co., Ltd.Financial assistance225,228,282.351 to 2 years9.57
Yiwu Land and Resources BureauLand bid deposit211,770,000.00Within 1 year9.00
Hangzhou Property Maintenance Funds Management CenterResidential property maintenance funds13,180,039.22Over 3 years0.562,636,007.84
Total/2,273,402,270.53/96.602,636,007.84

(7) Receivables involving government grants

□Applicable √N/A

(8) Other receivables derecognized due to transfer of financial assets

□Applicable √N/A

(9) Amounts of assets and liabilities formed by the transfer of accountsreceivable and continuing involvement

□Applicable √N/A

Other notes:

□Applicable √N/A

9 Inventory

(1) Classification of inventory

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Book balanceProvision for inventory depreciation/provision for impairment of contract performance costBook valueBook balanceProvision for inventory depreciation/provision for impairment of contract performance costBook value
Raw materials757,336.53757,336.53785,843.60785,843.60
Finished goods24,027,003.4024,027,003.4022,798,397.6122,798,397.61
work-in-progress materials6,610,105.616,610,105.614,022,027.424,022,027.42
Development cost3,283,796,900.0328,303,338.063,255,493,561.973,033,536,072.2328,303,338.063,005,232,734.17
Development products1,245,799,972.961,245,799,972.961,263,222,441.451,263,222,441.45
Total4,560,991,318.5328,303,338.064,532,687,980.474,324,364,782.3128,303,338.064,296,061,444.25

(2) Provision for inventory depreciation/provision for impairment of contractperformance cost

√Applicable □N/A

Unit: RMB

ItemOpening balanceIncrease in the current periodDecrease in the current periodClosing balance
ProvisionOthersCharge-off or write-offOthers
Development cost28,303,338.0628,303,338.06
Total28,303,338.0628,303,338.06

(3) Closing balance of inventory containing capitalized borrowing costs

√Applicable □N/A

As of Jun 30, 2020, the inventory with book value of RMB36,196,787.20(RMB36,196,787.20 on Dec 31, 2019) was formed from the capitalization ofborrowing costs.

(4) Amortization of contract performance cost during the current period

□Applicable √N/A

Other notes:

√Applicable □N/A

Inventory—development cost
Name of projectOpening balance of the current yearIncrease in the current yearDecrease in the current yearClosing balance of the current year
Pujiang Lvgu865,287,512.9230,264,673.90895,552,186.82
Haicheng Phase I Business Street67,907,950.2767,907,950.27
Haicheng Phase II Business Street135,754,710.482,862,496.10138,617,206.58
Jiamei Plaza1,198,924,906.6196,419,075.231,295,343,981.84
Suxi Yinxiang765,539,329.95117,653,829.24883,193,159.19
Gongchen Shangbo121,662.00121,662.00
Jiangxi Shangbo3,182,415.333,182,415.33
Total3,033,536,072.23250,382,489.80121,662.003,283,796,900.03
Inventory—development products
Name of projectOpening balance of the current yearIncrease in the current yearDelivery in the current yearClosing balance of the current year
Pujiang Lvgu130,954,254.73-1,779,785.00129,174,469.73
Haicheng Phase I Business Street918,976,130.79918,976,130.79
Mingshi Jiayuan946,724.0388,755.38857,968.65
Trade City Century Village23,993.0323,993.03
Jin Qiao Ren Jia1,731,088.61395,202.491,335,886.12
Hangzhou Dongcheng Yinxiang Apartment31,653,448.929,096,509.4222,556,939.50
Qiantang Yinxiang238,807.22238,807.22
Fenghuang Yinxiang150,488,116.135,246,430.06145,241,686.07
He Tang Yue Se10,845,072.6465,435.8910,779,636.75
Shuangchuang Building17,364,805.35750,350.2516,614,455.10
Total1,263,222,441.45-1,779,785.0015,642,683.491,245,799,972.96

10 Contract assets

(1) Overview of contract assets

□Applicable √N/A

(2) Amount of and reasons for material changes to book value during thereporting period

□Applicable √N/A

(3) Provision for impairment of contract assets in the current period

□Applicable √N/A

Other notes:

□Applicable √N/A

11 Held-for-sale assets

□Applicable √N/A

12 Non-current assets due within one year

□Applicable √N/A

13 Other current assets

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Entrusted loans to the merchants3,229,841.793,234,841.81
Other entrusted loans35,000,000.00
To-be-deducted input tax265,442,293.26172,556,881.73
To-be-certified input tax3,450,333.221,449,678.96
Additional deduction5,119,089.70
Prepaid land transfer fees2,887,900,000.00
Debt investment595,000,000.00
Less: bad debt provision for entrusted loans-185,500.00-185,500.00
Total872,056,057.973,099,955,902.50

Other notes:

None

14 Debt investment

(1) Overview of debt investment

□Applicable √N/A

(2) Important debt investment as of the close of the reporting period

□Applicable √N/A

(3) Provision for impairment

□Applicable √N/A

15 Other debt investment

(1) Overview of other debt investment

□Applicable √N/A

(2) Important other debt investment as of the close of the reporting period

□Applicable √N/A

(3) Provision for impairment

□Applicable √N/A

Other notes:

□Applicable √N/A

16 Long-term receivables

(1) Overview of long-term receivables

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balanceRange of discount rate
Book valueBad debt provisionBook valueBook balanceBad debt provisionBook value
Financial assistance receivable from joint ventures93,650,436.1593,650,436.1561,250,000.0061,250,000.00
Total93,650,436.1593,650,436.1561,250,000.0061,250,000.00/

(2) Bad debt provision

□Applicable √N/A

(3) Long-term receivables derecognized due to transfer of financial assets

□Applicable √N/A

(4) Amounts of assets and liabilities formed by the transfer of long-termreceivables and continuing involvement

□Applicable √N/A

Other notes:

√Applicable □N/A

For receivable financial assistances, please refer to Notes XII-6 AccountsReceivable from and Payable to Related Parties.17 Long-term equity investment

√Applicable □N/A

Unit: RMB

InvesteeOpening balanceChange in the current periodClosing balanceClosing balance of impairment provision
Additional investmentDecrease in investmentInvestment gains or losses recognized with the equity methodAdjustment of other comprehensive incomeChange in other benefitsCash dividend or profits declared to be distributedImpairment provisionOthers
1. Joint ventures
Yiwu Shanglv348,139,707.061,410,985.53349,550,692.59
Yiwu Rongshang Property23,890,291.66-4,262,987.4119,627,304.25
Yiwu Chuangcheng Property17,885,010.32-2,436,401.1615,448,609.16
Yiwu Guoshen Property20,000,000.00-11,058,047.248,941,952.76
Others26,809,427.55-467,881.4526,341,546.103,327,216.16
Subtotal416,724,436.5920,000,000.00-16,814,331.73419,910,104.863,327,216.16
2. Associates
Binjiang Shangbo137,128,387.7516,729,010.14153,857,397.89
Huishang Micro-Finance83,302,336.78-7,756,416.3575,545,920.43
Chouzhou Financial Lease330,665,464.3120,478,144.40351,143,608.71
Yiwu China Commodities City Investment and Management Co., Ltd.9,508,049.22
Yiwu China Commodities City Fuxing Investment Center (limited partnership)102,918,559.00102,918,559.00
Hangzhou MicroAnts Co., Ltd.10,480,198.77-854,967.399,625,231.38
Yiwu Hongyi Equity Investment Fund Partnership (limited partnership)590,375,442.2690,000,000.001,843,206.70682,218,648.96
Others99,825,229.1115,385,901.202,654,175.061,025,208.162,072,860.50111,509,302.91
Sub-total1,354,695,617.98105,385,901.202,654,175.0631,464,185.662,072,860.501,486,818,669.289,508,049.22
Total1,771,420,054.57125,385,901.202,654,175.0614,649,853.932,072,860.501,906,728,774.1412,835,265.38

Other notes

Provision for impairment of long-term equity investment:

Opening balance of the current yearIncrease in the current yearDecrease in the current yearClosing balance
Yiwu China Commodities City Investment and Management Co., Ltd.9,508,049.229,508,049.22
Others3,327,216.163,327,216.16
12,835,265.3812,835,265.38

Note 1: in 2017, the Group’s wholly-owned subsidiary Yiwu China Commodities CityFinancial Holdings Co., Ltd. (“CCCF”) and Shanghai Fuxing Industry Group Co., Ltd.(“Fuxing”) jointly established an industry fund Yiwu China Commodities City FuxingInvestment Center (limited partnership) (hereinafter referred to as the “FoF”). TheFoF has invested in 12 sub-funds including Yiwu Shangfu Chuangzhi InvestmentCenter (limited partnership) (“Shangfu Chuangzhi Fund”). CCCF subscribed forcapital contribution of RMB998mn in the FoF as a limited partner, accounting for

49.9% of the total capital contribution, and has paid in RMB102.92mn, and theunpaid portion is not subject to any term. Fuxing is also a limited partner of the FoF.CCCF also made capital contribution of RMB9.8mn (49% equity) to establish, jointlywith Fuxing, Yiwu China Commodities City Investment and Management Co., Ltd.(hereinafter referred to as the “CCCIM”) to be a general partner of the above FoFand sub-funds. The FoF and CCCIM are both under the control of Fuxing and areassociates of CCCF. As a limited partner of Shangfu Chuangzhi Fund, CCCF hassubscribed for and made capital contribution of RMB617.51mn. Due to thesubstance of Fuxing’s fixed income as guarantee for the capital contribution, thecapital contribution was recognized as other non-current assets at the end of 2018(please refer to Notes V-19 for details); in 2019, due to the implementation of thenew standards for financial instruments, the investment could not pass thecontractual cash flow test and was thus re-classified into the financial assets thatare measured by fair value and of which the changes in fair value are recognized inthe profit or loss for the current period, and was presented as other non-currentfinancial assets (please refer to Notes VII-18 for details). The above paid-in capitalcontribution made by CCCF to the FoF has been contributed to Shangfu ChuangzhiFund together with the capital contribution of Fuxing to the FoF through the FoF as

a limited partner. With the capital contribution from the FoF as a limited partner andCCCF’s capital contribution to Shangfu Chuangzhi Fund as a limited partner,Shangfu Chuangzhi Fund made capital contribution of RMB820.54mn to subscribefor the increase in the registered capital of Hubei Provincial Asset Management Co.,Ltd. to acquire 22.667% equity therein.In 2018, CCCF learned during its after-investment follow-up management thatFuxing and its actual controller ZHU Yidong were suspected of having committed acriminal offense and the 22.667% equity held by Shangfu Chuangzhi Fund in HubeiProvincial Asset Management Co., Ltd. was frozen by the Public Security Bureau ofShanghai due to Fuxing’s contribution to the sources of the capital contribution. TheGroup thought that as of Dec 31, 2018, the Group’s capital contributions to the FoFand Shangfu Chuangzhi Fund were irrelevant to Fuxing’s capital contribution andhad not been impaired, but it made full provision for its equity investment in CCCIM.Please refer to Notes VII-81 and Notes XIV-1.18 Other equity instruments investment

(1) Overview of other equity instruments investment

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Shenwan Hongyuan Securities Co., Ltd.633,408,055.13642,187,968.78
Total633,408,055.13642,187,968.78

(2) Non-trading equity instruments investment

□Applicable √N/A

Other notes:

□Applicable √N/A

19 Other non-current financial assets

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
PE investment1,379,506,051.181,374,004,972.45
Unlisted equity investment127,388,186.5781,388,186.57
NEEQ equity investment50,524,390.8564,056,280.00
Total1,557,418,628.601,519,449,439.02

Other notes:

The above included the investment of RMB617,511,352.00 made by CCCF in YiwuShangfu Chuangzhi Investment Center (limited partnership) as a limited partner.20 Property investmentMeasurement models

(1) Property investment measured by cost

Unit: RMB

ItemBuildings and structuresLand use rightTotal
I. Original book value
1. Opening balance1,694,060,209.90576,533,042.182,270,593,252.08
2. Increase in the current period523,034,076.97-523,034,076.97
(1) Outsourcing515,928,954.94515,928,954.94
(2) Inventory\fixed assets\construction in progress changed into property investment7,086,024.377,086,024.37
(3) Others19,097.6619,097.66
3. Decrease in the current period4,193,501.253,431,878.117,625,379.36
(1) Disposal315,716.961,209,465.001,525,181.96
(2) Other changeover3,877,784.292,222,413.116,100,197.40
4. Closing balance2,212,900,785.62573,101,164.072,786,001,949.69
II. Accumulated depreciation and accumulated amortization-
1. Opening balance331,296,074.2676,078,821.42407,374,895.68
2. Increase in the current period39,467,365.815,279,744.9244,747,110.73
(1) Provision or amortization39,467,365.815,279,744.9244,747,110.73
3. Decrease in the current period612,031.31689,583.051,301,614.36
(1) Disposal167,540.18403,611.40571,151.58
(2) Other changeover444,491.13285,971.65730,462.78
4. Closing balance370,151,408.7680,668,983.29450,820,392.05
III. Depreciation provision
IV. Book value
1. Opening book value1,842,749,376.86492,432,180.782,335,181,557.64
2. Closing book value1,362,764,135.64500,454,220.761,863,218,356.40

(2) Property investment for which the ownership certificates have not been

obtained:

√Applicable □N/A

Unit: RMB

ItemBook valueReasons for having not obtained the ownership certificate
Jiangxi Yinxiang Xintiandi Commercial City173,954,508.54Completion settlement not completed
Office building of the auxiliary project in western Yiwu108,790,539.02Completion settlement not completed
Total282,745,047.56

Other notes:

□Applicable √N/A

21 Fixed assetsPresentation of items

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Fixed assets5,306,898,046.334,783,819,070.71
Total5,306,898,046.334,783,819,070.71

Other notes:

NoneFixed assets

(1) Overview of fixed assets

√Applicable □N/A

Unit: RMB

ItemBuildings and structuresMachinery equipmentTransportation equipmentTotal
I. Original book value:
1. Opening balance6,800,283,071.043,665,371,519.3019,996,191.6310,485,650,781.97
2. Increase in the current period542,009,226.35171,655,048.85-713,664,275.20
(1) Purchase17,010,957.5817,010,957.58
(2) Changeover from construction in progress542,009,226.35133,281,174.97675,290,401.32
(3) Increase due to mergers21,362,916.3021,362,916.30
3. Decrease in the current period3,111,858.444,219,406.07-7,331,264.51
(1) Disposal or retirement1,065,282.973,374,968.354,440,251.32
(2) Other changeover2,046,575.47844,437.722,891,013.19
4. Closing balance7,339,180,438.953,832,807,162.0819,996,191.6311,191,983,792.66
II. Accumulated depreciation-
1. Opening balance2,203,781,112.953,012,444,637.9314,442,492.535,230,668,243.41
2. Increase in the current period138,382,872.9248,776,324.15558,201.06187,717,398.13
(1) Provision138,382,872.9248,776,324.15558,201.06187,717,398.13
3. Decrease in the current period450,565.424,012,797.64-4,463,363.06
(1) Disposal or retirement450,565.424,012,797.644,463,363.06
4. Closing balance2,341,713,420.453,057,208,164.4415,000,693.595,413,922,278.48
III. Impairment provision-
1. Opening balance471,163,467.85471,163,467.85
2. Closing balance471,163,467.85471,163,467.85
IV. Book value
1. Closing book value4,526,303,550.65775,598,997.644,995,498.045,306,898,046.33
2. Opening book value4,125,338,490.24652,926,881.375,553,699.104,783,819,070.71

(2) Temporarily idle fixed assets

□Applicable √N/A

(3) Fixed assets leased in through financial lease

√Applicable □N/A

Unit: RMB

ItemOriginal book valueAccumulated depreciationImpairment provisionBook value
General equipment6,084,431.995,841,054.71243,377.28

(4) Fixed assets leased out through operating lease

□Applicable √N/A

(5) Fixed assets for which the ownership certificates have not been obtained

√Applicable □N/A

Unit: RMB

ItemBook valueReasons for having not obtained the ownership certificate
Huangyuan Clothing Market296,303,143.99Completion settlement not completed
CCC Hotel54,903,102.37Completion settlement not completed
Total351,206,246.36

Other notes:

√Applicable □N/A

The impairment of fixed assets was RMB471,163,467.85, which was theimpairment of the fixed assets of Yiwu China Commodities City.Disposal of fixed assets

□Applicable √N/A

22 Construction in progressPresentation of items

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Construction in progress336,579,220.70865,754,600.02
Total336,579,220.70865,754,600.02

Other notes:

NoneConstruction in progress

(1) Overview of construction in progress

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Book balanceImpairment provisionBook valueBook balanceImpairment provisionBook value
West Yiwu International Means of Production Market Auxiliary Project118,927,524.32118,927,524.32715,506,628.67715,506,628.67
Liaoning Xiliu Yiwu China Commodities City Commerce Phase I Project—Hotel Project32,290,506.334,635,059.9627,655,446.3732,290,506.334,635,059.9627,655,446.37
Culture Creative Industry Park Project65,215,636.5265,215,636.5234,195,677.6034,195,677.60
Zhimei Dachen Project29,859,985.8129,859,985.8129,859,985.8129,859,985.81
Chi’an Xihai Project28,072,996.7228,072,996.7228,072,996.7228,072,996.72
Dafan Hotel Project10,399,882.8410,399,882.84
Auxiliary Project of Tourism Project13,521,181.2613,521,181.26
Section A Plaza Renovation Project18,295,254.2918,295,254.2917,155,743.5617,155,743.56
Meihu Exhibition Center Renovation Project1,750,924.631,750,924.635,415,678.905,415,678.90
Yiwu Comprehensive Bonded Zone Project10,280,939.7310,280,939.73
Trade City Station in Warehouse Park997,950.11997,950.11
Other projects11,601,498.1011,601,498.107,892,442.397,892,442.39
Total341,214,280.664,635,059.96336,579,220.70870,389,659.984,635,059.96865,754,600.02

(2) Changes to important construction in progress during the current period

√Applicable □N/A

Unit: RMB

Name of projectBudgetOpening balanceIncrease in the current periodAmount changed into fixed assetsOther decrease in the current periodClosing balanceRatio of accumulated investment to budget (%)Progress of projectAccumulated capitalized interestIn which: capitalized interest in the current periodInterest capitalization ratio for the current period (%)Source of funds
West Yiwu International Means of Production Market Auxiliary Project1,339,160,000.00715,506,628.6761,101,418.15657,680,522.50118,927,524.3276.43
75,357,556.7815,494,362.774.05Self-owned/financing
Liaoning Xiliu Yiwu China Commodities City Commerce Phase I Project—Hotel Project1,800,000,000.0032,290,506.3332,290,506.3390.85The main work is under constructionSelf-owned/financing
Culture Creative Industry Park Project507,560,000.0034,195,677.6048,085,672.7417,065,713.8265,215,636.5238.61The renovation of Section A, B, C, D and E has been completed, and the renovation of the central square has been completed by 50%Self-owned
Zhimei Dachen Project30,000,000.0029,859,985.8129,859,985.8199.53The basic construction works such as the tourist center landscape renovation works and tourist footpath Phase 5 works have been completedSelf-owned
Chi’an Xihai Project30,000,000.0028,072,996.7228,072,996.7293.58The basic construction works such as the basic infrastructures of Shangyang Countryside Complex and Shangyang-Laishan road have been completedSelf-owned
Dafan Hotel Project50,740,000.00-10,399,882.8410,399,882.8420.50The construction of the main structure roofs, the confirmation of the decoration plan and the infrastructure construction for the auxiliary park of the 1-9# buildings of the hotel have been completedSelf-owned
Auxiliary Project of Tourism Project38,500,000.00-13,521,181.2613,521,181.2635.12The basic construction works of Maodian-Guanyu road, Dacheng Dongtang ecological parking lot and Chi’an Maodian-Guanyu road to Laishansi road have been completedSelf-owned
Section A Plaza Renovation Project20,600,000.0017,155,743.561,139,510.7318,295,254.2988.8185% of the project has been completedSelf-owned
Meihu Exhibition Center Renovation Project12,000,000.005,415,678.905,565,765.799,230,520.061,750,924.6391.5195% of the project has been completedSelf-owned
Yiwu Comprehensive Bonded Zone Project6,242,500,000.0010,280,939.7310,280,939.730.1680% of the earthwork has been completed, the overpass works have come under construction, invitations are being made for the bidding for Phase I project of the comprehensive bonded zone (civil works of customs supervision facilities)Self-owned
Trade City Station in Warehouse Park104,474,460.00997,950.11997,950.1115.36Application for the construction permit is being made and the constructor is being determinedSelf-owned
Other projects7,892,442.394,144,220.71435,165.0011,601,498.10
Total10,175,534,460.00870,389,659.98155,236,542.06684,411,921.38341,214,280.66//75,357,556.7815,494,362.77//

(3) Provision made for the impairment of construction in progress in thecurrent period

□Applicable √N/A

Other notes

□Applicable √N/A

Construction materials

□Applicable √N/A

23 Bearer biological asset

(1) Bearer biological asset measured by cost

□Applicable √N/A

(2) Bearer biological asset measured by fair value

□Applicable √N/A

Other notes

□Applicable √N/A

24 Oil and gas assets

□Applicable √N/A

25 Right-of-use assets

□Applicable √N/A

26 Intangible assets

(1) Overview of intangible assets

√Applicable □N/A

Unit: RMB

ItemLand use rightSoftwareTotal
I. Original book value
1. Opening balance4,853,588,486.468,646,093.924,862,234,580.38
2. Increase in the current period444,166,900.001,831,140.08445,998,040.08
(1) Purchase444,166,900.001,831,140.08445,998,040.08
3. Decrease in the current period806,310.00806,310.00
(1) Disposal806,310.00806,310.00
4. Closing balance5,296,949,076.4610,477,234.005,307,426,310.46
II. Accumulated amortization
1. Opening balance1,402,983,356.143,113,978.221,406,097,334.36
2. Increase in the current period64,825,023.01697,791.0665,522,814.07
(1) Provision64,825,023.01697,791.0665,522,814.07
3. Decrease in the current period266,374.95266,374.95
(1) Disposal266,374.95266,374.95
4. Closing balance1,467,542,004.203,811,769.281,471,353,773.48
II. Impairment provision
IV. Book value
1. Closing book value3,829,407,072.266,665,464.723,836,072,536.98
2. Opening book value3,450,605,130.325,532,115.703,456,137,246.02

The proportion of the balance of intangible assets formed through internal R&D was0% at the end of the current period

(2) Land use right for which the ownership certificate has not been obtained

□Applicable √N/A

Other notes:

□Applicable √N/A

27 Development expenses

□Applicable √N/A

28 Goodwill

(1) Original book value of goodwill

□Applicable √N/A

(2) Provision for goodwill impairment

□Applicable √N/A

(3) Information on the assets group or combination of assets groups towhich the goodwill belongs

□Applicable √N/A

(4) Goodwill impairment test process, key parameters (e.g. growth rate in

the forecast period, growth rate in the stable period, profit margin,discount rate, forecast period for the estimate of present value of futurecash flows, if applicable) and recognition of goodwill impairment loss

□Applicable √N/A

(5) Impact of goodwill impairment test

□Applicable √N/A

Other notes:

□Applicable √N/A

29 Long-term prepaid expenses

√Applicable □N/A

Unit: RMB

ItemOpening balanceIncrease in the current periodAmortized amount in the current periodOther decreaseClosing balance
Decoration of buildings and structures130,917,605.118,511.1127,441,413.32103,484,702.90
Advertising facilities8,584,777.7667,924.536,242,773.182,409,929.11
Total139,502,382.8776,435.6433,684,186.50105,894,632.01

Other notes:

None30 Deferred income tax assets/deferred income tax liabilities

(1) Deferred income tax assets having not been offset

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Deductible temporary differenceDeferred income tax assetsDeductible temporary differenceDeferred income tax assets
Provision for impairment of assets54,886,084.0013,721,521.0028,086,747.077,021,686.77
Unrealized profits of internal transactions105,807,284.5626,451,821.14107,448,552.6826,862,138.17
Deductible losses58,364,771.9614,591,192.9985,414,896.1221,353,724.03
Prepayment of income tax on presold houses177,808,146.0044,452,036.5092,177,928.2723,044,482.07
Recognized but unpaid liabilities218,544,922.5654,636,230.63333,438,714.8383,359,678.71
Overspent advertising cost9,910.642,477.6610,604,186.362,651,046.60
Change in fair value of other non-current financial liabilities66,248,179.8816,562,044.9664,448,179.8616,112,044.95
Total681,669,299.60170,417,324.88721,619,205.19180,404,801.30

(2) Deferred income tax liabilities having not been offset

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Taxable temporary differenceDeferred income tax liabilitiesTaxable temporary differenceDeferred income tax liabilities
Asset evaluation appreciation for merger of the enterprises not under common control1,163,217.48290,804.371,257,714.04314,428.51
Change in fair value of other equity instruments investment79,782,624.1219,945,656.0388,562,537.8022,140,634.45
Change in fair value of other non-current financial assets382,470,612.5695,617,653.13360,477,102.9390,119,275.73
Total463,416,454.16115,854,113.53450,297,354.77112,574,338.69

(3) Deferred income tax assets or liabilities presented in net amount after

offsetting

□Applicable √N/A

(4) Breakdown of unrecognized deferred income tax assets

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Deductible temporary difference3,385,634.1936,832,234.08
Deductible loss767,927,960.89663,848,325.35
Total771,313,595.08700,680,559.43

(5) The deductible loss in unrecognized deferred income tax assets will be

due in the following years

√Applicable □N/A

Unit: RMB

YearClosing amountOpening amountRemark
202045,804,174.10
202134,738,115.4434,738,115.44
2022245,346,275.18245,346,275.18
2023148,493,718.68145,652,609.01
2024226,329,502.26192,307,151.62
2025113,020,349.33
Total767,927,960.89663,848,325.35/

Other notes:

√Applicable □N/A

The Group believed that the above deductible temporary differences such asprovision for impairment of assets and estimated profits of presold houses and the

deductible loss of some subsidiaries could be deducted in the foreseeable futureand the Group would have adequate profits before tax for such deduction during thereversal period. Therefore, the Group deemed it necessary to recognize the abovedeferred income tax assets.31 Other non-current assets

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Book balanceImpairment provisionBook valueBook balanceImpairment provisionBook value
Prepaid land transfer fees138,253,316.00138,253,316.00138,253,316.00138,253,316.00
Prepaid office building transfer fees22,500,000.0022,500,000.00519,850,000.00519,850,000.00
Prepayment for renovation works and prepaid decoration rent3,545,391.193,545,391.19
Total160,753,316.00160,753,316.00661,648,707.19661,648,707.19

Other notes:

None32 Short-term borrowings

(1) Classification of short-term borrowings

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Credit loans3,577,474,227.224,178,903,704.82
Total3,577,474,227.224,178,903,704.82

Note to the classification of short-term borrowings:

As of Jun 30, 2020, the annual interest rate of the above borrowings was

1.10%-4.15% (1.10%-4.35% as of Dec 31, 2019). For the guarantees for theborrowings, please refer to Notes 12-5-(4) Related-Party Guarantees

(2) Overdue short-term borrowings

□Applicable √N/A

Other notes:

□Applicable √N/A

33 Held-for-trading financial liabilities

□Applicable √N/A

34 Derivative financial liabilities

□Applicable √N/A

35 Notes payable

□Applicable √N/A

36 Accounts payable

(1) Presentation of accounts payable

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Accounts payable for real estate projects302,129,281.17300,646,681.02
Accounts payable for market and auxiliary works projects132,700,009.10180,639,638.94
Accounts payable for procurement for the hotel project27,202,590.7723,650,330.93
Accounts payable for import and export193,414,224.96
Others35,031,112.8120,304,842.59
Total690,477,218.81525,241,493.48

(2) Important accounts payable with age over 1 year

√Applicable □N/A

Unit: RMB

ItemClosing balanceReasons for not being paid or carried forward
Accounts payable for real estate projects35,931,620.16Settlement has not been completed or the projects are within the warranty periods
Total35,931,620.16/

Other notes:

√Applicable □N/A

The accounts payable are free of interest and are generally paid within two monthsafter receipt of the payment notice or based on the project contracts and progress ofprojects. The balance payments for the projects are made after completion ofsettlement.

37 Advances from customers

(1) Presentation of advances from customers

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Rental advances18,672,952.84250,436,393.04
Total18,672,952.84250,436,393.04

(2) Important advances with the age over 1 year

□Applicable √N/A

Other notes:

□Applicable √N/A

38 Contract liabilities

(1) Overview of contract liabilities

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Market booth use fees1,506,064,215.012,657,979,673.50
House payment2,712,470,230.851,515,939,313.37
Goods payment53,781,966.8220,601,261.43
Network cable use fees11,851,148.3314,275,224.26
Advertising fees16,324,369.3719,199,914.96
Exhibition fees1,998,842.807,188,678.96
Others101,264,214.2722,834,669.11
Total4,403,754,987.454,258,018,735.59

(2) Amount of and reason for significant change in book value during the

reporting period

□Applicable √N/A

Other notes:

□Applicable √N/A

39 Payroll payable

(1) Presentation of payroll payable

√Applicable □N/A

Unit: RMB

ItemOpening balanceIncrease in the current periodDecrease in the current periodClosing balance
I. Short-term compensation196,068,529.87186,237,127.75313,081,650.2169,224,007.41
II. Post employment benefits – defined contribution plan1,105,890.0923,159,577.6022,463,317.041,802,150.65
III. Severance benefits368,323.45368,323.45
IV. Other benefits due within one year
Total197,174,419.96209,765,028.80335,913,290.7071,026,158.06

(2) Presentation of short-term compensation

√Applicable □N/A

Unit: RMB

ItemOpening balanceIncrease in the current periodDecrease in the current periodClosing balance
1. Salary, bonus, allowance and subsidy195,405,526.67140,750,161.58267,847,764.8468,307,923.41
2. Employee benefits36,202.1219,100,101.2219,075,524.0060,779.34
3. Social security contribution411,043.106,757,193.136,473,692.83694,543.40
In which: contribution to medical insurance scheme365,691.236,441,056.576,185,257.75621,490.05
Contribution to work-related injury insurance scheme22,289.75151,011.52133,291.5740,009.70
Contribution to maternity insurance scheme23,062.12165,125.04155,143.5133,043.65
4. Housing provident fund85,803.0014,259,063.0014,281,542.0063,324.00
5. Contribution to trade union fund and employee education fund129,954.985,370,608.825,403,126.5497,437.26
Total196,068,529.87186,237,127.75313,081,650.2169,224,007.41

(3) Presentation of defined contribution plan

√Applicable □N/A

Unit: RMB

ItemOpening balanceIncrease in the current periodDecrease in the current periodClosing balance
1. Contribution to the basic endowment insurance scheme1,020,021.288,843,336.418,192,998.501,670,359.19
2. Contribution to the unemployment insurance scheme85,868.81304,696.51258,773.86131,791.46
3. Contribution to enterprise annuity14,011,544.6814,011,544.68-
Total1,105,890.0923,159,577.6022,463,317.041,802,150.65

Other notes:

□Applicable √N/A

40 Taxes payable

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
VAT2,961,114.3141,578,727.82
Business tax-1,094,595.61-15,123,820.98
Corporate income tax110,793,460.16187,716,475.31
Individual income tax817,363.59958,941.24
Urban maintenance and construction tax-4,455,424.60-876,344.54
Land appreciation tax-62,694,045.07-36,912,707.44
Real estate tax42,504,762.3099,398,810.58
Land use tax2,384,947.954,905,517.10
Others-4,735,046.82-1,461,345.83
Total86,482,536.21280,184,253.26

Other notes:

The main taxes prepaid by the Group as of Jun 30, 2020 are listed as follows:

International trade city marketHe Tang Yue SeQiantang YinxiangFenghuang YinxiangEurope and U.S. CenterPujiang LvguJiamei PlazaSuxi ShangboTotal amount of prepaid tax
Business tax201,063.51509,383.05240,013.55144,135.501,094,595.61
Urban maintenance and construction tax36,603.75156,013.43731,793.321,096,159.502,008,454.311,114,074.115,143,098.42
Land appreciation tax0.00119,905,833.25337,976.8674,632,317.9620,275,824.4315,745,580.77230,897,533.27
Education surcharge and local education surcharge26,145.30111,438.16522,709.511,096,159.821,434,610.241,114,074.094,305,137.12
Total201,063.51572,132.10120,145,846.80411,587.091,592,479.6976,824,637.2823,718,888.9817,973,728.97241,440,364.42

41 Other payablesPresentation of items

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Other payables759,474,210.61909,483,132.47
Total759,474,210.61909,483,132.47

Other notes:

NoneInterest payable

□Applicable √N/A

Dividend payable

□Applicable √N/A

Other payables

(1) Presentation of other payables by nature

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Withholdings, deposit and margin488,278,549.04622,982,815.42
Miscellaneous expenses payable209,999,653.34181,518,107.60
House reservation fees4,876,852.704,876,852.70
Bank reserve24,601,394.0021,381,358.25
Others31,717,761.5378,723,998.50
Total759,474,210.61909,483,132.47

(2) Important other payables with account age over 1 year

□Applicable √N/A

Other notes:

√Applicable □N/A

As other payables were mainly sourced from the deposit and margin of marketbooths, the bid bond for engineering projects and the house reservation fees forreal estate projects, and the amount of each item was small, the Group did not haveimportant other payables with account age over 1 year on Jun 30, 2020.42 Held-for-sale liabilities

□Applicable √N/A

43 Non-current liabilities due within one year

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Long-term borrowings within one year320,364,833.35270,332,413.94
Total320,364,833.35270,332,413.94

Other notes:

None44 Other current liabilities

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Short-term bonds payable3,031,046,913.212,011,484,133.28
To-be-reported output tax7,861,458.537,615,690.09
Dividend announced but not collected before listing2,083,112.652,083,112.65
Dividend payable to to-be-recognized accounts1,829,182.201,829,182.20
Total3,042,820,666.592,023,012,118.22

Changes in short-term bonds payable:

√Applicable □N/A

Unit: RMB

BondFace valueIssue dateMaturityIssue valueOpening balanceCurrent issueInterest accrued based on face valuePremium/discount amortizationCurrent repaymentClosing balance
Super short-term commercial paper100Aug 29, 2019270D1,000,000,0001,010,236,895.8413,404,536.27702,830.191,000,000,000
Super short-term commercial paper100Dec 9, 2019270D1,000,000,0001,001,247,237.4416,803,835.62480,020.971,018,565,056.29
Super short-term commercial paper100Feb 18, 2020180D1,000,000,0001,000,000,00010,451,506.85366,666.671,010,318,173.52
Super short-term commercial paper100May 14, 2020120D1,000,000,0001,000,000,0002,374,794.52122,222.221,002,163,683.40
Total///4,000,000,0002,011,484,133.282,000,000,00043,034,673.261,671,740.051,000,000,0003,031,046,913.21

Other notes:

√Applicable □N/A

As of Jun 30, 2020, the annualized interest rates of the above commercial paperswere 1.97%-3.37% (4.19%-5.42% as of Dec 31, 2019).45 Long-term borrowings

(1) Classification of long-term borrowings

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Guaranteed borrowings90,098,000.00200,239,555.56
Credit borrowings280,350,777.78330,454,758.42
Total370,448,777.78530,694,313.98

Notes on the classification of long-term borrowings:

NoneOther notes, including the interest rate range:

√Applicable □N/A

As of Jun 30, 2020, the annualized interest rates of the above borrowings were

3.92%-4.51% (3.92%-4.51% as of Dec 31, 2019). For the guarantee information ofguaranteed borrowings, please refer to Notes XII-5-(4) Related-Party Guarantees.46 Bonds payable

(1) Bonds payable

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Bonds payable4,625,150,185.914,564,291,387.81
Total4,625,150,185.914,564,291,387.81

(2) Change in bonds payable (excluding other financial instrumentsclassified as financial liabilities, such as preferred shares and perpetualbonds)

√Applicable □N/A

Unit: RMB

BondFace valueIssue dateMaturityIssue valueOpening balanceCurrent issueInterest accrued based on face valuePremium/discount amortizationCurrent repaymentClosing balance
MTN100Sep 6, 20183Y1,000,000,0001,012,965,562.7023,684,931.51634,565.601,037,285,059.81
MTN100Jul 15, 20193Y1,000,000,0001,017,459,101.2819,840,983.61180,283.671,037,480,368.56
MTN100Oct 21, 20193Y1,000,000,0001,006,575,929.3119,741,530.05191,133.801,026,508,593.16
Corporate bonds100Jun 5, 20193Y800,000,000819,791,780.8217,058,630.1434,400,000802,450,410.96
Corporate bonds100Sep 25, 20193Y700,000,000707,499,013.7013,926,739.72721,425,753.42
Total///4,500,000,0004,564,291,387.8194,252,815.031,005,983.0734,400,0004,625,150,185.91

(3) Conditions and time for the conversion of convertible corporate bonds

□Applicable √N/A

(4) Notes on other financial instruments classified as financial liabilitiesBasic information of other financial instruments such as preferred shares andperpetual bonds outstanding at the end of the reporting period

□Applicable √N/A

Changes in other financial instruments such as preferred shares and perpetualbonds outstanding at the end of the reporting period

□Applicable √N/A

Basis for other financial instruments being classified as financial liabilities

□Applicable √N/A

Other notes:

√Applicable □N/A

As of Jun 30, 2020, the annualized interest rates of the above bonds payable were

3.97%-4.75% (3.97%-4.75% as of Dec 31, 2019).

47 Lease liabilities

□Applicable √N/A

48 Long-term accounts payablePresentation of items

□Applicable √N/A

Long-term accounts payable

□Applicable √N/A

Special accounts payable

□Applicable √N/A

49 Long-term payroll payable

□Applicable √N/A

50 Estimated liabilities

√Applicable □N/A

Unit: RMB

ItemOpening balanceClosing balanceCause of formation
Letter of credit compensation loss110,620,306.10110,620,306.10In 2017, the letters of credit issued by the Group’s subsidiary based on international trade agency business became overdue successively due to the principals’ failure to make payments as agreed. Based on the principle of prudence, the Group recognized estimated liabilities for the estimated potential losses. On Apr 30, 2018, the Group lost control over the subsidiary due to its disposal of some equity in the subsidiary. As of Jun 30, 2020, the matter was still pending.
Total110,620,306.10110,620,306.10/

Other notes, including the notes on related important assumptions and estimates ofimportant estimated liabilities:

None51 Deferred incomeOverview of deferred income

√Applicable □N/A

Unit: RMB

ItemOpening balanceIncrease in the current periodDecrease in the current periodClosing balanceCause of formation
Government grants
Asset-related government grants27,966,750.98710,736.8427,256,014.14
Income-related government grants3,000,000.001,500,000.001,500,000.00
Total27,966,750.983,000,000.002,210,736.8428,756,014.14/

Items involving government grants:

√Applicable □N/A

Unit: RMB

Liability itemOpening balanceIncrease in grant amount in the current periodAmount recognized in revenue from non-operating activities in the current periodAmount recognized in other income in the current periodOther changesClosing balanceAsset-related or income-related
Subsidy for service industry cluster project5,776,779.23133,333.325,643,445.91Asset-related
Interest subsidy for the international exhibition center construction fund22,189,971.75577,403.5221,612,568.23Asset-related
Grant for the3,000,000.001,500,000.001,500,000.00Income-related

Other notes:

□Applicable √N/A

52 Other non-current liabilities

√Applicable □N/A

Unit: RMB

construction andoperation of thecredit data centerItem

ItemClosing balanceOpening balance
To-be-reported output tax1,148.89
Total1,148.89

Other notes:

None53 Capital stock

√Applicable □N/A

Unit: RMB

Opening balanceIncrease or decrease in the current period (+, -)Closing balance
New shares issuedBonus sharesShares converted from capital reserveOthersSub-total
Total number of shares5,443,214,176.005,443,214,176.00

Other notes:

None54 Other equity instruments

(1) Basic information of other financial instruments such as preferred sharesand perpetual bonds outstanding at the end of the reporting period

□Applicable √N/A

(2) Changes in other financial instruments such as preferred shares andperpetual bonds outstanding at the end of the reporting period

□Applicable √N/A

Changes in other equity instruments in the current period, the reasons therefor andthe basis for relevant accounting treatment:

□Applicable √N/A

Other notes:

□Applicable √N/A

55 Capital reserve

√Applicable □N/A

Unit: RMB

ItemOpening balanceIncrease in the current periodDecrease in the current periodClosing balance
Capital surplus (share premium)1,468,014,797.111,468,014,797.11
Other capital reserve56,168,982.5315,959,450.8140,209,531.72
Total1,524,183,779.6415,959,450.811,508,224,328.83

Other notes including those on the changes in the current period and the reasonstherefor:

None56 Treasury shares

□Applicable √N/A

57 Other comprehensive income

√Applicable □N/A

Unit: RMB

ItemOpening balanceAmount in the current periodClosing balance
Amount before tax incurred in the current periodLess: income tax expensesAmount after tax attributable to parent company
I. Other comprehensive income that cannot be reclassified into profit or loss66,421,903.33-8,779,913.65-2,194,978.42-6,584,935.2359,836,968.10
Changes in fair value of other equity instruments investment66,421,903.33-8,779,913.65-2,194,978.42-6,584,935.2359,836,968.10
II. Other comprehensive income to be reclassified into profit or loss-154,710.59-266,077.70-266,077.70-420,788.29
Difference arising from the translation of foreign currency financial-154,710.59-266,077.70-266,077.70-420,788.29
statements
Total other comprehensive income66,267,192.74-9,045,991.35-2,194,978.42-6,851,012.9359,416,179.81

Other notes, including those on the adjustment of the initially recognized amount ofhedged items converted from the effective part of gains or losses from cash flowhedging:

None58 Special reserve

□Applicable √N/A

59 Surplus reserves

√Applicable □N/A

Unit: RMB

ItemOpening balanceIncrease in the current periodDecrease in the current periodClosing balance
Statutory surplus reserve1,184,282,215.221,184,282,215.22
Discretionary surplus reserve40,195,855.6840,195,855.68
Others11,688,840.9111,688,840.91
Total1,236,166,911.811,236,166,911.81

Notes on surplus reserves, including those on the changes in the current period andthe reasons therefor:

None60 Undistributed profits

√Applicable □N/A

Unit: RMB

ItemCurrent periodPrevious year
Undistributed profits at the end of the previous reporting period before adjustment4,750,787,389.173,957,969,914.54
Opening undistributed profits after adjustment4,750,787,389.173,957,969,914.54
Plus: net profits attributable to shareholders of the parent company in the current period719,595,308.661,255,276,023.70
Less: withdrawal of statutory surplus reserve135,865,698.51
Common share dividend payable326,592,850.56
Closing undistributed profits5,470,382,697.834,750,787,389.17

Details of the adjustment of opening undistributed profits:

1. The opening undistributed profits affected by the retroactive adjustment made inaccordance with the Accounting Standards for Enterprises and related newprovisions amounted to RMB0.

2.The opening undistributed profits affected by the changes in accounting policiesamounted to RMB0.

3. The opening undistributed profits affected by the correction of major accountingerrors amounted to RMB0.

4. The opening undistributed profits affected by changes in the scope of mergerscaused by common control amounted to RMB0.

5. The opening undistributed profits affected by other adjustments togetheramounted to RMB0.61 Revenue and cost of sales

(1) Overview of revenue and cost of sales

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
RevenueCost of salesRevenueCost of sales
Main business1,720,825,843.49855,681,051.351,378,063,465.52614,332,523.61
Other businesses400,622,950.8213,546,505.12425,533,089.2228,350,270.57
Total2,121,448,794.31869,227,556.471,803,596,554.74642,682,794.18

(2) Revenue generated from contracts

□Applicable √N/A

(3) Contract performance obligations

□Applicable √N/A

(4) Amortization to remaining contract performance obligations

□Applicable √N/A

Other notes:

None62 Taxes and surcharges

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Business tax14,045,794.117,792,040.13
Urban maintenance and construction tax2,314,536.163,673,260.00
Education surcharges991,721.151,571,314.98
Real estate tax51,999,617.0757,616,471.08
Land use tax4,196,070.425,766,214.00
Vehicle and vessel use tax32.9026.64
Stamp duty2,006,907.562,150,689.64
Land appreciation tax5,552,018.398,816,844.44
Local education surcharges661,966.731,051,373.57
Cultural undertaking development fee631,486.57
Total81,768,664.4989,069,721.05

Other notes:

None63 Sales expenses

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Advertising expenses37,445,306.5526,050,575.23
Marketing expenses22,055,175.366,908,251.28
Security and insurance expenses7,101,404.908,114,200.04
Depreciation and amortization93,888.35148,512.03
Water, electricity and fuel expenses2,647,286.403,084,626.27
Transport expenses1,602,775.54780.00
Repair expenses1,519,754.371,413,750.70
Sanitation expenses251,799.89116,921.49
Epidemic prevention and control expenses9,322,583.01
Informatization construction5,367,416.92
Employee expenses46,767.12723,217.05
Others432,913.45814,268.45
Total87,887,071.8647,375,102.54

Other notes:

None64 Administrative expenses

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Employee and uniform expenses98,049,547.0291,417,943.32
Depreciation and amortization10,598,352.978,362,624.79
Intermediary expenses7,983,319.286,022,292.02
Travel expenses1,992,980.092,860,124.96
Office expenses6,236,038.033,930,554.51
Lease and property management expenses556,659.50304,486.19
Promotion and merchants introduction expenses496,350.00193,214.88
Others4,537,677.743,334,960.79
Total130,450,924.63116,426,201.46

Other notes:

None65 R&D expenses

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Labor cost3,834,282.804,645,053.41
Technology R&D expenses12,962,871.101,164,190.29
Depreciation and amortization284,072.04158,423.66
Total17,081,225.945,967,667.36

Other notes:

None66 Financial expenses

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Interest expenses234,936,097.83223,018,844.81
Amortization of commercial paper discount2,673,477.844,334,876.02
Interest income-132,172,237.44-131,284,052.33
Capitalized interest-15,494,362.77-14,918,398.67
Foreign exchange gains or losses-393,092.753,049,415.79
Others1,722,025.633,504,775.97
Total91,271,908.3487,705,461.59

Other notes:

None67 Other income

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Government subsidy for service industry cluster133,333.32133,333.32
Interest subsidy for international exhibition center construction577,403.52581,921.34
Financial assistance to Yiwu e-commerce business credit system construction project545,454.54
Subsidy for undergraduates internship and practical training46,360.00
Award for provincial service industry cluster550,000.00
VAT refund at levying for software products9,108.98
Grant for the construction and operation of the credit data center1,500,000.00500,000.00
Provincial technology SME award10,000.00
Software copyright subsidy2,700.00
Special fund for the promotion of import trade188,800.00
PV installation subsidy from the economy and information technology bureau616,308.00
2018 R&D input award from the technology bureau978,100.00
2019 new and high-tech award from the technology bureau600,000.00
Subsidy for the autumn fair of the import exhibition570,000.00
2020 online hardware exhibition subsidy600,000.00
Tourism development special award from culture and tourism bureau50,000.00
Civilized entity grant3,000.00
Additional deduction of input tax from VAT2,634,909.22353,199.71
Education surcharges refunded by the tax bureau9.78254.91
Refund of the service charges of individual income tax144,060.64
Refund of social security contributions (Employment stabilization subsidy)5,899,392.92
VAT reduction for the recruitment of retired soldiers finding jobs on their own36,000.00
Electricity charge award for production resumption14,214.66
Total13,684,424.063,593,440.80

Other notes:

None68 Investment income

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Income from long-term equity investment calculated with the equity method13,185,907.4927,924,881.72
Investment income from disposal of long-term equity investment
Investment income from held-for-trading financial assets during holding period20,500,000.00
Dividend income from other equity instruments investment during holding period6,271,366.90
Interest income from debt investment during holding period8,196,820.88
Investment income from disposal of held-for-trading financial assets169,594.1522,382,904.11
Investment income from disposal of subsidiaries and related claims76,523,765.30
Investment income from disposal of wealth management products574,553.43
Investment income from disposal of available-for-sale financial assets70,042.18
Total119,150,641.2556,649,194.91

Other notes:

None69 Income from net exposure hedging

□Applicable √N/A

70 Income from changes in fair value

√Applicable □N/A

Unit: RMB

Sources of income from changes in fair valueAmount in the current periodAmount in the previous period
Other non-current financial assets20,193,509.585,642,525.18
Total20,193,509.585,642,525.18

Other notes:

None71 Loss of impairment of credit

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Bad debt loss of accounts receivable-2,379,335.67-5,552,323.74
Total-2,379,335.67-5,552,323.74

Other notes:

None

72 Loss of impairment of assets

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
I. Bad debt loss
II. Inventory depreciation loss and loss of impairment of contract performance cost639,659.42
Total639,659.42

Other notes:

None73 Income from disposal of assets

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Gains from the disposal of fixed assets1,096,272.81216,562.96
Losses from the disposal of fixed assets-776.57-295,357.31
Total1,095,496.24-78,794.35

Other notes:

□Applicable √N/A

74 Revenue from non-operating activities

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous periodAmount recognized in profit or loss of nonrecurring items for the current period
Income from penalties for market booth415,800.00641,453.65415,800.00
Others337,775.18982,104.95337,775.18
Total753,575.181,623,558.60753,575.18

Government grants recognized in the profit or loss for the current period

□Applicable √N/A

Other notes:

□Applicable √N/A

75 Expenses from non-operating activities

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous periodAmount recognized in profit or loss of nonrecurring items for the current period
External donation2,731,413.91
Water conservancy construction fund249,451.94244,400.45
Others250,031.27501,750.83250,031.27
Total3,230,897.12746,151.28250,031.27

Other notes:

None76 Income tax expenses

(1) Overview of income tax expenses

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Current income tax expenses260,211,241.65195,568,804.97
Deferred income tax expenses12,775,944.4211,488,892.93
Total272,987,186.07207,057,697.90

(2) Adjustment process of accounting profits and income tax expenses

√Applicable □N/A

Unit: RMB

ItemAmount in the current period
Profits before tax993,028,856.10
Income tax expenses calculated at the statutory/applicable tax rate248,257,214.03
Effect of adjusting income tax of previous period3,255,463.70
Effect of non-taxable income-3,946,902.14
Effect of non-deductible costs, expenses and losses484,985.20
Effect of using deductible losses of unrecognized deferred income tax assets in previous period-13,179.23
Effect of deductible temporary differences or deductible losses of unrecognized deferred income tax assets in the current period28,255,087.33
Profits or losses attributable to joint ventures and associates-3,305,482.82
Income tax expenses272,987,186.07

Other notes:

□Applicable √N/A

77 Other comprehensive income

√Applicable □N/A

Please refer to Notes 57 Other Comprehensive Income for details78 Items of cash flow statement

(1) Other cash receipts relating to operating activities

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Bank deposit interest income received120,684,004.99131,284,052.33
Government grants received10,859,472.561,943,947.48
Deposit and margin received10,660,056.6131,517,576.33
Financial assistance recovered94,465,000.00
Property ownership certificate fees collected temporarily666,782.84
Total142,203,534.16259,877,358.98

Notes on other cash receipts relating to operating activities:

None

(2) Other cash payments relating to operating activities

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Margins paid125,625,663.45118,950,778.69
Fees paid111,864,579.58116,594,322.47
Bank reserves paid for Yiwugou-3,157,824.29-88,930.44
Property ownership certificate fees paid1,335,791.744,482,403.45
Cash paid to purchase time deposits496,500,000.00
Others18,942,646.9532,481,260.63
Total751,110,857.43272,419,834.80

Notes on other cash payments relating to operating activities:

None

(3) Other cash receipts relating to investing activities

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Financial assistance recovered from joint ventures192,154,897.34
Total192,154,897.34

Notes on other cash receipts relating to investing activities:

None

(4) Other cash payments relating to investing activities

□Applicable √N/A

(5) Other cash receipts relating to financing activities

□Applicable √N/A

(6) Other cash payments relating to financing activities

□Applicable √N/A

79 Supplements to cash flow statement

(1) Supplements to cash flow statement

√Applicable □N/A

Unit: RMB

SupplementsAmount in the current periodAmount in the previous period
1.Adjust net profits to cash flow from operating activities:
Net profits720,041,670.03669,083,018.20
Plus: provision for impairment of assets0.00-639,659.42
Loss of impairment of credit2,379,335.675,552,323.74
Depreciation of fixed assets, depletion of oil and gas assets and depreciation of bearer biological assets232,464,508.86222,652,086.20
Amortization of intangible assets65,522,814.0764,732,258.81
Amortization of long-term prepaid expenses33,684,186.5037,537,272.51
Loss from disposal of fixed assets, intangible assets and other long-term assets (gains indicated by “-”)-1,095,407.99286,652.03
Loss from fixed assets retirement (gains indicated by “-”)-88.25
Loss from changes in fair value (gains indicated by “-”)-20,193,509.58-5,642,525.18
Financial expenses (gains indicated by “-”)15,494,362.7787,705,461.59
Investment loss (gains indicated by “-”)-311,305,538.59-56,649,194.91
Decrease in deferred income tax assets (increase indicated by “-”)-22,701,798.394,711,309.48
Increase in deferred income tax liabilities (decrease indicated by “-”)1,084,796.4338,602,823.80
Decrease in inventory (increase indicated by “-”)-239,207,823.16-835,275,638.62
Decrease in operating receivables (increase indicated by “-”)-879,633,090.02210,361,275.66
Increase in operating payables (decrease indicated by-299,601,118.51-519,136,095.48
“-”)
Others284,599.70
Net cash flow from operating activities-703,066,700.16-75,834,031.89
2.Significant investing and financing activities not involving cash receipt and payment:
3.Net changes in cash and cash equivalents:
Closing balance of cash3,470,682,166.572,513,655,497.85
Less: opening balance of cash3,426,712,549.262,632,160,386.99
Net increase in cash and cash equivalents43,969,617.31-118,504,889.14

(2) Net cash paid for acquisition of subsidiaries in the current period

□Applicable √N/A

(3) Net cash received from disposal of subsidiaries in the current period

□Applicable √N/A

(4) Composition of cash and cash equivalents

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
I. Cash3,470,682,166.573,426,712,549.26
In which: cash on hand369,439.29523,925.97
Bank deposits available for payment at any time3,470,312,727.283,425,411,273.53
Other cash and cash equivalents available for payment at any time1,072,959.97777,349.77
III. Closing balance of cash and cash equivalents3,470,682,166.573,426,712,549.26

Other notes:

□Applicable √N/A

80 Notes to items in statement of changes in owners’ equityNames of “others” items whose closing balances in the previous year are adjustedand the amounts of adjustments:

□Applicable √N/A

81 Assets with restricted title or right of use

√Applicable □N/A

Unit: RMB

ItemClosing book valueReasons for restriction
Cash and cash equivalents209,493,305.80[Note 1]
Long-term equity investment102,918,559.00[Note 2]
Other non-current assets617,511,352.00[Note 2]
Total929,923,216.80/

Other notes:

Note 1: As of Jun 30, 2020, its title or use right of the bank deposits with book valueof RMB209,493,305.80 (RMB56,196,102.62 as of Dec 31, 2019) was restrictedsince the deposits were used as security for obtaining house mortgage loans andas funds for the supervision of advance sales of houses.Note 2: As of Jun 30, 2020, its long-term equity investment with book value of RMB102,918,559.00 (RMB102,918,559.00 as of Dec 31, 2019) and other non-currentassets with book value of RMB617,511,352.00 (RMB617,511,352.00 as of Dec 31,2019) were frozen by Shanghai Municipal Bureau of Public Security. For details,please see XIV-1.82 Foreign currency monetary items

(1) Foreign currency monetary items

√Applicable □N/A

ItemClosing balance in foreign currencyExchange rateClosing balance in RMB
Cash and cash equivalents19,522,661.86
In which: USD2,274,151.817.079516,099,857.74
EUR384,083.927.94003,049,626.32
AED116,287.841.9277224,168.76
RWF19,723,566.000.0076149,009.04

Other notes:

None

(2) Notes on overseas business entities, including, with respect to important

overseas business entities, disclosure of their overseas main businessplaces, functional currency and the basis of choosing the functionalcurrency, and the reasons for changes in functional currency (if any)

□Applicable √N/A

83 Hedging

□Applicable √N/A

84 Government grants1 Overview of government grants

√Applicable □N/A

Unit: RMB

CategoryAmountPresentationAmount recognized in profit or loss for the current period
Interest subsidy for the international exhibition center construction577,403.52Asset-related577,403.52
Government subsidy for service industry cluster for 2011133,333.32Asset-related133,333.32
Civilized entity award3,000.00Income-related3,000.00
Additional deduction of 10% input tax from VAT for production and life service taxpayers2,604,188.90Income-related2,604,188.90
Employment stabilization subsidy5,916,709.09Income-related5,916,709.09
Additional deduction of R&D input award for 2018978,100.00Income-related978,100.00
Tourism development special award50,000.00Income-related50,000.00
Award for 2018 provincial service industry cluster demonstration zone550,000.00Income-related550,000.00
2020 online hardware exhibition subsidy600,000.00Income-related600,000.00
Grant for the construction and operation of Yiwu credit data center1,500,000.00Income-related1,500,000.00
2019 new and high-tech award600,000.00Income-related600,000.00
Electricity charge award for production resumption14,214.66Income-related14,214.66
Total13,526,949.4913,526,949.49

2 Refund of government grants

□Applicable √N/A

Other notes:

None85 Others

□Applicable √N/A

VIII Changes in consolidation scope1 Mergers of enterprises not under common control

□Applicable √N/A

2 Mergers of enterprises under common control

□Applicable √N/A

3 Reverse acquisition

□Applicable √N/A

4 Disposal of subsidiariesHas the Group lost control upon a single disposal of investment in a subsidiary?

√Applicable □N/A

Unit: RMB

Name of subsidiaryConsideration of the equity disposalPercentage of equity disposed of (%)Form of disposalTime of loss of controlBasis for determining the time of loss of controlDifference between the consideration of the disposal and the share in the subsidiary’s net assets in the consolidated financial statement corresponding to the investment disposed ofRemaining shareholding ratio on the date of loss of control (%)Book value of remaining shareholding on the date of loss of controlFair value of remaining shareholding on the date of loss of controlGains or losses from the remaining shareholding re-calculated by fair valueDetermination of the fair value of remaining shareholding on the date of loss of control and main assumptions thereforAmount of other comprehensive income relating to the original equity investment in the subsidiary that is recognized in investment gains or losses
Yiwu Gongchen Shangbo Property Co., Ltd.20,000,000100InvestmentFeb 27, 2020The earliest date when the transfer of control is effectuated76,523,765.30

Other notes:

√Applicable □N/A

The Group’s subsidiary CCCP and Beijing Golden Resources Hongda Property Co., Ltd. signed a cooperative developmentagreement on Dec 12, 2019 in connection with the establishment of a joint venture named Yiwu Guoshen Shangbo Property Co.,Ltd. for cooperative development of Yiwu Choucheng Street Station 01, 02 and 03 Land Plots. CCCP made capital contribution ofRMB20,000,000.00 with its 100% equity in Yiwu Gongcheng Shangbo Property Co., Ltd. and thus acquired 49% equity in GuoshenShangbo, and completed the registration of change. The date of disposal was Feb 27, 2020. Therefore, as from Feb 27, 2020, theGroup no longer consolidated Yiwu Gongcheng Shangbo Property Co., Ltd.. The financial information relating to the Company’sdisposal of Yiwu Gongcheng Shangbo Property Co., Ltd. is listed as follows:

Feb 27, 2020 Book valueDec 31, 2019 Book value
Current assets3,174,401,258.691,543,078,265.77
Non-current assets3,765,234.403,705,485.81
Current liabilities3,234,690,258.391,537,900,209.01
Non-current liabilities--
-56,523,765.308,883,542.57
Minority interest--
Income from the disposal76,523,765.30
Consideration of disposal20,000,000.00
Jan 1-Feb 27, 2020
Revenue
Cost of sales
Net loss-176,452.49

The consolidated net assets attributable to the Group on the disposal date of Gongchen Shangbo were RMB -56,523,765.30. Thedifference between the amount and the net assets of RMB8,407,090.08 in the individual financial statement of Gongchen Shangbowas unrealized gross profits formed by internal transactions within the Group.Did the Group dispose of subsidiaries through multiple transactions and lose control in the current period?

□Applicable √N/A

5 Changes in consolidation scope for other reasonsChanges in the consolidation scope for other reasons (e.g. new establishment of subsidiaries, liquidation of subsidiaries, etc.) andthe related information:

√Applicable □N/A

During the current period, the Company established several subsidiaries, namely Yiwu China Commodities City Big Data Co., Ltd.,Yiwu Global Yida Logistics Co., Ltd., Yiwu Comprehensive Bonded Zone Operation and Management Co., Ltd. and Yiwu ChinaCommodities City Research Institute Co., Ltd.; and also acquired equity in Zhejiang Huajie Investment and Development Co., Ltd.and European Huajie Development Co., Ltd. subordinated thereto in the way of merger by capital contribution increase.6 Others

□Applicable √N/A

IX Equity in Other Entity1 Equity in subsidiaries

(1) Composition of the enterprise group

√Applicable □N/A

Name of subsidiaryMain place of businessPlace of registrationBusinessShareholding ratio (%)Method of acquisition
DirectIndirect
Yiwu China Commodities City Property Development Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangReal estate100Establishment
Zhejiang Shangbo Property Co., Ltd.Hangzhou, ZhejiangHangzhou, ZhejiangReal estate100Establishment
Yiwu China Commodities City Logistics and Distribution Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService100Establishment
Yiwu Commodities City Gonglian Property Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangReal estate100Establishment
Yiwu China Commodities City Property Service Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService60Establishment
Yiwu China Commodities City Exhibition Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService100Establishment
China Yiwu International Commodities Fair Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService100Establishment
Yiwu China Commodities City Advertising Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangAdvertising100Establishment
Yiwu China Commodities City Information Technology Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangIT100Establishment
Yiwu China Commodities City Currency Exchange Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService100Establishment
Jiangxi Shangbo Property Co., Ltd.Nanchang, JiangxiNanchang, JiangxiReal estate100Establishment
Hangzhou Shangbo Nanxing Property Co., Ltd.Hangzhou, ZhejiangHangzhou, ZhejiangReal estate100Establishment
Yiwu China Commodities City Payment Network Technology Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangIT100Establishment
Pujiang Lvgu Property Co., Ltd.Pujiang, ZhejiangPujiang, ZhejiangReal estate100Establishment
Yiwu China Commodities City Credit Investigation Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService85Establishment
Haicheng Yiwu China Commodities City Investment and Development Co., Ltd.Haicheng, LiaoningHaicheng, LiaoningReal estate95Establishment
Zhejiang Yiwugou E-commerce Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangE-commerce51Establishment
Jiangxi Commodities City Property Management Co., Ltd.Nanchang, JiangxiNanchang, JiangxiService60Establishment
Yiwu Shangbo Property Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangReal estate100Establishment
Yiwu China Commodities City Import and Export Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangWholesale100Establishment
Yiwu China Commodities City Supply Chain Management Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService100Establishment
Yiwu China Commodities City Tourism Development Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangLease and business service100Establishment
Yiwu China Commodities City Financial Holdings Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService100Establishment
Yiwu China Commodities City (Germany) Co., Ltd.Frankfurt, GermanyFrankfurt, GermanyService100Establishment
Yiwu Suxi Shangbo Property Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangReal estate100Establishment
Yiwu International Trade Comprehensive Service Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangWholesale60Establishment
Yiwu ICMall Supply Chain Management Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService100Establishment
Yiwu China Commodities City (Hong Kong) International Trade Co., Ltd.Hong Kong, ChinaHong Kong, ChinaWholesale100Establishment
Ningxia Yiwu Commodities City Supply Chain Management Co., Ltd.Shizuishan, NingxiaShizuishan, NingxiaService100Establishment
Yiwu China Commodities City Overseas Investment and Development Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangWholesale100Establishment
Yiwu China Commodities City Commerce and Trade Service Training Center Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangEducation100Establishment
Yiwu ChinaYiwu,Yiwu,Lease and100Establishment
Commodities City Assets Operation and Management Co., Ltd.ZhejiangZhejiangbusiness service
Zhejiang Yindu Hotel Management Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangLease and business service100Establishment
Hong Kong Better Silk Road Co., Ltd.Hong Kong, ChinaHong Kong, ChinaService100Establishment
BETTER SILK ROAD FZDubai, UAEDubai, UAEService100Establishment
BETTER SILK ROAD RWANDA LtdKigali, RwandaKigali, RwandaService100Establishment
Yiwu China Commodities City Internet Finance Information Service Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService100Establishment + acquisition
Zhejiang Huajie Investment and Development Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangLease and business service96.4Establishment + acquisition
Yiwu Global Yida Logistics Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService60Establishment
Yiwu Comprehensive Bonded Zone Operation and Management Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService100Establishment
Yiwu China Commodities City Research Institute Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService100Establishment

Explanation for the difference between the shareholding ratio and voting right ratioin a subsidiary:

NoneBasis for holding half or less voting rights in but still controlling an investee, andholding more than half of the voting rights in but not controlling an investee:

NoneBasis for controlling important structured entities included in the consolidationscope:

NoneBasis for determining whether a company is an agent or a principal:

NoneOther notes:

None

(2) Important non-wholly-owned subsidiaries

√Applicable □N/A

Unit: RMB

Name of subsidiaryShareholding ratio of minority shareholders (%)Profits or losses attributable to minority shareholders in the current periodDividends declared to be distributed to minority shareholders for the current periodClosing balance of minority interest
Yiwugou49%3,601,759.1141,910,399.18
Haicheng Company5%-3,755,483.12-32,772,043.77

Explanation for the difference between the shareholding ratio and voting right ratioof minority shareholders in a subsidiary:

□Applicable √N/A

Other notes:

□Applicable √N/A

(3) Major financial information of important non-wholly-owned subsidiaries

√Applicable □N/A

Unit: RMB

Name of subsidiaryClosing balanceOpening balance
Current assetsNon-current assetsTotal assetsCurrent liabilitiesTotal liabilitiesCurrent assetsNon-current assetsTotal assetsCurrent liabilitiesTotal liabilities
Yiwugou99,900,921.1511,691,224.07111,592,145.2226,060,718.3326,060,718.3390,082,372.7912,291,197.88102,373,570.6724,192,672.5724,192,672.57
Haicheng Company1,244,729,042.32950,736,997.072,195,466,039.392,850,906,914.772,850,906,914.771,101,186,085.561,140,086,229.482,241,272,315.042,821,603,527.952,821,603,527.95
Name of subsidiaryAmount in the current periodAmount in the previous period
RevenueNet profitsTotal comprehensive incomeCash flow from operating activitiesRevenueNet profitsTotal comprehensive incomeCash flow from operating activities
Yiwugou23,290,461.097,350,528.797,350,528.796,176,724.9121,321,065.24819,010.50819,010.501,710,963.71
Haicheng Company1,704,851.23-75,109,662.47-75,109,662.474,562,423.14569,526.45-80,473,526.46-80,473,526.46-82,779,776.07

Other notes:

None

(4) Major restrictions on the use of the enterprise group’s assets andrepayment of the enterprise group’s debts:

□Applicable √N/A

(5) Financial support or other support provided to structured entitiesincluded in the consolidated financial statements:

□Applicable √N/A

Other notes:

□Applicable √N/A

2 Transactions in which the Group’s share of owners’ equity in a subsidiarychanges and the Group still controls the subsidiary

□Applicable √N/A

3 Equity in joint ventures or associates

√Applicable □N/A

(1) Important joint ventures or associates

√Applicable □N/A

Unit: RMB

Name of joint venture or associateMain place of businessPlace of registrationBusinessShareholding ratio (%)Accounting treatment method of investment in the joint venture or associate
DirectIndirect
Yiwu Shanglv Investment and Development Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangReal estate49Equity method
Hunan Shang Yun Zhonghe Scientific Research and Trade Co., Ltd.Changsha, HunanChangsha, HunanRetail35Equity method
Jiangsu Jin’an Hefeng Network Technology Co., Ltd.Nanjing, JiangsuNanjing, JiangsuRetail40Equity method
Henan Yiwugou Technology Development Co., Ltd.Puyang, HenanPuyang, HenanRetail40Equity method
Yiwu Huishang Redbud Capital Management Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangFinance20Equity method
Yiwu China Commodities City Creative Design and Development Services Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangLease and business service49Equity method
Yiwu Rongshang Property Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangReal estate49Equity method
Zhejiang Commodities City China Olympic Sports Industry Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangCulture, sports and entertainment45Equity method
Yiwu HuishangYiwu,Yiwu,Finance23Equity method
Micro-finance Co., Ltd.ZhejiangZhejiang
Hangzhou Binjiang Shangbo Property Development Co., Ltd.Hangzhou, ZhejiangHangzhou, ZhejiangReal estate49Equity method
Yiwu Huishang Redbud Equity Investment Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangFinance10.41Equity method
Zhejiang Zhiku Co., Ltd.Hangzhou, ZhejiangHangzhou, ZhejiangService45Equity method
Zhejiang Chouzhou Financial Lease Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangFinance26Equity method
Yiwu Huishang Redbud Phase II Investment Partnership (limited partnership)Yiwu, ZhejiangYiwu, ZhejiangLease and business service9.43Equity method
Yiwu China Commodities City Investment Management Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangLease and business service49Equity method
Yiwu China Commodities City Fuxing Investment Center (limited partnership)Yiwu, ZhejiangYiwu, ZhejiangLease and business service49.9Equity method
Zhejiang Yemai Data Technology Co., Ltd.Hangzhou, ZhejiangHangzhou, ZhejiangScientific research and technical service40Equity method
Yiwu Chuangcheng Property Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangReal estate24Equity method
Yiwu Meipinshu Supply Chain Management Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService20.57Equity method
Zhejiang YXE Supply Chain Management Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangService25Equity method
Yiwu Hongyi Equity Investment Fund PartnershipYiwu, ZhejiangYiwu, ZhejiangFinance49.98Equity method
Hangzhou MicroAnts Co., Ltd.Hangzhou, ZhejiangHangzhou, ZhejiangService49.04Equity method
Yiwu Guoshen Shangbo Property Co., Ltd.Yiwu, ZhejiangYiwu, ZhejiangReal estate49Equity method
Cheng Jian Bao (Beijing) Consulting Services Co., Ltd.BeijingBeijingBusiness management consulting15Equity method

Explanation for the difference between the shareholding ratio and voting right ratioin a joint venture or associate:

NoneBases for holding less than 20% of the voting rights but having significant influence,or holding 20% or more of the voting rights but not having significant influence:

1.The Company holds 10.41% (10.41% in 2019) equity in Yiwu Huishang RedbudEquity Investment Co., Ltd. (“Redbud Investment”), but takes the latter as itsassociate. According to Redbud Investment’s articles of association, it is engaged

in investing and its important financial and operating decision-making activities areto pick and manage investment projects, which have been fully entrusted to theCompany’s joint venture Yiwu Huishang Redbud Capital Management Co., Ltd.(“Redbud Capital”). Redbud Capital picks and manages investment projects via itsinvestment decision-making committee. Except for special investment matters,which are subject to the resolution of Redbud Investment’s board of directors, otherimportant financial and operating decision-making activities are conducted byRedbud Capital on the behalf of Redbud Investment. Therefore, the Company canexert significant influence on Redbud Investment in which it holds 10.41% equity.

2.The Company holds 9.43% (16:39% in 2019) equity in Yiwu Huishang RedbudPhase II Investment Partnership (limited partnership) (“Redbud Phase II”), but takesthe latter as its associate. According to Redbud Phase II’s articles of association, itis engaged in investing and its important financial and operating decision-makingactivities are to pick and manage investment projects, which have been fullyentrusted to the Company’s joint venture Redbud Capital. Redbud Capital picks andmanages investment projects via its investment decision-making committee. Exceptfor special investment matters, which are subject to the resolution of Redbud PhaseII’s board of directors, other important financial and operating decision-makingactivities are conducted by Redbud Capital on the behalf of Redbud Phase II.Therefore, the Company can exert significant influence on Redbud Phase II inwhich it holds 9.43% equity.

(2) Main financial information of important joint ventures

√Applicable □N/A

Unit: RMB

Closing balance/amount in the current periodOpening balance/amount in the previous period
Yiwu ShanglvYiwu Shanglv
Current assets149,532,357.01206,568,731.62
In which: cash and cash equivalents13,773,570.9311,332,301.02
Non-current assets1,406,054,867.681,679,507,095.46
Total assets1,555,587,224.691,886,075,827.08
Current liabilities391,194,388.71663,841,939.73
Non-current liabilities417,215,494.21477,412,606.21
Total liabilities808,409,882.921,141,254,545.94
Shareholders’ equity attributable to parent company747,177,341.77744,821,281.14
Share of net assets calculated based shareholding ratio366,116,897.47364,962,427.76
Adjustments-16,822,720.70
--unrealized profits of internal transactions-16,822,720.70
Book value of equity investment in joint ventures366,116,897.47348,139,707.06
Revenue86,301,394.3990,585,096.97
Financial expenses15,128,184.5717,750,126.77
Net profits2,397,343.821,777,528.99
Total comprehensive income2,397,343.821,777,528.99

Other notes:

None

(3) Main financial information of important associates

√Applicable □N/A

Unit: RMB

Closing balance/amount in the current periodOpening balance/amount in the previous period
Binjiang ShangboHuishang Micro-FinanceChouzhou Financial LeaseHongyi FundBinjiang ShangboHuishang Micro-FinanceChouzhou Financial LeaseHongyi Fund
Current assets472,639,007.30318,695,061.71361,952,288.815,758,553.02550,436,271.65352,311,663.51570,925,159.80465,583,259.40
Non-current assets99,504.0512,414,015.669,642,532,745.361,359,418,730.131,469,646.1512,899,627.588,564,000,577.98715,918,730.13
Total assets472,738,511.35331,109,077.3710,004,485,034.171,365,177,283.15551,905,917.80365,211,291.099,134,925,737.781,181,501,989.53
Current liabilities155,409,913.662,180,159.367,757,262,817.7357,771.39266,275,422.722,716,662.606,875,287,112.49160,734.38
Non-current liabilities893,027,217.31984,205,719.99
Total liabilities155,409,913.662,180,159.368,650,290,035.0457,771.39266,275,422.722,716,662.607,859,492,832.48160,734.38
Minority interest
Shareholders’ equity attributable to parent company317,328,597.69328,928,918.011,354,194,999.131,365,119,511.76285,630,495.08362,494,628.491,275,432,905.301,181,341,255.15
Share of net assets calculated based on shareholding ratio155,491,012.8775,653,651.14352,090,699.77682,286,731.98139,958,942.5983,373,764.55331,612,555.38590,434,359.32
Adjustments0.000.000.000.00-2,830,554.54-71,427.77-947,091.07-58,917.06
--Goodwill
--unrealized profits of internal transactions-2,830,554.54-71,427.77-947,091.07-58,917.06
--Others
Book value of equity investment in joint ventures155,491,012.8775,653,651.14352,090,699.77682,286,731.98137,128,388.0583,302,336.78330,665,464.31590,375,442.26
Fair value of equity investment in associates with public offering price
Revenue87,481,651.377,266,005.51203,900,029.536,095,701.31115,229,870.7030,680,326.05146,353,532.63
Net profits31,698,102.61-33,723,549.3678,762,093.83-16,369,907.2718,343,264.48-2,007,932.21133,430,276.764,757.45
Net profits of discontinued operations
Other comprehensive income
Total comprehensive income31,698,102.61-33,723,549.3678,762,093.83-16,369,907.2718,343,264.48-2,007,932.21133,430,276.764,757.45
Dividend on98,000,000.00

Other notes:

None

(4) Summary financial information of unimportant joint ventures andassociates

√Applicable □N/A

Unit: RMB

associatesreceived in thecurrent year

Closing balance/amount in the current periodOpening balance/amount in the previous period
Joint ventures:
Total book value of investments99,188,141.6049,136,717.42
Total amounts of the following items calculated based on shareholding ratio
--Net profits-58,781,609.61-799,211.91
--Other comprehensive income0.00424,150.54
--Total comprehensive income-58,781,609.61-375,061.36
Associates:
Total book value of investments209,938,868.75232,671,998.99
Total amounts of the following items calculated based on shareholding ratio
--Net profits2,988,663.4716,594,030.08
--Total comprehensive income2,988,663.4716,594,030.08

Other notes:

None

(5) Restrictions on the ability of joint ventures or associates to transfermoney to the Company

□Applicable √N/A

(6) Excess losses of joint ventures or associates

□Applicable √N/A

(7) Unrecognized commitments relating to investment in joint ventures

□Applicable √N/A

(8) Contingent liabilities relating to investment in joint ventures orassociates

□Applicable √N/A

4 Important joint operations

□Applicable √N/A

5 Equity in structured entities not included in the consolidated financialstatementsNotes on structured entities not included in the consolidated financial statements:

□Applicable √N/A

6 Others

□Applicable √N/A

X Risks associated with financial instruments

√Applicable □N/A

Risks associated with financial instrumentsThe risks associated with financial instruments faced by the Group in regularactivities mainly include credit risk, liquidity risk and market risk. The main financialinstruments of the Group include cash, borrowings from banks, bonds payable andcommercial papers payable. Those instruments are used mainly to finance theoperation of the Group. The Group has lots of other financial assets and liabilitiesdirectly arising from operation, such as accounts receivable, other receivables,accounts payable and other payables. The risks associated with those financialinstruments and the risk management strategy taken by the Group to reduce thoserisks are stated as follows.Credit riskThe Group only deals with the recognized third parties with good reputation.According to its policy, the Group needs to carry out credit review on all clients whorequire to deal with the Group on credit. In addition, the Group keeps monitoring thebalance of accounts receivable to ensure it will not face any material bad debt risk.For the transactions settled other than in the functional currency of related businessentities, unless with specific approval of the Group’s credit control department, theGroup will not provide the conditions for dealing on credit. The Group also facescredit risk due to the provision of financial guarantees. Please refer to the disclosurein Notes XIV-2 for details.As the counterparties to the transactions of cash are banks with good reputationand high credit ratings, the credit risk of those financial instruments is relatively low.

The Group’s other financial assets include cash, debt investment, other receivablesand certain derivatives, the credit risk of which is sourced from default by thecounterparties, and the maximum risk exposure is equal to the book value of thoseinstruments.As the clients from which the Group’s accounts receivable are receivable arescattered in different sectors and industries, there’s no material credit riskconcentrated within the Group. The Group does not have any collaterals or othercredit enhancements for the balance of its accounts receivable.Criteria for significant increase in credit riskThe group evaluates, on each balance sheet date, whether the credit risk of relatedfinancial instruments has increased significantly since the initial recognition thereof.In determining whether the credit risk of a financial instrument has increasedsignificantly since the initial recognition thereof, the Group takes into account thereasonable and well-grounded information that is accessible without unnecessaryextra costs or efforts, including the qualitative and quantitative analyses based onthe Group’s historical data, external credit risk rating and forward-lookinginformation. The Group compares the risk of financial instruments defaulting on thebalance sheet date and the risk of them defaulting on the date of initial recognitionbased on an individual financial instrument or a group of financial instruments withsimilar credit risk characteristics to determine the changes in anticipated default riskof the financial instrument(s) within the duration thereof.If a financial instrument meets one or more of the following quantitative orqualitative criteria, the Group will determine that its credit risk has increasedsignificantly:

(1) The main quantitative criterion is that its probability of default within theremaining duration on the reporting date rises by a certain margin from thatat its initial recognition;

(2) The main qualitative criterion is that the debtor has materially adversechanges in business or financial conditions or is on the warning list of clients.Definition of the assets whose credit has been impairedIn order to determine whether the credit of an asset has been impaired, the Groupadopts the criteria consistent with its internal credit risk management goal forrelated financial instruments and also takes into account the quantitative andqualitative indicators. The Group mainly considers the following factors whileassessing whether the credit of a debtor has been impaired:

(1) the issuer or debtor suffers material financial difficulty;

(2) the debtor is in breach of contract, such as breach in interest payment,

principal repayment or overdue payment;

(3) the creditor makes a compromise to the debtor which it would in no case

make, based on the economic or contract considerations in connection withthe debtor’s financial difficulty;

(4) the debtor is very likely to go bankrupt or enter into other financial

reorganizations;

(5) the financial difficulty of the issuer or debtor results in the disappearance of

the active market of the financial asset;

(6) a financial asset is purchased or derived at a large discount and the discountpoints to the fact of credit loss having been incurred.The credit impairment of financial assets may be caused by multiple eventstogether and may not necessarily be caused by an individually identifiable event.Measurement parameters of expected credit lossDepending on whether credit risk has increased significantly and whether credit hasbeen impaired, the Group makes impairment provisions for the expected creditlosses of different assets within 12 months or the entire durations. The keyparameters of expected credit loss include the probability of default, loss givendefault and default risk exposure. The Group has built the models of probability ofdefault, loss given default and default risk exposure based on the quantitativeanalysis of historical data (e.g. rating of counterparties, form of guarantee andcategory of collaterals or pledges, form of repayment) and forward-lookinginformation.The related definitions are as follows:

(1) Probability of default refers to the probability of a debtor failing to fulfill itsrepayment obligation within the coming 12 months or the entire remaining duration.The Group adjusts the probability of default based on the results of the expectedcredit loss model and with forward-looking information included to reflect thedebtors’ probability of default under the current macro economic environment.

(2) Loss given default refers to the Group’s expectation of loss to be incurred due tothe exposure of default risk. The loss given default varies with the type ofcounterparty, the form and priority of claims and collaterals. The loss given default isthe percentage of risk exposure loss at the time of default and is calculated basedon the coming 12 months or the entire remaining duration.

(3) Default risk exposure refers to the amount that shall be paid to the Group at the

time of default within the coming 12 months or the remaining duration.The determination of significant increase in credit risk and the calculation ofexpected credit loss both involve forward-looking information. The Group identifiesthe key economic indicators that affect the credit risk and expected credit loss ofvarious types of businesses through the analysis of historical data.The influence of those economic indicators on the probability of default and lossgiven default varies with the type of business. The Group predicts those indicatorson a quarterly basis based on experts’ judgments and determines their influence onthe probability of default and loss given default through regression analysis.The Group makes impairment provisions for the expected credit loss of accountsreceivable and other receivables within the coming 12 months with the simplifiedmethod and general method respectively. Please refer to Notes VII-5 and 8 fordetails.As of Jun 30, 2020, the Group did not have any accounts receivable or otherreceivables that had been overdue but not been impaired.Liquidity riskThe Group manages the cash shortage risk with the cyclical liquidity plan tool. Thetool considers not only the maturity dates of financial instruments but also theestimated cash flows arising from the operation of the Group.The Group aims to make use of such financing instruments as bank loans,commercial papers, MTNs, corporate bonds and long-term borrowings to maintainthe balance between the continuity and flexibility of financing.Market risksInterest rate riskThe Group manages interest costs by maintaining an appropriate combination offixed-rate debts and variable-rate debts. As of Jun 30, 2020, the Company hadlong-term borrowings of RMB370mn among its long-term liabilities, the interestrates of which were adjusted on an annual basis based on the benchmark loan rateon the anniversary dates. Therefore, the management believe that its risk of marketinterest rate change is relatively low.Foreign exchange rate riskThe Group faces transactional foreign exchange rate risk, which is caused by somebusiness entities’ sale or purchase in the currencies other than their functionalcurrencies. Considering the Group’s short time of inventory and timely collection of

accounts receivable, the management believe that its foreign exchange rate risk isrelatively low.Price risk of equity instrument investmentsThe price risk of equity instrument investments refers to the risk of the fair value ofequity securities decreasing due to the changes in stock indices and value ofindividual securities. As of Jun 30, 2020, the Group was exposed to the price risk ofequity instrument investments arising from the individual equity instrumentinvestments classified as the financial instruments that are measured by fair valueand of which the changes in fair value are recognized in other comprehensiveincome (Notes VII-18). The listed equity instrument investments held by the Groupare listed on the SZSE, and their values are determined at a discount on thebalance sheet dates based on the price of similar tradable shares of the identicallisted company and the status of liquidity.XI Disclosure of fair value1 Closing fair value of the assets and liabilities measured by fair value

√Applicable □N/A

Unit: RMB

ItemClosing fair value
Level 1 fair valueLevel 2 fair valueLevel 3 fair valueTotal
I. Continuous fair value measurement
(1) Held-for-trading financial assets16,049.6732,076,492.7832,092,542.45
(3) Other equity instruments investment633,408,055.13633,408,055.13
(4) Other non-current financial assets130,039,390.851,427,379,237.751,557,418,628.60
Total assets continuously measured by fair value633,424,104.80130,039,390.851,459,455,730.532,222,919,226.18

2 Basis for determining the market prices of the items continuously and

non-continuously measured by Level 1 fair value

√Applicable □N/A

The Group’s continuous Level 1 fair value measurement covers listed equityinstruments, the fair value of which was determined based on the market offeringprices on Jun 30, 2020.

3 Valuation techniques and qualitative and quantitative information ofimportant parameters for the items continuously and non-continuouslymeasured by Level 2 fair value

√Applicable □N/A

The Group’s continuous Level 2 fair value measurement mainly covers unlistedequity investments. The fair value of unlisted equity investments was determinedbased on the financial statements of those unlisted companies and the comparableinformation of listed companies in the same sectors as of Jun 30, 2020 by thecomparable multiples approach.4 Valuation techniques and qualitative and quantitative information ofimportant parameters for the items continuously and non-continuouslymeasured by Level 3 fair value

√Applicable □N/A

The Group’s continuous Level 3 fair value measurement covers convertible bondinvestments, unlisted equity investment to which the comparable multiplesapproach cannot apply and debt investments. The fair value of convertible bondinvestments consists of the value of straight bonds and the value of options. To bespecific, the fair value of straight bonds was determined with the discounted futurecash flow method, that of options was determined with the Black-Scholes optionpricing model. The fair value of unlisted equity investment to which the comparablemultiples approach cannot apply and debt investments was determined by theasset-based approach as of Jun 30, 2020.5 Adjustment information between the opening book value and closingbook value, and the sensitivity analysis of unobservable parameters foritems continuously measured by Level 3 fair value

□Applicable √N/A

6 For items continuously measured by fair value, if there is conversionbetween different levels in the current period, the reasons for theconversion and the policy for determining the time of conversion

□Applicable √N/A

7 Changes in valuation techniques in the current period and reasons forchanges

□Applicable √N/A

8 Fair value of financial assets and financial liabilities not measured by fairvalue

√Applicable □N/A

Assets and liabilities disclosed by fair valueJun 30, 2020

Input values for fair value measurementOffering price in active market Important observable Important unobservable input Input valueLevel 1 Level 2 Level 3 total

Bonds payable - 4,615,755,065.77 - 4,615,755,065.77

9 Others

√Applicable □N/A

The table below shows the differences between book value and fair value of theGroup’s financial instruments other than the financial instruments with very smalldifferences between book value and fair value and the equity instruments that didnot have an offering price in the active market and whose fair value could not bemeasured reliably:

Book valueFair value
Jun 20202019Jun 20202019
Financial liabilities Bonds payable4,625,150,185.914,564,291,387.814,615,755,065.774,553,867,057.85

The management have evaluated cash and cash equivalents, accounts receivable,notes payable and accounts payable. Their fair values were equivalent to their bookvalues as their remaining terms were not long. The fair values of long-termreceivables, other non-current assets, long and short-term borrowings andlong-term accounts payable were determined with the discounted future cash flowmethod, with the market yields of other financial instruments with similar contractterms, credit risks and remaining terms as the discount rates. Their fair values wereequivalent to their book values.On each balance date, the financial department and investment managementdepartment analyze the changes in the value of financial instruments, determine themain inputs of valuation and submit the valuation to the Group’s financial directorfor review and approval. For the preparation of semi-annual and annual financialstatements, the valuation process and results are discussed with the auditcommittee twice a year.

The fair values of financial assets and financial liabilities refer to the amountsdetermined based on the voluntary exchange of assets or repayment of debts bythe parties to arm’s length transactions who are familiar with the transactions ratherthan forced sale or liquidation. The following methods and assumptions are used toestimate fair value.The fair value of bonds payable is determined with the discounted future cash flowmethod, with the market yields of other financial instruments with similar contractterms, credit risks and remaining terms as the discount rates, and falls in Level 2.The significant unobservable inputs for measurement of the fair value of bondspayable are the prepayment rate and loss given default.The fair value of listed equity instruments investment is determined based onmarket offering prices.There was no significant conversion of the Group’s and the Company’s financialinstruments measured by fair value between different levels in the current periodand in the previous year.XII Related parties and related-party transactions1 Parent company of the Company

√Applicable □N/A

Unit: RMB10,000

Name of parent companyPlace of registrationBusinessRegistered capitalShareholding ratio in the Company (%)Voting right ratio in the Company (%)
Yiwu China Commodities City Holdings LimitedYiwu, ZhejiangHolding company services, consulting service and trading100,000.0055.8255.82
Market Development GroupYiwu, ZhejiangAsset management7,833.7755.8255.82

Notes on the parent company of the CompanyYiwu China Commodities City Holdings LimitedThe ultimate controller of the Company is the State-owned Assets Supervision andAdministration Office of the Yiwu Municipal Government.Other notes:

None

2 Subsidiaries of the CompanyFor details of the Company’s subsidiaries, please refer to the Notes

□Applicable √N/A

3 Joint ventures and associates of the CompanyFor details of the Company’s important joint ventures or associates, please refer tothe Notes

□Applicable √N/A

Other joint ventures or associates that have related-party transactions with theCompany in the current period or had related-party transactions with the Companyin the previous periods which resulted in an outstanding amount are as follows

√Applicable □N/A

Name of joint venture or associateRelationship with the Company
Yiwu ShanglvJoint venture
Binjiang ShangboAssociate
Huishang Micro-financeAssociate
Redbud CapitalJoint venture

Other notes:

□Applicable √N/A

4 Other related parties

√Applicable □N/A

Name of other related partyRelationship with the Company
Zhejiang Xingfuhu Sports Development Co., Ltd.Subsidiary of the Company’s largest shareholder
Yiwu Security Service Co., Ltd.Subsidiary of the Company’s largest shareholder
Yiwu State-owned Capital Operation Co., Ltd.Controlling shareholder of the Company’s largest shareholder
Yiwu Huangyuan Shangbo Property Co., Ltd.Subsidiary of the Company’s joint venture
Yiwu Chengzhen Property Co., Ltd.Subsidiary of the Company’s joint venture

Other notesNone

5 Related-party transactions

(1) Related-party transactions of purchasing and selling goods and rendering

and accepting servicePurchasing goods/accepting service

√Applicable □N/A

Unit: RMB

Related partyContent of related-party transactionAmount in the current periodAmount in the previous period
Yiwu Security Service Co., Ltd.Local and foreign currencies truck escort security service fees42,500.0053,437.50

Selling goods/rendering service

√Applicable □N/A

Unit: RMB

Related partyContent of related-party transactionAmount in the current periodAmount in the previous period
Yourworld International Conference CenterLaundering fees506,168.10788,810.80

Notes on related-party transactions of purchasing and selling goods and renderingand accepting service

□Applicable √N/A

(2) Entrustment/contracting from and to related parties

Entrustment/contracting to the Company:

√Applicable □N/A

Unit: RMB

Name of entruster/employerName of entrustee/contractorType of entrusted/contracted assetsStarting date of entrustment /contractingEnding date of entrustment /contractingPricing of entrustment income/contracting incomeEntrustment income/contracting income recognized in the current period
Market Development GroupThe CompanyEntrustment of other assetsNegotiated price452,962.93

Notes on entrustment/contracting from related parties

√Applicable □N/A

According to the Yourworld International Conference Center Management Contractentered into by and between the Company and MDG, the Company was entrustedto manage the Yourworld International Conference Center located in No.100Xingfuhu Road, Yiwu. In the current period, the Company collected hotelmanagement fees of RMB452,962.93 (RMB252,670.35 in Jan-Jun 2018).Entrustment/contracting from the Company:

□Applicable √N/A

Notes on related-party management/contracting

□Applicable √N/A

(3) Related-party lease

The Company as the lessor:

√Applicable □N/A

Unit: RMB

Name of lesseeType of leased assetRental income recognized in the current periodRental income recognized in the previous period
Huishang Micro-FinanceOffice space217,159.71217,159.71
Redbud CapitalOffice space135,779.71272,279.94
Zhejiang YemaiOffice space56,131.90

The Company as the lessee

□Applicable √N/A

Notes on related-party lease

√Applicable □N/A

1. As of Jun 30, the Group leased office space to Huishang Micro-Finance at themarket price, and the rental and property management fees recognized in thecurrent reporting period were RMB217,159.71 (RMB217,159.71 in Jan-Jun 2019).

2. As of Jun 30, the Group leased office space to Redbud Capital at the marketprice, and the rental and property management fees recognized in the currentreporting period were RMB135,779.71 (RMB272,279.94 in Jan-Jun 2019).

3. As of Jun 30, the Group leased office space to Zhejiang Yemai Data TechnologyCo., Ltd. at the market price, and the rental and property management feesrecognized in the current reporting period were RMB56,131.90 (RMB0 in Jan-Jun2019).

(4) Related-party guarantees

The Company as the guarantor

√Applicable □N/A

Unit: RMB

Guaranteed partyAmount of guaranteeStarting date of guaranteeDue date of guaranteeWhether the guarantee has been fulfilled
Yiwu Shanglv260,828,179.21Jul 1, 2015Dec 15, 2026No
Huangyuan Shangbo907,021,078.25Aug 23, 2019Aug 22, 2024No
Chengzhen Property201,454,362.00Sep 22, 2019Sep 21, 2024No

The Company as the guaranteed party

√Applicable □N/A

Unit: RMB

GuarantorAmount of guaranteeStarting date of guaranteeDue date of guaranteeWhether the guarantee has been fulfilled
Market Development Group310,000,000.002013/4/22Oct 22, 2021No

Notes on related-party guarantees

√Applicable □N/A

1. MDG provided guarantee for the Group’s loan from the Export-Import Bank ofChina Zhejiang Branch, with a total amount of guarantee being RMB420mn(RMB420mn as of Dec 31, 2019). As of Jun 30, 2020, the Group borrowedRMB310mn (RMB420mn as of Dec 31, 2019) under this guarantee, for which MDGassumed joint and several liability in full.

2. The Group provided guarantee for the borrowings of Yiwu Shanglv. As of Jun 30,2020, Yiwu Shanglv actually borrowed RMB532.3024mn (RMB587.4126mn as ofDec 31, 2019) from banks. According to the guarantee contract, the Groupassumed liability for RMB260.8282mn (RMB287.8322mn as of Dec 31, 2019). YiwuState-owned Capital Operation Co., Ltd. provided a counter guarantee for thisguarantee.

3. The Group provided guarantee for the borrowings of Huangyuan Shangbo. As ofJun 30, 2020, Huangyuan Shangbo actually borrowed RMB1851.0634mn(RMB1682.1217mn as of Dec 31, 2019) from banks. According to the guarantee

contract, the Group assumed liability for RMB907.0211mn (RMB824.2396mn as ofDec 31, 2019).

4. The Group provided guarantee for the borrowings of Chengzhen Property. As ofJun 30, 2020, Chengzhen Property actually borrowed RMB839.3932mn(RMB839.7028mn as of Dec 31, 2019) from banks. According to the guaranteecontract, the Group assumed liability for RMB201.4544mn (RMB201.5287mn as ofDec 31, 2019).

(5) Related-party lending and borrowing

√Applicable □N/A

Unit: RMB

Related partyAmountStarting dateMaturity dateRemark
Lending to
Huangyuan Shangbo228,464,117.96Feb 5, 2019
Chengzhen Property225,228,282.35Jun 30, 2019
Gongchen Shangbo1,594,759,831.00Mar 30, 2020

(6) Related-party transfer of assets and restructuring of debts

□Applicable √N/A

(7) Remunerations of key officers

√Applicable □N/A

Unit: RMB10,000

ItemAmount in the current periodAmount in the previous period
Remunerations of key officers1,213.93811.31

(8) Other related-party transactions

□Applicable √N/A

6 Accounts receivable from and payable to related parties

(1) Receivables

√Applicable □N/A

Unit: RMB

ItemRelated partyClosing balanceOpening balance
Book balanceBad debt provisionBook balanceBad debt provision
Interest receivableGongchen Shangbo97,547,403.23
Interest receivableChengzhen Property191,064,382.11
Interest receivableYiwu Shanglv677,670.00
Other receivablesHuangyuan Shangbo228,464,117.96684,164,117.96
Other receivablesGongchen Shangbo1,594,759,831.00
Other receivablesChengzhen Property225,228,282.35451,816,700.00
Total2,146,677,304.541,327,045,200.07
Long-term receivablesYiwu Shanglv61,250,000.0061,250,000.00
Total61,250,000.0061,250,000.00

(2) Payables

√Applicable □N/A

Unit: RMB

ItemRelated partyClosing book balanceOpening book balance
Advance from customersZhejiang Yemai45,767.434,425.37
Advance from customersRedbud Capital226,899.5190,759.79
Advance from customersHuishang Micro-Finance229,295.66
Contract liabilitiesHuishang Micro-Finance27,227.72
Accounts payableZhejiang Yemai820,810.10912,462.01
Other payablesMarket Development Group140,354.00140,354.00
Other payablesZhejiang Yemai68,100.00267,150.20
Total1,329,158.761,644,447.03

7 Related-party commitments

□Applicable √N/A

8 Others

□Applicable √N/A

XIII Share-based payment1 Overview of share-based payment

□Applicable √N/A

2 Share-based payment settled with equity

□Applicable √N/A

3 Share-based payment settled with cash

□Applicable √N/A

4 Modification and termination of share-based payment

□Applicable √N/A

5 Others

□Applicable √N/A

XIV Commitments and contingencies1 Important commitments

√Applicable □N/A

Important external commitments, nature and amount thereof as of the balancesheet dates

Jun 30, 2020 Dec 31, 2019

Capital commitmentsCapital commitments that

have been contracted but

not provided for 128,556,605.78 128,556,605.78

Investment commitments:

In 2017, the Group’s wholly-owned subsidiary Yiwu China Commodities CityFinancial Holdings Co., Ltd. (“CCCF”) and Shanghai Fuxing Industry Group Co., Ltd.(“Fuxing”) jointly established an industry fund Yiwu China Commodities City FuxingInvestment Center (limited partnership) (hereinafter referred to as the “FoF”). TheFoF invested in 12 sub-funds including Yiwu Shangfu Chuangzhi Investment Center(limited partnership) (“Shangfu Chuangzhi Fund”). CCCF subscribed for capitalcontribution of RMB998mn in the FoF as a limited partner, accounting for 49.9% ofthe total capital contribution, and has paid in RMB102.92mn. The unpaid portion ofits subscribed capital contribution was promised to be RMB895.08mn and was notsubject to a term. CCCF also made capital contribution of RMB9.8mn (49% equity) toYiwu China Commodities City Investment and Management Co., Ltd. (hereinafterreferred to as the “CCCIM”), which was a general partner of the above FoF andsub-funds. Fuxing made capital contribution of 51% to and had control over CCCIM.Shangfu Chuangzhi Fund raised funds of RMB823.36mn in total. The FoF hassubscribed for and paid in capital contribution of RMB205.84mn as a limited partner(including the above RMB102.92mn from CCCIM and the rest was contributed byFuxing, the other limited partner of the FoF). As the other limited partner of ShangfuChuangzhi Fund, CCCF has separately subscribed for and paid in capitalcontribution of RMB617.51mn. In addition, neither the Group nor CCCF haveinvested in other sub-funds of the FoF. Subsequently, Shangfu Chuangzhi Fundmade capital contribution of RMB820.54mn to subscribe for the increase in theregistered capital of Hubei Provincial Asset Management Co., Ltd. to acquire

22.667% equity therein. By 2019, 9 out of the above 12 sub-funds had beenderegistered.In 2018, CCCF learned during its after-investment follow-up management thatFuxing and its actual controller ZHU Yidong were suspected of having committed acriminal offense and the 22.667% equity held by Shangfu Chuangzhi Fund in HubeiProvincial Asset Management Co., Ltd. was frozen by the Public Security Bureau ofShanghai for a term from Sep 6, 2018 to Sep 6, 2019 due to Fuxing’s contribution inthe sources of the capital contribution. As of the approval date of the financialstatements, the term of freezing had been extended to Sep 5, 2020.As of the approval date of the financial statements, the Group had not received anynotice of capital contribution other than the above contributions that had been madeor any notice of action involving the Group, CCCF, FoF and its sub-funds.In addition, as of Dec 31, 2019, the Group had promised other investments ofRMB401.86mn in total (RMB401.86mn by Dec 31, 2019).2 Contingencies

(1) Important contingencies on the balance sheet dates

√Applicable □N/A

Jun 30, 2020 2019Contingent liabilitiesarising from the provisionof external guarantees 2,272,143,067.32 1,853,883,809.89According to relevant provisions, while selling houses, the Group shall provideguarantees for the mortgage loans of the house buyers before they obtain theproperty ownership certificates. The outstanding amount of guarantees as of Jun 30,2020 was RMB902,839,447.86 (RMB540,283,351.51 as of Dec 31, 2019). Thoseguarantees would be released after the issuance of the property ownershipcertificates and are thus little likely to incur losses. Therefore, the managementbelieved that it was not necessary to make provision for the guarantees.According to the resolution of the 15

thmeeting of the 7th Board of Directors on Jul 1,2015, the Group applied to the Yiwu Branch of ABC for a RMB750mn loan for YiwuShanglv and provided guarantee based on its shareholding ratio. The guaranteewas a joint and several liability guarantee, the maximum amount of guarantee wasRMB367.5mn and the term was 11 years. As of Jun 30, 2020, Yiwu Shanglvactually borrowed RMB532,302,406.56 from the Yiwu Branch of ABC(RMB587,412,606.21 as of Dec 31, 2019). According to the guarantee contract, theGroup provided guarantee for RMB260,828,179.21 (RMB287,832,177.04 as of Dec31, 2019) to the Yiwu Branch of ABC. Yiwu State-owned Capital Operation Co., Ltd.provided a counter guarantee for this guarantee.

According to the resolution of the 65

th

meeting of the 7th Board of Directors on Jul23, 2019, the Group applied to the Yiwu Branch of ICBC and Yiwu Branch of SPDBfor RMB1bn loans respectively for Huangyuan Shangbo and provided guaranteesfor them based on its shareholding ratio. The guarantees were joint and severalliability guarantees, the maximum amounts of guarantees were RMB490mn and theterms were two years from the dates immediately following the maturities of theloans under corresponding loan contracts. As of Jun 30, 2020, HuangyuanShangbo actually borrowed RMB887,170,875 (RMB700,923,611.11 as of Dec 31,2019) from the Yiwu Branch of ICBC and RMB963,892,550 (RMB981,198,055.56as of Dec 31, 2019) from the Yiwu Branch of SPDB. According to the guaranteecontracts, the Group provided guarantees for RMB434,713,728.75(RMB343,452,569.44 as of Dec 31, 2019) to the Yiwu Branch of ICBC andRMB472,307,349.5 (RMB480,787,047.22 as of Dec 31, 2019) to the Yiwu Branchof SPDB.According to the resolution of the fourth meeting of the 8th Board of Directors onNov 4, 2019, the Group applied to the Yiwu Branch of Hengfeng Bank for a loanwith a total amount no higher than RMB1.63bn for Chengzhen Property andprovided guarantee based on its shareholding ratio. The guarantee was a joint andseveral liability guarantee, the maximum amount of guarantee was RMB391.2mnand the term was from the maturity date of the debt agreed under the correspondingloan contract until two years after the maturity date of the debt agreed in the loancontract with the latest expiration date among all loan contracts. As of Jun 30, 2020,Chengzhen Property actually borrowed RMB839,393,175 (RMB839,702,769.44 asof Dec 31, 2019) from the Yiwu Branch of Hengfeng Bank. According to theguarantee contract, the Group provided guarantee for RMB201,454,362(RMB201,528,664.67 as of Dec 31, 2019) to the Yiwu Branch of Hengfeng Bank.

(2) Notes shall also be made even if the Company has no importantcontingencies to be disclosed:

□Applicable √N/A

3 Others

□Applicable √N/A

XV Post-balance sheet date events1 Important non-adjusting events

√Applicable □N/A

Unit: RMB

ItemContentEffect on financial status and operatingReasons for inability to
resultsestimate the effect
Stripping of some wholly-owned subsidiariesPlease refer to the Announcement on the Transfer of Some Equity in Wholly-owned Subsidiaries and Related-Party Transaction (Announcement No. Temporary 2020-048) for details.

2 Profit distribution

□Applicable √N/A

3 Sales return

□Applicable √N/A

4 Other post-balance sheet date events

√Applicable □N/A

1) Assessment of the impact of COVID-19 epidemic

Since the nationwide outbreak of the COVID-19 epidemic in Jan 2020, theCompany has kept implementing epidemic prevention and control in all its businesspremises across the country to protect its employees and clients in accordance withthe guidance of related authorities and complied with the related epidemicprevention and control requirements of local governments.The epidemic exerts certain impact on the entire economy and may affect theCompany’s future revenue and profits to some extent depending on the duration ofthe epidemic, the epidemic prevention and control measures and the actualimplementation thereof.The Company will keep a close eye on the epidemic and assess and actively dealwith the impact on its financial status and operating results. As of the reporting date,the impact was still being assessed.

2) Bidding in land auction

In Apr 2020, the Company won the bid for the land use right of 1-42# and 1-43#land plots of Yiwu International Landport Logistics Park at a price of RMB431.23mn.As of the reporting date, the delivery was still under way and the Company had notactually obtained the land use right of the above land plots yet.

XVI Other important events1 Correction of previous accounting errors

(1) Retrospective restatement

□Applicable √N/A

(2) Prospective application

□Applicable √N/A

2 Debt restructuring

□Applicable √N/A

3 Exchange of assets

(1) Exchange of non-monetary assets

□Applicable √N/A

(2) Exchange of other assets

□Applicable √N/A

4 Annuity plan

□Applicable √N/A

5 Termination of operations

□Applicable √N/A

6 Information of divisions

(1) Determination basis and accounting policy of reporting divisions

√Applicable □N/A

Information of divisions is reported based on business divisions of the Group. In theidentification of region-based divisions, revenue is attributable to the divisions in theregions where the clients are located, and assets are attributable to the divisions inthe regions where the assets are located. As the Group’s main operating activitiesand operating assets are both concentrated in mainland China, it is not required toreport more detailed information on region-based divisions.

The Group’s businesses are organized and managed separately based on thenature of business and the products and services provided. Each business divisionof the Group is a business department or a subsidiary and provides the productsand services that face the risk different from that faced by other business divisionsand bring the compensations different from those brought by other businessdivisions. The detailed information on business divisions are summarized asfollows:

(a) The market operation division refers to the Group’s market operation business

where the Group charges market booth use fees and auxiliary houses and officebuilding rentals;(b) The commodities sales division engages in the purchase and sale of goods suchas export trade;(c) The property sales division engages in the development and sale of real estateproperties;(d) The hotel service division engages in the operation of hotels includingaccommodation and catering services;(e) The exhibition advertising division engages in the design, production, placementand agency of advertisements;(f) Other services division covers the provision of market-related auxiliary services.The transfer pricing between divisions is made based on the prices offered to thirdparties and the then prevailing market prices.

(2) Financial information of reporting divisions

√Applicable □N/A

Unit: RMB mn

ItemMarket operationCommodities salesProperty salesHotel serviceExhibition advertisingOther servicesSet-offs among divisionsTotal
Revenue from external transactions1,5621065462373622,183
Revenue from inter-division transactions-15-1-4-8-15-19-62
Loss of impairment of assets
Profits before tax956-6-6-21-2339-54993
Total assets39,3261778,4812966133,94520,86431,974
Total liabilities25,5401423,1263165931,11112,60718,221
Capital expenditures1,765115271,808
Long-term equity investment in joint ventures and associates9959231,918

(3) If the Company does not have reporting divisions or is unable to disclose

the total assets and total liabilities of each division, please explain

□Applicable √N/A

(4) Other notes

□Applicable √N/A

7 Other important transactions and events that have influence on investors’decisions

□Applicable √N/A

8 Others

□Applicable √N/A

XVII Notes to main items in financial statements of parent company1 Accounts receivable

(1) Disclosure by account age

√Applicable □N/A

Unit: RMB

Account ageClosing book balance
Within 1 year26,853,260.66
Over 3 years11,562.06
Less: bad debt provision for accounts receivable-43,549.31
Total26,821,273.41

(2) Disclosure by bad debt provision method

√Applicable □N/A

Unit: RMB

CategoryClosing balanceOpening balance
Book balanceBad debt provisionBook valueBook balanceBad debt provisionBook value
AmountWeight (%)AmountProvision ratio (%)AmountWeight (%)AmountProvision ratio (%)
Accounts receivable for which bad debt provision is made individually31,912.970.1231,912.97100.0078,801.183.1978,801.180.03
Accounts receivable for which bad debt provision is made by group26,832,909.7599.8811,636.340.0426,821,273.412,393,443.6996.8111,745.465.382,381,698.23
Total26,864,822.72100.0043,549.31/26,821,273.412,472,244.87100.0090,546.64/2,381,698.23

Accounts receivable for which bad debt provision is made individually:

√Applicable □N/A

Unit: RMB

ItemClosing balance
Book balanceBad debt provisionProvision ratio (%)Reason for provision
Credit consumption of hotel31,912.9731,912.97100%The amount is estimated to be unrecoverable
Total31,912.9731,912.97100%/

Explanation for making bad debt provision for accounts receivable individually:

□Applicable √N/A

Explanation for making bad debt provision for accounts receivable by group:

□Applicable √N/A

If the bad debt provision is made according to the general model of expected creditloss, please refer to the disclosure of other receivables:

√Applicable □N/A

ItemClosing balance
Accounts receivableBad debt provisionProvision ratio (%)
Within 1 year26,821,347.6974.280.00
Over 3 years11,562.0611,562.06100.00
Total26,832,909.7511,636.34

(3) Bad debt provision

√Applicable □N/A

Unit: RMB

CategoryOpening balanceAmount of change in the current periodClosing balance
ProvisionRecovery or reversalCharge-off or write-offOther changes
Bad debt provision for accounts receivable90,546.64-46,997.3343,549.31
Total90,546.64-46,997.3343,549.31

In which the recovered or reversed amount is important:

□Applicable √N/A

(4) Accounts receivable actually written off during the current period

□Applicable √N/A

(5) Accounts receivable from the five debtors with the highest closingbalance

√Applicable □N/A

The Company is mainly engaged in market operation and hotel services and itsrevenue from an individual client is very low. Therefore, the combined accountsreceivable from the top five clients occupied a very small share in its total balance ofaccounts receivable.

(6) Accounts receivable derecognized due to transfer of financial assets

□Applicable √N/A

(7) Amounts of assets and liabilities formed by the transfer of accountsreceivable and continuing involvement

□Applicable √N/A

Other notes:

□Applicable √N/A

2 Other receivablesPresentation of items

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Interest receivable98,225,073.23134,543,859.25
Other receivables2,095,574,583.251,145,594,759.16
Total2,193,799,656.481,280,138,618.41

Other notes:

□Applicable √N/A

Interest receivable

(1) Classification of interest receivable

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Cash occupation fee for receivables98,225,073.23134,543,859.25
Total98,225,073.23134,543,859.25

(2) Important overdue interest

□Applicable √N/A

(3) Bad debt provision

□Applicable √N/A

Other notes:

□Applicable √N/A

Dividend receivable

(1) Overview of dividend receivable

□Applicable √N/A

(2) Important dividend receivable with the account age longer than 1 year

□Applicable √N/A

(3) Bad debt provision

□Applicable √N/A

Other notes:

□Applicable √N/A

Other receivables

(1) Disclosure by account age

√Applicable □N/A

Unit: RMB

Account ageClosing book balance
Within 1 year1,736,977,885.11
1 to 2 years354,659,163.07
2 to 3 years1,289,345.50
Over 3 years3,496,397.15
-848,207.58
Total2,095,574,583.25

(2) Classification by the nature of accounts

√Applicable □N/A

Unit: RMB

Nature of receivableClosing book balanceOpening book balance
Financial assistance receivable from joint ventures2,048,452,231.311,135,980,817.96
Reserve387,590.99599,890.14
Withholding, deposit and margin46,734,760.959,014,051.06
Total2,095,574,583.251,145,594,759.16

(3) Bad debt provision

√Applicable □N/A

Unit: RMB

Bad debt provisionPhase 1Phase 2Phase 3Total
Expected credit loss in the coming 12 monthsExpected credit loss in the entire duration (credit has not been impaired)Expected credit loss in the entire duration (credit has been impaired)
Balance as of Jan 1, 2020540,270.80540,270.80
Provision made in the current period307,936.78307,936.78
Balance as of Jun 30, 2020848,207.58848,207.58

Significant changes in the book balance of other receivables with changes in lossprovisions in the current period:

□Applicable √N/A

Basis for the bad debt provision made in the current period and for assessingwhether the credit risk of financial instruments has increased significantly:

□Applicable √N/A

(4) Bad debt provision

√Applicable □N/A

Unit: RMB

CategoryOpening balanceChange in the current periodClosing balance
ProvisionRecovery or reversalCharge-off or write-offOther changes
Bad debt540,270.80307,936.78848,207.58
provision for other receivables
Total540,270.80307,936.78848,207.58

In which the recovered or reversed amount is important:

□Applicable √N/A

(5) Other receivables actually written off in the current period

□Applicable √N/A

Notes on the write-off of other receivables:

□Applicable √N/A

(6) Other receivables from the five debtors with the highest closing balance

√Applicable □N/A

Unit: RMB

DebtorNature of receivableClosing balanceAccount agePercentage in the total closing balance of other receivables (%)Closing balance of bad debt provision
Yiwu Gongchen Shangbo Property Co., Ltd.Financial assistance1,594,759,831.00Within 1 year76.10
Yiwu Huangyuan Shangbo Property Co., Ltd.Financial assistance228,464,117.96Within 1 year and 1 to 2 years10.90
Yiwu Chengzhen Property Co., Ltd.Financial assistance225,228,282.351 to 2 years10.75
Yiwu International Production Materials Market Construction HeadquartersConstruction commencement deposit2,400,000.00Over 3 years0.11
Yiwu Xuanniao Supply Chain Management Co., Ltd.Disbursement of warehouse rental1,073,782.801 to 2 years and 2 to 3 years0.05214,756.56
Total/2,051,926,014.11/97.91214,756.56

(7) Receivables involving government grants

□Applicable √N/A

(8) Other receivables derecognized due to transfer of financial assets

□Applicable √N/A

(9) Amounts of assets and liabilities formed by the transfer of otherreceivables and continuing involvement

□Applicable √N/A

Other notes:

□Applicable √N/A

3 Long-term equity investment

√Applicable □N/A

Unit: RMB

ItemClosing balanceOpening balance
Book balanceImpairment provisionBook valueBook balanceImpairment provisionBook value
Investment in subsidiaries6,968,166,767.38570,000,000.006,398,166,767.386,528,370,031.25570,000,000.005,958,370,031.25
Investment in associates and joint ventures996,186,574.56996,186,574.56927,726,964.52927,726,964.52
Total7,964,353,341.94570,000,000.007,394,353,341.947,456,096,995.77570,000,000.006,886,096,995.77

(1) Investment in subsidiaries

√Applicable □N/A

Unit: RMB

InvesteeOpening balanceIncrease in the current periodDecrease in the current periodClosing balanceImpairment provision made in the current periodClosing balance of impairment provision
Yiwu China Commodities City Property Development Co., Ltd.2,595,500,000.0040,556,292.362,636,056,292.36
Yiwu China Commodities City Advertising Co., Ltd.9,380,000.009,380,000.00
Yiwu China Commodities City Exhibition Co., Ltd.6,000,000.0012,000,000.0018,000,000.00
Yiwu China Commodities City Logistics Co., Ltd.19,000,000.00250,000.0019,250,000.00
Yiwu China Commodities200,594,000.00200,594,000.00
City Information Technology Co., Ltd.
Yiwu International Commodities Fair Co., Ltd.10,000,000.0010,000,000.000.00
Pujiang Lvgu Property Co., Ltd.700,000,000.00700,000,000.00
Haicheng Company0.00570,000,000.00
Hangzhou Shangbo Nanxing Property Co., Ltd.50,000,000.0050,000,000.00
Yiwu Shangbo Property Co., Ltd.300,000,000.00300,000,000.00
Yiwu China Commodities City Financial Holdings Co., Ltd.1,847,416,031.25110,000,000.001,957,416,031.25
Yiwu China Commodities City Import and Export Co., Ltd.50,000,000.0050,000,000.00
Yiwu China Commodities City Tourism Development Co., Ltd.70,200,000.0029,800,000.00100,000,000.00
Yiwu China Commodities City Overseas Investment and Development Co., Ltd.100,000,000.00100,000,000.00
Yiwu China Commodities City Commerce and Trade Service Training Center Co., Ltd.100,000.00100,000.00
Yiwu China Commodities City Assets Operation180,000.004,900,000.005,080,000.00
and Management Co., Ltd.
Zhejiang Yindu Hotel Management Co., Ltd.0.001,000,000.001,000,000.00
Yiwu China Commodities City Big Data Co., Ltd.0.0013,600,000.0013,600,000.00
Zhejiang Huajie Investment and Development Co., Ltd.0.0037,690,443.7737,690,443.77
Yiwu Commodities City Gonglian Property Co., Ltd.0.00200,000,000.00200,000,000.00
Total5,958,370,031.25449,796,736.1310,000,000.006,398,166,767.38570,000,000.00

(2) Investment in associates and joint ventures

√Applicable □N/A

Unit: RMB

InvesteeOpening balanceChange in the current periodClosing balanceClosing balance of impairment provision
Additional investmentDecrease in investmentInvestment gains or losses recognized with the equity methodAdjustment of other comprehensive incomeChange in other equityCash dividend or profits declared to be distributedImpairment provisionsOthers
1. Joint ventures
Yiwu Shanglv348,139,707.061,410,985.53349,550,692.59
Yiwu Rongshang Property50,000,000.00-30,372,695.7519,627,304.25
Yiwu Chuangcheng Property20,000,000.00-4,551,390.8415,448,609.16
Yiwu Guoshen Shangbo Property20,000,000.00-11,058,047.248,941,952.76
Others1,125,415.75-156,476.74968,939.01
Subtotal349,265,122.8190,000,000.00-44,727,625.04394,537,497.77
2. Associates
Binjiang Shangbo137,128,387.7516,729,010.14153,857,397.89
Huishang Micro-Finance83,302,336.78-7,756,416.3575,545,920.43
Chouzhou330,665,464.3120,478,144.40351,143,608.71
Financial Lease
Others27,365,652.871,500,000.00-3,036,467.552,654,175.06-2,072,860.5021,102,149.76
Subtotal578,461,841.711,500,000.0026,414,270.642,654,175.06-2,072,860.50601,649,076.79
Total927,726,964.5291,500,000.00-18,313,354.402,654,175.06-2,072,860.50996,186,574.56

Other notes

□Applicable √N/A

4 Revenue and cost of sales

(1) Overview of revenue and cost of sales

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
RevenueCost of salesRevenueCost of sales
Main business1,259,705,715.29391,267,375.061,186,687,468.41455,209,940.59
Other businesses403,256,371.6126,416,255.20372,790,296.1518,084,394.30
Total1,662,962,086.90417,683,630.261,559,477,764.56473,294,334.89

(2) Revenue generating from contracts

□Applicable √N/A

(3) Contract performance obligations

□Applicable √N/A

(4) Amortization to remaining contract performance obligations

□Applicable √N/A

Other notes:

None5 Investment income

√Applicable □N/A

Unit: RMB

ItemAmount in the current periodAmount in the previous period
Income from long-term equity investment with the cost method149,000,000.00
Income from long-term equity investment with the equity method22,242,937.9616,108,492.57
Dividend income from other equity instruments investment during holding period6,271,366.90
Investment income from disposal of held-for-trading20,669,594.1521,716,507.93
financial assets
Investment income from disposal of wealth management products461,232.88
Total43,373,764.99193,096,367.40

Other notes:

None6 Others

□Applicable √N/A

XVIII Supplementary materials1 Detailed statement of current non-recurring items

√Applicable □N/A

Unit: RMB

ItemAmountRemark
Gain or loss from the disposal of non-current assets57,619,261.54Mainly the investment income arising from the disposal of subsidiaries and related claims
Tax refund or credit due to approval beyond the authority or without official approval
Government grants that are recognized in the current profit or loss, excluding government grants that are closely related to the businesses of the Company and are provided in a fixed amount or quantity according to the unified national standards13,526,949.49Employment stabilization subsidy of RMB5.9167mn, additional VAT deduction (10%) of RMB2.6042mn, amortization of the subsidy for the data construction and operation of information center of RMB1.5mn, hardware exhibition subsidy of RMB0.6mn, new and high-tech award of RMB0.6mn in 2019, provincial service demonstration zone award of RMB0.55mn in 2019, additional R&D input deduction of RMB0.9781mn in 2018 and interest subsidy of RMB0.5774mn for the construction of the international exhibition center
Cash occupation fees charged from non-financial enterprises that are recognized in the current profit or loss48,341,409.06Cash occupation fees charged for the provision of financial assistance to Yiwu Shanglv, Chengzhen Property and Gongchen Property
Gain or loss from changes in fair value of held-for-trading financial assets, derivative financial assets, held-for-trading financial liabilities and derivative financial liabilities, and investment income from the disposal of held-for-trading financial assets, derivative financial assets, held-for-trading financial41,552,057.16RMB20.1935mn of gains from changes in fair value of derivative financial assets, RMB20.5mn of investment income from the disposal of held-for-trading financial assets, RMB0.689mn of income from the purchase of

liabilities, derivative financial liabilities andother debt instruments, except for effectivehedging during theordinary course of business

wealth management products, and RMB0.1696mn of income from IPO subscription
Net income from other non-operating activities-2,477,321.94Mainly external donation of RMB2.7314nm and confiscated margin and penalty of RMB0.3311mn
Effect of income tax-40,078,629.26
Effect of minority interest-1,082,219.35
Total117,401,506.70

Explanations shall be made for the non-recurring items identified by the Companyaccording the Explanatory Announcement No. 1 on Information Disclosure byCompanies Publicly Offering Securities – Non-recurring Items, and for theCompany identifying the non-recurring items enumerated in the ExplanatoryAnnouncement No. 1 on Information Disclosure by Companies Publicly OfferingSecurities – Non-recurring Items as recurring items.

√Applicable □N/A

Unit: RMB

ItemInvolved amountReasons
Investment income from the disposal of subsidiaries and related claims56,523,765.30The Group identified non-recurring items according to the Explanatory Announcement No. 1 on Information Disclosure by Companies Publicly Offering Securities – Non-recurring Items (CSRC Announcement [2018] No.43)
Government grants13,526,949.49Ditto
Penalties for market booths267,800.00Ditto
Cash occupation fees48,341,409.06Ditto
Gains or losses from the changes in fair value arising from the holding of held-for-trading financial assets and other noncurrent financial assets40,693,509.58Ditto
Investment income from the disposal of wealth management products688,953.43Ditto
Investment income from the disposal of held-for-trading financial assets169,594.15Ditto

2 ROE and EPS

√Applicable □N/A

Profits in the reporting periodWeighted average ROE (%)EPS
Basic EPSDiluted EPS
Net profits attributable to common shareholders of the Company5.380.130.13
Net profits attributable to common shareholders of the Company with non-recurring items excluded4.500.110.11

3 Differences in accounting data between foreign and Chinese accounting

standards

□Applicable √N/A

4 Others

□Applicable √N/A

Section XI Documents for Inspection

Documents for inspectionAccounting statements with the signatures and stamps of the Company’s legal representative, person in charge of accounting and person in charge of the accounting body.
All of the Company’s original documents and announcements disclosed publicly on Shanghai Securities News, China Securities Journal and Securities Times during the reporting period.

Chairman of Board Of Directors: ZHAO WengeDate of approval by the Board Of Directors: Aug 13, 2020

Amendment

□Applicable √N/A


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