Hangzhou Robam Appliances Co., Ltd.
2020 Full Annual Report
April 2021
Section 1 Important Notes, Contents and DefinitionsThe board of directors, the board of supervisors and directors, supervisors and senior management of theCompany hereby guarantee that no false or misleading statement or major omission was made to thematerials in this report and that they will assume all the responsibility, individually and jointly, for theauthenticity, accuracy and completeness of the contents of the annual report.Ren Jianhua, the head of the Company, Zhang Guofu, the head of accounting work, and Zhang Guofu, thehead of accounting body (accountant in charge), guarantee the authenticity, accuracy and completeness ofthe financial report in the annual report.All the directors attended the board meeting during which they reviewed this report.The Company has risks such as fluctuations in the real estate market, price fluctuations of raw materialsand intensifying market competition. Please pay attention to the investment risks.The preplanned profit distribution deliberated and approved by the board of directors is as follows: basedon the total share capital of 949,024,050.00 shares, the Company will send cash dividends of 5 yuan (taxinclusive) and 0 bonus share (tax inclusive) to all shareholders for every 10 shares, and instead ofconverting capital reserve into share capital.
Contents
Section 1 Important Notes, Contents and Definitions ...... 1
Section 2 Company Profile and Main Financial Indicators ...... 2
Section 3 Business Summary ...... 6
Section 4 Discussion and Analysis on Business Conditions ...... 10
Section 5 Important Matters ...... 26
Section 6 Changes in Shares and Shareholders ...... 35
Section 7 Preferred Shares ...... 41
Section 8 Convertible Bonds ...... 42
Section 9 Directors, Supervisors, Senior Management and Employees ...... 43
Section 10 Corporate Governance ...... 54
Section 11 Corporate Bonds ...... 61
Section 12: Financial Report ...... 62
Section 13: Reference file directory ...... 178
Definitions
| Terms | Refers to | Definition |
| The Company, company, Robam Appliances | Refers to | Hangzhou Robam Appliances Co., Ltd. |
| Mingqi | Refers to | Hangzhou Mingqi Electric Co., Ltd. |
| Kinde Intelligent | Refers to | Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. |
| The Group | Refers to | Robam Appliances, Mingqi, Beijing ROBAM Electric Appliance Sales Co., Ltd., Shanghai Robam Electric Appliance Sales Co., Ltd. and Kinde Intelligent |
| Robam Group | Refers to | Hangzhou Robam Industrial Group Co., Ltd., controlling shareholder of the Company |
| Reporting period | Refers to | Year 2020 |
| AVC | Refers to | Beijing All View Cloud Data Technology Co., Ltd. |
Section 2 Company Profile and Main Financial IndicatorsI. Company Profile
| Stock abbreviation | Robam | Stock code | 002508 |
| Stock exchange for stock listing | Shenzhen Stock Exchange | ||
| Company name in Chinese | Hangzhou Robam Appliances Co., Ltd. | ||
| Chinese abbreviation of the Company | HANGZHOU ROBAM APPLIANCES CO.,LTD. | ||
| Company name in foreign language (if any) | ROBAM | ||
| Legal Representative of the Company | Ren Jianhua | ||
| Registered address | No. 592 Linping Av., Yuhang Economic Development Zone, Hangzhou, China | ||
| Postal code of the registered address | 311100 | ||
| Office address | No. 592 Linping Av., Yuhang Economic Development Zone, Hangzhou, China | ||
| Postal code of the office address | 311100 | ||
| Company website | http://www.robam.com/ | ||
| robam@robam.com | |||
II. Contact Person and Contact Information
| Secretary of the Board | Representative on Securities Matters | |
| Name | Wang Gang | Jiang Yu |
| Contact address: | No. 592 Linping Av., Yuhang Economic Development Zone, Hangzhou, China | No. 592 Linping Av., Yuhang Economic Development Zone, Hangzhou, China |
| Tel | 0571-86187810 | 0571-86187810 |
| Fax | 0571-86187769 | 0571-86187769 |
| wg@robam.com | jy@robam.com |
III. Information Disclosure and Place of Preparation
| Name of media selected by the Company for information disclosure | Securities Times, China Securities Journal, Securities Daily,Shanghai Securities News |
| URL of Website designated by China Securities Regulatory Commission for annual report | http://www.cninfo.com.cn |
| Place of preparation of the Company’s annual | Board office |
IV. Registration Changes
reportOrganization code
| Organization code | 725252053 |
| Changes in main business since the Company's listing (if any) | No changes |
| Changes of controlling shareholders (if any) | No changes |
V. Other Relevant Information
Accounting firm engaged by the Company
| Name of the accounting firm | Shinewing Certified Public Accountants (special general partnership) |
| Office address of the accounting firm | 9/F, Block A, Fuhua Mansion, No.8 Chaoyangmen North Street, Dongcheng District, Beijing |
| Name of signatory accountant | Lei Yongxin, Wang Qing |
The sponsor institution engaged by the Company to perform the continuous supervision responsibility during the reporting period
□ Applicable √ Not applicable
The financial advisor engaged by the Company to perform the continuous supervision responsibility during the reporting period
□ Applicable √ Not applicable
VI. Major Accounting Data and Financial IndicatorsWhether the Company needs to retroactively adjust or restate the accounting data of the previous years
□ Yes √ No
| 2020 | 2019 | Increase/decrease this year compared to the previous year | 2018 | |
| Operating income (yuan) | 8,128,620,799.31 | 7,760,581,855.53 | 4.74% | 7,424,885,274.14 |
| Net profits attributable to shareholders of listed companies (yuan) | 1,660,749,958.89 | 1,589,814,847.80 | 4.46% | 1,473,579,665.62 |
| Net profits attributable to shareholders of the listed company after deduction of non-recurring profits and losses (yuan) | 1,584,584,566.83 | 1,516,979,830.78 | 4.46% | 1,390,626,550.21 |
| Net cash flow from operating activities (yuan) | 1,537,299,958.71 | 1,555,220,926.90 | -1.15% | 1,508,960,311.29 |
| Basic EPS (yuan/share) | 1.75 | 1.68 | 4.17% | 1.55 |
| Diluted EPS (yuan/share) | 1.75 | 1.68 | 4.17% | 1.55 |
| Weighted average return on net assets | 22.39% | 25.10% | Decreased by 2.71% | 26.40% |
| End of 2020 | End of 2019 | Increase/decrease at the end of this year compared to the end of the previous year | End of 2018 | |
| Total assets (yuan) | 12,457,568,276.25 | 10,651,922,572.87 | 16.95% | 9,455,361,508.83 |
| Net assets attributable to shareholders of listed companies (yuan) | 8,050,626,815.35 | 6,864,388,881.46 | 17.28% | 6,045,384,387.57 |
VII. Accounting data difference under domestic and foreign accounting standards
1. Differences between net profits and net assets in financial statements disclosed according to the
International Accounting Standards (IAS) and Chinese Accounting Standards simultaneously
□ Applicable √ Not applicable
No difference between net profits and net assets in financial statements disclosed according to the International Accounting Standards(IAS) and Chinese Accounting Standards during the reporting period.
2. Differences between net profits and net assets in financial statements disclosed according to theOverseas Accounting Standards and Chinese Accounting Standards simultaneously
□ Applicable √ Not applicable
No difference between net profits and net assets in financial statements disclosed according to the Overseas Accounting Standardsand Chinese Accounting Standards during the reporting period.
VIII. Key Quarterly Financial Indicators
Unit: yuan
| First quarter | Second quarter | Third quarter | Fourth quarter | |
| Operating income | 1,265,689,550.31 | 1,945,482,785.48 | 2,415,077,732.21 | 2,502,370,731.31 |
| Net profits attributable to shareholders of listed companies | 245,010,424.02 | 367,306,825.27 | 510,521,854.21 | 537,910,855.39 |
| Net profits attributable to shareholders of the listed company after deduction of non-recurring profits and losses | 189,293,064.42 | 362,027,367.63 | 505,555,890.56 | 527,708,244.22 |
| Net cash flow from operating activities | -244,718,331.36 | 652,405,464.92 | 533,264,051.72 | 596,348,773.43 |
Whether there is significant difference between the above financial indicators or the total sum of them and the financial indicatorsrelated to the quarterly report and semiannual report disclosed by the Company
□ Yes √ No
IX. Non-recurring Profit and Loss Items and Amount
√Applicable □ Not applicable
Unit: yuan
| Item | Amount in 2020 | Amount in 2019 | Amount in 2018 |
| Profits and losses on the disposal of non-current assets (including the write-off part of the provision for asset impairment) | -422,706.54 | -158,607.19 | -27,525.06 |
| Government subsidies included into the current profits and losses, except those government subsidies, which are closely related to the business of a company and enjoyed in accordance with a certain standard quota or quantity of the state | 91,184,657.20 | 88,113,806.09 | 98,235,805.08 |
| Profits and losses from investment or management assets entrusted to others | 285,386.29 | ||
| Income and expenditure other than those mentioned above | -2,965,479.76 | -1,884,306.56 | 1,916,399.82 |
| Less: Amount affected by income tax | 11,202,215.16 | 13,290,725.11 | 17,276,844.91 |
| Amount of minority shareholders' equity affected (after tax) | 428,863.68 | -54,849.79 | 180,105.81 |
| Total | 76,165,392.06 | 72,835,017.02 | 82,953,115.41 |
Explain the non-recurrent profit and loss items defined by the Company according to the Interpretative Announcement No. 1 onInformation Disclosure of Public Securities Issuing Companies - Non-recurrent Profits and Losses and defined from thenon-recurrent profit and loss items enumerated in the Interpretative Announcement No. 1 on Information Disclosure of PublicSecurities Issuing Companies - Non-recurrent Profits and Losses
□ Applicable √ Not applicable
No definition of non-recurrent profit and loss items defined and enumerated in the Interpretative Announcement No. 1 on InformationDisclosure of Public Securities Issuing Companies - Non-recurrent Profits and Losses as non-recurrent profit and loss items duringthe reporting period.
Section 3 Business SummaryI. Main Business of the Company during Reporting Period(I) Main businessDedicated to creating a new quality kitchen for millions of families, the Company takes foot in the kitchen fieldand focuses on the development, production, sales and comprehensive services of kitchen appliances, includingrange hoods, gas hobs, sterilizer cabinets, steam ovens, ovens, steam oven-ovens, dishwashers, water purifiers,water heaters, microwaves, integrated hobs and integrated sink. After more than 40 years of development andgrowth, the Company has become the manufacturer with the longest history, the highest market share and thelargest production capacity in the Chinese kitchen appliance industry. The Company has achieved the best sales ofrange hoods in China for 23 years and the world for six consecutive years.(II) Development Stage of IndustryAccording to the National Economic and Social Development Statistics Bulletin 2020 issued by the NationalBureau of statistics, by the end of 2020, the urbanization rate of the country's permanent population was more than60%. According to the 14th Five-Year Plan and outline goal of 2035, the urbanization rate of the country'spermanent population during the 14th Five-Year Plan will reach 65%. It could be predicted that China'surbanization rate would still achieve a rapid growth, and urbanization construction will shift to a stage ofhigh-quality development in the next few years Thanks to the increasing urbanization rate, there is still a hugespace in the kitchen appliance industry. Due to the influence of COVID-19 in 2020, the kitchen appliance industrywas impacted to some extent, but the long-term development trend was not changed. On the other hand, the stockmarket demand gradually emerged, the new market and the stock market will jointly support the futuredevelopment of kitchen industry.According to the data from AVC, in 2020, the annual retail volume of range hoods was 22.83 million, representinga year-on-year decrease of 7.6%, and the amount of retail sales was 31.95 billion yuan, representing ayear-on-year decrease of 9.3%. The retail volume of gas hobs was 28.039 million units, representing ayear-on-year decrease of 8.1%, and the amount of retail sales was 18.84 billion yuan, representing a year-on-yeardecrease of 5.9%. The retail volume of steam oven-oven was 12.63 million units, representing a year-on-yearincrease of 12.3%, and the amount of retail sales was 7.17 billion yuan, representing a year-on-year increase of
11.2%. The retail volume of dishwasher was 1.919 million units, representing a significant year-on-year increaseof 31.0%, and the amount of retail sales was 8.70 billion yuan, representing a year-on-year increase of 25.3%. Theretail volume of sterilizer cabinet was 5.598 million units, representing a year-on-year increase of 4.3%. In themeantime, the uncertainty of kitchen appliance industry is increased, which is reflected on brand. The revenue andgrowth rate begin to differentiate. Brand concentration degree is promoted further and Matthew effect highlights.Affected by various factors, such as epidemic situation, rising cost of raw materials, industry shuffling accelerated.According to online and offline monitoring data of AVC, there were 339 online market brands in 2020,representing a year-on-year decrease of 78, and 202 offline market brands, representing a year-on-year decrease of15.From the perspective of category development, in addition to the continuous innovation of traditional categoriesof products such as range hood and gas hob, the steam oven-oven and dishwasher also ushered in rapid growth.The improvement of kitchen life experience is still the unremitting pursuit of the whole industry, and the futurekitchen appliance market is still the most promising market in the whole home appliance industry. The evolutionand innovation of kitchen appliance products is accelerating, especially under the influence of epidemic, health,intelligence, integration and scene have become the key words of product development, which are mainlymanifested in three aspects: 1. The single product’s iteration is accelerated, and the product form turns to diversityand stronger function; 2. The whole kitchen solution, represented by series and whole kitchen, is heating up. 3.The health related products, represented by the dishwasher, sterilizer cabinet, built-in steam oven-oven, sell well.In the short term, integrated technology products will focus on solving the contradiction between people's demandfor the expansion of kitchen appliances and kitchen space. Integrated products have been more and morerecognized by consumers. In the long run, artificial intelligence, Internet of Things and other technologies willlead the upgrade of intelligent products and the transformation of kitchen appliance industry.
II. Significant Changes in Prime Assets
1. Significant Changes in Prime Assets
| Prime assets | Significant changes |
| Equity assets | No significant change during the reporting period |
| Fixed assets | No significant change during the reporting period |
| Intangible assets | No significant change during the reporting period |
| Construction in progress | The construction in progress increased by 70.24% year on year in the reporting period, which was mainly caused by the increased infrastructure investment in Maoshan Intelligent Manufacturing Park in the current year. |
2. Major overseas assets
□ Applicable √ Not applicable
III. Analysis of Core CompetitivenessNo significant change in the Company's core competitiveness during the reporting period: The Company's corecompetitiveness is mainly reflected in the high-end positioned the brand capacity, continuous innovative researchand development capacity, comprehensive and efficient operation capacity.
1. Brand capability of high-end positioning
ROBAM, founded in 1988, has established a significant brand advantage in the kitchen appliance industry. Since1991, ROBAM range hood has won the only "Quality Silver Award of the People's Republic of China", "ChinaFamous-brand Product", "National Inspection-free Product" in the kitchen appliance industry; ROBAM has beenrecognized as "China Famous Brand"; ROBAM has won "Most Influential Brand in China's Kitchen ApplianceIndustry" and "China's 500 Most Valuable Brands". After more than 40 years of efforts, it continues to deepen thepositioning of "big suction" and create high-end brand experience. "Big suction" has become the synonym of"high-end range hood", and the ROBAM has become one of the most famous and favorite professional high-endkitchen appliance brands in China. In 2015, ROBAM represented China's high-end manufacturing and landed atMilan Expo, and in 2016, it landed at IFA exhibition in Germany, which improved the ROBAM's high-end imageand international influence. In 2018, Robam Appliances put forward a new brand concept, that is, to "createChina’s new kitchen." According to the survey data released by Euromonitor International, the world'sauthoritative market research organization, Robam Appliances’ range hood won the first market share of globalrange hood private brand market for six consecutive years from 2015 to 2020. In 2020, Robam has been rated asone of the "BrandZ Top 100 Most Valuable Chinese Brands" for 7 consecutive years, and ranks first in the kitchenappliance industry with a brand value of $948 million. In addition, Robam has been awarded the "Top 500 AsianBrands" for 15 consecutive years.
2. R & D capability of continuous innovation
The mission of the Company is to render happiness of kitchen life for more families, by improving the existingcooking environment based on continuous research on technology to bring healthy and relaxed cooking life tousers with cooking fun. For this reason, the Company adheres to the principle of "product leading" and constantlypursues "technology leading". The Company now has a national technology center, a national laboratory, anational industrial design center, California institute of innovation, Shenzhen innovation research institute andacademician workstation of Tsinghua University. At present, the research and development team has more than 700 membersand has led the establishment of several important industry standards. The R&D investment has been continuously increased year onyear. In 2020, the Company applied for 744 patents, including 161 invention patents, and 418 authorized patents, including 14invention patents. From the hardware side, the Company upholds the craftsman spirit of excellence, promotes the comprehensivemulti-dimensional improvement of first, second and third category; As for the software side, the Company explores the developmentof AI-IoT intelligent IOT platform, focuses on the application of AI intelligent cooking curve, to improves the soft power of kitchenappliances.
3. Comprehensive and efficient operation capability
The Company has the leading marketing capability in the industry: the Company adopts the only agencymarketing mode in the industry, and creates the most comprehensive, efficient and responsive marketing system inthe industry through strong management and control, equity incentive and the de facto business partner system. Itdeepens intelligent manufacturing, lean operation and technology driven, and comprehensively builds theindustry's first supply chain system. It looks at global manufacturing and becomes a first-class manufacturingbenchmark in China. In addition, informatization, as the subject of the Company's promotion of "in-depthintegration of informatization and industrialization", focuses on the interactive innovation and continuousoptimization of data, technology, business process and organizational structure, constantly creates new capabilitiesin the informatization environment, and improves the sustainable competitiveness in the domestic and foreignmarkets.
Section 4 Discussion and Analysis on Business Conditions
I. OverviewIn 2020, the kitchen appliance industry was greatly affected by COVID-19 in the first half of the year and recoveredsignificantly in the second half of the year. At the same time, the performance of various channels was significantlydifferentiated. In terms of retail channel, due to the limited offline consumption caused by epidemic, retail salesdecreased significantly, according to the monthly data report of offline retail market monitoring of All View (hereinafterreferred to as "All View offline report"), the retail sales of main categories of kitchen appliances, such as range hoodsand gas hobs, decreased by 16.7% and 18.1% respectively compared with the same period of last year, which havedeclined by a large proportion for three consecutive years. In terms of e-commerce channel, due to the obviousimprovement of consumers' online shopping intentions, sales in e-commerce channel showed an upward overall trend,according to the monthly data report of online retail market monitoring of All View (hereinafter referred to as "All Viewonline report"), the retail sales of kitchen appliance packages increased by 9.1% compared with the same period of lastyear. In terms of engineering channel, according to the 2020 annual report on kitchen appliance products in China's realestate refined decoration market (hereinafter referred to as "All View refined decoration report"), the market of refineddecoration kitchen appliances in 2020 decreased by 0.2% year on year, showing a stable overall trend.The Company, as the industry leader, closely focused on the annual business philosophy of "practice internal skills andgo through the period, strive for progress in stability and promote growth - strengthen products, seize the market", andpaid close attention to COVID-19 prevention and control and actively promoted the iteration of products of variouscategories and groups, to continuously increase the market share. In 2020, the Company realized an operatingrevenue of 8.129 billion yuan, with a year-on-year growth of 4.74%, and realized a net profit attributable to theparent company of 1.661 billion yuan, with a year-on-year increase of 4.46%, which are obviously better thanthe industry average.
According to the All View offline report, as of December 31, 2020, the market share and market position of the offlineretail sales of Company's major product categories are shown in the following table:
| Range hood | Gas hobs | Sterilizer cabinet | Built-in electrical steam oven | Built-in steam oven-oven | Built-in electric oven | Built-in dishwasher |
| 28.30% | 25.80% | 21.20% | 24.50% | 31.50% | 34.10% | 9.60% |
| 1 | 1 | 2 | 1 | 2 | 2 | 4 |
According to the All View online report, as of December 31, 2020, the market share and market position of the onlineretail sales of Company's major product categories are shown in the following table:
| Kitchen appliance packages | Two sets of smoke cooker | Range hood | Gas hobs | Built-in electrical steam oven | Built-in steam oven-oven | Built-in sterilizer cabinet | Built-in dishwasher |
| 28.00% | 28.80% | 16.00% | 8.5% | 21.5% | 11.40% | 10.10% | 4.3% |
| 1 | 1 | 3 | 4 | 2 | 3 | 3 | 5 |
According to the All View refined decoration report, as of December 31, 2020, the market share of ROBAM in refineddecoration channel was 35.0%, ranking first in the industry.In 2020, the technology sector has made remarkable achievements in new product development, talent training,technology patents, standard formulation and other aspects. With the persistence of the craftsman spirit, we haveharvested technology-driven achievements. Through project management, product management, quality management,the Company promoted the multi-dimensional improvement of product hardware performance, appearance form anduser experience and other multi-dimensional improvement, launched the industry innovation product double-cavityrange hood 8235S; new steam oven-oven CQ975 with extreme performance; dishwasher 775A and 776X which aremore suitable for Chinese cooking cleaning. Integrated range hood 5908S+90B8Z, dual chamber oven RQ035 anddishwasher W735 won AWE2020 Appleland Excellent Product Award. At the same time, the Company explored thedevelopment of AI-IoT intelligent Internet of Things platform, focused on the application of AI intelligent cookingcurve, to enhance the soft power of kitchen electricity products. In addition, the Company continually introducedhigh-level technical personnel and implemented delicacy management, to improve the construction of technicalpersonnel echelon. The Company paid attention to the quality and efficiency of R&D, continuously optimizes theproduct development cycle and improves the success rate of product launch, and reserves core technologies forintelligence and integration. In 2020, the Company applied for 744 patents, including 161 invention patents, and 418authorized patents, including 14 invention patents. In addition, the Company led the development of 7 standards,including 2 industry standards, 4 group standards, 1 Zhejiang manufacturing standard, and participated in thedevelopment of 16 standards. The R&D innovation ability has been recognized by the industry, won the Science andTechnology Award of China National Light Industry Council, Science and Technology Progress Award of ZhejiangProvince, Second Prize for Quality Technology Award of China Quality Association.In 2020, the marketing sector adhered to the high-end positioning of the brand, took consumers as the starting point andproducts as the starting point, continued to promote the transformation from channel-driven to product-driven, builtproduct matrix and coordinate channel resources. In terms of retail channel, the Company focused on the sales strategyof " Robam Four-piece suit", which is a set of series products. The matching rate of second and third product groups
increased rapidly. The Company further optimized KA layout and flat store system construction to improve operationalefficiency. In terms of e-commerce channel, the Company centered on the idea of "deep category operation,reconstructing user value and strengthening brand building", gave full play to the advantages of the first product group,empowered the growth of the second and third product groups, and excavated the stock value to improve the operationalefficiency. In terms of project channels, the Company enriched customer echelon, optimized customer structure,adjusted product structure, gradually improved the permeability of each category, and further promoted central rangehood CCS. In terms of innovate channel, the Company cooperated with industry leading company of whole housecustomization companies and home decoration companies to carry out comprehensive cooperation, directing to the frontof consumption, and contributing to the rapid promotion of new and old categories. In terms of overseas channel, theCompany actively responded to the great challenges brought by the pandemic, strengthened the positioning of "globalhigh-end kitchen leader", steadily advanced the brand internationalization process, and gradually expanded the globalinfluence of the brand.In 2020, the production sector deepened intelligent manufacturing with the carrier of automation and information, fullyrealized online digitization, becoming one of the manufacturing benchmarks with the strongest comprehensivecompetitiveness in China's manufacturing industry. In terms of supply chain, the Company continued to improve thewhole process of efficient logistics system and supplier ecosystem construction, to achieve procurement cost reductionand accurate delivery; In terms of manufacturing capacity, the Company took value-driven as the main line andstrengthened lean manufacturing system management, realizing efficient operation of the whole value chain and strovefor building an intelligent benchmark factory in the industry; In terms of new product development ability, through thelinkage of new product supply chain, the Company shorten the development cycle to ensure the timely delivery of newproducts; In terms of organization and operation, the Company emphasized the company culture, and organize theconstruction of a talent system. With the theme of "future cooking, digital intelligent manufacturing", Jiutian centerdigital platform and zero point manufacturing of Robam appliance were successfully released, marking the official useof unmanned factory. From building of the industry model of replacing people with machine in 2012, to building of theindustry's first digital intelligent manufacturing base in 2015, then to building of the industry's first unmanned factory inNovember 2020, the Company has experienced a gradual transition from local machine replacement to in-deepthintegration of "informatization and industrialization". It has been successively selected into the "2016 IntelligentManufacturing Pilot Demonstration Project", "2018 Manufacturing and Internet Integration Development PilotDemonstration Project" and the first batch of "Future Factory" in Zhejiang Province. Moreover, Maoshan IntelligentManufacturing Park project of the Company was also constructed smoothly. After completion, it would promote the
iterative upgrading of products and intelligent upgrading of manufacturing and lay a solid foundation for the Company'slong-term development.In 2020, based on the concept of "creating a new Chinese kitchen", the Company carries out brand system constructionfrom multiple dimensions such as products, channels and activities, so as to build the No. 1 brand of high-end kitchenappliances in China that understands Chinese cooking best. From product perspective, relying on "stronger performance,better space, more functions "as the hardware threshold, with the world's largest Chinese cooking AI curve database assoftware support, the Company devoted itself to creating the brand potential energy of "China's new kitchen, Robamfour-piece suit". From channel perspective, the Company relied on multiple channels work together to promote brandbuilding. The new visual image of offline stores was fully covered, and the electronic scene application manual 2.0version of online stores was newly launched. The brand terminal image was strengthened. From the activity perspective,the Company successfully held the " conference on the consumption trends of new kitchen in China and conference onlaunch of new Chinese cuisine product of Robam" and issued the White Paper on China's new kitchen (2020 version),aiming to set up standards of China's new kitchen and explore consumption trends of new kitchen in China through thestudy on Chinese families and Chinese cooking way. At the same time, the Company successfully held ChinaDishwasher Festival and carried out theme activities such as Family Feast, Yearning Kitchen Festival, Kitchen CarnivalSeason and Comprehensive Cooking Day, etc. In addition, the Company served as the food creation officer of "Yearning Life 4" and "Chinese Restaurant 4", interpreting Chinese cooking and delivering Chinese flavor; TheCompany has also become the exclusive supplier of official kitchen appliances for the 2022 Asian Games in Hangzhou,to support the publicity and promotion of the Games and to help the construction of the Asian Games.In 2020, Mingqi Company focused on transformation and change, to improve the layout of kitchen products and meetthe diversified needs of users. The Company created a new retail model, integrated online and offline development, andoptimized the consumption experience. Kinde archived a reversal growth under the influence of COVID-19. Thedevelopment of intelligent integrated kitchen ecological industrialization project was progressing smoothly, aftercompletion, it would enhance the R&D and production capacity of integrated series products.In 2020, the Company continued to be recognized by the capital market in terms of corporate governance, internalmanagement and shareholder returns, and won "Best Board of Directors in Small and Medium Enterprise Board", "BestNew Media Operation in Small and Medium Enterprise Board", "Best Investment Company Award", "Best DirectorSecretary in Small and Medium Enterprise Board" in the 11th China listed company investor relations Tianma Award,organized by Securities Times; The Company also gained "Top 50 Listed Enterprise in Small and Medium EnterpriseBoard in Terms of Value", “Top 10 Best Management Team Among the Listed Enterprises in Small and Medium
Enterprise Board” and “Outstanding Director Secretary in Listed Company for Information Disclosure” in 14th Chinalisted company value selection. The Company has been always adhered to kitchen domain, to support long-term valueinvestment.
II. Main business analysis
1. Overview
See “I. Overview” in “Discussion and Analysis of Operation”.
2. Revenue and Costs
(1) Operating income composition
Unit: yuan
| 2020 | 2019 | Year-on-year increase/decrease | |||
| Amount | Proportion in operating income | Amount | Proportion in operating income | ||
| Total operating income | 8,128,620,799.31 | 100% | 7,760,581,855.53 | 100% | 4.74% |
| By industry | |||||
| Home and kitchen & bath appliances | 7,950,757,663.78 | 97.81% | 7,589,302,689.33 | 97.79% | 4.76% |
| Other operating income | 177,863,135.53 | 2.19% | 171,279,166.20 | 2.21% | 3.84% |
| By product | |||||
| First category: | |||||
| Range hood | 4,109,720,518.81 | 50.56% | 4,081,545,017.88 | 52.59% | 0.69% |
| Gas hobs | 1,917,138,716.95 | 23.59% | 1,843,440,109.62 | 23.75% | 4.00% |
| Sterilizer cabinet | 558,934,801.48 | 6.88% | 560,848,048.70 | 7.23% | -0.34% |
| Second Category: | |||||
| Steam oven-oven | 377,875,190.46 | 4.65% | 127,740,642.01 | 1.65% | 195.81% |
| steam oven | 188,586,242.66 | 2.32% | 245,373,245.51 | 3.16% | -23.14% |
| Oven | 118,200,187.42 | 1.45% | 140,846,016.00 | 1.81% | -16.08% |
| Third category: | |||||
| Dishwasher | 223,781,076.46 | 2.75% | 138,025,125.30 | 1.78% | 62.13% |
| Water purifier | 61,458,853.99 | 0.76% | 77,528,039.72 | 1.00% | -20.73% |
| Water heater | 56,885,678.02 | 0.70% | 42,644,066.19 | 0.55% | 33.40% |
| Others: | |||||
| Integrated hob | 259,062,761.51 | 3.19% | 211,906,015.61 | 2.73% | 22.25% |
| Other small home appliances | 79,113,636.02 | 0.97% | 119,406,362.79 | 1.54% | -33.74% |
| Other operating income | 177,863,135.53 | 2.19% | 171,279,166.20 | 2.21% | 3.84% |
| By region | |||||
| East China - main products | 3,660,037,066.87 | 45.03% | 3,295,823,380.45 | 42.47% | 11.05% |
| East China - other | 177,863,135.53 | 2.19% | 171,279,166.20 | 2.21% | 3.84% |
| South China | 1,166,738,209.66 | 14.35% | 1,110,071,492.74 | 14.30% | 5.10% |
| Central China | 798,608,093.61 | 9.82% | 808,538,868.51 | 10.42% | -1.23% |
| North China | 859,966,194.92 | 10.58% | 906,014,918.04 | 11.67% | -5.08% |
| Northeast China | 417,632,137.86 | 5.14% | 416,692,738.11 | 5.37% | 0.23% |
| Northwest China | 366,186,500.24 | 4.50% | 390,575,627.50 | 5.03% | -6.24% |
| Southeast China | 644,756,608.57 | 7.93% | 618,037,810.38 | 7.96% | 4.32% |
| Overseas regions | 36,832,852.05 | 0.45% | 43,547,853.60 | 0.56% | -15.42% |
(2) Industries, products or regions that account for more than 10% of the Company's operating income orprofit
√Applicable □ Not applicable
Unit: yuan
| Operating income | Operating cost | Gross margin ratio | Year-on-year increase/decrease of operating income | Year-on-year increase/decrease of operating cost | Year-on-year increase/decrease of gross margin ratio | |
| By industry | ||||||
| Home and kitchen & bath appliances | 8,128,620,799.31 | 3,563,206,930.87 | 56.16% | 4.74% | 0.41% | 1.89% |
| By product | ||||||
| Range hood | 4,109,720,518.81 | 1,660,664,394.98 | 59.59% | 0.69% | -2.03% | 1.12% |
| Gas hobs | 1,917,138,716.95 | 783,340,061.78 | 59.14% | 4.00% | -3.40% | 3.13% |
| By region | ||||||
| East China | 3,660,037,066.87 | 1,548,939,686.79 | 57.68% | 11.05% | 7.20% | 1.52% |
| South China | 1,166,738,209.66 | 546,692,231.16 | 53.14% | 5.10% | -3.37% | 4.11% |
| North China | 859,966,194.92 | 350,372,950.55 | 59.26% | -5.08% | -4.93% | -0.07% |
In the case that the statistical standards for main business data of the Company are adjusted during the reporting period, the mainbusiness data of the Company in recent 1 year are subject to those after the adjustment of the statistical standards at the end of thereporting period
□ Applicable √ Not applicable
(3) Whether the Company's physical sales revenue is greater than the service revenue
√ Yes □ No
| Industry category | Item | Unit | 2020 | 2019 | Year-on-year increase/decrease |
| Home and kitchen & bath appliances | Sales volume | Unit | 6,952,763 | 6,748,364 | 3.03% |
| Production output | Unit | 7,056,783 | 6,858,755 | 2.89% | |
| Inventory | Unit | 2,222,055 | 2,118,035 | 4.91% |
Reasons for more than 30% year-on-year changes in the relevant data
□ Applicable √ Not applicable
(4) Performance of major sales contracts signed by the Company up to the reporting period
□ Applicable √ Not applicable
(5) Composition of operating cost
Industry and product categories
Unit: yuan
| Industry category | Item | 2020 | 2019 | Year-on-year increase/decrease | ||
| Amount | Proportion in operating cost | Amount | Proportion in operating cost | |||
| Home and kitchen & bath appliances | Manufacturing costs | 231,680,866.15 | 6.50% | 208,262,654.93 | 5.87% | 11.24% |
| Raw materials | 3,112,334,458.17 | 87.35% | 3,136,357,317.10 | 88.38% | -0.77% | |
| Labor | 219,191,606.55 | 6.15% | 204,157,773.01 | 5.75% | 7.36% | |
Unit: yuan
| Product category | Item | 2020 | 2019 | Year-on-year increase/decrease | ||
| Amount | Proportion in operating cost | Amount | Proportion in operating cost | |||
| Range hood | Manufacturing costs | 134,505,424.42 | 3.77% | 122,148,958.89 | 3.44% | 10.12% |
| Raw materials | 1,407,036,579.61 | 39.49% | 1,458,490,197.62 | 41.10% | -3.53% | |
| Labor | 119,122,390.95 | 3.34% | 114,502,871.76 | 3.23% | 4.03% | |
| Gas hobs | Manufacturing costs | 23,134,151.04 | 0.65% | 25,155,032.87 | 0.71% | -8.03% |
| Raw materials | 730,332,351.14 | 20.50% | 756,745,591.54 | 21.32% | -3.49% | |
| Labor | 29,873,559.60 | 0.84% | 28,998,831.19 | 0.82% | 3.02% | |
| Sterilizer cabinet | Manufacturing costs | 28,084,404.21 | 0.79% | 27,356,202.65 | 0.77% | 2.66% |
| Raw materials | 286,265,054.99 | 8.03% | 291,482,100.97 | 8.21% | -1.79% | |
| Labor | 25,979,428.66 | 0.73% | 21,777,670.44 | 0.61% | 19.29% | |
| Other | Manufacturing costs | 45,956,886.49 | 1.29% | 33,602,460.52 | 0.95% | 36.77% |
| Raw materials | 688,700,472.43 | 19.33% | 629,639,426.97 | 17.74% | 9.38% | |
| Labor | 44,216,227.34 | 1.24% | 38,878,399.62 | 1.10% | 13.73% | |
(6) Whether the consolidation scope changes in the reporting period
√ Yes □ No
On October 25, 2020, the Company's holding subsidiary Shengzhou Kinde and Gongqingcheng Binlan Investmentpartnership (limited partnership) (hereinafter referred to as "Binlan Investment") signed a Project CooperationAgreement. The agreement stipulates that both parties jointly contribute to the establishment of Cooking Futurewith registered capital of 50 million yuan, including 35 million yuan contributed by Shengzhou Kinde, accountingfor 70% of the equity, and 15 million yuan contributed by Binlan Investment, accounting for 30% of the equity.There are 7 directors on the board of directors of Cooking Future, including 4 directors from Shengzhou Kindeand 3 directors from Binglan Investment. The resolution of the board of directors must be approved by more thanhalf of the members of the board of directors, so Shengzhou Kinde controls Cooking Future. Cooking Future hascompleted the industrial and commercial registration on November 16, 2020 and is currently in the preparation
period.
(7) Major changes or adjustments of business, products or services of the Company during the reportingperiod
□ Applicable √ Not applicable
(8) Major sales customers and major suppliers
Major sales customers of the Company
| Total sales amount of top five customers (yuan) | 2,847,342,891.98 |
| Proportion of total sales amount of top five customers in total annual sales | 35.03% |
| Among the sales amount of top five customers, proportion of sales amount of related parties in total annual sales | 0.00% |
Top 5 customers of the Company
| No. | Customer name | Sales amount (yuan) | Proportion in total annual sales |
| 1 | Unit 1 | 1,087,165,863.15 | 13.37% |
| 2 | Unit 2 | 751,181,480.69 | 9.24% |
| 3 | Unit 3 | 377,455,306.57 | 4.64% |
| 4 | Unit 4 | 350,802,073.00 | 4.32% |
| 5 | Unit 5 | 280,738,168.57 | 3.45% |
| Total | -- | 2,847,342,891.98 | 35.03% |
Major suppliers of the Company
| Total purchase amount of top five suppliers (yuan) | 764,506,651.81 |
| Proportion of total purchase amount of top five suppliers in total annual purchase amount | 20.96% |
| Among the purchase amount of top five suppliers, proportion of purchase amount of related parties in total annual purchase amount | 0.00% |
Top 5 suppliers of the Company
| No. | Supplier name | Purchase amount (yuan) | Proportion in total annual purchase amount |
| 1 | Unit 1 | 179,827,450.62 | 4.93% |
| 2 | Unit 2 | 161,554,760.89 | 4.43% |
| 3 | Unit 3 | 151,051,714.02 | 4.14% |
| 4 | Unit 4 | 147,638,576.98 | 4.05% |
| 5 | Unit 5 | 124,434,149.30 | 3.41% |
| Total | -- | 764,506,651.81 | 20.96% |
3. Cost
Unit: yuan
| 2020 | 2019 | Year-on-year increase/decrease | Description of major changes | |
| Selling expenses | 2,146,965,048.87 | 1,928,259,172.35 | 11.34% | |
| Management costs | 296,985,763.24 | 284,364,115.17 | 4.44% | |
| Financial expenses | -150,148,186.75 | -83,410,491.25 | N/A | |
| Research and development cost | 303,347,555.81 | 299,469,126.54 | 1.30% |
4. R&D Investment
√Applicable □ Not applicable
In 2020, the Company’s R&D investment was 303 million yuan, representing an year-on-year increase of 1.30%.At present, the Company has 742 R&D technicians, accounting for 16.09% of the total number of employees,increased by 0.27% as compared with the same period of last year. The Company now has a national technologycenter, a national laboratory and a national industrial design center. In addition, the Company also has CaliforniaInnovation Research Institute and Shenzhen Innovation Research Institute. The former focuses on collection ofcutting-edge technology, the latter focuses on basic research and application of new materials and new techniques.In terms of product development, for mature categories such as range hoods and gas hobs, the main developmentdirection is to maintain the industry performance of the "highest point" and double cavity form of gas hobs leadsthe industry innovation; For non-open fire cooking appliances such as steam oven-oven, the Company focused oncreating product differentiation features, enriching product lines, and realizing the ability of multi-dimensionalplatform layout. At the same time, the Company would increase investment in dishwasher categories, focusing onthe researches on strong washing, drying, purification and other characteristic functions. In addition, the Companywould explore the development of AI-IoT intelligent IOT platform, focus on the application of AI intelligent cooking curve, toenhance the soft power of kitchen appliances.R & D investment of the Company
| 2020 | 2019 | Proportion of change | |
| Number of R & D personnel (person) | 742 | 714 | 3.92% |
| Proportion of R & D personnel | 16.09% | 15.82% | 0.27% |
| R & D investment amount (yuan) | 303,347,555.81 | 299,469,126.54 | 1.30% |
| Proportion of R & D investment in operating revenue | 3.73% | 3.86% | -0.13% |
| Capitalized amount of R & D investment (yuan) | 0.00 | 0.00 | 0.00% |
| Proportion of capitalized R & D investment in R & D investment | 0.00% | 0.00% | 0.00% |
5. Cash flow
Unit: yuan
| Item | 2020 | 2019 | Year-on-year increase/decrease |
| Subtotal cash inflows from operating activities | 8,399,284,005.14 | 8,178,723,903.78 | 2.70% |
| Subtotal cash outflows from operating activities | 6,861,984,046.43 | 6,623,502,976.88 | 3.60% |
| Net cash flow from operating activities | 1,537,299,958.71 | 1,555,220,926.90 | -1.15% |
| Subtotal cash inflows from investment activities | 1,649,618,287.44 | 4,021,202,772.82 | -58.98% |
| Subtotal cash outflows from investment activities | 2,867,289,864.56 | 2,965,663,320.83 | -3.32% |
| Net cash flow from investment activities | -1,217,671,577.12 | 1,055,539,451.99 | -215.36% |
| Subtotal cash inflows from financing activities | 12,726,177.30 | / | / |
| Subtotal cash outflows from financing activities | 474,512,025.00 | 759,219,240.00 | -37.50% |
| Net cash flow from financing activities | -461,785,847.70 | -759,219,240.00 | / |
| Net increase of cash and cash equivalents | -143,199,751.94 | 1,852,076,406.65 | -107.73% |
Description of main influencing factors of significant changes in relevant data on a year-on-year basisNet cash flow from investment activities decreased by 215.36% as compared with that in the same period of previous year, whichwas mainly caused by the increase of the amount purchased from bank wealth management products.The cash outflow from financing activities decreased by 37.50% year on year, which was mainly caused by the reduction of thedividend amount last year.The net increase in cash and cash equivalents decreased by 107.73% from the previous year, which was mainly due to the decrease innet cash flow from investment activities.III. Non-main business analysis
□ Applicable √ Not applicable
IV. Analysis of assets and liabilities
1. Major changes in asset composition
Unit: yuan
| End of 2020 | At the beginning of 2020 | Proportion change | Description of major changes | |||
| Amount | Proportion in total assets | Amount | Proportion in total assets | |||
| Monetary capital | 3,921,052,700.31 | 31.48% | 4,054,121,726.23 | 38.06% | -6.58% | - |
| Trading financial assets | 2,352,000,000.00 | 18.88% | 1,360,000,000.00 | 12.77% | 6.11% | - |
| Accounts receivable | 1,008,235,946.40 | 8.09% | 725,630,901.28 | 6.81% | 1.28% | - |
| Inventory | 1,386,089,344.84 | 11.13% | 1,339,176,925.20 | 12.57% | -1.44% | - |
| Investment properties | 2,591,001.84 | 0.02% | 112,588.34 | 0.00% | 0.02% | - |
| Long-term equity investment | 3,452,769.59 | 0.03% | 4,168,338.79 | 0.04% | -0.01% | - |
| Fixed assets | 824,978,354.71 | 6.62% | 826,234,929.97 | 7.76% | -1.14% | - |
| Construction in progress | 463,424,647.46 | 3.72% | 272,211,720.62 | 2.56% | 1.16% | - |
| Accounts payable | 1,723,832,208.09 | 13.84% | 1,395,061,285.28 | 13.10% | 0.74% | - |
2. Assets and liabilities measured at fair value
□ Applicable √ Not applicable
3. Limitation on the assets and rights as of the end of the reporting period
Other monetary capital at the end of 2020 was 35,034,898.78 yuan, including the L/C deposit of 33,394,968.71yuan and deposit for bill acceptance of 1,561,218.04, which are limited funds.V. Analysis of Investment
1. Overall situation
□ Applicable √ Not applicable
2. Significant equity investments acquired during the reporting period
□ Applicable √ Not applicable
3. Significant ongoing non-equity investments during the reporting period
□ Applicable √ Not applicable
4. Financial assets investment
(1) Securities investment
□ Applicable √ Not applicable
The Company had no securities investments in the reporting period.
(2) Derivative investment
□ Applicable √ Not applicable
The Company had no derivative investments in the reporting period.
5. Use of funds raised
□ Applicable √ Not applicable
No funds raised are used in the reporting period.VI. Sales of Major Assets and Equities
1. Sales of major assets
□ Applicable √ Not applicable
The Company did not sell major assets in the reporting period.
2. Sales of major equities
□ Applicable √ Not applicable
VII. Analysis of main holding and joint-stock companies
□ Applicable √ Not applicable
During the reporting period, there is no important information of the shareholding company that should be disclosed.VIII. Structured entities controlled by the company
□ Applicable √ Not applicable
IX. Prospect of the Company's future development
1. Company development strategy (2020-2022)
Focus on cooking, focus on range hoods, expand the first category advantages, lead the second category, andsteadily promote the third category. Adhere to the spirit of hard-working vise entrepreneurship, take products andusers as the core, create a competitive advantage of the enterprise. Continue to create a more "convenient, healthyand interesting" kitchen life for users, build a global brand and a century-old enterprise.I. Overall goal: build a global brand and a century-old enterprise.To be a world-class century-old leader of cooking innovation.II. Business goal: focus on cooking, focus on range hoods, expand the first category advantages, lead the secondcategory, and steadily promote the third category.The first category refers to the product group represented by range hoods. The second category refers to theelectrified cooking product group represented by steam oven-oven. The third category refers to the water kitchenappliance product group represented by dishwashers.III. Core work: take products and users as the core, create a competitive advantage of the enterprise, and continueto create a more "convenient, healthy and interesting" kitchen life for users.The core of products focus on the leading product technology; users refer to the consumers who purchase and usekitchen products. At present, the kitchen appliance industry has entered the era of stock game. With theacceleration of industry integration, products and user experience will become more and more important. Throughtechnological innovation, expand the competitive advantages of products, increase the market share driven byproducts, pay attention to the user's cooking process and cooking environment, take improving the user's cookingexperience as the starting point, make the products and user experience the Company's competitive advantage, andcontinue to create a more "convenient, healthy and interesting" kitchen life for users.
2. Mission, vision and values of the Company
Mission: To render happiness of kitchen life for more families.Vision: To be a world-class century-old leader of cooking innovation.Values: Hard-working vise entrepreneurship.
3. In 2021, the Company's work policy is "build dreams and travel far, advance courageously in torrent". TheCompany will comprehensively reshape the Company's culture of struggle, highlight the Company's hard power;Make the cooking culture powerful, shape the soft power of the enterprise; Realize digitalization driven
transformation and build smart power.
4. Risk Factors
(1) Risk of real estate market fluctuation
The Company takes root in the kitchen and provides integrated solutions for built-in kitchen appliances includingrange hoods, gas hobs, sterilizer cabinets, steam oven-oven, ovens, steaming machine, dishwashers, waterpurifiers, integrated hobs, purification sinks, etc. Its demand comes from the kitchen decoration after the housepurchase, which has certain attributes of "decoration" and "furniture". In addition, main demand currently is fromthe new demand rather than the renewal demand, so its demand is greatly affected by the fluctuation of the realestate market. Although the Company has certain ability to resist fluctuations by virtue of its market leadership,the fluctuation of the real estate market will still have a certain impact on the Company's operating performance.
(2) Risk of raw material price fluctuation
The Company's main raw materials are stainless steel, cold-rolled sheet, copper, glass, etc. whose price fluctuationwill directly affect the Company's product costs, thus affecting the Company's profitability. Since the fourthquarter of 2020, the price of the Company's main raw materials have risen sharply, exerting certain pressure on theCompany's operating performance.
(3) Risk of intensified market competition
In recent years, due to the decline of demand caused by real estate regulation, the continuous improvement ofindustry concentration, the increasing investment of comprehensive brands in the kitchen appliance market andthe strong participation of Internet brands, there is a risk of intensified market competition in the kitchen applianceindustry, which will have a certain impact on the Company's business performance.
X. Reception, research, communication, interview and other activities
1. Registration form of reception, research, communication, interview and other activities during thereporting period
√Applicable □ Not applicable
| Reception time | Reception location | Reception way | Type of received object | Basic information index of the survey |
| January 02, 2020 | Meeting room of the Company | Field survey | Organization | See Record of Investor Relations Activity on January 02, 2020 in Cninfo for further information about the received objects and main communications |
| January 06, 2020 | Meeting room of the Company | Field survey | Organization | See Record of Investor Relations Activity on January 06-16, 2020 at in Cninfo for further information about the received objects and main communications |
| August 28, 2020 | Meeting room of the Company | Field survey | Organization | See Record of Investor Relations Activity on August 28, 2020 in Cninfo for further information about the received objects and main communications |
| Tuesday, September 22, 2020 | Meeting room of the Company | Field survey | Organization | See Record of Investor Relations Activity on September 22, 2020 in Cninfo for further information about the received objects and main communications |
| September 24, 2020 | Meeting room of the Company | Field survey | Organization | See Record of Investor Relations Activity on September 24, 2020 in Cninfo for further information about the received objects and main communications |
| November 09, 2020 | Meeting room of the Company | Field survey | Organization | See Record of Investor Relations Activity on November 9-11, 2020 in Cninfo for further information about the received objects and main communications |
| December 24, 2020 | Meeting room of the Company | Field survey | Organization | See Record of Investor Relations Activity on December 24, 2020 in Cninfo for further information about the received objects and main communications |
Section 5 Important MattersI. Common stock profit distribution and share capital increase from capital surplusFormulation, implementation and adjustment of common stock profit distribution policy, especially cash dividend policy, during thereporting period
√Applicable □ Not applicable
| Description for cash dividend policy | |
| Whether it meet the requirements of the Company’s articles of association and of the resolutions of shareholders’ meeting: | Yes |
| Whether the dividend distribution standard and proportion are specific and clear: | Yes |
| Whether relevant decision-making procedures and mechanisms are complete: | Yes |
| Whether the independent directors have performed their duties and fulfilled their due roles: | Yes |
| Whether the minor shareholders have the chance to fully express their opinions and demands, and whether their legal rights and interests have been fully protected: | Yes |
| Whether the conditions and procedures are normative and transparent in case of adjustments or changes of the cash dividend policy: | Yes |
Common stock dividend distribution program (plan) and share capital increase from capital surplus program (plan) in the past 3 years(including this reporting period)
1. The Company's profit distribution plan in 2018: based on its existing total stock issue of 949,024,050 shares, the Companydistributed cash dividends of 8 yuan (tax inclusive) for every 10 shares to all shareholders, amounting up to a total of759,219,240 yuan.
2. The Company's profit distribution plan in 2019: based on its existing total stock issue of 949,024,050 shares, the Company
distributed cash dividends of 5 yuan (tax inclusive) for every 10 shares to all shareholders, amounting up to a total of474,512,025.00 yuan.
3. The Company's profit distribution plan in 2020: based on its existing total stock issue of 949,024,050 shares, the Companydistributed cash dividends of 5 yuan (tax inclusive) for every 10 shares to all shareholders, amounting up to a total of474,512,025.00 yuan.
Common stock cash dividends of the Company in the past 3 years (including this reporting period)
Unit: yuan
| Year of dividend | Amount of cash dividend (tax inclusive) | Net profits attributable to common stockholders of the listed company in the annual consolidated | Ratio of cash dividends to net profits attributable to common stockholders of the listed company in the consolidated | Amount of cash dividend in other forms (e.g. share repurcha | Ratio of cash dividends in other forms to net profits attributable to | Total amount of cash dividends (including other forms) | Ratio of total amount of cash dividends (including other forms) to net profits attributable |
| statement of dividends | statement | se) | common stockholders of the listed company in the consolidated statement | to common stockholders of the listed company in the consolidated statement | |||
| 2020 | 474,512,025.00 | 1,660,749,958.89 | 28.57% | 474,512,025.00 | 28.57% | ||
| 2019 | 474,512,025.00 | 1,589,814,847.80 | 29.85% | 474,512,025.00 | 29.85% | ||
| 2018 | 759,219,240.00 | 1,473,579,665.62 | 51.52% | 759,219,240.00 | 51.52% |
The Company achieved profit within the reporting period and the parent company's attributable profit to common stockholders waspositive, but no common stock cash dividend distribution plan was proposed.
□ Applicable √ Not applicable
II. Profit distribution and share capital increase from capital surplus during the reportingperiod
√Applicable □ Not applicable
| Bonus shares per 10 shares (shares) | 0 |
| Dividend per 10 shares (yuan) (tax inclusive) | 5 |
| The number of shares converted every 10 shares (shares) | 0 |
| Equity base of distribution plan (shares) | 949,024,050.00 |
| Amount of cash dividend (yuan) (tax inclusive) | 474,512,025.00 |
| Amount of cash dividend in other forms (e.g. share repurchase) (yuan) | 0.00 |
| Amount of cash dividend (including other forms) (yuan) | 474,512,025.00 |
| Distributable profit (yuan) | 6,240,444,654.34 |
| Ratio of total amount of cash dividend (including other forms) to total amount of distributable profit | 100% |
| Cash dividend distribution in this period | |
| Should the Company be in a growing stage and have major capital expenditure arrangements, the cash dividend should account for a minimum of 20% of the profit distribution when the profit is distributed. | |
| Description for details of profit distribution or share capital increase from capital surplus plan |
| According to the standard unqualified audit report issued by ShineWing Certified Public Accountants, the Company’s net profit attributable to the parent company owner in 2020 was RMB 1,660,749,958.89 yuan (number of parent company), plus the undistributed profit of RMB 5,054,206,720.45 yuan at the beginning of the year, minus the cash dividend of profit distribution of 2019, i.e., RMB 474,512,025.00 yuan, the Company's profit available to shareholders at the end of 2020 was RMB 6,240,444,654.34 yuan. Based on its existing total stock issue of 949,024,050 shares, the Company distributed cash dividends of 5 yuan (tax inclusive) for every 10 shares to all shareholders, amounting up to a total of 474,512,025.00 yuan. |
III. Performance of the commitments
1. Commitments fulfilled within and not fulfilled by the end of the reporting period by the Company’sactual controller, shareholders, related parties, acquirer and other commitment parties
√Applicable □ Not applicable
| Commitment reason | Commitment party | Commitment type | Commitment content | Commitment time | Time limit for acceptance | Degree of performance |
| Commitment made at the time of IPO or refinancing | Directors, supervisors and senior management directly or indirectly holding shares of the Company | Commitment to restriction on sales of shares | After the expiry of the 36-month sales restriction period, the shares transferred each year during his/her tenure shall not exceed 25% of the total number of shares held directly or indirectly in the Company; the Company shares directly or indirectly held shall not be transferred within six months after the resignation | Tuesday, November 23, 2010 | Long-term | Strict performance |
| Hangzhou Robam Industrial Group Co., Ltd.; Ren Jianhua | Commitment on avoiding horizontal competition | 1. The Company/I and other enterprises under the control of the Company/me do not, and will not, directly or indirectly, engage in any activities that constitute horizontal competition with the existing and future business of Robam and its holding subsidiaries; 2. If any business opportunity obtained the Company/I and other enterprises under the control of the Company/me from any third party constitutes or may constitute substantial competition with the business of Robam, the Company/I will immediately notify Robam and transfer such business opportunity to Robam; 3. The Company/I and other enterprises under the control of the Company/me commit not to provide | Tuesday, November 23, 2010 | Long-term | Strict performance |
| technical information, process flow, marketing channels or other trade secrets to other companies, enterprises, organizations or individuals whose business constitutes competition with the business of Robam. | ||||||
| Other commitments made to minor shareholders of the Company | Company | Dividend | The cumulative profits distributed in cash for three consecutive years shall not be less than 40% of the annual average distributable profits realized in the three years. | Tuesday, April 10, 2018 | Three years | Strict performance |
| Whether the commitment is fulfilled on time | Yes | |||||
2. In case the Company’s asset or project saw earning expectation, and the reporting period is still coveredby the term of the earning expectation, the Company shall make a statement about the asset or projectfulfilling the original expectation and the reasons thereof.
□ Applicable √ Not applicable
IV. Non-operating occupation of funds of listed companies by controlling shareholders and theirrelated parties
□ Applicable √ Not applicable
No non-operating occupation of funds of listed companies by controlling shareholders and their related parties during the reportingperiod.
V. Statement of the board of directors, the board of supervisors and independent directors (if any) onthe "non-standard audit report" of the accounting firm during the reporting period
□ Applicable √ Not applicable
VI. Explanation of changes in accounting policy, accounting estimates and accounting methods whencompared to the financial statements of the previous fiscal year
√Applicable □ Not applicable
In 2017, the Ministry of Finance issued the revised Accounting Standards for Business Enterprises No. 14 - Revenue(referred to as the "new revenue standards"). From January 1, 2020, the Company will conduct accounting treatment in
accordance with the newly revised above standards. According to the convergence provisions, the balance of items inrelevant statements at the beginning of this reporting period will be adjusted according to the difference between theimplementation of the new standards and the current standards on the first day, and the information in comparableperiods will not be adjusted.VII. Explanation of rectification of major accounting error in the reporting period which needs to betracked and restated
□ Applicable √ Not applicable
No rectification of major accounting error in the reporting period which needs to be tracked and restated.VIII. Explanation of changes in the scope of combined financial statements when compared withfinancial statements of the previous fiscal year
√Applicable □ Not applicable
On October 25, 2020, the Company's holding subsidiary Shengzhou Kinde and Gongqingcheng Binlan Investmentpartnership (limited partnership) (hereinafter referred to as "Binlan Investment") signed a Project CooperationAgreement. The agreement stipulates that both parties jointly contribute to the establishment of Cooking Future withregistered capital of 50 million yuan, including 35 million yuan contributed by Shengzhou Kinde, accounting for 70%of the equity, and 15 million yuan contributed by Binlan Investment, accounting for 30% of the equity. There are 7directors on the board of directors of Cooking Future, including 4 directors from Shengzhou Kinde and 3 directors fromBinglan Investment. The resolution of the board of directors must be approved by more than half of the members of theboard of directors, so Shengzhou Kinde controls Cooking Future. Cooking Future has completed the industrial andcommercial registration on November 16, 2020 and is currently in the preparation period.
IX. Appointment and dismissal of accounting firmsAccounting firm currently appointed
| Name of Chinese accounting firm | Shinewing Certified Public Accountants (special general partnership) |
| Remuneration (10,000 yuan) | 83 |
| Term of audit services of domestic accounting firms | 2 |
| Name of certified public accountants in domestic accounting firms | Lei Yongxin, Wang Qing |
| Term of auditing services of certified public accountant in domestic accounting firms | 2 |
Whether the accounting firm has been changed within the reporting period?
□ Yes √ No
Employment of internal control audit accounting firm, financial advisor or sponsor
□ Applicable √ Not applicable
X. Delisting confronted upon disclosure of the annual report
□ Applicable √ Not applicable
XI. Matters related to bankruptcy reorganization
□ Applicable √ Not applicable
There is no matter related to bankruptcy reorganization of the Company during the reporting period.
XII. Major litigations and arbitration matters
□ Applicable √ Not applicable
There is no major litigation or arbitration matters of the Company during the reporting period.XIII. Punishment and rectification
□ Applicable √ Not applicable
There is no punishment or rectification of the Company during the reporting period.XIV. Credit conditions of the Company, its controlling shareholders and actual controllers
□ Applicable √ Not applicable
XV. Implementation of the Company's equity incentive plan, employee stock ownership planor other employee incentive measures
√Applicable □ Not applicable
Implementation of the employee stock ownership plan in 2018
(1) On January 11, 2018, the 3rd meeting of the 4th Board of Directors of the Company was held to review and approve thedocuments titled About the Company's 2018 Employee Stock Ownership Plan (Draft) and the Summary and Proposal onAuthorizing the Board of Directors to Handle Matters Related to the Company's Stock Ownership Plan. The former was alsoreviewed and approved in the 3rd meeting of the 4th Board of Supervisors of the Company the same day.
(2) On February 2, 2018, the Company’s first extraordinary general meeting of shareholders in 2018 was held to review andapprove About the Company's 2018 Employee Stock Ownership Plan (Draft) and the Summary and Proposal on Authorizingthe Board of Directors to Handle Matters Related to the Company's Stock Ownership Plan.
(3) On May 4, 2018, purchases of the Company's employee stock ownership plan in 2018 had been completed, purchasing price upto 35.94 yuan/share, a total of 5,443,300 shares purchased, accounting for 0.57% of the total stock issue.
(4) On July 22, 2020, the Company completed the sale of the Employee Stock Ownership Plan. Please refer to the Company's
Notice on the Completed Sale of the Employee Stock Ownership Plan (Notice No. : 2020-018) for details.
XVI. Major related transactions
1. Related transactions associated with daily operation
□ Applicable √ Not applicable
There is no related transactions associated with daily operation during the reporting period.
2. Related transactions arising from the acquisition or sale of assets or equity
□ Applicable √ Not applicable
There is no related transactions arising from the acquisition or sale of assets or equity of the Company during the reporting period.
3. Related transactions of joint foreign investment
□ Applicable √ Not applicable
There is no related transactions of joint foreign investment of the Company during the reporting period.
4. Related claims and debts
□ Applicable √ Not applicable
There is no related claims and debts of the Company during the reporting period.
5. Other major related transactions
□ Applicable √ Not applicable
There is no other major related transactions of the Company during the reporting period.XVII. Major contracts and their performance
1. Trusteeship, contracting and lease
(1) Trusteeship
□ Applicable √ Not applicable
There is no trusteeship of the Company during the reporting period.
(2) Contracting
□ Applicable √ Not applicable
There is no contracting of the Company during the reporting period.
(3) Lease
□ Applicable √ Not applicable
There is no lease of the Company during the reporting period.
2. Major guarantee
□ Applicable √ Not applicable
There is no guarantee of the Company during the reporting period.
3. Entrusted cash asset management
(1) Entrusted financing
√Applicable □ Not applicable
Entrusted financing during the reporting period
Unit: 10,000 yuan
| Specific type | Source of funds for entrusted financing | Amount incurred in entrusted financing | Outstanding balance | Overdue amount not recovered |
| Bank financial products | Owned fund | 236,000 | 235,200 | 0 |
| Total | 236,000 | 235,200 | 0 | |
Specific circumstance of high-risk entrusted financing with significant single amount or with low security, poor liquidity and notbreak-even?□ Applicable √Not applicableThe entrusted financing is expected not to recover the principal or has other circumstances that may cause impairment
□ Applicable √ Not applicable
(2) Entrusted loans
□ Applicable √ Not applicable
There is no entrusted loans of the Company during the reporting period.
4. Major contracts for daily operations
□ Applicable √ Not applicable
5. Other major contracts
□ Applicable √ Not applicable
There is no other major contracts of the Company during the reporting period.XVIII. Social responsibility
1. Social responsibility fulfillment
For more details, see the Company's Social Responsibility Report of 2020, which is disclosed in the designated media.
2、Implementation of social responsibility for targeted poverty alleviation
N/A
3. Environmental protection related condition
Whether the listed company and its subsidiaries are key pollutant discharging units announced by environmental protectionauthorities
□ Yes √ No
XIX. Description on other important events
□ Applicable √ Not applicable
There is no other important events to be described during the reporting period.XX. Major events of subsidiaries
□ Applicable √ Not applicable
Section 6 Changes in Shares and ShareholdersI. Change in shares
1. Change in shares
Unit: share
| Prior to this change | Increase/Decrease by this change (+, -) | After this change | |||||||
| Quantity | Proportion | New issue of shares | Share donation | Share capital increase from reserved funds | Other | Subtotal | Quantity | Proportion | |
| I. Restricted shares | 14,123,269 | 1.49% | 14,123,269 | 1.49% | |||||
| Share held by other domestic capital | 14,123,269 | 1.49% | 14,123,269 | 1.49% | |||||
| Shares held by domestic natural persons | 14,123,269 | 1.49% | 14,123,269 | 1.49% | |||||
| II. Unrestricted shares | 934,900,781 | 98.51% | 934,900,781 | 98.51% | |||||
| Common stock in RMB | 934,900,781 | 98.51% | 934,900,781 | 98.51% | |||||
| III. Total amount of shares | 949,024,050 | 100.00% | 949,024,050 | 100.00% | |||||
2. Changes in restricted shares
□ Applicable √ Not applicable
II. Securities issuance and listing
1. Securities issuance (excluding preferred shares) during the reporting period
□ Applicable √ Not applicable
2. Description of changes in the total number of shares, shareholder structure, asset and liability structureof the Company
□ Applicable √ Not applicable
3. Existing internal employee shares
□ Applicable √ Not applicable
III. Shareholders and actual controllers
1. Number and shareholding of the Company's shareholders
Unit: share
| Total number of common shareholders at the end of the reporting period | 41,028 | Total number of common shareholders at the end of the previous month before the disclosure date of the annual report | 75,073 | Total number of preferred shareholders with voting rights restored at the end of the reporting period (if any) (see Note 8) | 0 | Total number of preferred shareholders with voting rights restored at the end of the previous month before the disclosure date of the annual report (if any) (see Note 8) | 0 | ||||||||
| Shareholders holding more than 5% shares or top 10 shareholders | |||||||||||||||
| Shareholder's name | Shareholder nature | Shareholding ratio | Number of shares held at the end of the reporting period | Increase or decrease during the reporting period | Number of shares held with limited sales conditions | Number of shares held with unlimited sales conditions | Pledge or freeze | ||||||||
| Status of shares | Quantity | ||||||||||||||
| Hangzhou Robam Industrial Group Co., Ltd. | Domestic non-state legal person | 49.68% | 471,510,000 | 471,510,000 | |||||||||||
| Hong Kong Securities Clearing Co. Ltd. | Overseas legal person | 13.09% | 124,229,511 | -10,845,886 | 124,229,511 | ||||||||||
| Shen Guoying | Domestic natural person | 1.29% | 12,240,000 | 12,240,000 | |||||||||||
| TEMASEK | Overseas | 1.10% | 10,461,546 | 10,461,546 | 10,461,546 | ||||||||||
| FULLERTON ALPHA PTE LTD | legal person | |||||||||
| Hangzhou Jinchuang Investment Co., Ltd. | Domestic non-state legal person | 1.00% | 9,451,985 | 9,451,985 | ||||||
| Norges Bank - equity fund | Overseas legal person | 0.99% | 9,440,215 | 8,118,215 | 9,440,215 | |||||
| Quebec Savings and Investment Group | Overseas legal person | 0.72% | 6,808,111 | 6,808,111 | 6,808,111 | |||||
| Hangzhou Yinchuang Investment Co., Ltd. | Domestic non-state legal person | 0.67% | 6,318,000 | 6,318,000 | ||||||
| China Resources Szitic Trust Co.,Ltd. - China Resources Trust · Kuan Yuan Value Renaissance Securities Investment Collect Fund Trust Plan | Other | 0.66% | 6,299,928 | 6,299,928 | 6,299,928 | |||||
| Ren Jianhua | Domestic natural person | 0.62% | 5,923,150 | 4,442,362 | 1,480,788 | |||||
| Description of the associated relationship or consistent actions of the above shareholders | The actual controller of the Company’s controlling shareholder Hangzhou Robam Industrial Group Co., Ltd. and the shareholder Hangzhou Jinchuang Investment Co., Ltd. is Mr. Ren Jianhua, and the natural person shareholder Shen Guoying is the wife of Ren Jianhua. The above shareholders have the possibility of acting in unison. | |||||||||
| Shareholding of top 10 shareholders with unlimited sales conditions | ||||||||||
| Shareholder's name | Number of shares with | Type of share | ||||||||
| unlimited sales conditions held at the end of the reporting period | Type of share | Quantity | |
| Hangzhou Robam Industrial Group Co., Ltd. | 471,510,000 | Common stock in RMB | 471,510,000 |
| Hong Kong Securities Clearing Co. Ltd. | 124,229,511 | Common stock in RMB | 124,229,511 |
| Shen Guoying | 12,240,000 | Common stock in RMB | 12,240,000 |
| TEMASEK FULLERTON ALPHA PTE LTD | 10,461,546 | Common stock in RMB | 10,461,546 |
| Hangzhou Jinchuang Investment Co., Ltd. | 9,451,985 | Common stock in RMB | 9,451,985 |
| Norges Bank - equity fund | 9,440,215 | Common stock in RMB | 9,440,215 |
| Quebec Savings and Investment Group | 6,808,111 | Common stock in RMB | 6,808,111 |
| Hangzhou Yinchuang Investment Co., Ltd. | 6,318,000 | Common stock in RMB | 6,318,000 |
| China Resources Szitic Trust Co.,Ltd. - China Resources Trust · Kuan Yuan Value Renaissance Securities Investment Collect Fund Trust Plan | 6,299,928 | Common stock in RMB | 6,299,928 |
| Central Huijin Investment Ltd. | 5,685,810 | Common stock in RMB | 5,685,810 |
| Description of the association or concerted action between top 10 public shareholders with unlimited sales conditions, and between top 10 public shareholders with unlimited sales conditions and top 10 shareholders | The actual controller of the Company’s controlling shareholder Hangzhou Robam Industrial Group Co., Ltd. and the shareholder Hangzhou Jinchuang Investment Co., Ltd. is Mr. Ren Jianhua, and the natural person shareholder Shen Guoying is the wife of Ren Jianhua. The above shareholders have the possibility of acting in unison. | ||
| Description of the top 10 common shareholders engaging in securities margin trading (if any) (see note 4) | N/A | ||
Whether the Company’s top 10 common shareholders and op 10 common shareholders with unlimited sales conditions agreed on arepurchase transaction during the reporting period
□ Yes √ No
The Company’s top 10 common shareholders and op 10 common shareholders with unlimited sales conditions did not agree on arepurchase transaction during the reporting period
2. Controlling shareholders of the Company
Nature of controlling shareholder: natural person holdingType of controlling shareholder: legal person
| Controlling shareholder's name | Legal Representative / Head of Unit | Date of establishment | Organization code | Main business |
| Hangzhou Robam Industrial Group Co., Ltd. | Ren Jianhua | March 22, 1995 | 14384025-0 | Industrial investment, import and export of goods |
| Equity of other domestic and foreign listed companies controlled and participated by controlling shareholders during the reporting period | Directly holds 55.76% of the equity of Hangzhou Nbond Nonwoven Co., Ltd. (603238), acting as its controlling shareholder. | |||
Change of controlling shareholders during the reporting period
□ Applicable √ Not applicable
There is no change in controlling shareholders during the reporting period.
3. Actual controller of the Company and person acting in concert
Type of actual controller: natural person
| Actual controller’s name | Relationship with actual controller | Nationality | Whether to obtain the right of residence in other countries or regions |
| Ren Jianhua | Self | China | No |
| Main occupations and positions | Chairman and secretary of the party committee of Robam Group, chairman of Robam Appliances, chairman of Hangzhou Nbond Nonwoven Co., Ltd., and chairman of Hangzhou Amblem Kitchen Ware Co., Ltd. | ||
| Domestic and foreign listed companies that have held shares in the past 10 years | The actual controller of Robam appliances 002508 and Nbond Nonwoven 603238 | ||
Changes in actual controller during the reporting period
□ Applicable √ Not applicable
There is no change in actual controller during the reporting period.Block diagram of property right and control relationship between the Company and actual controller
The actual controller controls the Company through trust or other asset management methods
□ Applicable √ Not applicable
4. Other legal person shareholders holding more than 10%
□ Applicable √ Not applicable
5. Restricted share reduction of controlling shareholders, actual controller, reorganizers and othercommitment subjects
□ Applicable √ Not applicable
Ren JianhuaRobam Group
Robam Group
Jinchuang
Investment
Jinchuang
InvestmentHangzhou Robam Appliances Co., Ltd.
Section 7 Preferred Shares
□ Applicable √ Not applicable
There is no preferred shares of the Company during the reporting period.
Section 8 Convertible Bonds
□ Applicable √ Not applicable
There is no convertible bonds of the Company during the reporting period.
Section 9 Directors, Supervisors, Senior Management and EmployeesI. Equity changes of directors, supervisors and senior management
| Name | Position | Employment Status | Gender | Age | Start date of tenure | End date of tenure | Number of shares held at the beginning of the period (shares) | Number of shares held at the end of the period (shares) |
| Ren Jianhua | Chairman | Incumbent | Male | 64 | Tuesday, August 18, 2020 | August 17, 2023 | 5,923,150 | 5,923,150 |
| Ren Fujia | Deputy chairman, general manager | Incumbent | Male | 37 | Tuesday, August 18, 2020 | August 17, 2023 | 2,800,075 | 2,800,075 |
| Zhao Jihong | Director | Incumbent | Male | 58 | Tuesday, August 18, 2020 | August 17, 2023 | 1,690,065 | 1,690,065 |
| Ren Luozhong | Director | Incumbent | Male | 58 | Tuesday, August 18, 2020 | August 17, 2023 | 1,690,062 | 1,690,062 |
| Wang Gang | Director, deputy general manager, secretary to the board of directors | Incumbent | Male | 45 | Tuesday, August 18, 2020 | August 17, 2023 | 576,750 | 576,750 |
| Shen Guoliang | Director | Incumbent | Male | 55 | Tuesday, August 18, 2020 | August 17, 2023 | 1,524,264 | 1,524,264 |
| Zhang Guangjie | Independent director | Abtreten | Male | 57 | August 18, 2017 | August 17, 2020 | ||
| Dong Jing | Independent director | Abtreten | Female | 45 | August 18, 2017 | August 17, 2020 | ||
| Ma Guoxin | Independent director | Incumbent | Male | 67 | Tuesday, August 18, 2020 | August 17, 2023 | ||
| He Yuanfu | Independent director | Incumbent | Male | 65 | Tuesday, August 18, | August 17, 2023 |
| 2020 | ||||||||
| Chen Yuanzhi | Independent director | Incumbent | Male | 43 | Tuesday, August 18, 2020 | August 17, 2023 | ||
| Zhang Linyong | Chairman of the board of supervisors | Incumbent | Male | 55 | Tuesday, August 18, 2020 | August 17, 2023 | 1,112,315 | 1,112,315 |
| Tang Genquan | Employee supervisor | Incumbent | Male | 60 | Tuesday, August 18, 2020 | August 17, 2023 | 1,112,312 | 1,112,312 |
| Zhang Songnian | Supervisor | Incumbent | Male | 54 | Tuesday, August 18, 2020 | August 17, 2023 | 1,112,312 | 1,112,312 |
| Zhang Huifen | Employee supervisor | Incumbent | Female | 42 | Tuesday, August 18, 2020 | August 17, 2023 | ||
| Sheng Yueming | Supervisor | Incumbent | Male | 61 | Tuesday, August 18, 2020 | August 17, 2023 | 53,875 | 53,875 |
| Xia Zhiming | Deputy general manager | Incumbent | Male | 45 | Tuesday, August 18, 2020 | August 17, 2023 | 411,950 | 411,950 |
| He Yadong | Deputy general manager | Incumbent | Male | 46 | Tuesday, August 18, 2020 | August 17, 2023 | 411,950 | 411,950 |
| Zhang Guofu | Chief financial officer | Incumbent | Male | 51 | Tuesday, August 18, 2020 | August 17, 2023 | 411,950 | 411,950 |
| Total | -- | -- | -- | -- | -- | -- | 18,831,030 | 18,831,030 |
II. Change of directors, supervisors and senior management
√Applicable □ Not applicable
| Name | Position | Type | Date | Reason |
| Zhang Guangjie | Independent director | Leave office after expiration of the term | August 17, 2020 | Independent director leaves office after expiration of the term |
| Dong Jing | Independent director | Leave office after expiration of the term | August 17, 2020 | Independent director leaves office after expiration of the term |
| He Yuanfu | Independent director | Appointment | Tuesday, August 18, 2020 | Appointment of independent director |
| Chen Yuanzhi | Independent director | Appointment | Tuesday, August 18, 2020 | Appointment of independent director |
III. Service status
Professional background, main work experience and main responsibilities currently in the Company of current directors, supervisorsand senior management of the CompanyMr. Ren Jianhua, Han nationality, born in August, 1956, Chinese, without permanent residency abroad; juniorhigh school education, member of Communist Party of China, economist. He began to work in 1978 andsuccessively served as the supply and marketing section chief and factory director of Yuhang Hongxing HardwareFactory, the chairman, general manager and Secretary of the Party branch of Hangzhou Robam Industrial GroupCo., Ltd., and the chairman and general manager of Hangzhou Robam Home Appliances & Kitchen Sanitary Co.,Ltd. He has won the titles of national model worker and outstanding member of Communist Party of ZhejiangProvince, and was elected as the deputy to the 8th and 10th National People's Congress of Zhejiang Province,deputy to the 11th National People's Congress of Hangzhou City, the Party representative, deputy to the 12thNational People's Congress of Hangzhou City, and the 12th Fengyun Zhejiang Merchants. At present, he is thechairman of Hangzhou Robam Appliances Co., Ltd., Hangzhou Robam Industrial Group Co., Ltd., HangzhouNbond Nonwoven Co., Ltd., Hangzhou Guoguang Touring Commodity Co., Ltd. and Hangzhou AmblemHousehold Co., Ltd., the executive director and general manager of Hangzhou Mingqi Electric Co., Ltd., theexecutive director and general manager of Hangzhou Robam Fuchuang Investment Management Co., Ltd., thedeputy chairman of Garden Hotel Hangzhou, the director of Zhejiang Hangzhou Yuhang Rural Commercial BankCompany Limited, Hangzhou Dongming Forest Park Co., Ltd., Zhejiang CFMOTO Power Co., Ltd, the executivedirector of Hangzhou Bonyee Daily Necessity Technology Co., Ltd., the executive director and general managerof Hangzhou Jinchuang Investment Co., Ltd., the executive partner of Hangzhou Jinnuochang InvestmentManagement Partnership (Limited Partnership), deputy to the 13th Hangzhou Municipal People's Congress.Mr. Ren Fujia, Han nationality, born in January, 1983, Chinese, without permanent residency abroad; bachelordegree. He used to be the product manager of marketing department and the deputy general manager of R & Dcenter of Hangzhou Robam Industrial Group Co., Ltd., the deputy general manager of Hangzhou Robam HomeAppliances & Kitchen Sanitary Co., Ltd.; now he is the director of Hangzhou Nbond Nonwoven Co., Ltd., thedeputy chairman and general manager of Hangzhou Robam Appliances Co., Ltd., the director of HangzhouAmblem Household Co., Ltd., the director of Dize Home Appliances Trading (Shanghai) Co., Ltd., and the deputychairman of De Dietrich Trade (Shanghai) Co., Ltd.Mr. Zhao Jihong, Han nationality, born in December 1962, Chinese, without permanent residency abroad; masterdegree, senior economist; successively served as the chairman and general manager of Hubei Huangshi JinyeGroup Co., Ltd, the deputy general manager and general manager of the marketing center of Robam Group, thedeputy general manager and general manager of the marketing center of Robam Home Appliances, and the deputygeneral manager of the Company; now he is the director of the Company. He has successively won the titles ofnational outstanding entrepreneur, outstanding Hangzhou merchant in the World, "top 10 influential figures inChina's kitchen and bathroom industry", "top 10 personalities in China's home appliance industry", and twice wonthe Mundell World Executive Awards for Achievement and was selected into the dictionary of Chinese expertsand celebrities. Now, he is the director of the Company, director of uTransHub Technologies Co., Ltd. and DizeHome Appliance Trading (Shanghai) Co., Ltd.; director and general manager of Hangzhou Robam Industrial
Group Co., Ltd., director of Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd., chairman of ZhejiangCooking Future Technology Co., Ltd.Mr. Ren Luozhong, Han nationality, born in August, 1962, Chinese, without permanent residency abroad; EMBA,assistant economist. He began to work in 1982 and successively served as the operation director of YuhangHongxing Hardware Factory, the deputy general manager, general manager of the marketing center, generalmanager of the technology center and director of the first production department of Robam Group, the directorand deputy general manager of Robam Home Appliances, and the deputy general manager of the Company. Now,he is the director of the Company, director of Hangzhou Robam Industrial Group Co., Ltd, and president ofHangzhou Yuhang ROBAM Charity Foundation.Mr. Wang Gang, Han nationality, born in October, 1975, Chinese, without permanent residency abroad; masterdegree, EMBA of China Europe International Business School, member of Communist Party of China, certifiedpublic accountant, senior economist. He began to work in 1997 and successively served as an inspector of HainingLocal Taxation Bureau of Zhejiang Province, the R & D director of Shanghai Realize Investment Consulting Co.,Ltd., the secretary of the board of directors, director of human resources, general manager assistant of ShanghaiHailong Software Co., Ltd, and the secretary of the board of directors of Hangzhou Robam Home Appliances &Kitchen Sanitary Co., Ltd. Now, he is the director, the secretary of the board of directors and deputy generalmanager of the Company, the director of Hangzhou Nbond Nonwovens Co., Ltd., the director of ShengzhouKinde Intelligent Kitchen Electric Co., Ltd., the director of Dize Home Appliances Trading (Shanghai) Co., Ltd.,the director of Ninbo Qinfeng Investment Co., Ltd. the director of De Dietrich Trade (Shanghai) Co., Ltd., thesupervisor of Hangzhou Robam Fuchuang Investment Management Co., Ltd.,the director of Hangzhou GuoguangTouring Commodity Co., Ltd., the director of Hangzhou Zhu Bingren Culture and Art Co., Ltd., the director ofHangzhou Fortune Gas Cryogenic Group Co., Ltd., the director of Versolsolar Hangzhou Co., Ltd., the director ofHangzhou Wheeler General Machinery Co.,Ltd., the supervisor of Shanghai MXCHIP Information TechnologyCo., Ltd.Mr. Ren Guoliang, Han nationality, born in November, 1965, Chinese, without permanent residency abroad; highschool education. He began to work in 1982 and successively served as the chief of the transportation section ofYuhang Hongxing Hardware Factory, the director, chief financial officer and the deputy general manager of themarketing center of Robam Group, the director of Robam Home Appliances, and the chairman of the board ofsupervisors of the Company. Now, he is the director of the Company, vice chairman of Shengzhou KindeIntelligent Kitchen Electric Co., Ltd., the director of Zhejiang Cooking Future Technology Co., Ltd., thesupervisor of Hangzhou Amblem Household Co., Ltd. and the supervisor of Beijing Robam Electric ApplianceSales Co., Ltd.Mr. Ma Guoxin, Han nationality, born in September, 1953, Chinese, without permanent residency abroad; memberof Communist Party of China, bachelor degree. He began to work in 1970 and successively served as the officedirector of the Company (Party committee), deputy manager (and secretary) of the sales company of HangzhouMedical Equipment Factory (later changed into Hangzhou Refrigerator General Factory, Hangzhou XilingElectrical Appliance Group Co., Ltd.), the director of household appliance industry management department anddeputy secretary general of Zhejiang Household Appliance Association. At present, he is the secretary general andvice president of Zhejiang Household Appliance Association; the independent director of AUPU Home StyleCorporation Limited and the Company.Mr. He Yuanfu, Han nationality, born in March, 1955, bachelor degree, Chinese, without permanent residencyabroad, p,rofessor-level senior accountant, CPA retired in January, 2012. Now, he is the independent director ofthe Company and the independent director of Xilinmen Furniture Co., Ltd., Anhui Jiangnan Chemical IndustryCo.,Ltd., Zhejiang CFMOTO Power Co., Ltd. and Zhejiang Yilida Co.,Ltd. He used to be the principal staff
member of accountant management division of Zhejiang Provincial Department of Finance, secretary general ofZhejiang Institute of Certified Public Accountants, director of Zhejiang Provincial Education Center for FinancialLeaders, vice president of China Accounting Correspondence School in Zhejiang Province.Mr. Chen Yuanzhi, Han nationality, born in November, 1977, Chinese; member of Communist Party of China,doctor of management. He has held the post of professor in China Executive Leadership Academy Pudong,adjunct researcher in the Research Center for Technological Innovation, Tsinghua University, director of ChinaEnterprise Management Research Association (Special Committee for Future Analysis and Management ofEmerging Technologies), expert of Shanghai Science and Technology Expert Database, and adjunct professor ofEast China Normal University. Now, he is an independent director of the Company.
2. Resume of current supervisors
Mr. Zhang Linyong, Han nationality, born in August, 1965, Chinese, without permanent residency abroad; highschool education, member of Communist Party of China, assistant economist. He began to work in 1984 andsuccessively served as the office director of Yuhang Hongxing Hardware Factory, the general manager ofHangzhou Huafa Electric Appliance Co., Ltd., the director and director of the engineering department of RobamGroup, and the director of Robam Home Appliances. Now, he is the chairman of the board of supervisors of theCompany and the director of Hangzhou Robam Industrial Group Co., Ltd.Mr. Tang Genquan, Han nationality, born in October, 1960, Chinese, without permanent residency abroad; collegedegree, engineer. He began to work in 1979 and successively served as the mould workshop director and technicaldirector of Yuhang Hongxing Hardware Factory, the deputy general manager of technology, general manager ofproduction quality and director of the third production department of Robam Group, the director of Robam HomeAppliances. In 1993-1994 and 2005-2006, he was awarded as the outstanding scientific and technological workerof Hangzhou. In 2004, he was selected into the "new century talent project 139 youth talent cultivation candidatelist", applied for 1 national invention patent, 7 utility model patents and 10 design patents. He has been employedas a member of China daily hardware industry expert committee since 1996 and the deputy secretary general offifth China daily hardware industry expert committee since 2006. Now, he is the staff representative supervisor ofthe Company, the director of Hangzhou Robam Industrial Group Co., Ltd., the supervisor of Hangzhou YuhangRobam Gas Station Co., Ltd., and president of Hangzhou Yuhang ROBAM Charity Foundation.Mr. Zhang Songnian, Han nationality, born in September, 1966, Chinese, without permanent residency abroad;high school education. He began to work in 1983 and successively served as the production section chief ofYuhang Hongxing Hardware Factory, the deputy general manager of Hangzhou Huafa Electric Appliance Co.,Ltd., the director, deputy director of production department, director of the second production department andgeneral manager of product R & D center of Robam Group, and the supervisor of Robam Home Appliances. Now,he is supervisor of the board of supervisors of the Company and the director of Hangzhou Robam IndustrialGroup Co., Ltd.Ms. Zhang Huifen, Han nationality, born in October, 1977, Chinese, without permanent residency abroad; collegedegree, junior economist, junior accountant. She began to work in 1997 and successively served as the employeeof Hangzhou Gaobo Electronic Co., Ltd., the employee of punching machine third workshop, member of auditdepartment of marketing center and office clerk of financial center of Robam Group. At present, she is theemployee representative supervisor of the Company.Mr. Sheng Yueming, Han nationality, born in October, 1959, Chinese, without permanent residency abroad; highschool education. He began to work in 1978 and successively served as the factory director of Tingzhi FoodFactory of Yuhang Supply and Marketing Cooperative, the production section director of Hangzhou Huafa
Electric Appliance Co., Ltd., and the general manager of Beijing Robam Electric Appliance Sales Co., Ltd. Atpresent, he is the supervisor of the Company.
3. Resume of current senior management
Mr. Ren Fujia is the general manager of the Company; Mr. Wang Gang is the deputy general manager of theCompany. Please refer to the resume of the directors of the Company for the introduction.Mr. Xia Zhiming, Han nationality, born in May 1975, Chinese, without permanent residency abroad; collegedegree. He began to work in 1996 and successively served as the production section chief of Qiaori ElectricProducts Factory, the manufacturing director of Foxconn Technology Co., Ltd. and the production director of theCompany's production center. At present, he is the deputy general manager of the Company.Mr. He Yadong, Han nationality, born in August, 1974, Chinese, without permanent residency abroad; bachelordegree, senior economist. He began to work in 2000 and successively served as the marketing section chief,director of marketing department and deputy general manager of marketing center of Robam Group, the assistantto general manager of Robam Home Appliances, and director of the Company. At present, he is the deputy generalmanager of the Company.Mr. Zhang Guofu, Han nationality, born in December, 1969, Chinese, without permanent residency abroad;bachelor degree. He began to work in 1990 and successively served as the capital section chief, director offinancial center of Hangzhou Robam Industrial Group Co., Ltd., and financial chief of Hangzhou Robam HomeAppliances & Kitchen Sanitary Co., Ltd. At present, he is chief financial officer of the Company, the chairman ofthe board of supervisors of Hangzhou Nbond Nonwoven Co., Ltd., the supervisor of Hangzhou Mingqi ElectricCo., Ltd., the supervisor of Dize Home Appliances Trading (Shanghai) Co., Ltd., the director of Shengzhou KindeIntelligent Kitchen Electric Co., Ltd., and the director of De Dietrich Trade (Shanghai) Co., Ltd.
Service status in the shareholder unit
√Applicable □ Not applicable
| Name of the staff member | Shareholder unit name | Position held in shareholder unit | Start date of tenure | End date of tenure | Whether to receive remuneration or allowance in the shareholder unit |
| Ren Jianhua | Hangzhou Robam Industrial Group Co., Ltd. | Chairman | Saturday, February 25, 1995 | No | |
| Ren Jianhua | Hangzhou Jinchuang Investment Co., Ltd. | Executive director | March 24, 2008 | No | |
| Ren Luozhong | Hangzhou Robam Industrial Group Co., Ltd. | Deputy chairman | December 24, 2014 | No | |
| Zhao Jihong | Hangzhou Robam Industrial Group Co., Ltd. | Director, general manager | December 24, 2014 | No | |
| Shen Guoliang | Hangzhou Robam Industrial | Director | March 01, 1999 | No |
| Group Co., Ltd. | |||||
| Zhang Linyong | Hangzhou Robam Industrial Group Co., Ltd. | Director | March 01, 1999 | No | |
| Tang Genquan | Hangzhou Robam Industrial Group Co., Ltd. | Director | March 01, 1999 | No | |
| Zhang Songnian | Hangzhou Robam Industrial Group Co., Ltd. | Director | March 01, 1999 | No | |
| Description of service status in the shareholder unit | N/A | ||||
Service status in other unit
√Applicable □ Not applicable
| Name of the staff member | Other unit name | Position held in other unit | Whether to receive remuneration or allowance in other unit |
| Ren Jianhua | Hangzhou Amblem Household Co., Ltd. | Chairman | No |
| Garden Hotel Hangzhou | Deputy chairman | No | |
| Hangzhou Dongming Forest Park Co., Ltd. | Director | No | |
| Hangzhou Nbond Nonwoven Co., Ltd. | Chairman | No | |
| Hangzhou Yuhang Robam Gas Station Co., Ltd. | Chairman | No | |
| Zhejiang Hangzhou Yuhang Rural Commercial Bank Company Limited | Director | No | |
| Hangzhou Jinnuochuang Investment Management Partnership (Limited Partnership) | Executive partner | No | |
| Hangzhou Bonyee Daily Necessity Technology Co., Ltd. | Executive director | No | |
| Zhejiang CFMOTO Power Co., Ltd. | Director | No | |
| Hangzhou Mingqi Electric Co., Ltd. | Executive director and general manager | No | |
| Ren Fujia | De Dietrich Trade (Shanghai) Co., Ltd. | Deputy chairman | No |
| Hangzhou Amblem Household Co., Ltd. | Director | No | |
| Hangzhou Nbond Nonwoven Co., Ltd. | Director | No | |
| Zhao Jihong | Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | Chairman | No |
| uTransHub Technologies Co., Ltd. | Director | No | |
| Dize Home Appliance Trading (Shanghai) Co., Ltd. | Director | No | |
| Zhejiang Cooking Future Technology Co., Ltd. | Chairman | No | |
| Ren Luozhong | Hangzhou Amblem Household Co., Ltd. | Director | No |
| Shen Guoliang | Hangzhou Amblem Household Co., Ltd. | Supervisor | No |
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | Director | No | |
| Beijing Robam Electric Appliance Sales Co., Ltd. | Supervisor | No | |
| Zhejiang Cooking Future Technology Co., Ltd. | Director | No | |
| Ma Guoxin | Zhejiang Household Appliance Association | Secretary general, vice president | Yes |
| AUPU Home Style Corporation Limited | Independent director | Yes | |
| He Yuanfu | Xilinmen Furniture Co., Ltd. | Independent director | Yes |
| Anhui Jiangnan Chemical Industry Co.,Ltd. | Independent director | Yes | |
| Zhejiang CFMOTO Power Co., Ltd. | Independent director | Yes | |
| Zhejiang Yilida Co.,Ltd. | Independent director | Yes | |
| Chen Yuanzhi | Hangzhou Gaoxin Rubber & Plastic Materials Co.,Ltd. | Independent director | Yes |
| Chian Executive Leadership Academy Pudong | Professor | Yes | |
| Research Center for Technological Innovation, Tsinghua University | Researcher | No | |
| Wang Gang | Hangzhou Zhu Bingren Culture and Art Co., Ltd. | Director | No |
| Hangzhou Robam Fuchuang Investment Management Co., Ltd. | Supervisor | No | |
| Shanghai MXCHIP Information Technology Co., Ltd. | Supervisor | No | |
| Hangzhou Fortune Gas Cryogenic Group Co., Ltd. | Director | No | |
| Versolsolar Hangzhou Co., Ltd. | Director | No | |
| Hangzhou Gaoxin Rubber & Plastic Materials Co.,Ltd. | Independent director | Yes | |
| Hangzhou Nbond Nonwoven Co., Ltd. | Director | No | |
| Ninbo Qinfeng Investment Co., Ltd. | Director | No | |
| De Dietrich Trade (Shanghai) Co., Ltd. | Director | No | |
| Dize Home Appliance Trading (Shanghai) Co., Ltd. | Director | No | |
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | Director | No | |
| Hangzhou Wheeler General Machinery Co.,Ltd. | Director | No | |
| Hangzhou Guoguang Touring Commodity Co., Ltd. | Director | No | |
| Zhang Guofu | De Dietrich Trade (Shanghai) Co., Ltd. | Director | No |
| Dize Home Appliance Trading (Shanghai) Co., Ltd. | Supervisor | No | |
| Hangzhou Mingqi Electric Co., Ltd. | Supervisor | No | |
| Hangzhou Nbond Nonwoven Co., Ltd. | Chairman of the board of supervisors | No |
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | Director | No |
Punishment of current directors, supervisors and senior management of the Company and those who left during the reporting periodby securities regulators in recent three years
□ Applicable √ Not applicable
IV. Remuneration of Directors, Supervisors and Senior ManagementDecision making procedures, determination basis and actual payment of remuneration of directors, supervisors and seniormanagementThe Company has established a sound performance appraisal system and salary system for senior management, whose workperformance is directly linked to their income. The remuneration and appraisal committee of the board of directors is responsible forthe year-end assessment of the working ability, performance of duties, completion of responsibility objectives, etc. of the seniormanagement, and preparing the remuneration plan and submitting it to the board of directors of the Company for approval. Theremuneration of directors, supervisors and senior management shall be paid on time.
Remuneration of directors, supervisors and senior management during the reporting period
Unit: 10,000 yuan
| Name | Position | Gender | Employment Status | Total pretax remuneration received from the Company | Whether to get remuneration from related parties of the Company |
| Ren Jianhua | Chairman | Male | Incumbent | 87.04 | No |
| Ren Fujia | Deputy chairman, general manager | Male | Incumbent | 93.09 | No |
| He Yadong | Deputy general manager | Male | Incumbent | 113.09 | No |
| Xia Zhiming | Deputy general manager | Male | Incumbent | 90.15 | No |
| Zhang Guofu | Chief financial officer | Male | Incumbent | 85.95 | No |
| Wang Gang | Director, secretary of the board, deputy general manager | Male | Incumbent | 90.63 | No |
| Ren Luozhong | Director | Male | Incumbent | 81.43 | No |
| Shen Guoliang | Director | Male | Incumbent | 73.03 | No |
| Zhao Jihong | Director | Male | Incumbent | 84.23 | No |
| Zhang Linyong | Chairman of the board of supervisors | Male | Incumbent | 67.43 | No |
| Tang Genquan | Supervisor | Male | Incumbent | 81.84 | No |
| Zhang Songnian | Supervisor | Male | Incumbent | 67.43 | No |
| Zhang Huifen | Supervisor | Male | Incumbent | 12.78 | No |
| Sheng Yueming | Supervisor | Male | Incumbent | 28.3 | No |
| Dong Jing | Independent director | Female | Abtreten | 5.99 | No |
| Zhang Guangjie | Independent director | Male | Abtreten | 5.99 | No |
| Ma Guoxin | Independent director | Male | Incumbent | 9.52 | No |
| He Yuanfu | Independent director | Male | Incumbent | 3.53 | No |
| Chen Yuanzhi | Independent director | Male | Incumbent | 3.53 | No |
| Total | -- | -- | -- | 1,084.98 | -- |
Equity incentive granted to directors and senior management of the Company during the reporting period
□ Applicable √ Not applicable
V. Company Employees
1. Number of employees, professional composition and education background
| Number of employees in the parent company (person) | 2,880 |
| Number of employees in main subsidiaries (person) | 1,732 |
| Total number of employees (person) | 4,612 |
| Total number of employees receiving salary in the current period (person) | 4,634 |
| Number of retired employees whose expenses need to be borne by the parent company and major subsidiaries (person) | 22 |
| Professional composition | |
| Professional composition categories | Number of professionals (person) |
| Production personnel | 1,662 |
| Sales personnel | 1,637 |
| Technical personnel | 742 |
| Financial personnel | 166 |
| Administrative personnel | 405 |
| Total | 4,612 |
| Education background | |
| Education background categories | Number (person) |
| Bachelor degree or above | 1,049 |
| Junior college | 1,085 |
| Other | 2,478 |
| Total | 4,612 |
2. Salary policy
The Company has formulated the Salary Management Standards and Performance Management Standards, andestablished a salary management system based on the post value and centered on the competency and performanceevaluation of employees, according to the salary status of the regional market and industry.
3. Training plan
The Company has carried out various training programs in 2020, including Lemon, Blue Whale, Sunflower, Ivy,etc, and talent projects; As the Company's own mobile learning platform, Chestnut School played an importantrole in the achievement transformation of the development course of internal trainer, and the Company'semployees' participation in learning has been greatly improved. A series of activities such as the vice platform andsuper open class enrich the vision of employees and improves their abilities.
4. Labor outsourcing
□ Applicable √ Not applicable
Section 10 Corporate Governance
I. Basic State of Corporate Governance
In the reporting period, the Company constantly improved the corporate governance structure, established andimproved internal management and control systems, and continued to carry out in-depth corporate governanceactivities in strict accordance with the Company law, the Securities Law, the Governance Guidelines for ListedCompanies, the Rules for Stock Listing of Shenzhen Stock Exchange and relevant laws and regulations of ChinaSecurities Regulatory Commission to further regulate the Company operation and improve the corporategovernment level. By the end of the reporting period, the actual situation of corporate governance conformed tothe normative documents on listed corporate governance issued by China Securities Regulatory Commission.During the reporting period, the Company operated in strict accordance with national laws and regulations, theRules for Stock Listing of Shenzhen Stock Exchange and Guidelines on the Standardized Operation of ListedCompanies on the SME Board, and performed its obligations of information disclosure in a timely, complete, true,accurate and fair manner. The Company has not received the relevant documents of administrative supervisionmeasures taken by the regulatory authorities.
(1) Shareholders and Shareholders’ Meeting
In strict accordance with the Rules of the Shareholders’ Meeting of Listed Companies and the Rules of Procedureof the Shareholders' Meeting, the Company shall convene the shareholders’ meeting to ensure that all shareholders,especially minority shareholders, enjoy equal status and fully exercise their rights.
(2) Company and Controlling Shareholders
The Company has independent business and operational independence and is independent from the controllingshareholders in business, personnel, assets, institutions and finance. The Company's board of directors, the boardof supervisors and internal organize operate independently. The controlling shareholders of the Company canstrictly regulate their own behaviors, without directly or indirectly intervening in the Company's decision-makingand business activities beyond the shareholders’ meeting.
(3) Directors and Board of Directors
The Company elects its directors in strict accordance with the recruiting procedures stipulated in the Articles ofAssociation; all the directors of the Company can carry out their work in accordance with the Rules of Procedureof the Board of Directors and the Guidelines on the Behaviors of Directors of Listed Companies on the SMEBoard, attend the board of directors and shareholders' meetings earnestly, actively participate in the training ofrelevant knowledge, and be familiar with relevant laws and regulations.
(4) Supervisors and Board of Supervisors
The Company shall appoint supervisors in strict accordance with the relevant provisions of the Company law and
the Articles of Association, and the number and composition of the board of supervisors shall meet therequirements of laws and regulations. In accordance with the requirements of the Rules of Procedure of the Boardof Supervisors, the Company's supervisors can earnestly perform their duties, effectively supervise the Company'smajor issues, related party transactions, financial condition, and the performance of directors and managers, andexpress independent opinions.
(5) Performance Evaluation and Incentive and Restraint Mechanisms
The Company is gradually establishing a fair and transparent performance evaluation standard and incentive andrestraint mechanism for directors, supervisors and managers. The appointment of the Company's managers is openand transparent and conforms to the provisions of laws and regulations.
(6) Information Disclosure and Transparency
The Company carries out information disclosure and investor relations management under the board secretaryresponsibility system; the Company performs the information disclosure procedure in strict accordance with theMeasures for the Administration of Information Disclosure and discloses the information on the designatedinformation disclosure media such as the Securities Times, the China Securities Journal, the Securities Daily andCninfo in a true, accurate, complete and timely manner according to law; meanwhile, according to therequirements of the Measures for the Investor Relations Management, the Company standardizes investorreception procedures, receives visits and inquiries from shareholders, and ensures that all shareholders have equalaccess to the Company information.
(7) Stakeholders
The Company fully respects and safeguards the legitimate rights and interests of relevant stakeholders, realizes thecoordination and balance of interests of the society, shareholders, the Company and employees, and jointlypromotes the sustainable and steady development of the Company.
(8) Internal Audit System
The Company has established an internal audit system and set up an internal audit department. The board ofdirectors has appointed the person in charge of internal audit to effectively control the Company's daily operationand management, internal control system and major issues of the Company. There is no significant differencebetween the actual situation of corporate governance and the normative documents on listed corporate governanceissued by China Securities Regulatory Commission.
Whether there is significant difference between the actual situation of corporate governance and the normative documents on listedcorporate governance issued by China Securities Regulatory Commission.
□ Yes √ No
There is no significant difference between the actual situation of corporate governance and the normative documents on listedcorporate governance issued by China Securities Regulatory Commission.
II. Independence of Company from its controlling shareholders in terms of business,personnel, assets, institutions and financeThe Company operates in strict accordance with the Company Law and the Articles of Association, establishes andimproves the corporate governance structure, is completely separated from the controlling shareholders in termsof business, personnel, assets, institutions and finance, and has independent and complete business andindependent operation capability.
III. Horizontal competition
□ Applicable √ Not applicable
IV. Information about the annual general meeting of shareholders and extraordinary generalmeeting of shareholders held during the reporting period
1. General meeting of shareholders during the reporting period
| Meeting session | Meeting type | Investor participation proportion | Convening date | Date of disclosure | Disclosure index |
| 2019 Annual General Meeting of Shareholders | Annual general meeting of shareholders | 65.33% | Tuesday, May 19, 2020 | May 20, 2020 | Cninfo: Announcement of Resolutions of 2019 Annual General Meeting of Shareholders |
| First extraordinary general meeting of shareholders in 2020 | Extraordinary general meeting of shareholders | 65.73% | Tuesday, August 18, 2020 | August 19, 2020 | Cninfo: Announcement of Resolutions of 2020 First Extraordinary General Meeting of Shareholders |
2. The preferred shareholders with voting rights restored request an extraordinary general meeting ofshareholders
□ Applicable √ Not applicable
V. Performance of duties by independent directors during the reporting period
1. Attendance of board of directors and shareholders' meeting by independent directors
| Attendance of board of directors and shareholders' meeting by independent directors | |||||||
| Name of independent director | Number of board meetings to | Number of board meetings | Number of board meetings | Number of board meetings | Number of board meetings | Whether not to personally attend the | Number of shareholders' meetings |
| be attended during this reporting period | attended on site | attended by correspondence | delegated to attend | absent | board meeting for two consecutive times | attended | |
| Zhang Guangjie | 2 | 0 | 2 | 0 | No | 0 | |
| Dong Jing | 2 | 0 | 2 | 0 | No | 0 | |
| Ma Guoxin | 5 | 5 | 0 | 0 | No | 2 | |
| He Yuanfu | 3 | 2 | 1 | 0 | No | 0 | |
| Chen Yuanzhi | 3 | 1 | 2 | 0 | No | 0 |
Description on failure to personally attend the board meeting for two consecutive times
2. Objections made by independent directors on relevant matters
Whether the independent directors make objections on relevant matters of the Company
□ Yes √ No
The independent directors don’t make objections on relevant matters of the Company in the reporting period.
3. Other description on the performance of duties by the independent directors
Whether relevant suggestions of the independent directors on the Company are adopted
□ Yes √ No
Description on adoption or non-adoption of relevant suggestions of the independent directors on the CompanyN/AVI. Performance of duties by special committees under the board of directors during thereporting periodIn 2020, the board strategy committee held several meetings: strategic theory-discussing meeting, strategic seminar, strategy andperformance communication meeting, etc., effectively fulfilling the responsibilities of the strategy committee.In 2020, the audit committee held several meetings to review the Company's regular reports and internal audit work reports andsupervise the improvement and implementation of the internal control system, communicated with the certified public accountants ofthe annual audit on the audit arrangement and progress and the problems found in the audit process and effectively performed theduties of the audit committee.In 2020, the remuneration and appraisal committee held a meeting to review and approve the remuneration of the Company'sdirectors and senior managers, effectively fulfilling the responsibilities of the remuneration and appraisal committee.In 2020, the nominations committee actively performed its duties and seriously examined the tenure and performance of theCompany's directors and senior managers.
VII. Work of board of supervisorsWhether the board of supervisors find any risk of the Company in the supervision activities during the reporting period
□ Yes √ No
The board of supervisors has no objection to the supervisory matters during the reporting period.
VIII. Evaluation and incentive of senior managersThe Company has established a sound performance appraisal system and salary system for senior management, whose workperformance is directly linked to their income. The remuneration and appraisal committee of the board of directors is responsible forthe year-end assessment of the working ability, performance of duties, completion of responsibility objectives, etc. of the seniormanagement, and preparing the remuneration plan and submitting it to the board of directors of the Company for approval.IX. Internal control evaluation report
1. Details of major internal control defects discovered during the reporting period
□ Yes √ No
2. Internal control self-evaluation report
| Full disclosure date of internal control self-evaluation report | April 28, 2021 | |
| Index of full disclosure of internal control evaluation report | Cninfo: Internal control evaluation report of Robam Appliances | |
| Proportion of the total assets of the unit included in the evaluation scope to the total assets of the consolidated financial statement of the Company | 100.00% | |
| Proportion of operating income of the unit included in the evaluation scope to the operating income of the consolidated financial statement of the Company | 100.00% | |
| Defect identification standard | ||
| Category | Financial report | Non-financial report |
| Qualitative standard | Signs of major defects in the financial report include: 1) The fraud of the directors, supervisors and senior executives of the Company; 2) Misstatement correction of material errors in financial reports that have been announced by the Company; | 1) The defects in non-financial reports are mainly determined according to the influence of the defects on the business process effectiveness and the possibility of occurrence; 2) The defects with low possibility |
| 3) Material misstatement in the current financial report, which is not found by the internal control in the process of operation; 4) The audit committee and the audit department are ineffective for the supervision of the internal control of the external financial report and financial report of the Company. Signs of important defects in the financial report include: 1) Fail to select and apply accounting policies in accordance with the accepted accounting standards; 2) The anti-fraud procedures and control measures have not been established. 3) No corresponding control mechanism is established or no corresponding compensatory control has been established for unconventional or special transactions; 4) One or more defects in the control of the final financial reporting process and no reasonable assurance that the financial statements will achieve the objective of authenticity and completeness. Common defects refer to control defects other than the major defects and important defects mentioned above. | that will reduce the work efficiency or effect, or increase the uncertainty of the effect, or make it deviate from the expected goal are common defects; 3) The defects with high possibility that will significantly reduce the work efficiency or effect, or significantly increase the uncertainty of the effect, or make it significantly deviate from the expected goal are major defects; 4) The defects with high possibility that will seriously reduce the work efficiency or effect, or seriously increase the uncertainty of the effect, or make it seriously deviate from the expected goal are major defects. | |
| Quantitation standard | The quantitative standard takes the operating income and the total assets as the measurement index. 1) The internal control defects that may cause losses or whose losses are related to the income statement are measured on the basis of operating income: Common defect: misstatement amount < 1% of operating income; Important defect: 1% of operating income 《 misstatement amount < 2% of operating income; | Common defect: direct property loss < RMB 5 million; Important defect: RMB 5 million < direct property loss < RMB 20 million; Major defect: direct property loss ＞RMB 20 million. |
| Major defect: misstatement amount > 2% of operating income 2) The internal control defects that may cause losses or whose losses are related to the assets management are measured on the basis of total assets: Common defect: misstatement amount < 0.5% of total assets; Important defect: 0.5% of total assets < misstatement amount < 1% of total assets; Major defect: misstatement amount ＞1% of total assets | ||
| Number of major defects in financial reports | 0 | |
| Number of major defects in non-financial reports | 0 | |
| Number of important defects in financial reports | 0 | |
| Number of important defects in non-financial reports | 0 | |
Section 11 Corporate Bonds
Whether the Company has bonds publicly issued and listed on the stock exchange that have not expired or expired but not paid in fullon the date of approval of the annual reportNo
Section 12: Financial Report
I. Audit report
| Type of audit opinion | Standard unqualified opinion |
| Date of signing of audit report | Tuesday, April 27, 2021 |
| Name of audit institution | Shinewing Certified Public Accountants |
| Name of Certified Public Accountant | Lei Yongxin, Wang Qing |
Main body of the audit report
XYZH/2021BJAA100383
To all shareholders of Hangzhou Robam Appliances Co., Ltd.:
I. Audit opinionWe have audited the accompanying financial statements of Hangzhou Robam Appliances Co., Ltd.(hereinafter referred to as Robam), including the consolidated balance sheet and the balance sheet of parentcompany as of December 31, 2020, consolidated income statement and income statement of parent company,consolidated cash flow statement and cash flow statement of parent company, consolidated statement ofchange in equity and statement of change in equity of parent company for the year 2020 and notes to relevantfinancial statements.In our opinion, the attached financial statements of your company have been prepared in accordance with theprovisions of the Accounting Standards for Business Enterprises and give a true and fair view of theconsolidated financial position and financial position of parent company of Robam as of December 31, 2020and of the financial performance and cash flows for the year 2020 in all significant terms.II. Basis for audit opinionWe conducted our audit in accordance with the Standards on Auditing for Certified Public Accountants. Thepart on "CPA's responsibility for financial statements audit" of the audit report further expounds ourresponsibilities under these guidelines. We were independent of Robam and fulfill other responsibilities interms of professional ethics according to the code of professional ethics. We believe that the audit evidencewe have obtained is sufficient and appropriate to provide a basis for our audit opinion.
III. Key audit itemsThe key audit items are those that we consider most important to audit the financial statements of the currentperiod in our professional judgment. The response to these items is based on the audit of the financialstatements as a whole and the formation of an audit opinion. We do not comment on these items separately.We confirm that the following matters are key matters about which we need communicated in the auditreport.
| 1. Income recognition - Agency model and engineering channels | |
| Key audit items | Response in audit |
| Refer to Notes to financial statements IV. 29 and VI. 34 Operating income and operating cost. The operating income of Robam was 8,128,620,800 yuan in 2020, an increase of 368,038,900 yuan compared with that of 2019, including the agency mode income of 2,191,561,200 yuan and the engineering channel income of 1,835,559,100 yuan, accounting for 49.54% of revenue of the period. Since the agency mode income and engineering channel income account for large proportion in the operating income and are one of the key performance indicators of Robam, there may be an inherent risk that the management may recognize the income in the wrong way to reach the specific goal or expected goal. Therefore, we regard income recognition as a key audit issue. | For the income recognition of the agency mode and engineering channels, the audit procedures we implemented mainly include: 1. Understand key internal controls related to income recognition, evaluate and test the effectiveness of internal control design and implementation; 2. Check the information of the shareholders and main personnel of the agency company and evaluate whether there is any correlation; 3. Combine contract terms and business nature, and check the terms related to the transfer time point of control right of commodity, to evaluate whether the revenue recognition method and the time point conform to the relevant provisions of the accounting standards for enterprises; 4. Carry out substantive analysis procedures on operating income and gross margin ratio by channels, customers, products, etc., identify whether there are significant or abnormal fluctuations, and analyze the causes of fluctuations; 5. Check the original documents of the income recognition for major customers according to the income recognition policy and settlement process and evaluate the authenticity and accuracy of operating income recognition; 6. Confirm current sales to main customers by sampling combined with the confirmation of accounts receivable; 7. Carry out the cut-off test procedure of income, check the supporting documents such as outbound delivery order and acceptance certificate for the operating income recognized before and after the balance sheet date, and evaluate whether the operating income is recognized within an appropriate period; 8. Check whether the information relating to operating income has been properly presented and disclosed in the financial statements. |
| 2. Impairment of notes receivable and accounts receivable | |
| Key audit items | Response in audit |
| Refer to Notes to financial statements IV. 11.12, VI. 3 Notes receivable and VI. 4 Accounts receivable. As of December 31, 2020, the balance of notes receivable of Robam was 1,899,008,600 yuan and the provision for bad debt was 66,307,100 yuan; the balance of accounts receivable was 1,080,844,400 yuan, and the provision for bad debt was 72,608,500 yuan. Due to the large amount of notes receivable and accounts receivable at the end of the period, the management needs to use material accounting estimate and judgment when determining the recoverable amount, so we regard the impairment of notes receivable and accounts receivable as the key audit items. | For the impairment of notes receivable and accounts receivable, the audit procedures we implemented mainly include: 1. Understand key internal controls for notes receivable and accounts receivable of Robam, evaluate and test the effectiveness of internal control design and implementation; 2. Check the contracts of main customers according to the income status, understand the settlement terms, pay attention to the customers who have not made payment after the settlement credit period or acceptance period, and analyze the reasons. Judge the solvency of customers by understanding their operating and financial conditions; 3. Analyze the implementation of the new financial instrument standards for receivables, including the rationality of determination and estimation of the expected credit loss model for the receivables of Robam, calculate the expected credit loss amount on the balance sheet date, and analyze whether the credit loss is fully accounted for in the receivables period; 4. Verify the rationality of expected credit loss of receivables combined with the receivables confirmation procedure and post-dated collection by analyzing the aging of accounts receivable; 5. Carry out supervision procedures, check the balance of notes receivable at the end of the period, and check the current endorsement and discount status to check whether they conform to the derecognition conditions; 6. Check the post-dated acceptance status of notes receivable from main customers, record the amount of notes receivable collected after the post-dated period, and check the supporting documents, such as bank receipt and other vouchers, for those with large amounts of notes receivable; 7. Check whether the information relating to notes receivable and accounts receivable has been properly presented and disclosed in the financial statements. |
IV. Other information
The management of Robam (hereinafter referred to as the management) is responsible for other information,including the information covered in Robam annual report for 2020, but excluding the financial statementsand our audit report.Our audit opinion on the financial statements does not cover other information and we do not express anyform of verification conclusions on other information.In combination with our audit of financial statements, it is our duty to read other information. In the process,we consider whether other information is significantly inconsistent with the financial statements or what welearned in the audit process, or there seems to be a substantial misstatement.Based on the work that we have already implemented, we should report the fact if we determine that there isa major misstatement in other information. In this respect, we have nothing to report.V. Responsibility of management and government for the financial statementsThe management is responsible for preparing the financial statements in accordance with the provisions ofthe Accounting Standards for Business Enterprises and giving a true and fair view; designing, implementingand maintaining necessary internal control, so that the financial statements are free from materialmisstatement, whether due to fraud or error.When preparing the financial statements, the management is responsible for evaluating the going-concernability of Robam, disclosing the matters related to the going-concern (if applicable) and using thegoing-concern assumption, unless the management plans to liquidate Robam or stop operation or no otherrealistic options.The government is responsible for supervising the financial reporting process of Robam.VI. Responsibility of certified public accountants for audit of financial statementsOur goal is to obtain reasonable guarantee on inexistence of the material misstatement of the financialstatements whether due to fraud or error and to issue an audit report including audit opinion. Reasonableguarantee is high level guarantee, but it cannot guarantee that a material misstatement of the audit executedaccording to the auditing standards will always be found. Misstatement may be caused by fraud or error. Ifthe reasonable expected misstatements may affect the economic decision made by the financial statementuser according to the financial statements, whether individually or collectively, the misstatement is generallybelieved material.We made professional judgment and maintained professional skepticism in the audit process according to theauditing standards. At the same time, we also carry out the following work:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud
or error, design and implement audit procedures to address these risks, and obtain sufficient andappropriate audit evidence as the basis for audit opinion. Since the fraud may involve collusion, forge,intentional omission, false statement or above internal control, the risk of material misstatement causedby fraud is higher than that caused by error.
(2) Understand internal control related to the audit in order to design audit procedures that are appropriate
in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of theinternal control.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimatesand relevant disclosure.
(4) Draw a conclusion about the appropriateness of the going-concern assumption used by the management.
Meanwhile, draw a conclusion about the major uncertainty of the matters or circumstances possiblyresulting in major concerns about the going-concern ability of Robam according to the audit evidenceobtained. If we draw a conclusion that major uncertainty exists, the auditing standards require us torequest the statement user to notice relevant disclosure in the financial statements in the audit report; incase of insufficient disclosure, we should issue a modified audit report. Our conclusion is made on thebasis of the information available as of the audit report date. However, the future matters orcircumstances may result in going concern failure of Robam.
(5) Evaluate the overall presentation, structure and content of the financial statements and evaluate whetherthe financial statements give a true and fair view of relevant transactions and matters.
(6) Obtain adequate and appropriate audit evidence for the financial information of Robam entity orbusiness activities to express an opinion on the financial statements. We are responsible for guiding,supervising and implementing the group audit and take full responsibility for the audit opinions.We communicate with the governance on the planned audit scope, time arrangement and major audit findings,including the internal control defects identified by us in the audit and worthing attention.We also provide a statement to the government layer that we have been complying with the professionalethics requirements related to independence, and communicate with the government layer about all therelationships and other matters that may be considered to affect our independence, and about the relatedprecautions (if applicable).From the items communicated with the governance, we determine which items are most important to theaudit of current financial statements and thus constitute the key audit items. We describe these items in our
audit report, unless the disclosure of these matters is prohibited by law or regulation, or, in rarecircumstances, we determine that we should not communicate the items in our audit report if it is reasonablyexpected that the negative consequences of communicating an item outweigh the benefits in the publicinterest.II. Financial statementsUnit of statements in financial notes: CNY
1. Consolidated Balance Sheet
Unit: Hangzhou Robam Appliances Co., Ltd.
December 31, 2020
Unit: yuan
| Item | December 31, 2020 | Tuesday, December 31, 2019 |
| Current assets: | ||
| Monetary capital | 3,921,052,700.31 | 4,054,121,726.23 |
| Deposit reservation for balance | ||
| Lending funds | ||
| Trading financial assets | 2,352,000,000.00 | 1,360,000,000.00 |
| Derivative financial assets | ||
| Notes receivable | 1,832,701,443.08 | 986,693,149.40 |
| Accounts receivable | 1,008,235,946.40 | 725,630,901.28 |
| Receivables financing | 408,972,104.07 | |
| Advances to suppliers | 69,889,399.47 | 50,113,549.84 |
| Premiums receivables | ||
| Reinsurance accounts receivable | ||
| Reinsurance contract reserve receivable | ||
| Other receivables | 56,589,791.38 | 110,899,448.65 |
| Including: Interest receivable | ||
| Dividends receivable | 14,295,039.38 | |
| Redemptory monetary capital for sale | ||
| Inventory | 1,386,089,344.84 | 1,339,176,925.20 |
| Contract assets | ||
| Assets held for sales | ||
| Non-current assets due within a year | ||
| Other current assets | 667,378.56 | 16,189,237.81 |
| Total current assets | 10,627,226,004.04 | 9,051,797,042.48 |
| Non-current assets: | ||
| Loans and advances | ||
| Debt investment | ||
| Other debt investments | ||
| Long-term receivables | ||
| Long-term equity investment | 3,452,769.59 | 4,168,338.79 |
| Other equity instrument investments | 102,116,023.22 | 102,116,023.22 |
| Other non-current financial assets | ||
| Investment properties | 2,591,001.84 | 112,588.34 |
| Fixed assets | 824,978,354.71 | 826,234,929.97 |
| Construction in progress | 463,424,647.46 | 272,211,720.62 |
| Productive biological assets | ||
| Oil and gas assets | ||
| Right-of-use assets | ||
| Intangible assets | 235,217,240.32 | 219,733,270.51 |
| Development expenditure | ||
| Goodwill | 80,589,565.84 | 80,589,565.84 |
| Long-term unamortized expenses | 1,798,358.85 | 523,195.74 |
| Deferred income tax assets | 112,492,030.71 | 70,877,116.09 |
| Other non-current assets | 3,682,279.67 | 23,558,781.27 |
| Total non-current assets | 1,830,342,272.21 | 1,600,125,530.39 |
| Total assets | 12,457,568,276.25 | 10,651,922,572.87 |
| Current liabilities | ||
| Short-term borrowing | 6,076,177.30 | |
| Borrowings from central bank | ||
| Borrowing funds | ||
| Trading financial liabilities | ||
| Derivative financial liabilities | ||
| Notes payable | 751,802,498.92 | 603,308,648.96 |
| Accounts payable | 1,723,832,208.09 | 1,395,061,285.28 |
| Advance from customers | 1,092,261,332.25 | |
| Contract liabilities | 949,591,228.35 | |
| Financial assets sold for repurchase |
| Deposits from customers and interbank | ||
| Acting trading securities | ||
| Acting underwriting securities | ||
| Payroll payable | 126,130,391.24 | 122,070,325.03 |
| Tax payable | 181,887,237.51 | 102,726,655.21 |
| Other payables | 242,559,615.30 | 241,641,864.89 |
| Including: Interest payable | ||
| Dividends payable | ||
| Fees and commissions payable | ||
| Dividend payable for reinsurance | ||
| Liabilities held for sales | ||
| Non-current liabilities due within a year | ||
| Other current liabilities | 126,535,407.26 | |
| Total current liabilities | 4,108,414,763.97 | 3,557,070,111.62 |
| Non-current liabilities: | ||
| Reserve fund for insurance contracts | ||
| Long-term borrowing | ||
| Bonds payable | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Lease liabilities | ||
| Long-term payable | ||
| Long-term payroll payable | ||
| Estimated liabilities | ||
| Deferred income | 150,163,523.90 | 114,851,263.30 |
| Deferred income tax liabilities | 5,210,759.74 | 5,717,848.25 |
| Other non-current liabilities | ||
| Total non-current liabilities | 155,374,283.64 | 120,569,111.55 |
| Total liabilities | 4,263,789,047.61 | 3,677,639,223.17 |
| Owner's equity: | ||
| Capital stock | 949,024,050.00 | 949,024,050.00 |
| Other equity instruments | ||
| Including: preferred stock | ||
| Perpetual bond |
| Capital reserve | 401,799,332.67 | 401,799,332.67 |
| Minus: treasury stock | ||
| Other comprehensive income | -15,157,634.16 | -15,157,634.16 |
| Special reserve | ||
| Surplus reserves | 474,516,412.50 | 474,516,412.50 |
| General risk preparation | ||
| Undistributed profit | 6,240,444,654.34 | 5,054,206,720.45 |
| Total owners' equities attributable to the owners of parent company | 8,050,626,815.35 | 6,864,388,881.46 |
| Minority equity | 143,152,413.29 | 109,894,468.24 |
| Total owners' equities | 8,193,779,228.64 | 6,974,283,349.70 |
| Total liabilities and owners' equities | 12,457,568,276.25 | 10,651,922,572.87 |
| Legal representative: Ren Jianhua | Head of accounting work: Zhang Guofu | Head of accounting institution: Zhang Guofu |
2. Balance sheet of parent company
Unit: yuan
| Item | December 31, 2020 | Tuesday, December 31, 2019 |
| Current assets: | ||
| Monetary capital | 3,660,573,828.66 | 3,974,490,043.89 |
| Trading financial assets | 2,260,000,000.00 | 1,100,000,000.00 |
| Derivative financial assets | ||
| Notes receivable | 1,826,318,388.55 | 974,185,844.67 |
| Accounts receivable | 933,609,909.29 | 704,246,884.81 |
| Receivables financing | 408,605,906.50 | |
| Advances to suppliers | 54,046,490.84 | 41,005,526.82 |
| Other receivables | 49,092,820.31 | 105,766,154.95 |
| Including: Interest receivable | ||
| Dividends receivable | 14,295,039.38 | |
| Inventory | 1,310,365,800.56 | 1,268,289,683.46 |
| Contract assets | ||
| Assets held for sales | ||
| Non-current assets due within a year | ||
| Other current assets | 12,064,254.50 | |
| Total current assets | 10,094,007,238.21 | 8,588,654,299.60 |
| Non-current assets: | ||
| Debt investment | ||
| Other debt investments | ||
| Long-term receivables | ||
| Long-term equity investment | 229,958,703.32 | 230,674,272.52 |
| Other equity instrument investments | 102,116,023.22 | 102,116,023.22 |
| Other non-current financial assets | ||
| Investment properties | 2,890,836.38 | 436,960.72 |
| Fixed assets | 798,041,764.29 | 798,954,901.11 |
| Construction in progress | 388,628,789.02 | 271,619,361.89 |
| Productive biological assets | ||
| Oil and gas assets | ||
| Right-of-use assets | ||
| Intangible assets | 153,598,124.59 | 157,002,023.43 |
| Development expenditure | ||
| Goodwill | ||
| Long-term unamortized expenses | 1,626,828.83 | 383,195.74 |
| Deferred income tax assets | 110,283,291.78 | 70,173,783.09 |
| Other non-current assets | 3,005,279.67 | 23,558,781.27 |
| Total non-current assets | 1,790,149,641.10 | 1,654,919,302.99 |
| Total assets | 11,884,156,879.31 | 10,243,573,602.59 |
| Current liabilities | ||
| Short-term borrowing | 6,076,177.30 | |
| Trading financial liabilities | ||
| Derivative financial liabilities | ||
| Notes payable | 706,096,531.24 | 601,960,648.96 |
| Accounts payable | 1,643,087,806.83 | 1,358,297,550.30 |
| Advance from customers | 983,128,543.51 | |
| Contract liabilities | 863,047,926.93 | |
| Payroll payable | 102,753,699.88 | 97,599,336.20 |
| Tax payable | 170,747,570.08 | 96,425,637.42 |
| Other payables | 225,015,032.38 | 226,064,422.04 |
| Including: Interest payable | ||
| Dividends payable |
| Liabilities held for sales | ||
| Non-current liabilities due within a year | ||
| Other current liabilities | 115,284,778.08 | |
| Total current liabilities | 3,832,109,522.72 | 3,363,476,138.43 |
| Non-current liabilities: | ||
| Long-term borrowing | ||
| Bonds payable | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Lease liabilities | ||
| Long-term payable | ||
| Long-term payroll payable | ||
| Estimated liabilities | ||
| Deferred income | 121,306,538.90 | 114,851,263.30 |
| Deferred income tax liabilities | ||
| Other non-current liabilities | ||
| Total non-current liabilities | 121,306,538.90 | 114,851,263.30 |
| Total liabilities | 3,953,416,061.62 | 3,478,327,401.73 |
| Owner's equity: | ||
| Capital stock | 949,024,050.00 | 949,024,050.00 |
| Other equity instruments | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Capital reserve | 401,754,349.66 | 401,754,349.66 |
| Minus: treasury stock | ||
| Other comprehensive income | -15,157,634.16 | -15,157,634.16 |
| Special reserve | ||
| Surplus reserves | 474,516,412.50 | 474,516,412.50 |
| Undistributed profit | 6,120,603,639.69 | 4,955,109,022.86 |
| Total owners' equities | 7,930,740,817.69 | 6,765,246,200.86 |
| Total liabilities and owners' equities | 11,884,156,879.31 | 10,243,573,602.59 |
3. Consolidated Statement of Income
Unit: yuan
| Item | Year 2020 | Year 2019 |
| I. Total operating income | 8,128,620,799.31 | 7,760,581,855.53 |
| Including: Operating income | 8,128,620,799.31 | 7,760,581,855.53 |
| Interest revenue | ||
| Premium earned | ||
| Fee and commission income | ||
| II. Total operating costs | 6,222,313,742.92 | 6,044,077,772.58 |
| Including: Operating costs | 3,563,206,930.87 | 3,548,777,745.04 |
| Interest expenditure | ||
| Fee and commission expense | ||
| Surrender value | ||
| Net payments for insurance claims | ||
| Net reserve fund extracted for insurance contracts | ||
| Bond insurance expense | ||
| Reinsurance costs | ||
| Taxes and surcharges | 61,956,630.88 | 66,618,104.73 |
| Selling expenses | 2,146,965,048.87 | 1,928,259,172.35 |
| Management costs | 296,985,763.24 | 284,364,115.17 |
| Research and development cost | 303,347,555.81 | 299,469,126.54 |
| Financial expenses | -150,148,186.75 | -83,410,491.25 |
| Including: interest expenditure | 6,721,543.47 | 477,352.78 |
| Interest revenue | 160,282,611.34 | 84,590,717.34 |
| Plus: other incomes | 92,182,244.92 | 86,454,822.71 |
| Income from investment (loss expressed with “-”) | 39,488,969.96 | 127,100,794.11 |
| Including: Income from investment of joint venture and cooperative enterprise | -715,569.20 | 1,550,487.63 |
| Income from derecognition of financial assets measured at amortized cost | ||
| Exchange gain (loss expressed with “-”) | ||
| Net exposure hedging gain (loss expressed with “-”) | ||
| Income from fair value changes (loss expressed with “-”) | ||
| Credit impairment losses (loss expressed with “-”) | -64,138,118.53 | -48,823,331.47 |
| Assets impairment losses (loss expressed with “-”) | -21,977,893.76 | -9,321,963.35 |
| Income from disposal of assets (loss expressed with “-”) | -387,844.96 | -158,607.19 |
| III. Operating profits (loss expressed with “-”) | 1,951,474,414.02 | 1,871,755,797.76 |
| Plus: Non-operating income | 1,084,379.00 | 4,098,230.54 |
| Minus: Non-operating expenditure | 3,953,245.34 | 4,323,553.72 |
| IV. Total profits (total loss expressed with “-”) | 1,948,605,547.68 | 1,871,530,474.58 |
| Minus: income tax expenses | 261,247,643.74 | 257,285,119.95 |
| V. Net profits (net loss expressed with “-”) | 1,687,357,903.94 | 1,614,245,354.63 |
| (I) Classification by business continuity | ||
| 1. Net profits from ongoing operation (net loss expressed with “-”) | 1,687,357,903.94 | 1,614,245,354.63 |
| 2. Net profits from discontinuing operation (net loss expressed with “-”) | ||
| (II) Classified by ownership | ||
| 1. Net owners' profits attributable to the shareholders of the parent company | 1,660,749,958.89 | 1,589,814,847.80 |
| 2. Minority interest income | 26,607,945.05 | 24,430,506.83 |
| VI. Net of tax of other comprehensive income | -15,157,634.16 | |
| Net amount of after-tax other comprehensive income attributable to the owners of the parent company | -15,157,634.16 | |
| (I) Other comprehensive income that can't be reclassified into profit and loss | -15,157,634.16 | |
| 1. Remeasure the variation of net indebtedness or net asset of defined benefit plan | ||
| 2. Other comprehensive income that can't be reclassified into profit and loss in the invested enterprise under equity method | ||
| 3. Fair value change of other equity instrument investments | -15,157,634.16 | |
| 4. Fair value change of enterprise credit risks | ||
| 5. Other | ||
| (II) Other comprehensive income that will be reclassified into profit and loss | ||
| 1. Other comprehensive income that will be reclassified into profit and loss in the invested enterprise under equity method | ||
| 2. Fair value change of other debt investments | ||
| 3. Amount of financial assets reclassified into other comprehensive income | ||
| 4. Provision for credit impairment of other debt investments | ||
| 5. Cash flow hedging reserve | ||
| 6. Translation reserve | ||
| 7. Other | ||
| Net of tax of other comprehensive income attributable to the minority shareholders | ||
| VII. Total comprehensive income | 1,687,357,903.94 | 1,599,087,720.47 |
| Total comprehensive income belonging to parent company | 1,660,749,958.89 | 1,574,657,213.64 |
| Total comprehensive income belonging to minority shareholders | 26,607,945.05 | 24,430,506.83 |
| VIII. Earnings per share: | ||
| (I) Basic earnings per share | 1.75 | 1.68 |
| (II) Diluted earnings per share | 1.75 | 1.68 |
In case of business combination involving enterprises under common control in this period, the net profits achieved by the combinedenterprise before combination were RMB and achieved by the combined enterprise in previous period were RMB .
| Legal representative: Ren Jianhua | Head of accounting work: Zhang Guofu | Head of accounting institution: Zhang Guofu |
4. Income statement of parent company
Unit: yuan
| Item | Year 2020 | Year 2019 |
| I. Operating income | 7,530,428,964.96 | 7,171,273,971.28 |
| Minus: operating costs | 3,375,484,733.03 | 3,380,454,870.95 |
| Taxes and surcharges | 56,158,201.66 | 59,608,538.30 |
| Selling expenses | 1,883,064,814.48 | 1,663,615,331.66 |
| Management costs | 216,279,202.32 | 203,713,247.47 |
| Research and development cost | 290,347,551.69 | 289,897,222.53 |
| Financial expenses | -146,412,372.62 | -82,103,320.70 |
| Including: interest expenditure | 6,721,543.47 | 477,352.78 |
| Interest revenue | 155,949,366.04 | 82,747,708.18 |
| Plus: other incomes | 85,947,189.06 | 80,543,507.55 |
| Income from investment (loss expressed with “-”) | 32,129,921.37 | 118,589,082.46 |
| Including: Income from investment of joint venture and cooperative enterprise | -715,569.20 | 1,550,487.63 |
| Income from derecognition of financial assets measured at amortized cost (loss expressed with “-”) | ||
| Net exposure hedging gain (loss expressed with “-”) | ||
| Income from fair value changes (loss expressed with “-”) | ||
| Credit impairment losses (loss expressed with “-”) | -58,992,629.71 | -47,422,169.48 |
| Assets impairment losses (loss expressed with “-”) | -21,977,893.76 | -9,321,963.35 |
| Income from disposal of assets (loss expressed with “-”) | -585,889.07 | -303,654.83 |
| II. Operating profit (loss to be filled out with the minus sign "-") | 1,892,027,532.29 | 1,798,172,883.42 |
| Plus: Non-operating income | 858,846.38 | 3,704,034.22 |
| Minus: Non-operating expenditure | 2,997,945.29 | 1,542,215.05 |
| III. Total profit (total loss to be filled out with the minus sign "-") | 1,889,888,433.38 | 1,800,334,702.59 |
| Minus: income tax expenses | 249,881,791.55 | 246,593,779.26 |
| IV. Net profit (net loss to be filled out with the minus sign "-") | 1,640,006,641.83 | 1,553,740,923.33 |
| (I) Net profits from going concern (net loss expressed with “-”) | ||
| (II) Net profits from discontinuing operation (net loss expressed with “-”) | ||
| V. Net amount of other comprehensive income after tax | -15,157,634.16 | |
| (I) Other comprehensive income that can't be reclassified into profit and loss | -15,157,634.16 | |
| 1. Remeasure the variation of net indebtedness or net asset of defined benefit plan | ||
| 2. Other comprehensive income that can't be reclassified into profit and loss in the invested enterprise under equity method | ||
| 3. Fair value change of other equity instrument investments | -15,157,634.16 | |
| 4. Fair value change of enterprise credit risks | ||
| 5. Other | ||
| (II) Other comprehensive income that will be reclassified into profit and loss | ||
| 1. Other comprehensive income that will be reclassified into profit and loss in the invested enterprise under equity method | ||
| 2. Fair value change of other debt investments | ||
| 3. Amount of financial assets reclassified into other comprehensive income | ||
| 4. Provision for credit impairment of other debt investments | ||
| 5. Cash flow hedging reserve | ||
| 6. Translation reserve | ||
| 7. Other | ||
| Ⅵ. Total comprehensive income | 1,640,006,641.83 | 1,538,583,289.17 |
| Ⅶ. Earnings per share: | ||
| (I) Basic earnings per share | ||
| (II) Diluted earnings per share |
5. Consolidated Statement of Cash Flow
Unit: yuan
| Item | Year 2020 | Year 2019 |
| I. Cash flow from financing activities: | ||
| Cash from selling commodities or offering labor | 8,100,485,159.16 | 7,864,881,727.36 |
| Net increase of customer deposit and deposit from other banks | ||
| Net increase of borrowings from central bank | ||
| Net increase of borrowing funds from other financial institutions | ||
| Cash from obtaining original insurance contract premium | ||
| Cash received from insurance premium of original insurance contract | ||
| Net increase of deposit and investment of insured | ||
| Cash from interest, handling charges and commissions | ||
| Net increase of borrowing funds | ||
| Net increase of repurchase of business funds | ||
| Net cash from acting trading securities | ||
| Refund of tax and levies | 15,076.40 | |
| Other cash received related to operating activities | 298,798,845.98 | 313,827,100.02 |
| Subtotal cash inflows from operating activities | 8,399,284,005.14 | 8,178,723,903.78 |
| Cash paid for selling commodities or offering labor | 3,532,083,383.04 | 3,263,409,930.51 |
| Net increase of customer loans and advances | ||
| Net increase of amount due from central bank and interbank | ||
| Cash paid for original insurance contract claims payment | ||
| Net increase of lending funds | ||
| Cash paid for interest, handling charges and commissions | ||
| Cash paid for policy dividend | ||
| Cash paid to and for employees | 802,932,443.05 | 781,240,228.31 |
| Taxes and fees paid | 781,667,958.02 | 852,036,925.94 |
| Other cash paid related to operating activities | 1,745,300,262.32 | 1,726,815,892.12 |
| Subtotal cash outflows from operating activities | 6,861,984,046.43 | 6,623,502,976.88 |
| Net cash flow from operating activities | 1,537,299,958.71 | 1,555,220,926.90 |
| II. Cash flow from investment activities: | ||
| Cash from investment withdrawal | 1,593,000,000.00 | 3,898,500,000.00 |
| Cash from investment income | 55,973,702.31 | 122,289,095.82 |
| Net cash from disposal of fixed assets, intangible assets and other long-term assets | 644,585.13 | 413,677.00 |
| Net cash from disposal of subsidiaries and other business units | ||
| Other cash received related to investment activities | ||
| Subtotal cash inflows from investment activities | 1,649,618,287.44 | 4,021,202,772.82 |
| Cash paid for purchase of fixed assets, intangible assets and other long-term assets | 282,289,864.56 | 272,163,320.83 |
| Cash paid for investment | 2,585,000,000.00 | 2,693,500,000.00 |
| Net increase in hypothecated loan | ||
| Net cash paid for obtaining subsidiaries and other business units | ||
| Other cash paid related to investment activities | ||
| Subtotal cash outflows from investment activities | 2,867,289,864.56 | 2,965,663,320.83 |
| Net cash flow from investment activities | -1,217,671,577.12 | 1,055,539,451.99 |
| III. Cash flow from financing activities: | ||
| Receipts from equity securities | 6,650,000.00 | |
| Including: Cash received from subsidies’ absorption of minority shareholders’ investment | 6,650,000.00 | |
| Cash from borrowings | ||
| Other cash received related to financing activities | 6,076,177.30 | |
| Subtotal cash inflows from financing activities | 12,726,177.30 | |
| Cash repayments of amounts borrowed | ||
| Cash paid for distribution of dividends, profits or interest expenses | 474,512,025.00 | 759,219,240.00 |
| Including: dividends and profits paid by subsidiaries to minority shareholders | ||
| Other cash paid related to financing activities | ||
| Subtotal cash outflows from financing activities | 474,512,025.00 | 759,219,240.00 |
| Net cash flow from financing activities | -461,785,847.70 | -759,219,240.00 |
| IV. Impact of exchange rate movements on cash and cash equivalents | -1,042,285.83 | 535,267.76 |
| V. Net increase of cash and cash equivalents | -143,199,751.94 | 1,852,076,406.65 |
| Plus: Balance of cash and cash equivalents at the beginning of the period | 4,029,296,265.50 | 2,177,219,858.85 |
| VI. Balance of cash and cash equivalents at the end of the period | 3,886,096,513.56 | 4,029,296,265.50 |
6. Cash flow statement of parent company
Unit: yuan
| Item | Year 2020 | Year 2019 |
| I. Cash flow from financing activities: | ||
| Cash from selling commodities or offering labor | 7,509,377,698.55 | 7,234,628,896.12 |
| Refund of tax and levies | ||
| Other cash received related to operating activities | 251,289,264.69 | 263,736,687.48 |
| Subtotal cash inflows from operating activities | 7,760,666,963.24 | 7,498,365,583.60 |
| Cash paid for selling commodities or offering labor | 3,394,399,263.08 | 3,102,184,422.96 |
| Cash paid to and for employees | 610,750,252.22 | 578,818,044.96 |
| Taxes and fees paid | 727,573,489.15 | 768,377,438.19 |
| Other cash paid related to operating activities | 1,565,516,700.37 | 1,539,782,850.67 |
| Subtotal cash outflows from operating activities | 6,298,239,704.82 | 5,989,162,756.78 |
| Net cash flow from operating activities | 1,462,427,258.42 | 1,509,202,826.82 |
| II. Cash flow from investment activities: | ||
| Cash from investment withdrawal | 1,100,000,000.00 | 3,330,000,000.00 |
| Cash from investment income | 48,392,109.16 | 113,777,384.17 |
| Net cash from disposal of fixed assets, intangible assets and other long-term assets | 208,339.13 | 540,568.71 |
| Net cash from disposal of subsidiaries and other business units | ||
| Other cash received related to investment activities | ||
| Subtotal cash inflows from investment activities | 1,148,600,448.29 | 3,444,317,952.88 |
| Cash paid for purchase of fixed assets, intangible assets and other long-term assets | 205,445,153.06 | 234,445,701.10 |
| Cash paid for investment | 2,260,000,000.00 | 2,009,500,000.00 |
| Net cash paid for obtaining subsidiaries and other business units | ||
| Other cash paid related to investment activities | ||
| Subtotal cash outflows from investment activities | 2,465,445,153.06 | 2,243,945,701.10 |
| Net cash flow from investment activities | -1,316,844,704.77 | 1,200,372,251.78 |
| III. Cash flow from financing activities: | ||
| Receipts from equity securities | ||
| Cash from borrowings | ||
| Other cash received related to financing activities | 6,076,177.30 | |
| Subtotal cash inflows from financing activities | 6,076,177.30 | |
| Cash repayments of amounts borrowed | ||
| Cash paid for distribution of dividends, profits or interest expenses | 474,512,025.00 | 759,219,240.00 |
| Other cash paid related to financing activities | ||
| Subtotal cash outflows from financing activities | 474,512,025.00 | 759,219,240.00 |
| Net cash flow from financing activities | -468,435,847.70 | -759,219,240.00 |
| IV. Impact of exchange rate movements on cash and cash equivalents | -1,042,359.16 | 535,278.90 |
| V. Net increase of cash and cash equivalents | -323,895,653.21 | 1,950,891,117.50 |
| Plus: Balance of cash and cash equivalents at the beginning of the period | 3,951,074,513.16 | 2,000,183,395.66 |
| VI. Balance of cash and cash equivalents at the end of the period | 3,627,178,859.95 | 3,951,074,513.16 |
7. Consolidated statement of change in equity
Current amount
Unit: yuan
| Item | Year 2020 | ||||||||||||||
| Owners' equities attributable to the owners of parent company | Minority equity | Total owners' equities | |||||||||||||
| Capital stock | Other equity instruments | Capital reserve | Minus: treasury stock | Other comprehensive income | Special reserve | Surplus reserves | General risk preparation | Undistributed profit | Other | Subtotal | |||||
| Preferred stock | Perpetual bond | Other | |||||||||||||
| I. Ending balance in previous year | 949,024,050.00 | 401,799,332.67 | -15,157,634.16 | 474,516,412.50 | 5,054,206,720.45 | 6,864,388,881.46 | 109,894,468.24 | 6,974,283,349.70 | |||||||
| Plus: changes in accounting policies | |||||||||||||||
| Prior period error correction | |||||||||||||||
| Business combination under common control | |||||||||||||||
| Other | |||||||||||||||
| II. Beginning balance in current year | 949,024,050.00 | 401,799,332.67 | -15,157,634.16 | 474,516,412.50 | 5,054,206,720.45 | 6,864,388,881.46 | 109,894,468.24 | 6,974,283,349.70 | |||||||
| III. Increase/decrease in the current period (less to be filled out with the minus sign "-") | 1,186,237,933.89 | 1,186,237,933.89 | 33,257,945.05 | 1,219,495,878.94 | |||||||||||
| (I) Total comprehensive income | 1,660,749,958.89 | 1,660,749,958.89 | 26,607,945.05 | 1,687,357,903.94 | |||||||||||
| (II) Owner’s invested and decreased capital | 6,650,000.00 | 6,650,000.00 | |||||||||||||
| 1. Common stock invested by the owner | 6,650,000.00 | 6,650,000.00 | |||||||||||||
| 2. Capital invested by other equity instrument holders | |||||||||||||||
| 3. Amount of share-based payment included in the owner’s equity | |||||||||||||||
| 4. Other | |||||||||||||||
| (III) Profit distribution | -474,512,025.00 | -474,512,025.00 | -474,512,025.00 | ||||||||||||
| 1. Withdrawal of surplus reserves | |||||||||||||||
| 2. Withdrawal of general risk preparation | |||||||||||||||
| 3. Distribution of owners (or shareholders) | |||||||||||||||
| 4. Other | |||||||||||||||
| (IV) Internal transfer of owner’s equity | |||||||||||||||
| 1. Capital surplus transfer to paid-in capital (or capital stock) | |||||||||||||||
| 2. Earned surplus transfer to paid-in capital (or capital stock) | |||||||||||||||
| 3. Earned surplus covering the deficit | |||||||||||||||
| 4. Carryforward retained earnings in variation of defined benefit plan | |||||||||||||||
| 5. Carryforward retained earnings of other comprehensive income | |||||||||||||||
| 6. Other | |||||||||||||||
| (V) Special reserve | |||||||||||||||
| 1. Draw in this current | |||||||||||||||
| 2. Use in this current | |||||||||||||||
| (VI) Other | |||||||||||||||
| Ⅳ. The final balance of current period | 949,024,050.00 | 401,799,332.67 | -15,157,634.16 | 474,516,412.50 | 6,240,444,654.34 | 8,050,626,815.35 | 143,152,413.29 | 8,193,779,228.64 |
Last term amount
Unit: yuan
| Item | 2019 | ||||||||||||||
| Owners' equities attributable to the owners of parent company | Minority equity | Total owners' equities | |||||||||||||
| Capital stock | Other equity instruments | Capital reserve | Minus: treasury stock | Other comprehensive income | Special reserve | Surplus reserves | General risk preparation | Undistributed profit | Other | Subtotal | |||||
| Preferred stock | Perpetual bond | Other | |||||||||||||
| I. Ending balance in previous year | 949,024,050.00 | 401,689,801.42 | 3,456,989.00 | 474,516,412.50 | 4,223,611,112.65 | 6,045,384,387.57 | 85,463,961.41 | 6,130,848,348.98 | |||||||
| Plus: changes in accounting policies | |||||||||||||||
| Prior period error correction | |||||||||||||||
| Business combination under common control | |||||||||||||||
| Other | |||||||||||||||
| II. Beginning balance in current year | 949,024,050.00 | 401,689,801.42 | 3,456,989.00 | 474,516,412.50 | 4,223,611,112.65 | 6,045,384,387.57 | 85,463,961.41 | 6,130,848,348.98 | |||||||
| III. Increase/decrease in the current period (less to be filled out with the minus sign "-") | 109,531.25 | -3,456,989.00 | -15,157,634.16 | 830,595,607.80 | 819,004,493.89 | 24,430,506.83 | 843,435,000.72 | ||||||||
| (I) Total comprehensive income | -15,157,634.16 | 1,589,814,847.80 | 1,574,657,213.64 | 24,430,506.83 | 1,599,087,720.47 | ||||||||||
| (II) Owner’s invested and decreased capital | 109,531.25 | -3,456,989.00 | 3,566,520.25 | 3,566,520.25 | |||||||||||
| 1. Common stock invested by the owner | |||||||||||||||
| 2. Capital invested by other equity instrument holders | |||||||||||||||
| 3. Amount of share-based payment included in the owner’s equity | |||||||||||||||
| 4. Other | |||||||||||||||
| (III) Profit distribution | -759,219,240.00 | -759,219,240.00 | -759,219,240.00 | ||||||||||||
| 1. Withdrawal of surplus reserves | |||||||||||||||
| 2. Withdrawal of general risk preparation | |||||||||||||||
| 3. Distribution of owners (or shareholders) | -759,219,240.00 | -759,219,240.00 | -759,219,240.00 | ||||||||||||
| 4. Other | |||||||||||||||
| (IV) Internal transfer of owner’s equity | |||||||||||||||
| 1. Capital surplus transfer to paid-in capital (or capital stock) | |||||||||||||||
| 2. Earned surplus transfer to paid-in capital (or capital stock) | |||||||||||||||
| 3. Earned surplus covering the deficit | |||||||||||||||
| 4. Carryforward retained earnings in variation of defined benefit plan | |||||||||||||||
| 5. Carryforward retained earnings of other comprehensive income | |||||||||||||||
| 6. Other | |||||||||||||||
| (V) Special reserve | |||||||||||||||
| 1. Draw in this current | |||||||||||||||
| 2. Use in this current | |||||||||||||||
| (VI) Other | |||||||||||||||
| Ⅳ. The final balance of current period | 949,024,050.00 | 401,799,332.67 | -15,157,634.16 | 474,516,412.50 | 5,054,206,720.45 | 6,864,388,881.46 | 109,894,468.24 | 6,974,283,349.70 |
8. Statement of change in equity of parent company
Current amount
Unit: yuan
| Item | Year 2020 | |||||||||||
| Capital stock | Other equity instruments | Capital reserve | Minus: treasury stock | Other comprehensive income | Special reserve | Surplus reserves | Undistributed profit | Other | Total owners' equities | |||
| Preferred stock | Perpetual bond | Other | ||||||||||
| I. Ending balance in previous year | 949,024,050.00 | 401,754,349.66 | -15,157,634.16 | 474,516,412.50 | 4,955,109,022.86 | 6,765,246,200.86 | ||||||
| Plus: changes in accounting policies | ||||||||||||
| Prior period error correction | ||||||||||||
| Other | ||||||||||||
| II. Beginning balance in current year | 949,024,050.00 | 401,754,349.66 | -15,157,634.16 | 474,516,412.50 | 4,955,109,022.86 | 6,765,246,200.86 | ||||||
| III. Increase/decrease in the current period (less to be filled out with the minus sign "-") | 1,165,494,616.83 | 1,165,494,616.83 | ||||||||||
| (I) Total comprehensive income | 1,640,006,641.83 | 1,640,006,641.83 | ||||||||||
| (II) Owner’s invested and decreased capital | ||||||||||||
| 1. Common stock invested by the owner | ||||||||||||
| 2. Capital invested by other equity instrument holders | ||||||||||||
| 3. Amount of share-based payment included in the owner’s equity | ||||||||||||
| 4. Other | ||||||||||||
| (III) Profit distribution | -474,512,025.00 | -474,512,025.00 | ||||||||||
| 1. Withdrawal of surplus reserves | ||||||||||||
| 2. Distribution of owners (or shareholders) | ||||||||||||
| 3. Other | ||||||||||||
| (IV) Internal transfer of owner’s equity | ||||||||||||
| 1. Capital surplus transfer to paid-in capital (or capital stock) | ||||||||||||
| 2. Earned surplus transfer to paid-in capital (or capital stock) | ||||||||||||
| 3. Earned surplus covering the deficit | ||||||||||||
| 4. Carryforward retained earnings in variation of defined benefit plan | ||||||||||||
| 5. Carryforward retained earnings of other |
| comprehensive income | ||||||||||||
| 6. Other | ||||||||||||
| (V) Special reserve | ||||||||||||
| 1. Draw in this current | ||||||||||||
| 2. Use in this current | ||||||||||||
| (VI) Other | ||||||||||||
| Ⅳ. The final balance of current period | 949,024,050.00 | 401,754,349.66 | -15,157,634.16 | 474,516,412.50 | 6,120,603,639.69 | 7,930,740,817.69 |
Last term amount
Unit: yuan
| Item | 2019 | |||||||||||
| Capital stock | Other equity instruments | Capital reserve | Minus: treasury stock | Other comprehensive income | Special reserve | Surplus reserves | Undistributed profit | Other | Total owners' equities | |||
| Preferred stock | Perpetual bond | Other | ||||||||||
| I. Ending balance in previous year | 949,024,050.00 | 401,644,818.41 | 3,456,989.00 | 474,516,412.50 | 4,160,587,339.53 | 5,982,315,631.44 | ||||||
| Plus: changes in accounting policies | ||||||||||||
| Prior period error correction | ||||||||||||
| Other | ||||||||||||
| II. Beginning balance in current year | 949,024,050.00 | 401,644,818.41 | 3,456,989.00 | 474,516,412.50 | 4,160,587,339.53 | 5,982,315,631.44 | ||||||
| III. Increase/decrease in the current period (less to be filled out with the minus sign "-") | 109,531.25 | -3,456,989.00 | -15,157,634.16 | 794,521,683.33 | 782,930,569.42 | |||||||
| (I) Total comprehensive income | -15,157,634.16 | 1,553,740,923.33 | 1,538,583,289.17 | |||||||||
| (II) Owner’s invested | 109,531.25 | -3,456,989.00 | 3,566,520.25 | |||||||||
| and decreased capital | ||||||||||||
| 1. Common stock invested by the owner | ||||||||||||
| 2. Capital invested by other equity instrument holders | ||||||||||||
| 3. Amount of share-based payment included in the owner’s equity | 3,566,520.25 | |||||||||||
| 4. Other | ||||||||||||
| (III) Profit distribution | -759,219,240.00 | -759,219,240.00 | ||||||||||
| 1. Withdrawal of surplus reserves | ||||||||||||
| 2. Distribution of owners (or shareholders) | -759,219,240.00 | -759,219,240.00 | ||||||||||
| 3. Other | ||||||||||||
| (IV) Internal transfer of owner’s equity | ||||||||||||
| 1. Capital surplus transfer to paid-in capital (or capital stock) | ||||||||||||
| 2. Earned surplus transfer to paid-in capital (or capital stock) | ||||||||||||
| 3. Earned surplus covering the deficit | ||||||||||||
| 4. Carryforward retained earnings in variation of defined benefit plan | ||||||||||||
| 5. Carryforward retained earnings of other comprehensive income | ||||||||||||
| 6. Other | ||||||||||||
| (V) Special reserve |
| 1. Draw in this current | ||||||||||||
| 2. Use in this current | ||||||||||||
| (VI) Other | ||||||||||||
| Ⅳ. The final balance of current period | 949,024,050.00 | 401,754,349.66 | -15,157,634.16 | 474,516,412.50 | 4,955,109,022.86 | 6,765,246,200.86 |
III. Basic Information of the CompanyHangzhou Robam Appliances Co., Ltd. (Robam or the Company) is a limited liability company established byHangzhou Robam Home Appliances & Kitchen Sanitary Co., Ltd. by means of overall change on November 7,2000. Approved by China Securities Regulatory Commission (ZJXK [2010] No.1512) in 2010, the Companyissued 40 million ordinary shares to the public for the first time on November 23, 2010, with a par value of RMB1 per share and an issue price of RMB 24.00 and the stock code of 002508.As of December 31, 2020, the capital stock of the Company after several equity changes was RMB 949,024,050.Unified social credit code: 91330000725252053F, legal representative: Ren Jianhua; address: No.592, Linping Av.,Yuhang Economic Development Zone, Hangzhou, China.The Company is mainly engaged in the development, production, sales and comprehensive services of kitchenappliances in the manufacturing industry. Its main products include range hood, gas hob, sterilizer, steamer, oven,dishwasher, water purifier, microwave, integrated stove and purification tank.The main business scope is manufacture, processing, sales, export and import business of range hook, gas stove,sterilized cupboard, oven, steam oven, microwave oven, dishwasher, water purifier, multifunctional tank,kitchenware and other kitchen appliances, as well as the technical services of home appliances. (Any project thatneeds to be approved by law can only be carried out after getting approval by relevant authorities.)The combined financial statement of the company includs following six subsidiaries: Beijing Robam ElectricAppliance Sales Co., Ltd., Shanghai Robam Electric Appliance Sales Co., Ltd., Hangzhou Mingqi Appliances Co.,Ltd., Dize Appliances (Shanghai) Co., Ltd., Shengzhou Kinde Intelligent Appliances Co., Ltd.(ShengzhouKinde), Hangzhou Robam Fuchuang Investment Management Co., Ltd. In this period, there are sevensubsidiariesa of consolidation scope, with a new company entered, Zhejiang Cooking Future Technology Co.,Ltd.(Cooking Future).IV. Preparation basis of financial statements
1. Preparation basis
The financial statements of the Company are prepared on the basis of the going-concern and the accountingpolicy and accounting estimate in “IV. Significant accounting policy and accounting estimate” according tothe actual transactions and items, the Accounting Standards for Business Enterprises promulgated by theMinistry of Finance and relevant provisions.
2. Going concern
After comprehensive consideration to the macro policy risks, market operation risks, Company’s current andlong-term profitability, solvency, financial flexibility, intention of the management to change its businesspolicy and other factors, the Company's management believes that the Company has no issue affecting theCompany's going-concern ability within 12 months from the end of the report.I、 Significant accounting policy and accounting estimateThe specific accounting policies and accounting estimates formulated by the Company according to theactual production and operation characteristics include the operating cycle, the recognition and measurementof bad debt provision of receivables, the measurement of issued inventory, the classification and depreciationof fixed assets, the amortization of intangible assets, the capitalization conditions of R&D expenses, theincome recognition and measurement, etc.
1. Statement of compliance with Accounting Standards for Business EnterprisesThe Company’s financial statements comply with the requirements of the ASBE and truly and completelyreflect the Company's financial position, business performance, cash flows and other relevant information.
2. Accounting period
The fiscal year of the Company runs from January 1 to December 31 of each calendar year.
3. Operating cycle
The Company’s normal operating cycle is one year (12 months).
4. Bookkeeping currency
The bookkeeping currency of the Company is RMB.
5. Accounting process method of business combination involving enterprises under and not under common
controlThe assets and liabilities acquired by the Company as the combining party through business combinationunder common control are measured on the combination date according to the book value of the combinedparty in the consolidated statements of the final controlling party. The difference between the book value ofthe net assets obtained and the consideration paid for the combination is adjusted against capital reserve; ifthe capital reserve is not sufficient to absorb the difference, the retained earnings shall be adjusted.The acquiree's identifiable assets, liabilities and contingent liabilities acquired through business combinationnot under common control are measured at fair value on the acquisition date. The combined cost is the fairvalue of the cash or non-cash assets paid, liabilities incurred or assumed and equity securities issued by theacquirer on the acquiring date for acquisition of the control right of the acquiree, as well as the sum of directcosts for the business combination (for the business combination realized by steps through several times, thecombined cost is the sum of the costs of each transaction). Where the combined cost exceeds the acquirer’s
interest in the fair value of the acquiree’s net identifiable assets, the difference is recognized as goodwill;where the combined cost is less than the acquirer’s interest in the fair value of the acquiree’s net identifiableassets, the acquirer first reassesses the fair values of the acquiree's identifiable assets, liabilities andcontingent liabilities in combination and the fair values of non-cash assets or equity securities issued forconsolidation consideration. If after reassessment, the combined cost is still less than the acquirer's interest inthe fair value of the acquiree’s net identifiable assets, the difference is included in the current non-operatingincome.
6. Methods for preparing consolidated financial statements
The Company includes all subsidiaries under its control in the consolidated financial statements.In preparing the consolidated financial statements, where the accounting policies and the accounting periodsof the Company and subsidiaries are inconsistent, the financial statements of the subsidiaries are adjusted inaccordance with the accounting policies and the accounting period of the Company.All significant internal transactions, current balances and unrealized profits in the consolidation scope shallbe set off when the consolidated statements are prepared. The share of the owner's equity of the subsidiariesnot attributable to the parent company and current net profits and losses, other comprehensive income, andthe share of other comprehensive income attributable to the minority interests shall be presented in theconsolidated financial statements under “minority equity, minority interest income, other comprehensiveincome attributed to minority shareholders and total comprehensive income attributed to minorityshareholders”.For a subsidiary in the business combination under common control, its business performance and cash flowshave been consolidated since the beginning of the consolidation year into the consolidated financialstatements. When preparing and comparing the consolidated financial statements, the Company shall adjustthe relevant items of the previous year's financial statements, which shall be regarded as the subject of theconsolidated report that has been in existence since the beginning of the control by the final controlling party.For a subsidiary in the business combination not under common control, its business performance and cashflows shall be incorporated into the consolidated financial statements from the date of the Company'sacquisition of control. In preparing the consolidated financial statements, the financial statements of thesubsidiary shall be adjusted on the basis of the fair values of the identifiable assets, liabilities and contingentliabilities as determined on the acquiring date.If the Company acquires the equity of the acquiree by steps through several deals and finally forms businesscombination not under common control, in the compilation of the consolidated statements, as for the equityinterests held in the acquiree before the acquiring date, they shall be re-measured according to their fairvalues at the acquiring date; the difference between their fair values and book value shall be recorded into theinvestment gains for the period including the acquiring date. Other related comprehensive gains in relation to
the equity interests held in the acquiree under the equity accounting before the acquiring date, and thechanges in owners’ equity other than net profit and loss, other comprehensive income and profit distributionshall be carried forward into profit and loss on investments in the period of the acquiring date, except forother comprehensive income from the change caused by the remeasurement of the net liabilities or net assetsof the defined benefit plan by the investee.In consolidated financial statements, when the Company disposes of part of long-term equity investment inthe subsidiary before losing control rights, the difference between the disposal price and the long-term equityinvestment disposed of relative to the share of the net assets to be enjoyed and continuously calculated fromthe acquiring date or combination date is adjusted against capital premium or capital stock premium; if thecapital reserve is not sufficient to absorb the difference, the retained earnings shall be adjusted.When the Company loses the control right over the investee due to disposal of part of the equity investmentor other reasons, the residual equity shall be re-measured at its fair value on the date of losing the controlright in preparing the consolidated financial statements. The difference between the sum of the considerationacquired by disposal of the equity and the fair value of the residual equity, and the share of the net assets ofthe original subsidiary continuously calculated from the acquiring day or combination date according to theoriginal shareholding ratio, shall be included in the profit and loss on investments in the period of lose of thecontrol right and written down against the goodwill. Other comprehensive income related to the equityinvestment of the original subsidiary is transferred into the current profit and loss on investments in theperiod of loss of control right.
7. Classification of joint venture arrangement and accountant arrangement method of joint operationThe Company’s joint venture arrangements include cooperative enterprise.The investment in the cooperative enterprise is subject to the accounting treatment by the Company as thejoint venture party according to the Accounting Standards for Business Enterprises No. 2 - Long-term EquityInvestments.
8. Cash and cash equivalents
The cash in the cash flow statement of the Company refers to the cash on hand and deposits readily availablefor payment. The cash equivalents represent the short-term (no more than three months) and highly liquidinvestments that are readily convertible into known amounts of cash and that are subject to an insignificantrisk of change in value.
9. Foreign currency business and translation of financial statements denominated in foreign currencies
(1) Foreign currency transactions
The foreign currency transaction of the Company is converted to Renminbi at the spot rate on the transactiondate. The foreign currency project, on the balance sheet date, is converted to Renminbi at the spot rate. The
resulting converted difference is included in current profit and loss except the balance of exchange of specialforeign currency loan related to acquisition or construction of assets meeting the capitalization conditions.Non-monetary items in foreign currency measured at fair value are converted by the spot rate on therecognition date of the fair value. The difference between the bookkeeping currency amount after conversionand the original bookkeeping currency amount is recorded into the capital reserve if belonging tonon-monetary items in foreign currency of available-for-sale financial assets, or recorded into current profitand loss if belonging to non-monetary items in foreign currency measured at fair value and with the changesincluded in current profit and loss. Non-monetary items in foreign currency measured by the historical costare still converted by the spot rate on the transaction date without changing the RMB amount.
(2) Translation of financial statements denominated in foreign currenciesThe assets and liabilities in the balance sheet of a foreign operation are converted at the spot rate on thebalance sheet date; all items of owner’s equity, except the "undistributed profit", are converted at the spotrate at the time of occurrence. The income and expense items in the income statement of a foreign operationare converted at the approximate exchange rate of the spot rate on the date of transaction. The converteddifference of the foreign currency financial statements generated according to the above translation shall bepresented in other comprehensive income. For a foreign currency monetary item which constitutes a netinvestment in overseas operations, the exchange difference resulting from the change of exchange rate shallbe presented as other comprehensive income in the compilation of the consolidated financial statements.Upon disposal of an overseas operation, other comprehensive income related to the overseas operation shallbe transferred to the current profit and loss according to the proportion.The approximate exchange rate of the spot exchange rate on the date of the cash flows shall be based on forthe translation of cash flows in a foreign currency and in an overseas subsidiary. The effect of a change inexchange rate on cash shall be separately presented in the cash flow statement.
10. Financial assets and financial liabilities
The Company recognizes a financial asset or financial liability when becoming a party of the financialinstrument contract.
(1) Financial assets
1) Classification, recognition basis and measurement method for financial assetsAccording to the business model of managing financial assets and the contractual cash flow characteristics offinancial assets, the financial assets of the Company are classified into: financial assets measured at theamortized cost; financial assets measured at fair value of which changes are recorded into othercomprehensive income; financial assets at fair value through profit or loss (“FVTPL”).The financial asset of the Company that meets the following conditions simultaneously is classified asfinancial asset measured at the amortized cost: ① The business model for managing the financial asset is to
collect contractual cash flows. ② According to the contract terms of the financial asset, the cash flowgenerated on a specific date is only for the payment of the principal and the interest based on the outstandingprincipal amount. Such financial asset is initially measured at the fair value and the relevant transaction costsare charged to initially recognized amount; further measurement is made at the amortized cost. With theexception of the hedged item designated as such, the difference between the initial amount and the amountdue shall be amortized in accordance with the effective interest method, and the gains and losses arising fromthe amortization, impairment, exchange gains and losses and the derecognition shall be recorded into thecurrent profit and loss.The financial asset of the Company that meets the following conditions simultaneously is classified as thefinancial asset measured at fair value of which changes are recorded into other comprehensive income: ①The business model for managing such financial assets is to collect contractual cash flows and to sell thefinancial asset. ② According to the contract terms of the financial asset, the cash flow generated on aspecific date is only for the payment of the principal and the interest based on the outstanding principalamount. Such financial asset is initially measured at the fair value and the relevant transaction costs arecharged to initially recognized amount. With the exception of the hedged item designated as such, the othergains or losses incurred from such financial asset, except for credit impairment losses or gains, exchangegains and losses and interest on the financial asset calculated by effective interest method, shall be includedin other comprehensive income; when the financial asset is derecognized, the accumulated gains or lossespreviously recorded in other comprehensive income should be transferred from other comprehensive incomein current profit and loss.The Company recognizes interest income by effective interest method. The interest income is determined bymultiplying the book balance of a financial asset by the effective interest rate, except as follows: ① For anacquired or originated financial asset with credit impairment, the interest income shall be determinedaccording to the amortized cost of the financial asset and the effective interest rate adjusted by credit fromthe initial recognition. ② For an acquired or originated financial asset with credit impairment, but whichhas credit impairment in the subsequent period, the interest income of the financial asset shall be determinedaccording to the amortized cost and the effective interest rate of the financial asset in the subsequent period.The Company designates the non-transactional equity instruments as the financial assets measured at fairvalue of which changes are recorded into other comprehensive income. Such designation, once made, shallnot be revoked. The non-transactional equity instruments measured at fair value of which changes arerecorded into other comprehensive income are initially measured at the fair value and the relevant transactioncosts are charged to initially recognized amount; except for the dividends (excluding the part of investmentcost recovery) recorded into the current profit and loss, other related gains and losses (including exchangegains and losses) are recorded into other comprehensive income and shall not be transferred into the currentprofit and loss subsequently. Upon derecognition, the accumulated gains or losses previously recorded in
other comprehensive income should be transferred from other comprehensive income to the retainedearnings.The above financial assets measured at the amortized cost and the financial assets measured at fair value ofwhich changes are recorded into other comprehensive income are classified as financial assets at fair valuethrough profit or loss (“FVTPL”). Such financial asset is initially measured at the fair value and the relevanttransaction costs are directly charged to the current profit and loss. Gains or losses on such financial assetsare charged to the current profit and loss.The financial assets recognized by the Company through business combination not under common control orconstituted by contingent consideration are classified as financial assets at fair value through profit or loss(“FVTPL”).
2) Recognition basis and measurement method for transfer of financial assetsThe financial asset is derecognized when meeting any of the following conditions: ① The contract right tocharge the cash flow of the financial asset is terminated; ② The financial asset has been transferred andalmost all risks and remuneration of the financial asset ownership are transferred; ③ The financial asset hasbeen transferred and the Company does neither transfer nor retain almost all risks and remuneration of thefinancial asset ownership but gives up the control over the financial asset.If the overall transfer of the financial asset meets the derecognition conditions, the difference of the bookvalue of the transferred financial asset from the sum of the consideration received and the derecognizedamount in the cumulative amount of the fair value changes originally included in other comprehensiveincome (according to the contract terms of the financial asset transferred, the cash flow generated on aspecific date is only for the payment of the principal and the interest based on the outstanding principalamount) is charged to the current profit and loss.If the partial transfer of the financial asset meets the derecognition conditions, the overall book value of thetransferred financial asset, between the derecognized part and non-derecognized part, is allocated accordingto the respective relative fair value. The difference of the sum of the consideration received from transfer andthe derecognized amount in the cumulative amount of the fair value changes in the derecognized partoriginally included in other comprehensive income (according to the contract terms of the financial assettransferred, the cash flow generated on a specific date is only for the payment of the principal and the interestbased on the outstanding principal amount) from the overall book value of the above-mentioned financialasset allocated is charged to current profit and loss.
(2) Financial liabilities
1) Classification, recognition basis and measurement method for financial liabilitiesFinancial liabilities, upon initial recognition, are divided into those measured with fair value and with thechanges included in current profit and loss and other financial liabilities.
Financial liabilities measured with fair value and with the changes included in current profit and loss,including the trading financial liabilities and the financial liabilities measured with fair value and with thechanges included in current profit and loss upon initial recognition. The financial liability is subsequentlymeasured with the fair value. The gain or loss formed from the changes in the fair value as well as thedividends and interest expenditure related to the financial liability is charged to current profit and loss.The other financial liabilities are subsequently measured with the amortized cost by means of effectiveinterest method. Except for the following items, the financial assets are classified as the financial liabilitiesmeasured at amortized cost: ① Financial liabilities measured with fair value and with the changes includedin current profit and loss, including the trading financial liabilities (including derivative instrumentsbelonging to financial liabilities) and the financial liabilities measured with fair value and with the changesincluded in current profit and loss. ② Financial liabilities formed by the transfer of financial assets notconforming to the derecognition conditions or by continuing to involve in the transferred financial assets. ③Financial guarantee contracts that do not fall under the above ① or ② circumstances, and loancommitments to lend at a below-market rate that do not fall under the above ① circumstance.The financial liabilities recognized by the Company as the acquirer through business combination not undercommon control or formed by contingent consideration are classified as financial liabilities at fair valuethrough profit or loss for accounting.
2) Derecognition of financial liabilities
The Company derecognizes a financial liability (or part of it) only when the underlying present obligation (orpart of it) is discharged. An agreement between the Company and a creditor to replace the existing financialliability with a new one with substantially different terms is accounted for as the derecognition of theexisting financial liability and the recognition of a new financial liability. When the Company makes materialalteration to the contract terms of the existing financial liability (or part of it), it derecognizes the existingfinancial liability (or part of it) and recognizes a new one according to the altered terms. The differencebetween the book value of the derecognized part and the consideration paid is charged to current profit andloss.
(3) Fair value determination method of financial assets and financial liabilitiesThe fair value of the financial assets and financial liabilities is measured by the Company at the prices in theprincipal market. If no principal market exists, the fair value is measured at the most favorable market priceby valuation techniques that are applicable at the time and are supported by sufficient data and otherinformation available. The input value used in the fair value measurement is divided into three levels. That is,the input value of the first level is the unadjusted quotation of the same assets or liabilities on the activemarket that can be obtained on the measurement day. The input value of the second level is the direct orindirect observable input value of related assets or liabilities other than the input value of the first level. The
input value of the third level is the non-observable input value of the relevant assets or liabilities. TheCompany prefers the input value of the first level and finally the input value of the third level. The level ofthe measurement results of the fair value is determined by the lowest level of the input value that is of greatsignificance to the measurement of fair value as a whole.The Company measures the equity instrument investment at fair value. However, in limited cases, if therecent information used to determine the fair value is insufficient, or the possible estimated amount of thefair value is widely distributed, and the cost represents the best estimate of the fair value within the range, thecost may represent the appropriate estimate of the fair value within the range.
(4) Offset of financial assets and financial liabilities
The financial assets and financial liabilities of the Company are listed respectively in the balance sheet andno mutually offset. However, when the following conditions are met at the same time, they are listed as netamount after offset in the balance sheet: (1) the Company has the legal right to offset the recognized amountand may execute the legal right currently; (2) the Company plans to settle with net amount or realize thefinancial asset and pay off the financial liability simultaneously.
(5) Distinction between financial liabilities and equity instruments and relevant treatment methodThe Company distinguishes between a financial liability and an equity instrument in accordance with thefollowing principles :(1) If the Company cannot unconditionally avoid performing a contractual obligationby delivering cash or other financial assets, the contractual obligation is defined as a financial liability.Although some financial instruments do not explicitly contain terms and conditions for the obligation todeliver cash or other financial assets, they may indirectly form contractual obligations through other termsand conditions. (2) If a financial instrument is to be settled by or with the Company's equity instrument, it isnecessary to consider whether the Company's equity instrument used to settle the financial instrument is tobe used as a substitute for cash or other financial assets or to give the holder of the instrument a residualequity in the assets of the issuer after deducting all liabilities. In the former case, the financial instrument is afinancial liability of the issuer; in the latter case, the instrument is the issuer’s equity instrument. If it isstipulated in a financial instrument contract that the Company shall or may settle the financial instrument byits own equity instruments in some cases, in which, the amount of the contractual rights or contractualobligations is equal to the number of its equity instruments available or to be delivered multiplied by its fairvalue at the time of settlement, the contract is classified as a financial liability, whether the amount of thecontractual rights or obligations is fixed or whether it is based in whole or in part on changes in variables(such as the interest rate, the price of a commodity or the price of a financial instrument) other than themarket price of the Company's equity instruments.In classifying a financial instrument (or its components) in the consolidated statements, the Company takesinto account all terms and conditions agreed between the members of the Company and the financial
instrument holder. The instrument shall be classified as a financial liability if the Company as a whole isobligated to deliver cash, other financial assets, or settle accounts in other ways that cause the instrument tobecome a financial liability as a result of the instrument.The interest, dividends, profits or losses related to a financial instrument or its components classified as afinancial liability, as well as gains or losses from redemption or refinancing, shall be recorded into theCompany's current profit and loss.The issuance (including refinancing), repurchase, sales or cancellation of financial instrument or itscomponents classified as equity instruments is handled as the equity changes, and the fair value change ofthe equity instruments is not recognized.
(6) Impairment of financial instruments
The Company withdraws the provision for impairment for the financial assets measured at the amortized cost,financial assets measured at fair value of which changes are recorded into other comprehensive income, andfinancial guarantee contracts based on the expected credit loss, and recognizes the credit impairment loss.The expected credit loss refers to the weighted average credit loss of financial instruments weighted by therisk of default. Credit loss refers to the difference between all contract cash flows discounted by theCompany at the original effective interest rate and receivable according to the contract and all expected cashflows received, that is, the present value of all cash shortage. The financial assets purchased or originatedthat have suffered from credit impairment shall be discounted at the effective interest rate of the financialassets through credit adjustment.The provision for loss on the accounts receivable from standard transactions in the income guidelines and notcontaining material financing elements shall be measured by the Company by simplified measurementaccording to the amount equivalent to the expected credit loss in the whole duration.For the financial assets purchased or originated that have suffered from credit impairment, only thecumulative changes of the expected credit loss in the whole duration upon initial recognition are recognizedas provision for loss on the balance sheet date. On each balance sheet date, the amount of change in theexpected credit loss over the entire duration is recorded as an impairment loss or gain in the current period.Favorable changes in the expected credit loss are recognized as impairment gains even if the expected creditloss for the entire duration recognized on the balance sheet date is less than the amount of overdue credit lossreflected in the estimated cash flow upon initial recognition.For the financial assets other than those purchased or originated that have suffered from credit impairment bysimplified measurement, the Company shall evaluate whether the credit risk of relevant financial instrumenthas increased significantly upon initial recognition on each balance sheet date and measure its provision forloss and recognize the expected credit losses and changes respectively in the following cases:
1) If the credit risk of the financial instrument has not increased significantly upon initial recognition and
is in the first stage, its provision for loss is measured according to the amount equivalent to the expectedcredit loss of the financial instrument in the next 12 months, and the interest income is calculatedaccording to the book balance and the effective interest rate.
2) If the credit risk of the financial instrument has significantly increased without credit impairment uponinitial recognition and is in the second stage, its provision for loss is measured according to the amountequivalent to the expected credit loss of the financial instrument in the whole duration, and the interestincome is calculated according to the book balance and the effective interest rate.
3) If the financial instrument has suffered from credit impairment upon initial recognition and is in the
third stage, its provision for loss is measured according to the amount equivalent to the expected creditloss of the financial instrument in the whole duration, and the interest income is calculated according tothe amortized cost and the effective interest rate.The amount increased or written back of the provision for credit loss of the financial instrument is recordedas an impairment loss or gain in the current period. Except for financial assets measured at fair value ofwhich changes are recorded into other comprehensive income, the book balance of financial assets is offsetby the provision for credit losses. For financial assets measured at fair value of which changes are recordedinto other comprehensive income, the Company recognizes its provision for credit losses in othercomprehensive income and does not reduce the book value of the financial assets on the balance sheet.If the Company has measured the provision for loss in the previous accounting period according to theamount equivalent to the expected credit loss of the financial instrument in the whole duration but the creditrisk of the financial instrument has no longer been increased significantly upon initial recognition on thecurrent balance sheet date, the Company shall measure the provision for loss on the financial instrument onthe current balance sheet date according to the amount equivalent to the expected credit loss in the next 12months and the resulting amount written back from the provision for loss is recorded as an impairment gainin the current period.
①Significant increase in credit risk
By means of the reasonable and valid forward-looking information available, the Company determineswhether the credit risks of financial instruments have increased significantly upon initial recognition bycomparing the default risk of the financial instruments on the balance sheet date with the default risk on theinitial recognition date. For financial guarantee contracts, when the Company applies the impairmentprovisions on financial instruments, the date on which the Company becomes a party to make an irrevocablecommitment shall be the initial recognition date. The Company will consider the following factors whenassessing whether the credit risk has increased significantly: whether there are significant changes in theactual or overdue operating results of the debtor; whether there has been a significant adverse change in theregulatory, economic or technical environment in which the debtor resides; whether there are significant
changes in the value of collateral as collateral for debt or in the quality of guarantees or credit enhancementsprovided by third parties, as well as the probability that these changes are expected to reduce the financialincentive for the debtor to repay on the terms specified in the contract or affect the breach of contract;whether there has been a significant change in the expected performance and repayment behavior of thedebtor; whether the Company's credit management methods for financial instruments have changed.For a financial instrument with low credit risk on the balance sheet date, the Company assumes that thecredit risk has not increased significantly upon the initial recognition. The financial instrument is consideredto have a low credit risk if the financial instrument has relatively low default risk, and the borrower has astrong ability to fulfill its contractual cash flow obligations in a short term, which will not necessarilyreduced even if there are adverse changes in the economic situation and operating environment in a longterm.
②Financial assets that have suffered from credit impairment
When one or more events occur that adversely affect the expected future cash flow of a financial asset, thefinancial asset becomes a financial asset with credit impairment. The evidence for credit impairment offinancial assets includes: the debtor has incurred major financial difficulties; the debtor breaches a contract,such as by default or exceeding payment of default or late payment of interest or principal; the creditor givesthe debtor concessions that he would not make under any circumstances for economic or contractual reasonsrelated to the debtor's financial difficulties; the debtor is likely to go bankrupt or undergo other financialrestructuring; the financial difficulties of the issuer or debtor cause the active market for the financial asset todisappear; a substantial discount at which a financial asset is purchased or originated reflects the fact ofcredit loss.The credit impairment of the financial asset may be caused by the joint action of the above events, and maynot necessarily be caused by the events that can be identified separately.
③Recognition of credit losses
The Company evaluates the expected credit losses of financial instruments on the basis of individual andcombined instruments, and in assessing the expected credit losses, takes into account reasonable and validinformation about past events, current conditions and projections of future economic conditions.Based on the characteristics of common credit risks, the Company divides financial instruments into differentcombinations. The individual assessment standards and the characteristics of the combination credit risks ofrelevant financial instruments are detailed in the accounting policies of relevant financial instruments.The Company shall determine the expected credit losses of the relevant financial instruments in thefollowing ways:
In the case of a financial asset, the credit loss is the present value of the difference between the contract cashflow receivable by the Company and the expected cash flow receivable;
In the case of a financial guarantee contract, the credit loss is the present value of the difference between theestimated amount of payment to be made by the Company in respect of any credit loss incurred under thecontract, and the amount that the Company expects to receive from the contract holder, debtor or anywhereelse;In the case of a financial asset with credit impairment on the balance sheet date but not purchased ororiginated with credit impairment, the credit loss is the difference between the book balance of the financialasset and the present value of the estimated future cash flow discounted at the original effective interest rate.
11. Notes receivable
Based on the acceptor credit risk of notes receivable as a common risk feature, the Company divides thenotes receivable into different combinations and determines the expected credit loss accounting estimationpolicy:
| Combination classification | Basis for recognition of combination | Accrual method |
| Banker's acceptance bill combination | The acceptor is a banking financial institution | The Company believes that the banker's acceptance bill held does not have significant credit risk and will not cause major losses due to bank default. |
| Commercial acceptance bill combination | The acceptor is a financial company or other non-bank financial institution or enterprise unit | The Company measures the provision for bad debt of commercial acceptance bills receivable according to the expected credit loss of the entire duration |
12. Accounts receivable
The provision for loss on the accounts receivable (whether or containing material financing elements) fromstandard transactions in the Accounting Standards for Enterprises No.14 - Revenues and on the leasereceivables regulated in the Accounting Standards for Enterprises No. 21 - Lease shall be measured by theCompany by simplified measurement according to the amount equivalent to the expected credit loss in thewhole duration.The Company shall evaluate whether the credit risks of accounts receivable have increased significantly onthe basis of a single financial instrument or a financial instrument combination. The Company makes singleassessment of the credit risks for the accounts receivable with significantly different credit risks and thefollowing features: accounts receivable in dispute with the other party or involving litigation or arbitration;accounts receivable with obvious signs that the debtor is likely to be unable to perform the repaymentobligations. It is feasible for the Company to evaluate whether the credit risks increase significantly on thebasis of financial instrument combination if it is unable to obtain sufficient evidence for significant increasein credit risks at reasonable cost at the level of single financial instrument. The Company can classify
financial instruments based on the characteristics of common credit risk in assessment based on the financialinstrument combination.The Company divides the accounts receivable into the following combinations based on their credit riskcharacteristics:
| Combination classification | Basis for recognition of combination | Accrual method |
| Credit loss withdrawn on accounts receivable by aging analysis method | The receivables with the same aging have similar credit risk characteristics | Expected credit loss rate |
| Related parties in the consolidation scope | Funds of subsidiaries in the consolidation scope of controlling shareholders | Generally no expected credit loss |
If there is objective evidence that a credit impairment has occurred in an account receivable, the Companyshall withdraw the provision for bad debts for that account receivable and recognize the expected credit loss.For the accounts receivable with the credit loss drawn by aging analysis method, based on the actual creditlosses of the previous year and taking into account the forward-looking information of the current year, theCompany's accounting estimation policy for measuring expected credit losses is as follows:
| Aging | Expected credit loss rate |
| Within 1 year | 5.00% |
| 1-2 years | 10.00% |
| 2-3 years | 20.00% |
| 3-4 years | 50.00% |
| 4-5 years | 80.00% |
| More than 5 years | 100.00% |
The Company shall calculate the expected credit loss of the accounts receivable on the balance sheet date. Ifthe expected credit loss is greater than the book amount of the provision for impairment of current accountsreceivable, the Company recognizes the difference as the provision for impairment of accounts receivable,debits the "impairment loss" and credits the "provision for bad debt". On the contrary, the Companyrecognizes the difference as an impairment gain and records the opposite.Where the Company has actually incurred a credit loss and the relevant accounts receivable are determinedto be irrecoverable, and the write-off is approved, the "provision for bad debt" shall be debited and the"accounts receivable" shall be credited according to the approved write-off amount. If the write-off amount isgreater than the provision for loss which has been calculated, the "credit impairment loss" shall be debitedfor the difference on schedule.
13. Receivables financing
The financial asset of the Company that meets the following conditions simultaneously is classified as thefinancial asset measured at fair value of which changes are recorded into other comprehensive income: thebusiness model for managing such financial assets is to collect contractual cash flows and to sell the financial
asset; according to the contract terms of the financial asset, the cash flow generated on a specific date is onlyfor the payment of the principal and the interest based on the outstanding principal amount.The Company transfers the accounts receivable held in the form of discount or endorsement. Such accountsreceivable with frequent business and large amount involved are measured at fair value of which changes arerecorded into other comprehensive income according to relevant regulations in the financial instrumentstandards if the management business model is to collect and sell contractual cash flows.
14. Other receivables
The Company divides the process of credit impairment of accounts receivable-others into three stages.Different accounting methods for accounts receivable-others impairment in different stages:
(1) the credit risks has not increased significantly upon initial recognition (first stage)For the financial instruments in this stage, the Company should measure the loss provision according to theexpected credit loss in the next 12 months.The Company takes aging as the credit risk characteristic to group other receivables and measures them onthe basis of combination, which is equivalent to the expected credit loss in the next 12 months.
(2) The credit risk has significantly increased without credit impairment after initial recognition (secondstage)For the financial instruments in this stage, the Company should measure the provision for loss according tothe expected credit loss in the whole duration.
(3) Credit impairment after initial recognition (third stage)
For the financial instruments in this stage, the Company should measure the provision for loss according tothe expected credit loss in the whole duration.
15. Inventory
The Company's inventory mainly includes low priced and easily worn articles, raw materials, work inprocess, merchandise inventory and goods shipped in transit.The perpetual inventory system is adopted for the inventories and the inventories are price according to theactual cost when obtained; the cost of the inventories is recognized by the weighted average method whenreceived or issued. The low priced and easily worn articles and packages are amortized by one-timewriting-off method.The year-end inventory is priced according to the cost of inventories or net realizable value, whichever islower. In case of inventory damage, full or partial obsolescence or selling price below the cost, thenon-recoverable part of its cost is expected and the inventory falling price reserves are withdrawn. Theinventory falling price reserves of the merchandise inventory and raw materials are withdrawn according to
the difference between the cost of a single inventory item and its net realizable value; for the inventories withlarge quantity and low unit price, the inventory falling price reserves are withdrawn according to theinventory category.For the merchandise inventory, work in process, materials for sale and other merchandise inventories directlyused for sale, the net realizable value is recognized by the amount of the estimated sale price of theinventories subtracted by the estimated selling expenses and related taxes; for the material inventorypossessed for production, the net realizable value is recognized by the amount of the estimated sale price ofthe finished products subtracted by the estimated cost about to occur in completion, estimated sellingexpenses and related taxes.
16. Contract assets
(1) Recognition and standard of contract assets
Contract assets refers to the Company has the right to charge consideration when transferred commodity tocustomer, and that right depends on something other than time. If the Company sells two clearlydistinguishable items to the Customer and is entitled to receive payment for the delivery of one item, but thereceipt of such payment is contingent on the delivery of the other item, the Company shall regard the right ascontract asset.
(2) Recognition and accounting method for expected credit loss of contract assetsRecognition method for expected credit loss of contract assets refers to the related description above 10.Financial asset and financial liabilities, 11. Notes receivable and 12. Accounts receivableThe Company shall calculate the expected credit loss of contract assets on the balance sheet date. If theexpected credit loss is greater than the book amount of the provision for impairment of current contractassets, the Company recognizes the difference as the provision for impairment, debits the "assets impairmentloss" and credits the "allowances for contract assets impairment". On the contrary, the Company recognizesthe difference as an impairment gain and records the opposite.Where the Company has actually incurred a credit loss and the relevant contract assets are determined to beirrecoverable, and the write-off is approved, the "allowances for contract assets impairment" shall be debitedand the "contract assets" shall be credited according to the approved write-off amount. If the write-offamount is greater than the provision for loss which has been calculated, the "assets impairment loss" shall bedebited for the difference on schedule.
17. Contract cost
(1) Recognition method for assets related to contract costs
The Company's assets related to contract costs include contract performance costs and contract acquisitioncosts.
Contract performance cost refers to the cost incurred by the Company for contract fulfillment. It shall berecognized as assets in the contract when it is not included in the scope of accounting standards for otherenterprises and simultaneously meets the following conditions: the costs is directly related to a current orexpected contract, including direct labor, direct materials, manufacturing expenses (or similar expenses),costs identified to be borne by the customer and any other costs incurred solely as a result of the contract; thecost takes up resources of the Company to fulfill its obligatory performance and agreement; the cost isexpected to be withdrawn.Contract acquisition costs refer to the incremental cost incurred by the Company to acquire contract andexpected to be withdrawn, being recognized as assets in the contract acquisition; if the amortization period ofassets is within one year, it shall be included in the current profits and losses. Incremental cost refers to thecosts (such as sales commissions, etc.) that would not incur without contract acquisition by the Company.Other expenses incurred by the Company to acquire contract, other than the incremental costs expected to bewithdrawn ( such as the incurred travel expenses regardless of contract acquisition), shall be included in thecurrent profits and losses. However, costs identified to be borne by the customer are excluded.
(2) Amortization of assets related to contract costs
The assets of the Company related to the contract cost shall be amortized on the same basis with the revenuerecognition of commodity related to assets, and shall be included in the current profits and losses.
(3) Impairment of assets related to contract costs
Once any loss of asset impairment related to contract costs is recognized, the Company shall firstlydetermine the impairment loss of other assets which are confirmed in accordance with the accountingstandards of other related enterprises and related to contract; and then, if the book value of the asset is higherthan the difference between the remaining consideration expected to be obtained by the Company from thetransfer of commodity related to the asset and the estimated cost to be incurred for the transfer of commodity,the excessed balance shall be made provision for impairment and recognized as an assets impairment loss.When the former impairment factors changes, which makes the previous balance higher than the book valueof assets, the asset impairment reserves that have been originally withdrawn will be reversed and included inthe current profits and losses. The book value of the asset after the reversal shall not exceed the book valueof the asset on the date of reversal if no provision for impairment is assumed.
18. Long-term equity investment
The Company's long-term equity investment mainly consists of investment in subsidiaries, joint ventures andcooperative enterprises.The Company's judgment on common control is based on the collective control of the arrangement by allparticipants or a combination of participants, and the policy on the activities related to the arrangement mustbe agreed upon by all participants in the collective control of the arrangement.
When the Company directly or indirectly owns more than 20% (including) but less than 50% voting rights ofthe investee through its subsidiaries, it is generally considered to have a significant impact on the investee.When the Company owns less than 20% voting rights of the investee, it shall be judged to have a significantimpact on the investee with comprehensive consideration to dispatching representatives in the board ofdirectors of the investee or similar authority, participating in the formulation process of the financial andbusiness policy of the investee, conducting important transactions with the investee, dispatchingmanagement to the investee or providing key technical data for the investee.The company that forms control over the investee shall be a subsidiary of the Company. For the long-termequity investment acquired through business combination under common control, the share of the book valueof the net assets of the combined party in the consolidated statements of the final controlling party, on thecombination date, is regarded as the initial cost of the long-term equity investment. If the book value of thenet assets of the combined party on the combination date is negative, the long-term equity investment costshall be determined as zero.If the Company acquires the equity of the investee under common control by steps through several deals,finally forms business combination and such deals belong to package deal, the deals shall be subject toaccounting treatment as a deal to obtain the control right. If the deals do not belong to the package deal, theshare of the book value of the net assets of the combined party in the consolidated financial statements of thefinal controlling party, on the combination date, is regarded as the initial cost of the long-term equityinvestment. The difference between the initial cost of the long-term equity investment and the sum of thebook value of the long-term equity investment before the combination plus the book value of the newconsideration for shares on the combination date is adjusted against capital reserve; if the capital reserve isnot sufficient to absorb the difference, the retained earnings shall be written down.For the long-term equity investment acquired through business combination not under common control, thecombined cost is the initial investment cost.If the Company acquires the equity of the investee not under common control by steps through several deals,finally forms business combination and such deals belong to package deal, the deals shall be subject toaccounting treatment as a deal to obtain the control right. If the deals do not belong to the package deal, thesum of the book value of the equity investment originally held and newly increased investment cost shall beconsidered as initial cost of the investment that calculates according to cost method. If the equity held beforethe acquiring date is calculated by the equity method, other comprehensive income calculated by the equitymethod is not adjusted and shall be subject to accounting treatment when disposing of the investmentthrough adopting the basis for the direct disposal of relevant assets or liabilities of the investee. If the originalequity held before the acquiring date is calculated at fair value in the available-for-sale financial assets, thechange in the cumulative fair value originally included in other comprehensive income is transferred to thecurrent investment profit and loss on the combination date.
Except for the long-term equity investment acquired through business combination, for the long-term equityinvestment made by paying cash, the investment cost shall be the purchase price actually paid; for thelong-term equity investment acquired by issuing equity securities, the investment cost shall be the fair valueof the equity securities issued; for the long-term equity investment acquired through the exchange ofnon-monetary assets, the initial investment cost shall be recognized in accordance with the relevantprovisions of the Accounting Standards for Business Enterprises No.7 - Exchange of Non-monetary Assets;for the long-term equity investment acquired by debt restructuring, the initial investment cost shall berecognized in accordance with the relevant provisions of the Accounting Standards for Business EnterprisesNo.12 - Debt Restructuring.The investment in subsidiaries is measured by the cost method and the investment in joint ventures andcooperative enterprises is measured by equity method.For the long-term equity investment calculated by cost method subsequently, the long-term equityinvestment cost is adjusted when the investment is added or recovered. The cash dividends or profitsdeclared to be distributed by the investee should be recognized as current investment income.The book value of the long-term equity investment measured subsequently by equity method shall beincreased or decreased with the change in the owner’s equity of the investee. The share of the net profits andlosses of the investee to be enjoyed shall be recognized after offsetting of the part of the internal deal profitsand losses attributable to the Company between the joint venture and cooperative enterprise according to theshareholding ratio and after adjustment of the new profits of the investee on the basis of the fair value of theidentifiable assets of the investee when the investment is obtained and according to the Company’saccounting policy and accounting period.In disposal of the long-term equity investment, the balance between the book value and the actual priceobtained is charged to current investment income. If a long-term equity investment calculated by the equitymethod is included in the owner's equity due to changes in the owner's equity other than the net profit andloss of the investee, the part originally included in the owner's equity in the disposal of the investment shallbe transferred to the current investment profit and loss by the corresponding proportion.If the deals for disposal of the equity by steps until the loss of the control right do not belong to the packagedeal, each deal shall be subject to accounting treatment respectively. If they belong to a package deal, thedeals shall be subject to accounting treatment as a deal for disposal of subsidiary and loss of the control right;however, the difference between each disposal price and the book value of the long-term equity investmentcorresponding to the equity disposed of before the loss of control right is recognized as other comprehensiveincome and then transferred into the current profit and loss in the period of loss of control right.
19. Investment properties
The Company’s investment properties include the leased buildings which are measured by cost model.
The Company's investment properties are depreciated or amortized by the straight-line depreciation method.The estimated service life, net residual rate and yearly depreciation (amortization) ratio of all types ofinvestment properties are as follows:
| Category | Depreciation life (year) | Expected residual rate (%) | Yearly depreciation (%) |
| Houses and buildings | 20 | 5.00% | 4.75% |
20. Fixed assets
The Company’s fixed assets refer to the tangible assets with the following features which are held forproduction of goods, provision of labor, lease (excluding lease of buildings) or operating management andwhose service life exceeds year.The fixed assets can be recognized when the economic benefits related to the fixed assets are likely to flowto the Company and when the cost of the fixed assets can be reliably measured. The fixed assets, includingbuildings, machinery equipment, transportation equipment and other equipment, are entered into the accountby actual cost when obtained, in which, the cost of purchased fixed assets includes buying price, import tariffand other relevant taxes, as well as other expenses incurred before the fixed assets reach the extended usablestatus and directly attributable to the assets; cost of self-constructed fixed assets, consisting of necessaryexpenses incurred from construction of the asset to the intended serviceable conditions; the cost invested bythe investors in the fixed assets is determined according to the value stipulated in the investment contracts oragreements, except the value stipulated in the contracts or agreements is not fair; the fixed assets underfinancing lease shall be recorded in the accounts according to the lower present value between the fair valueof the leased asset on the lease commencement date and the minimum lease payment.Except the fixed assets withdrawn with depreciation and remaining use, the Company withdrawsdepreciation of all fixed assets by the straight-line depreciation method. According to the category of fixedassets, estimated economic life and expected net residual rate, the depreciation is determined as follows:
| Category | Depreciation life | Residual rate | Yearly depreciation |
| Houses and buildings | 20 | 5.00% | 4.75% |
| Machinery equipment | 10 | 5.00% | 9.50% |
| Transportation equipment | 5 | 5.00% | 19.00% |
| Other equipment | 5 | 5.00% | 19.00% |
Accounting treatment of subsequent expenditure of fixed assets: subsequent expenditure of fixed assetsmainly includes the transformation and renovation expenses and repair expenses. If the economic benefitsrelated may flow in and the cost can be reliably measured, the subsequent expenditure is included in thefixed asset cost and the book value of the replaced part is derecognized. The other subsequent expenditure ischarged to current profit and loss upon occurrence.The Company shall review the service life, estimated residual value and depreciation method of the fixed
assets on each balance sheet date and handle any change as the accounting estimate change.When the fixed assets are disposed of or cannot generate economic benefits through expected use or disposal,the fixed assets are derecognized. The income from sale, transfer, scrap or damage disposal of fixed assets isincluded in current profits and losses after deducting the book value and related taxes.
21. Construction in progress
The construction in progress is measured according to the actual cost. The self-run construction shall bemeasured by direct materials, direct wages and direct construction costs; the outsourced construction shall bemeasured according to the paid project cost; the equipment installation project cost shall be determinedaccording to the value, installation cost and test run expenses of the equipment installed. The cost of theconstruction in progress should also include the capitalized borrowing costs.The fixed assets of the construction shall be carried forward to the fixed assets by the estimated valueaccording to the construction budget, cost or actual construction cost from the date when they reach theintended usable state, and the depreciation shall be calculated and withdrawn from the following month. Theoriginal value difference of the fixed assets is adjusted after the completion settlement procedures.
22. Borrowing costs
Recognition principle of capitalization of borrowing costs: the construction or production borrowing costsincurred and directly attributable to the assets meeting the capitalization conditions are capitalized andcharged to relevant asset costs; other borrowing costs shall be recognized as costs according to the amountincurred when they occur and shall be included in the current profit and loss. Assets meeting thecapitalization conditions refer to the fixed assets, intangible assets, inventories and other assets which canreach the intended usable or marketable status only after quite a long time (generally more than 1 year) ofconstruction or production activities.Capitalization period of borrowing costs: the borrowing costs related to the assets that meet the capitalizationconditions start to be capitalized when the expenditure to acquire and the borrowing costs have occurred andthe construction or production activities required to make the assets reach the usable or marketable statushave started. In case of abnormal interrupt of the assets meeting the capitalization conditions for more than 3consecutive months in the construction or production process, the capitalization of the borrowing costs issuspended; the borrowing costs stop capitalization when the construction or production assets meeting thecapitalization conditions reach the usable or marketable status.Calculation method for capitalized amount of borrowing costs: when special borrowings are borrowed forconstruction or production of the assets meeting the capitalization conditions, the difference between theinterest incurred in the period of special borrowings and the interest income from the unused borrowing fundin the bank or the investment income of temporary investment is deemed as the capitalized amount of theinterest on the special borrowings. When general borrowings are occupied for construction or production of
assets meeting the capitalized conditions, the weighted average of the expenditure to acquire exceeding thespecial borrowings in the cumulative expenditure to acquire is multiplied by the weighted average interestrate of the general borrowings occupied to calculate and determine the amount of interest to be capitalized onthe general borrowings.
23. Intangible assets
The Company's intangible assets mainly include land use rights, software, trademarks, patents, etc. Theactual cost of the purchased intangible assets shall be the actual cost and other relevant expenses. The actualcost of the intangible assets invested by the investors is determined according to the value stipulated in theinvestment contracts or agreements. If the value stipulated in the contracts or agreements is not fair, theactual cost is determined according to the fair value. The intangible assets are amortized by the straight-linemethod. The classification and amortization period of the Company's intangible assets are as follows:
| Category | Amortization period |
| Land use right | 50 |
| Patents | 10 |
| Software | 3-5 years |
| Trademark and domain name | 10 |
The Company’s land use right is amortized averagely according to the transfer life from the date of transfer;the Company's patent right, non-patented technology, the right to use the special software and otherintangible assets are amortized averagely by the shortest of the estimated service life, the beneficial lifestipulated in the contract and the effective life stipulated by law. The amortization amount shall be recordedinto the current profit and loss or the cost of related assets according to its beneficiary object.The expected useful life and amortization methods of the intangible assets with limited useful life arereviewed at the end of each year and adjusted accordingly in case of change; the expected useful life of theintangible assets with uncertain useful life are reviewed in each accounting period. If there is evidence thatthe service life of intangible assets is limited, the service life shall be estimated and amortized within theexpected useful life.The expenditure of the Company's internal R&D projects is classified into the expenditure at the researchstage and the expenditure at the development stage according to its nature and great uncertainty of theintangible assets eventually formed by R&D activities.Expenses of developing intangible assets internally in research phases shall be included in the current profitsand losses at the time of occurrence; If all of the following conditions are satisfied, expenses incurred in thedevelopment phase shall be recognized as assets:
(1) Technically feasible to complete the intangible assets, so that they can be used or sold;
(2) The intangible assets with the intention of use or sale;
(3) Products generated by the intangible assets can be sold, or the intangible assets themselves can be sold;
(4) With the support of adequate technical and financial and other resources to complete the development ofthe intangible assets and with the ability to use or sell the intangible assets
(5) Expenses on development of the intangible assets can be measured in a reliable way.The expenses at the development stage not meeting above conditions are included in current profits andlosses when obtained. The development expenses included in profits and losses in previous periods are notrecognized as assets in subsequent periods. The capitalized expenses at the development stage are listed asdevelopment expenses in the balance sheet and transferred to intangible assets when the project reaches theintended usable state.If the expenditure at the research stage and the expenditure at the development stage cannot be distinguished,the R&D expenditure incurred is fully charged to the current profit and loss. The cost of intangible assetsformed by internal development activities consists only of the total expenditure incurred between the point atwhich the conditions for capitalization are met and the time at which the intangible assets reach theirintended use. The expenditure that has been expensed and included in the profit and loss for the sameintangible asset before reaching the capitalization conditions in the development process is no longeradjusted.
24. Long-term assets impairment
The Company checks the intangible assets determined for the long-term equity investment, fixed assets,construction in progress and service life of the subsidiaries, joint ventures and cooperative enterprises oneach balance sheet date. When there are the following signs, indicating that the assets may be impaired, theCompany will conduct impairment test; for intangible assets with uncertain goodwill and beneficial life,impairment test shall be conducted at the end of each year whether there is any sign of impairment or not.Where it is difficult to test the recoverable amount of a single asset, the test shall be based on the asset groupor the combination of asset groups to which the asset belongs.After the impairment test, if the book value of the asset exceeds the recoverable amount, the difference isrecognized as an impairment loss. Once the impairment loss of the said asset is recognized, it will not becarried back in the subsequent accounting period. The recoverable amount of an asset is the higher of the netamount of the assets fair value subtracted by the disposal costs and the present value of the expected futurecash flow of the assets.Impairment indication:
(1) The current market price of the asset falls sharply, which is significantly higher than expected decrease
for over time or normal use;
(2) The enterprise is undergoing significant changes in the business environment of economy, technology orlaw and the market of assets in the current period or in the near future, which will cause a bad effect on
the enterprise itself;
(3) The market interest rate or the return rate of investment in other markets has increased in the current
period, which influence the enterprise to calculate discount rate for the present value of the expectedfuture cash flow of the asset, and results in a significant decrease in the recoverable amount of the asset;
(4) There is evidence that the asset is obsolete or its entity is damaged;
(5) The asset has been or will be idle, terminated for use, or disposed ahead of time;
(6) The evidence of the internal report of the enterprise indicates that the economic performance of the assethas been below or will below expectation. For instance, the net cash flow created by the asset or thebusiness profit (or loss) is considerably lower than (or higher than) the estimated amount;
(7) Other indications showing that the assets impairment may have occurred.
25. Long-term unamortized expenses
The long-term unamortized expenses of the Company refer to the expenses that have been paid, but shouldbe borne in the current period and subsequent periods with the amortization period of more than one year(excluding one year). Such expenses are amortized on average in the benefit period. If a long-termunamortized expense item cannot benefit a later accounting period, the amortized value of the item that hasnot been amortized is transferred to the current profit and loss.
26. Employee compensation
The Company’s employee compensation includes short-term compensation, welfare after dismission,dismission welfare and other long-term employee services and benefits.The short-term compensation mainly includes salary, bonus, allowances and subsidies, employee servicesand benefits, housing fund, labor union expenditure and personnel education fund, medical insurancepremiums, industrial injury insurance premium, birth insurance premium and other social insurancepremiums. The short-term compensation actually happened during the accounting period when the staffoffering the service for the Company shall be recognized as liabilities and included in the current gains andlosses or relevant assets cost by the beneficiary object.Post-employment benefits mainly include basic endowment insurance, unemployment insurance andenterprise annuity payment and are classified as defined contribution plans according to the risks andobligations undertaken by the Company. The sinking funds made to a separate entity on the balance sheetdate in exchange for services rendered by the employee during the accounting period shall be recognized asliabilities and included in the current gains and losses or relevant assets cost by the beneficiary object.The Company puts forward compensation for an employee to terminate the labor relationship with theemployee before expiry of the employee labor contract. When failing to unilaterally withdraw the dismissionwelfare due to termination of labor relation plan or downsizing suggestions, or when recognizing the costs
related to restructuring involving payment of dimission welfare (whichever comes first), the Companyrecognizes the employee compensation liabilities from the dismission welfare and includes in current profitand loss. The compensation that is paid beyond a year is included in current profit and loss after discount.Other long-term employee benefits mainly include the long-term incentive plan and long-term benefits andshall be subject to the accounting treatment according to relevant provisions in the defined contributionplans.
27. Estimated liabilities
Any business related to contingencies such as external guarantee, pending litigation or arbitration, productquality assurance, staff reduction plan, loss contract, restructuring obligation, environmental pollutionremediation, commitment and fixed asset disposal obligation, if meeting all of the following conditions, isrecognized as a liability: the obligation is the current obligation undertaken by the Company; performance ofthe obligation is likely to lead to the outflow of economic benefits; the amount of the obligation can bereliably measured.The estimated liabilities are initially recognized according to the best estimate number of the expenditurerequired to perform relevant current obligations with consideration to the contingency related risks,uncertainty, time value of money and other factors. If the time value of money has significant impact, thebest estimate number is determined after discount of the future cash flow. The book value of the estimatedliabilities is reviewed on the balance sheet date and adjusted to reflect the current best estimate number ifthere is any change.The existence of a potential obligation for past transactions or events shall be substantiated by the occurrenceor non-occurrence of future uncertainties; the Company will disclose the potential or current obligation a ascontingent liability if the performance of such obligation is not likely to result in the outflow of economicbenefits from the Company or if the amount of such obligation cannot be reliably measured.
28. Share-based payments
The term share-based payment refers to a transaction in which the Company grants equity instruments orundertakes equity-instrument-based liabilities in return for services from employee or other parties. Theshare-based payments shall consist of equity-settled share-based payments and cash-settled share-basedpayments.The equity-settled share-based payment in return for employee services is measured at the fair value of theequity instruments granted to the employees. The amount of such fair value, under the situation that therights can only be exercised after the service is finished and the set performance is achieved within thewaiting period, and basing on the optimum estimation for the number of equity instrument which exerciserights within the waiting period, will be measured according to straight-line method and counted intorelevant costs and expenses. The capital reserve will be increased correspondingly.
The share-based payment settled by cash will be measured according to the fair value of the liabilityconfirmed basing on the shares borne by the Company and other equity instruments. If the rights can beexercised immediately after being granted, the payment will be counted into relevant costs or expenses at thefair value of the liabilities assumed and the liability will be increased correspondingly. If the rights can onlybe exercised after the situation that service within the waiting period is completed and set performance isachieved, the service obtained at the current period, according to the fair value amount of the liability borneby the Company, and basing on the optimum estimation for the condition of exercising rights, will becounted into costs or expenses on each and every balance sheet date during the waiting period, and theliability will be increased correspondingly.Each and every balance sheet date and settlement before relevant liability settlement, the fair value ofliability will be remeasured, of which changes occurred will be counted into the current period.
29. Revenue recognition principle and calculating method
The operating revenue of the Company mainly includes income from selling commodities, income fromoffering labor.
(1) Revenue recognition principle
The Company recognize the income when it has fulfilled its obligation stipulated in the contract, and thetime when the clients have controlled the relevant goods or services. Acquisition of control of the relevantgoods or services means that the clients can guide goods using and service providing and receive alleconomic benefit therefrom.The Company shall evaluate the contract on the commencement date of the contract, identify individualperformance obligations contained in the contract, and determine each performance obligation to be fulfilledwithin a certain period time or at a certain point of time.If one of the following conditions is satisfied, the Company shall perform its obligations within a certainperiod time; Otherwise, it shall perform its obligations at a certain point of time:
1) The clients obtain and take away economic benefits brought by the Company’s fulfillment of obligation
when the clients fulfill their obligation of the Company.
2) The clients are able to control commodities under production in the process of the Company’sfulfillment of obligation.
3) The commodities produced during the performance of the Contract by the Company is irreplaceable.And the Company has the right to charge for the accumulated performance completed so far duringcontract period.For the obligations performed within a certain period time, the Company shall recognize the income inaccordance with the performance progress during the period. If the performance cannot be reasonably
determined, and the Company is expected to receive compensation for incurred cost, the Company shallrecognize the income based on incurred cost until the performance can be reasonably determined.For the obligations performed at a certain point of time, the Company shall recognize the income when theclients have controlled relevant commodities or services. In determining whether the customer has controlledrelevant commodities or services, the Company shall consider the following indications:
1) The Company has the right to collect the current bill for the commodities or services.
2) The Company has transferred the legal title of commodities to the customer.
3) The Company has transferred the physical commodities to the customer.
4) The Company has transferred the main risks and rewards on the legal title of commodities to the
customer.
5) The customer has accepted commodities or services, etc.
The Company's right to receive consideration for commodities or services transferred to the customer isshown as an asset under the contract, which is subject to impairment based on expected credit losses. TheCompany's unconditional right to charge consideration from the customer shall be listed as accountreceivable. The Company’s obligation of the transfer of commodities or services to customers forconsideration of goods delivery is listed as a contract liability.
(2) Revenue measurement principle
1) If the contract contains two or more performance obligations, the Company shall apportion the
transaction price to each performance obligation according to the relative proportion of the individualselling price of the commodity or service committed by each performance obligation at the beginning ofthe contract, and measure the revenue according to the transaction price apportioned to eachperformance obligation.
2) The transaction price is the consideration amount expected to be collected by the Company for the
transfer of commodities or services to the customer, excluding the payments received from a third party.The transaction price confirmed by the Company shall not exceed the amount of accumulatedrecognized revenue, which is unlikely to turn back when the relevant uncertainties have been eliminated.The amount expected to be refunded to customers shall be regarded as liability and be excluded in thetransaction price.
3) If the contract includes significant financing elements, the Company shall determine the transactionprice based on the amount payable in cash assumed to be paid by the customer upon acquisition ofcontrol of the commodities or services. The balance between the transaction price and the contractconsideration shall be amortized by the effective interest method during the contract period. On thecommencement date of the contract, if the interval between the day of the customer's acquisition of
control of the commodities or services control and customer's payment of the price not exceed one year,the significant financing elements in the contract will not be taken into consideration.
(3) Specific revenue recognition method
1) Recognizing revenue at a certain point of time
Sell of electrical products, accessories and materials belongs to the performance obligations performed at acertain point of time.Revenue recognition conditions for domestic commodities: the Company has delivered products to thecustomer according to the contract and order. The customer has received the products. The Company hascollected payment and obtained receipts. The relevant economic benefits are likely to get into the Company.The main risks and rewards on the ownership of commodities have been transferred. The legal ownershipand control rights of commodities have been transferred.Revenue recognition conditions for export commodities: the Company has made an export declaration of theproducts according to the contract, obtained the bill of lading and delivered the commodities to the carrierentrusted by the buyer. The Company has collected payment and obtained receipts. The relevant economicbenefits are likely to get into the Company. The main risks and rewards on the ownership of commoditieshave been transferred. The legal ownership and control rights of commodities have been transferred.
2) Recognizing revenue by contract fulfillment
For the obligations performed within a certain period of time, the Company shall recognize the income inaccordance with technology service and operating lease with the customer.
30. Government subsidies
The Company's government subsidies include financial allocations. The asset related government subsidiesrefer to the government subsidies obtained by the Company and used for acquisition or construction or forformation of long-term assets in other ways; the income related government subsidies refer to thegovernment subsidies other than the asset related government subsidies. The government subsidies withoutsubsidy objects specified in government documents shall be judged by the Company according to the aboveprinciple, or classified into income related government subsidies as a whole if it is difficult to judge.The government subsidies as the monetary assets are measured according to the amount received. Forsubsidies allocated in accordance with fixed quota standards, or if there is evidence at the end of year that theCompany can meet relevant conditions stipulated in the financial support policy and can be expected toreceive the financial support fund, the government subsidies are measured according to receivables. Thegovernment subsidies not as the monetary assets are measured according to the fair value, or measuredaccording to the nominal amount (RMB 1 yuan) if the fair value cannot be obtained reliably.The government subsidies related to assets are recognized as deferred income and equally distributed and
charged to the current profit and loss in the service life of relevant assets.If the related asset is sold, transferred, scrapped or damaged before the end of the useful life, the deferredincome balance not yet distributed is transferred in the profits and losses in the period of assets disposal.The income related government subsidies, if used to compensate for related costs or losses in subsequentperiods, are recognized as the deferred income and charged to the current profit and loss when related costsor losses are recognized. The government subsidies pertinent to the daily activities of the Company shall beincluded in other income or used to offset relevant costs and expenses according to the substance of theeconomic business. The government subsidies irrelevant with the daily activities of the Company shall beincluded in non-operating revenues and expenditures.Where the Company has obtained discount interest on preferential loans, it shall distinguish between the twosituations in which the financial department allocates discount interest funds to the lending bank and thefinancial department directly allocates discount interest funds to the Company, and conduct accountingtreatment according to the following principles:
(1) Where the financial department allocates the discount interest funds to the lending bank, and the lendingbank provides the loan to the Company at the preferential policy interest rate, the Company shall takethe actual amount of the loan received as the entry value of the loan, and calculate the relevantborrowing costs according to the loan principal and the preferential policy interest rate.
(2) Where the financial department directly allocates discount interest funds to the Company, the Companywill write down the corresponding discount interest against the relevant borrowing costs.If the government subsidy confirmed by the Company needs to be returned, the accounting treatment shall becarried out in accordance with the following provisions in the current situation of the return:
1) The book value of related assets is adjusted if it is offset upon initial recognition.
2) For those with related deferred income, the book balance of related deferred income is written down andthe excess is accounted into the current profits and losses.
3) In the other cases, they are directly accounted into the current profits and losses.
31. Deferred income tax assets and deferred income tax liabilities
The Company’s deferred income tax assets and deferred income tax liabilities are calculated and recognizedaccording to the difference (temporary difference) between the tax base and book value of the assets andliabilities. For the deductible loss that can be carried forward to the subsequent year according to the tax law,the corresponding deferred income tax assets are recognized. For the deductible temporary differencesrelated to the initial recognition of the goodwill, the corresponding deferred income tax liabilities are notrecognized. For the temporary differences related to the initial recognition of the assets or liabilities incurredin the transaction not for business combination that will not affect the accounting profits and income tax
payable (or deductible loss), the corresponding deferred income tax assets and liabilities are not recognized.The deferred income tax assets and deferred income tax liabilities are measured on the balance sheet dateaccording to the applicable tax rate in the period of expected recovery of relevant assets of liquidation ofrelevant liabilities.The Company recognizes the deferred income tax assets by deductible temporary differences, within thelimit of the income tax payable that may be obtained in the future and used to offset the deductible temporarydifferences, the deductible loss and tax deduction.
32. Leased
Finance lease is the lease substantially transferring all risks and remuneration related to the asset ownership.The lease other than the finance lease is operating lease. The Company’s lease is mainly operating lease.The rental income or expense of operating lease is charged to relevant asset cost or current profit and loss bythe straight-line method in the lease term.
33. Significant accounting policy and accounting estimate change
(1) Changes in significant accounting policies
√Applicable □ Not applicable
In 2017, the Ministry of Finance issued the revised Accounting Standards for Business Enterprises No. 14 -Revenue (referred to as the "new revenue standards"). From January 1, 2020, the Company will conductaccounting treatment in accordance with the newly revised above standards. According to the convergenceprovisions, the balance of items in relevant statements at the beginning of this reporting period will be adjustedaccording to the difference between the implementation of the new standards and the current standards on the firstday, and the information in comparable periods will not be adjusted.
(2) Significant accounting estimate change
□ Applicable √ Not applicable
(3) Adjustment of relevant items in financial statements at the beginning of the implementation year as aresult of first implementation of new revenue standards and new release standards from 2020Consolidated Balance Sheet
Unit: yuan
| Item | Tuesday, December 31, 2019 | January 01, 2020 | Adjusted figure |
| Current assets: | |||
| Advance from customers | 1,092,261,332.25 | -1,092,261,332.25 | |
| Contract liabilities | 970,225,647.09 | 970,225,647.09 | |
| Other current liabilities | 122,035,685.16 | 122,035,685.16 |
Balance Sheet of the Parent Company
Unit: yuan
| Item | Tuesday, December 31, 2019 | January 01, 2020 | Adjusted figure |
| Current assets: | |||
| Advance from customers | 983,128,543.51 | -983,128,543.51 | |
| Contract liabilities | 873,647,957.94 | 873,647,957.94 | |
| Other current liabilities | 109,480,585.57 | 109,480,585.57 |
(4) Retrospective adjustment of early comparative data description as a result of first implementation ofnew revenue standards and new release standards from 2020? N/A
VI. Taxes
1. Main tax categories and tax rates
| Tax category | Taxation basis | Tax rate |
| Added value tax | Income from selling commodities | 13% |
| Added value tax | Technical service income | 6% |
| Added value tax | Income from house lease | 5% |
| Tax on city maintenance and construction | Turnover tax actually paid | 7% |
| Education surcharge | Turnover tax actually paid | 3% |
| Surcharge for local education | Turnover tax actually paid | 2% |
| House property tax | 70% of original value of the property | 1.2% |
| House property tax | Rental income | 12% |
| Land use tax | Total land area | 5-10 yuan/m2 |
| Corporate income tax | Income tax payable | 15%, 25% |
Presentation of condition shall be disclosed in cases that there are different subjects of corporate income tax payment
| Name of subject of tax payment | Income tax rate |
| Hangzhou Robam Appliances Co., Ltd. | 15% |
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | 15% |
| Zhejiang Cooking Future Technology Co., Ltd. | 25% |
| Beijing Robam Electric Appliance Sales Co., Ltd. | 25% |
| Shanghai Robam Electric Appliance Sales Co., Ltd. | 25% |
| Hangzhou Mingqi Electric Co., Ltd. | 25% |
| Dize Home Appliance Trading (Shanghai) Co., Ltd. | 25% |
| Hangzhou Robam Fuchuang Investment Management Co., Ltd. | 25% |
2. Tax preference
1) Preferential policies for income tax
On December 01, 2020, the Science Technology Department of Zhejiang Province, Zhejiang ProvincialDepartment of Finance, Zhejiang Provincial Tax Service of State Taxation Administration and ZhejiangLocal Taxation Bureau jointly issued a high-tech enterprise certificate (No. GR202033007142) and theCompany passed the high-tech enterprise identification for 3 years. According to relevant regulations, afterpassing the high-tech enterprise identification, the Company can enjoy the relevant preferential policies ofthe state on high-tech enterprises for three consecutive years (i.e., the income tax preference from January 1,2020 to December 31, 2022), and the enterprise income tax shall be levied at the rate of 15%.Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. (Shengzhou Kinde ), a subsidiary of the Company,obtained the high-tech enterprise certificate (No. GR201933002261) jointly issued by the Science andTechnology Department of Zhejiang Province, Finance Department of Zhejiang Province and ZhejiangProvincial Tax Bureau of the State Administration of Taxation on December 4, 2019. Shengzhou Kindepassed the high-tech enterprise identification. The Company can enjoy the relevant preferential policies ofthe state on high-tech enterprises for three consecutive years (i.e., the income tax preference from January 1,2019 to December 31, 2021), and the enterprise income tax shall be levied at the rate of 15%.
2) Preferential tax policies for land use tax
On December 2, 2020, the State Administration of Taxation, Hangzhou Yuhang District Tax Bureau issued anotice on the tax affairs (Hangyu shuitong [2020] No. 53490), from January 1, 2020 to December 31, 2020,Class A enterprises is free of tax on urban land use, the Company belongs to Class A enterprise and can enjoythe preferential policy of exemption of tax on urban land use.According to Decision of the State Council on Amending the Interim Regulations of the People's Republic ofChina on Urban Land Use Tax, the regulation of Article7 of Order No.483 of the State Council of thePeople's Republic of China, Shengzhou Kinde, a subsidiary of the Company, applied tax exemptions to theState Administration of Taxation Shengzhou Tax Bureau and received approval (filing code:
210406170634586299) and was approved to enjoy the preferential policy of full reduction of land use taxfrom January 1, 2020 to December 31, 2020.
3) Preferential policies for house property tax.
On December 31, 2020, the State Administration of Taxation, Hangzhou Yuhang District Tax Bureau issued anotice on the tax affairs (Hangyu shuitong [2020] No. 59493). From January 1, 2020 to December 31, 2020,
the ad valorem collection of house property tax levied on manufacturing (excluding tobacco products),wholesale and retail enterprises (for personal use) is exempted affected by the epidemic. The Company meetssuch requirements and can enjoy the preferential policy of full reduction of house property tax.VII. Notes to Items in Consolidated Financial Statements
1. Monetary capital
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Cash on hand | 110,770.11 | 218,775.77 |
| Bank deposit | 3,885,907,031.42 | 4,029,077,489.73 |
| Other monetary capital | 35,034,898.78 | 24,825,460.73 |
| Total | 3,921,052,700.31 | 4,054,121,726.23 |
| Including: total amount of fund deposit abroard | 0.00 | 0.00 |
Other descriptionNote: Other monetary capital at the year end is 35,034,898.78 yuan, including the L/C deposit of33,394,968.71 yuan and deposit for bill acceptance of 1,561,218.04 which are limited funds, and Alipaibalance of 78,712.03 yuan which allows to withdraw money at any time and without funds limitation.
2. Trading financial assets
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Financial assets measured with fair value and with the changes included in current profit and loss | 2,352,000,000.00 | 1,360,000,000.00 |
| Including: | ||
| Bank financial products | 2,352,000,000.00 | 1,360,000,000.00 |
| Including: | ||
| Total | 2,352,000,000.00 | 1,360,000,000.00 |
4. Notes receivable
(1) Classified presentation of notes receivable
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Banker’s acceptance | 850,950,227.31 | 359,876,143.64 |
| Trade acceptance | 981,751,215.77 | 626,817,005.76 |
| Total | 1,832,701,443.08 | 986,693,149.40 |
Unit: yuan
| Category | Year-end balance | Beginning balance | ||||||||
| Book balance | Provision for bad debt | Book value | Book balance | Provision for bad debt | Book value | |||||
| Amount | Proportion | Amount | Accruing proportion | Amount | Proportion | Amount | Accruing proportion | |||
| Notes receivable of single provision for bad debt | 11,176,846.26 | 0.59% | 7,823,792.38 | 70.00% | 3,353,053.88 | 0.00 | 0.00% | 0.00 | 0.00% | 0.00 |
| Including: | ||||||||||
| Notes receivable of provision for bad debt by combination | 1,887,831,706.05 | 99.41% | 58,483,316.85 | 3.10% | 1,829,348,389.20 | 1,019,683,518.12 | 100.00% | 32,990,368.72 | 3.24% | 986,693,149.40 |
| Including: | ||||||||||
| Banker’s acceptance bill | 850,950,227.31 | 44.81% | 0.00 | 0.00% | 850,950,227.31 | 359,876,143.64 | 35.29% | 0.00 | 0.00% | 359,876,143.64 |
| Trade acceptance | 1,036,881,478.74 | 54.60% | 58,483,316.85 | 5.64% | 978,398,161.89 | 659,807,374.48 | 64.71% | 32,990,368.72 | 5.00% | 626,817,005.76 |
| Total | 1,899,008,552.31 | 100.00% | 66,307,109.23 | 3.49% | 1,832,701,443.08 | 1,019,683,518.12 | 100.00% | 32,990,368.72 | 3.24% | 986,693,149.40 |
Provision for bad debt by single item:
Unit: yuan
| Name | Year-end balance | |||
| Book balance | Provision for bad debt | Accruing proportion | Reasons for provision | |
| Trade acceptance with provision for bad debt provision withdrawn by single item | 11,176,846.26 | 7,823,792.38 | 70.00% | |
Provision for bad debt by combination:
Unit: yuan
| Name | Year-end balance | ||
| Book balance | Provision for bad debt | Accruing proportion | |
| Banker’s acceptance bill combination | 850,950,227.31 | 0.00 | 0.00% |
| Commercial acceptance bill combination | 1,036,881,478.74 | 58,483,316.85 | 5.64% |
| Total | 1,887,831,706.05 | 58,483,316.85 | -- |
(2) Provision, recovery or reversal of bad debt reserves in the current periodProvision for bad debts in current period:
Unit: yuan
| Category | Beginning balance | Changes in amount in current period | Year-end balance | |||
| Provision | Recovered or reversed | Canceled after verification | Other | |||
| Trade acceptance | 32,990,368.72 | 33,316,740.51 | 0.00 | 0.00 | 66,307,109.23 | |
| Total | 32,990,368.72 | 33,316,740.51 | 0.00 | 0.00 | 66,307,109.23 | |
(3) Notes receivable endorsed or discounted by the Company at the end of the period and not expired yet onthe balance sheet date
Unit: yuan
| Item | Amount confirmed at end of period | Amount not yet confirmed at end of period |
| Banker’s acceptance | 908,147.68 | 0.00 |
| Trade acceptance | 0.00 | 10,000,000.00 |
| Total | 908,147.68 | 10,000,000.00 |
(4) Notes transferred to accounts receivable by the Company at the end of the period due to failure of thedrawer to perform
Unit: yuan
| Item | Accounts receivable transferred at the end of the period |
| Trade acceptance | 16,504,843.78 |
| Total | 16,504,843.78 |
5. Accounts receivable
(1) Classified disclosure of accounts receivable
Unit: yuan
| Category | Year-end balance | Beginning balance | ||||||||
| Book balance | Provision for bad debt | Book value | Book balance | Provision for bad debt | Book value | |||||
| Amount | Proportion | Amount | Accruing proportion | Amount | Proportion | Amount | Accruing proportion | |||
| Accounts receivable of provision for bad debt by single item | 15,164,080.60 | 1.40% | 12,320,940.24 | 81.25% | 2,843,140.36 | 4,216,329.97 | 0.55% | 4,216,329.97 | 100.00% | 0.00 |
| Including: | ||||||||||
| Accounts receivable of provision for bad debt by combination | 1,065,680,355.15 | 98.60% | 60,287,549.11 | 5.66% | 1,005,392,806.04 | 768,561,756.12 | 99.45% | 42,930,854.84 | 5.59% | 725,630,901.28 |
| Including: | ||||||||||
| Total | 1,080,844,435.75 | 100.00% | 72,608,489.35 | 6.72% | 1,008,235,946.40 | 772,778,086.09 | 100.00% | 47,147,184.81 | 6.10% | 725,630,901.28 |
Provision for bad debt by single item:
Unit: yuan
| Name | Year-end balance | |||
| Book balance | Provision for bad debt | Accruing proportion | Reasons for provision | |
| Accounts receivable without large single amount and withdrawn with single provision for bad debt | 5,686,946.05 | 5,686,946.05 | 100.00% | Expected to be irrecoverable |
| Accounts receivable without large single amount and withdrawn with single provision for bad debt | 9,477,134.55 | 6,633,994.19 | 70.00% | Expected risk of recovery |
| Total | 15,164,080.60 | 12,320,940.24 | -- | -- |
Provision for bad debt by combination: accounts receivable of provision for bad debt by expected credit loss combination based onaging features
Unit: yuan
| Name | Year-end balance | ||
| Book balance | Provision for bad debt | Accruing proportion | |
| Within 1 year | 1,005,819,109.05 | 50,273,301.62 | 5.00% |
| 1-2 years | 45,421,774.91 | 4,542,177.50 | 10.00% |
| 2-3 years | 8,757,586.46 | 1,751,517.29 | 20.00% |
| 3-4 years | 3,747,177.04 | 1,873,588.53 | 50.00% |
| 4-5 years | 438,717.57 | 350,974.05 | 80.00% |
| More than 5 years | 1,495,990.12 | 1,495,990.12 | 100.00% |
| Total | 1,065,680,355.15 | 60,287,549.11 | -- |
Disclosure by aging
Unit: yuan
| Aging | Book balance |
| Within 1 year (including 1 year) | 1,015,150,908.06 |
| Within 1 year (including 1 year) | 1,015,150,908.06 |
| 1-2 years | 47,452,910.95 |
| 2-3 years | 10,415,782.96 |
| More than 3 years | 7,824,833.78 |
| 3-4 years | 3,747,177.04 |
| 4-5 years | 808,021.57 |
| More than 5 years | 3,269,635.17 |
| Total | 1,080,844,435.75 |
(2) Provision, recovery or reversal of bad debt reserves in the current period
Provision for bad debts in current period:
Unit: yuan
| Category | Beginning balance | Changes in amount in current period | Year-end balance | |||
| Provision | Recovered or reversed | Canceled after verification | Other | |||
| Provision for bad debt of accounts receivable | 47,147,184.81 | 27,309,380.51 | 0.00 | 1,848,075.97 | 72,608,489.35 | |
| Total | 47,147,184.81 | 27,309,380.51 | 0.00 | 1,848,075.97 | 72,608,489.35 | |
(3) Accounts receivable actually written off at the current period
Unit: yuan
| Item | Written-off amount |
| Accounts receivable | 1,848,075.97 |
(4) Receivables with top 5 ending balances by debtor
Unit: yuan
| Unit name | Ending balance of accounts receivable | Proportion in total ending balance of accounts receivable | Ending balance of bad debt provision |
| Unit 1 | 150,213,112.47 | 13.90% | 7,510,655.63 |
| Unit 2 | 139,545,372.57 | 12.91% | 6,977,268.62 |
| Unit 3 | 106,880,264.70 | 9.89% | 5,344,013.24 |
| Unit 4 | 22,204,462.73 | 2.05% | 1,568,955.14 |
| Unit 5 | 19,105,863.54 | 1.77% | 955,293.18 |
| Total | 437,949,076.01 | 40.52% |
6. Receivables financing
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Banker’s acceptance bill | 0.00 | 408,972,104.07 |
| Total | 408,972,104.07 |
7. Advances to suppliers
(1) Presentation of advances to suppliers by aging
Unit: yuan
| Aging | Year-end balance | Beginning balance | ||
| Amount | Proportion | Amount | Proportion | |
| Within 1 year | 68,516,272.50 | 98.04% | 50,109,021.83 | 99.99% |
| 1-2 years | 1,373,126.97 | 1.96% | 4,528.01 | 0.01% |
| 2-3 years | 0.00 | 0.00% | 0.00 | 0.00% |
| Total | 69,889,399.47 | -- | 50,113,549.84 | -- |
(2) Advances to suppliers with top 5 ending balances by prepayment object
The total amount of advances to suppliers with top 5 ending balances by prepayment object in the current yearwas 36,963,699.30 yuan, accounting for 52.90% of total number of ending balance of advances to suppliers.
8. Other receivables
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Dividends receivable | 14,295,039.38 | |
| Other receivables | 56,589,791.38 | 96,604,409.27 |
| Total | 56,589,791.38 | 110,899,448.65 |
(1) Interest receivable
1) Classification of interest receivable
Unit: yuan
| Item | Year-end balance | Beginning balance |
(2) Dividends receivable
1) Classification of dividends receivable
Unit: yuan
| Project (or investee) | Year-end balance | Beginning balance |
| Suzhou Industrial Park Ruican Investment Enterprise (limited partnership) | 0.00 | 14,295,039.38 |
| Total | 14,295,039.38 |
(3) Other receivables
1) Other receivables classified by nature
Unit: yuan
| Fund nature | Year-end book balance | Year-begining book balance |
| Deposit and margin | 39,954,577.27 | 37,167,812.49 |
| Collection by third party | 20,064,674.31 | 63,604,415.88 |
| Imprest | 4,326,156.43 | 3,137,976.93 |
| Withheld amount | 2,740,994.81 | 2,502,348.12 |
| Other | 3,306,429.16 | 512,898.94 |
| Total | 70,392,831.98 | 106,925,452.36 |
2) Provision for bad debt
Unit: yuan
| Provision for bad debt | Stage 1 | Stage 2 | Stage 3 | Total |
| Expected credit losses over the next 12 months | Expected credit loss for the entire duration (no credit impairment) | Expected credit loss for the entire duration (credit impairment has occurred) | ||
| Balance on January 01, 2020 | 10,321,043.09 | 10,321,043.09 | ||
| Balance on January 1, 2020 in current period | —— | —— | —— | —— |
| Withdrawn in current period | 3,511,997.51 | 3,511,997.51 | ||
| Written-off in current period | 30,000.00 | 30,000.00 | ||
| Balance on December 31, 2020 | 13,803,040.60 | 13,803,040.60 |
Disclosure by aging
Unit: yuan
| Aging | Book balance |
| Within 1 year (including 1 year) | 39,565,072.08 |
| Within 1 year (including 1 year) | 39,565,072.08 |
| 1-2 years | 8,112,128.54 |
| 2-3 years | 4,307,383.02 |
| More than 3 years | 18,408,248.34 |
| 3-4 years | 16,291,346.00 |
| 4-5 years | 677,388.96 |
| More than 5 years | 1,439,513.38 |
| Total | 70,392,831.98 |
3) Provision, recovery or reversal of bad debt reserves in the current period
Provision for bad debts in current period:
Unit: yuan
| Category | Beginning balance | Changes in amount in current period | Year-end balance | |||
| Provision | Recovered or reversed | Canceled after verification | Other | |||
| Provision for bad debt of other receivables | 10,321,043.09 | 3,511,997.51 | 0.00 | 30,000.00 | 13,803,040.60 | |
| Total | 10,321,043.09 | 3,511,997.51 | 0.00 | 30,000.00 | 13,803,040.60 | |
4) Other receivables actually written off at the current period
Unit: yuan
| Item | Written-off amount |
| Other receivables actually written off in the current year | 30,000.00 |
5) Other receivables with top 5 ending balances by debtor
Unit: yuan
| Unit name | Nature of payment | Year-end balance | Aging | Proportion in total other ending balance receivable | Ending balance of bad debt provision |
| Unit 1 | Deposit and margin | 14,778,000.00 | 3-4 years | 20.99% | 7,389,000.00 |
| Unit 2 | Collection by third party | 14,390,028.64 | Within 1 year | 20.44% | 719,501.43 |
| Unit 3 | Collection by third party | 3,852,394.93 | Within 1 year | 5.47% | 192,619.75 |
| Unit 4 | Deposit and margin | 3,000,000.00 | 1-2 years | 4.26% | 300,000.00 |
| Unit 5 | Deposit and margin | 2,218,384.00 | Within 1 year | 3.15% | 110,919.20 |
| Total | -- | 38,238,807.57 | -- | 54.31% | 8,712,040.38 |
9. Inventory
(1) Inventory classification
Unit: yuan
| Item | Year-end balance | Beginning balance | ||||
| Book balance | Provision for inventory falling price reserves or contract performance costs | Book value | Book balance | Provision for inventory falling price reserves or contract performance costs | Book value | |
| Raw materials | 90,099,485.06 | 90,099,485.06 | 65,865,050.18 | 65,865,050.18 | ||
| Work in process | 56,669,379.52 | 56,669,379.52 | 48,635,094.61 | 48,635,094.61 | ||
| Merchandise inventory | 356,798,655.96 | 31,299,857.11 | 325,498,798.85 | 333,027,454.91 | 9,321,963.35 | 323,705,491.56 |
| Semi-finished products shipped in transit | 895,794,857.43 | 0.00 | 895,794,857.43 | 882,209,547.51 | 0.00 | 882,209,547.51 |
| Low priced and easily worn | 18,026,823.98 | 0.00 | 18,026,823.98 | 18,761,741.34 | 0.00 | 18,761,741.34 |
| articles and wrappage | ||||||
| Total | 1,417,389,201.95 | 31,299,857.11 | 1,386,089,344.84 | 1,348,498,888.55 | 9,321,963.35 | 1,339,176,925.20 |
(2) Provision for inventory falling price reserves and contract performance costs
Unit: yuan
| Item | Beginning balance | Amount increased in current period | Amount decreased in current period | Year-end balance | ||
| Provision | Other | Reversed or written off | Other | |||
| Merchandise inventory | 9,321,963.35 | 21,977,893.76 | 31,299,857.11 | |||
| Total | 9,321,963.35 | 21,977,893.76 | 31,299,857.11 | |||
10. Contract assets N/A
11. Assets available for sales N/A
12. Non-current assets due within a year N/A
13. Other current assets
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Pending deduct VAT on purchase | 667,378.56 | 2,386,707.05 |
| Prepaid tax | 0.00 | 13,802,530.76 |
| Total | 667,378.56 | 16,189,237.81 |
14. Debt investments N/A
15. Other debt investments N/A
16. Long-term receivables N/A
17. Long-term equity investment
Unit: yuan
| Investe | Beginni | Increase or decrease in current period | Ending | Balance |
| d unit | ng balance (book value) | Further investment | Capital reduction | Investment gains and losses recognized by the equity method | Adjustment of other comprehensive income | Changes in other equity | Declared payment of cash dividends or profits | Provision for impairment | Other | balance (book value) | of impairment provision at the end of period |
| I. Joint enterprise | |||||||||||
| De Dietrich Trade (Shanghai) Co., Ltd. | 4,168,338.79 | 0.00 | 0.00 | -715,569.20 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 3,452,769.59 | |
| Subtotal | 4,168,338.79 | 0.00 | 0.00 | -715,569.20 | 0.00 | 0.00 | 0.00 | 0.00 | 3,452,769.59 | ||
| II. Joint venture | |||||||||||
| Total | 4,168,338.79 | -715,569.20 | 3,452,769.59 | ||||||||
Other description
18. Other equity instrument investments
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Suzhou Industrial Park Ruican Investment Enterprise (limited partnership) | 100,000,000.00 | 100,000,000.00 |
| Shanghai MXCHIP Information Technology Co., Ltd. | 2,116,023.22 | 2,116,023.22 |
| Total | 102,116,023.22 | 102,116,023.22 |
Separate disclosure of the current period of non-transactional equity instruments
Unit: yuan
| Project name | Recognized dividend income | Aggregate gains | Aggregate losses | Amount of other comprehensive income | Cause for designation to measure at fair value of which changes are | Causes for carryforward retained earnings of other |
| transferred to retained earnings | recorded into other comprehensive income | comprehensive income | ||||
| Suzhou Industrial Park Ruican Investment Enterprise (limited partnership) | 11,985,836.92 | 0.00 | 0.00 | 0.00 | Held for non-trading purposes | — |
| Shanghai MXCHIP Information Technology Co., Ltd. | 0.00 | 0.00 | 17,832,510.78 | 0.00 | Held for non-trading purposes | — |
Other description:
19. Other non-current financial assets
20. Investment properties
(1) Investment properties using cost measurement mode
√Applicable □ Not applicable
Unit: yuan
| Item | Houses and buildings | Total |
| I. Original book value | ||
| 1. Year-beginning balance | 189,197.82 | 189,197.82 |
| 2. Increase in current year | 2,497,285.44 | 2,497,285.44 |
| (1) Transfer of fixed assets | 2,497,285.44 | 2,497,285.44 |
| 3. Decrease in current year | 0.00 | 0.00 |
| 4. Year-end balance | 2,686,483.26 | 2,686,483.26 |
| II. Accumulative depreciation | ||
| 1. Year-beginning balance | 76,609.48 | 76,609.48 |
| 2. Increase in current year | 18,871.94 | 18,871.94 |
| (1) Accrual | 18,871.94 | 18,871.94 |
| 3. Decrease in current year | 0.00 | 0.00 |
| 4. Year-end balance | 95,481.42 | 95,481.42 |
| III. Provision for impairment | ||
| 1. Year-beginning balance | 0.00 | 0.00 |
| Item | Houses and buildings | Total |
| 2. Increase in current year | 0.00 | 0.00 |
| 3. Decrease in current year | 0.00 | 0.00 |
| 4. Year-end balance | 0.00 | 0.00 |
| IV. Book value | ||
| 1. Year-end Book value | 2,591,001.84 | 2,591,001.84 |
| 2. Year-beginning book value | 112,588.34 | 112,588.34 |
(2) Investment properties using fair value measurement mode
□ Applicable √ Not applicable
21. Fixed assets
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Fixed assets | 824,978,354.71 | 826,234,929.97 |
| Total | 824,978,354.71 | 826,234,929.97 |
(1) Fixed assets
Unit: yuan
| Item | Houses and building | Machinery equipment | Transportation equipment | Other equipment | Total |
| I. Original book value | |||||
| 1. Year-beginning balance | 680,982,703.90 | 558,659,463.30 | 18,620,780.98 | 73,367,146.35 | 1,331,630,094.53 |
| 2. Increase in current year | 23,443,247.45 | 63,342,721.26 | 2,499,339.13 | 8,373,560.86 | 97,658,868.70 |
| (1) Purchase | 1,328,349.35 | 12,093,983.61 | 2,499,339.13 | 8,373,560.86 | 24,295,232.95 |
| (2) Transfer from construction in progress | 22,114,898.10 | 51,248,737.65 | 0.00 | 0.00 | 73,363,635.75 |
| 3. Decrease in current year | 2,497,285.44 | 4,046,851.23 | 2,234,293.93 | 3,168,337.97 | 11,946,768.57 |
| (1) Disposal or scrap | 0.00 | 4,046,851.23 | 2,234,293.93 | 3,168,337.97 | 9,449,483.13 |
| 2. Others decreases | 2,497,285.44 | 0.00 | 0.00 | 0.00 | 2,497,285.44 |
| 4. Year-end balance | 701,928,665.91 | 617,955,333.33 | 18,885,826.18 | 78,572,369.24 | 1,417,342,194.66 |
| II. Accumulative depreciation | |||||
| 1. Year-beginning balance | 209,304,987.24 | 240,108,059.23 | 11,262,138.92 | 44,719,979.17 | 505,395,164.56 |
| 2. Increase in current year | 31,514,712.26 | 53,199,041.23 | 2,432,308.53 | 8,211,794.94 | 95,357,856.96 |
| Item | Houses and building | Machinery equipment | Transportation equipment | Other equipment | Total |
| (1) Accrual | 31,514,712.26 | 53,199,041.23 | 2,432,308.53 | 8,211,794.94 | 95,357,856.96 |
| 3. Decrease in current year | 0.00 | 3,441,666.82 | 2,122,579.25 | 2,824,935.50 | 8,389,181.57 |
| (1) Disposal or scrap | 0.00 | 3,441,666.82 | 2,122,579.25 | 2,824,935.50 | 8,389,181.57 |
| 4. Year-end balance | 240,819,699.50 | 289,865,433.64 | 11,571,868.20 | 50,106,838.61 | 592,363,839.95 |
| III. Provision for impairment | |||||
| 1. Year-beginning balance | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2. Increase in current year | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 3. Decrease in current year | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 4. Year-end balance | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| IV. Book value | |||||
| 1. Year-end Book value | 461,108,966.41 | 328,089,899.69 | 7,313,957.98 | 28,465,530.63 | 824,978,354.71 |
| 2. Year-beginning book value | 471,677,716.66 | 318,551,404.07 | 7,358,642.06 | 28,647,167.18 | 826,234,929.97 |
22. Construction in progress
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Construction in progress | 463,424,647.46 | 272,211,720.62 |
| Total | 463,424,647.46 | 272,211,720.62 |
(1) Construction in progress
Unit: yuan
| Item | Year-end balance | Beginning balance | ||||
| Book balance | Provision for impairment | Book value | Book balance | Provision for impairment | Book value | |
| Maoshan intelligent manufacturing base infrastructure project | 358,241,059.59 | 0.00 | 358,241,059.59 | 259,945,664.42 | 0.00 | 259,945,664.42 |
| Shengzhou south district project | 73,511,454.76 | 0.00 | 73,511,454.76 | 352,500.23 | 0.00 | 352,500.23 |
| Dark workshop project | 14,096,794.95 | 0.00 | 14,096,794.95 | 0.00 | 0.00 | 0.00 |
| Riveting equipment project | 4,568,965.52 | 0.00 | 4,568,965.52 | 0.00 | 0.00 | 0.00 |
| Customized management software | 3,770,316.32 | 0.00 | 3,770,316.32 | 3,574,118.78 | 0.00 | 3,574,118.78 |
| Robam Mansion project | 2,219,316.28 | 0.00 | 2,219,316.28 | 0.00 | 0.00 | 0.00 |
| Air line project | 1,663,716.90 | 0.00 | 1,663,716.90 | 0.00 | 0.00 | 0.00 |
| Project of production department 2 | 1,530,973.46 | 0.00 | 1,530,973.46 | 1,206,896.55 | 0.00 | 1,206,896.55 |
| Project of production department 3 | 0.00 | 0.00 | 0.00 | 2,015,449.74 | 0.00 | 2,015,449.74 |
| Cutting machine project | 0.00 | 0.00 | 0.00 | 1,435,896.56 | 0.00 | 1,435,896.56 |
| Dispensing equipment project | 0.00 | 0.00 | 0.00 | 713,675.21 | 0.00 | 713,675.21 |
| Other sporadic projects | 3,822,049.68 | 0.00 | 3,822,049.68 | 2,967,519.13 | 0.00 | 2,967,519.13 |
| Total | 463,424,647.46 | 463,424,647.46 | 272,211,720.62 | 272,211,720.62 |
(3) Current changes in major projects under construction
Unit: yuan
| Project name | Year-beginning balance | Increase in current year | Decrease in current year | Year-end balance | |
| Carried forward to fixed assets | Other decreases | ||||
| Maoshan intelligent manufacturing base infrastructure project | 259,945,664.42 | 128,292,791.18 | 29,997,396.01 | 0.00 | 358,241,059.59 |
| Shengzhou south district project | 352,500.23 | 96,396,729.53 | 23,237,775.00 | 0.00 | 73,511,454.76 |
| Robam Mansion project | 0.00 | 2,219,316.28 | 0.00 | 0.00 | 2,219,316.28 |
| Total | 260,298,164.65 | 226,908,836.99 | 53,235,171.01 | 0.00 | 433,971,830.63 |
(Continued)
| Project name | Budget number | Proportion of project input to the budget (%) | Progress of the project (%) | Cumulative amount of capitalized interest | Including: amount of capitalized interest in current period of the year | Interest of current year Capitalization rate | Source of funds |
| Maoshan intelligent manufacturing base infrastructure project | 633,650,000.00 | 56.54 | 56.54 | 0.00 | 0.00 | 0.00 | Self-financing |
| Shengzhou south district project | 240,960,000.00 | 40.15 | 40.15 | 0.00 | 0.00 | 0.00 | Self-financing |
| Project name | Budget number | Proportion of project input to the budget (%) | Progress of the project (%) | Cumulative amount of capitalized interest | Including: amount of capitalized interest in current period of the year | Interest of current year Capitalization rate | Source of funds |
| Robam Mansion project | 546,000,000.00 | 0.41 | 0.41 | 0.00 | 0.00 | 0.00 | Self-financing |
23. No productive biological assets
24. No oil and gas assets
25. No right-of-use assets
26. Intangible assets
(1) Intangible assets
Unit: yuan
| Item | Land use right | Software | Trademark | Patents | Total |
| I. Original book value | |||||
| 1. Year-beginning balance | 202,418,904.95 | 46,474,694.36 | 24,624,622.64 | 7,300,000.00 | 280,818,221.95 |
| 2. Increase in current year | 23,237,775.00 | 5,866,072.21 | 0.00 | 0.00 | 29,103,847.21 |
| (1) Purchase | 23,237,775.00 | 5,866,072.21 | 0.00 | 0.00 | 29,103,847.21 |
| 3. Decrease in current year | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 4. Year-end balance | 225,656,679.95 | 52,340,766.57 | 24,624,622.64 | 7,300,000.00 | 309,922,069.16 |
| II. Accumulated amortization | |||||
| 1. Year-beginning balance | 21,274,593.91 | 34,447,626.59 | 3,678,115.56 | 1,684,615.38 | 61,084,951.44 |
| 2. Increase in current year | 4,353,503.80 | 5,677,718.88 | 2,465,577.80 | 1,123,076.92 | 13,619,877.40 |
| (1) Accrual | 4,353,503.80 | 5,677,718.88 | 2,465,577.80 | 1,123,076.92 | 13,619,877.40 |
| 3. Decrease in current year | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 4. Year-end balance | 25,628,097.71 | 40,125,345.47 | 6,143,693.36 | 2,807,692.30 | 74,704,828.84 |
| III. Provision for impairment | |||||
| 1. Year-beginning balance | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2. Increase in current year | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 3. Decrease in current year | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Item | Land use right | Software | Trademark | Patents | Total |
| 4. Year-end balance | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| IV. Book value | |||||
| 1. Year-end Book value | 200,028,582.24 | 12,215,421.10 | 18,480,929.28 | 4,492,307.70 | 235,217,240.32 |
| 2. Year-beginning book value | 181,144,311.04 | 12,027,067.77 | 20,946,507.08 | 5,615,384.62 | 219,733,270.51 |
27. Development expenditure N/A
28. Goodwill
(1) Original book value of goodwill
Unit: yuan
| Investee name or goodwill forming matter | Beginning balance | Increase in current period | Decrease in current period | Year-end balance | ||
| By business combination | Disposal | |||||
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | 80,589,565.84 | 0.00 | 0.00 | 80,589,565.84 | ||
| Total | ||||||
(2) Provision for impairment of goodwill
Unit: yuan
| Investee name or goodwill forming matter | Beginning balance | Increase in current period | Decrease in current period | Year-end balance | ||
| Provision | Disposal | |||||
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | |
Information about the asset group or combination of asset groups in which the goodwill is located
The Company has recognized Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd.( Shengzhou Kinde) asan assets group. The assets group of year-end goodwill is consistent with the assets group confirmed on thedate of purchase and goodwill impairment in the year before last.
Goodwill impairment test process and recognition method of key parameters (forecast period growth rate when estimating the presentvalue of future cash flow, stable period growth rate, profit rate, discount rate and forecast period) and goodwill impairment loss:
Our Company commissioned Zhonghe Appraisal Co,. Ltd. (hereinafter referred to as Zhonghe Appraisal)to evaluate whether the goodwill impairment of assets group of Shengzhou Kinde would occur. According tothe No. BJU3002 Zhonghe Appraisal Report (2021) on Goodwill Impairment Test issued by ZhongheAppraisal, Zhonghe Appraisal makes a decision according to the approved forecast of cash flow for the nextfive years by management, and estimates the cash flow after the next five years of forecast period based onthe specific long-term average growth rate, and calculates with the present value model of future cash flowand conduct impairment tests on goodwill with the net amount of the fair value subtracted by the disposalcosts and the present value of the expected future cash flow of asset, whichever is higher, based ongoing-concern assumption. It is tested that the recoverable amount of the assets group of Shengzhou Kinde isgreater than the book value containing the assets group of goodwill, and goodwill impairment does not exist.
29. Long-term unamortized expenses
Unit: yuan
| Item | Beginning balance | Amount increased in current period | Amortization amount in current period | Other decreases | Year-end balance |
| Service charge | 234,663.25 | 338,544.53 | 256,113.01 | 0.00 | 317,094.77 |
| Consulting fee | 187,169.81 | 154,463.52 | 100,545.48 | 0.00 | 241,087.85 |
| Training membership fee | 101,362.68 | 0.00 | 63,697.48 | 0.00 | 37,665.20 |
| Brand endorsement fee | 0.00 | 1,202,511.03 | 0.00 | 0.00 | 1,202,511.03 |
| Total | 523,195.74 | 1,695,519.08 | 420,355.97 | 1,798,358.85 |
30. Deferred income tax assets and deferred income tax liabilities
(1) Unoffset deferred income tax assets
Unit: yuan
| Item | Year-end balance | Beginning balance | ||
| Deductible temporary differences | Deferred income tax assets | Deductible temporary differences | Deferred income tax assets | |
| Recognition for provisional estimate cost | 399,311,723.24 | 59,896,758.48 | 215,006,417.88 | 32,250,962.68 |
| Provision for credit impairment | 152,718,639.18 | 24,152,559.74 | 90,458,596.62 | 14,479,181.31 |
| Recognition for deferred income | 121,306,538.90 | 18,195,980.84 | 114,851,263.30 | 17,227,689.50 |
| Provision for | 31,299,857.11 | 4,694,978.56 | 9,321,963.35 | 1,398,294.50 |
| impairment of assets | ||||
| Fair value change of other equity instrument investments | 17,832,510.78 | 2,674,876.62 | 17,832,510.78 | 2,674,876.62 |
| Unrealized profit of internal transaction | 10,991,208.96 | 2,747,344.24 | 8,075,375.65 | 2,018,843.91 |
| Payroll payable withdrawn but not issued | 863,548.19 | 129,532.23 | 5,388,241.47 | 827,267.57 |
| Total | 734,324,026.36 | 112,492,030.71 | 460,934,369.05 | 70,877,116.09 |
(2) Unoffset deferred income tax liabilities
Unit: yuan
| Item | Year-end balance | Beginning balance | ||
| Taxable temporary differences | Deferred income tax liabilities | Taxable temporary differences | Deferred income tax liabilities | |
| Appreciation of assets appraisal for business combination not under common control | 30,040,521.60 | 4,506,078.24 | 33,942,653.74 | 5,091,398.06 |
| Taxable temporary differences due to the pretax deduction of fixed assets | 4,697,876.68 | 704,681.50 | 4,176,334.57 | 626,450.19 |
| Total | 34,738,398.28 | 5,210,759.74 | 38,118,988.31 | 5,717,848.25 |
(3) Deferred income tax assets or liabilities presented as net amount after offset
Unit: yuan
| Item | Ending offset amount of deferred income tax assets and liabilities | Ending balance of deferred income tax assets and liabilities after offset | Beginning offset amount of deferred income tax assets and liabilities | Beginning balance of deferred income tax assets and liabilities after offset |
| Deferred income tax assets | 112,492,030.71 | 70,877,116.09 | ||
| Deferred income tax liabilities | 5,210,759.74 | 5,717,848.25 |
(4) Details of unrecognized deferred income tax assets
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Deductible loss | 9,798,260.49 | 6,459,439.41 |
| Total | 9,798,260.49 | 6,459,439.41 |
(5) Deductible losses on unrecognized deferred income tax assets will expire in the following year
Unit: yuan
| Year | Amount at the end of period | Amount in the beginning of period | Remark |
| 2020 | 0.00 | 6,367,784.94 | |
| 2021 | 39,785.54 | 39,785.54 | |
| 2022 | 39,552.31 | 39,552.31 | |
| 2023 | 6,714.34 | 6,714.34 | |
| 2024 | 5,602.28 | 5,602.28 | |
| 2025 | 9,706,606.02 | 0.00 | |
| Total | 9,798,260.49 | 6,459,439.41 | -- |
31. Other non-current assets
Unit: yuan
| Item | Year-end balance | Beginning balance | ||||
| Book balance | Provision for impairment | Book value | Book balance | Provision for impairment | Book value | |
| Advance payment for equipment purchase | 3,624,837.56 | 3,624,837.56 | 23,558,781.27 | 23,558,781.27 | ||
| Advance payment for intangible assets | 57,442.11 | 0.00 | 57,442.11 | |||
| Total | 3,682,279.67 | 3,682,279.67 | 23,558,781.27 | 23,558,781.27 | ||
32. Short-term borrowing
(1) Classification of short-term borrowing
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Credit Loan | 6,076,177.30 | |
| Total | 6,076,177.30 |
33. No trading financial liabilities
34. No derivative financial liabilities
35. Notes payable
Unit: yuan
| Type | Year-end balance | Beginning balance |
| Banker’s acceptance bill | 751,802,498.92 | 603,308,648.96 |
| Total | 751,802,498.92 | 603,308,648.96 |
36. Accounts payable
(1) Presentation of accounts payable
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Payment for materials | 950,631,079.92 | 880,995,549.70 |
| Costs | 709,723,793.53 | 465,097,084.50 |
| Project payment | 48,606,778.41 | 33,887,108.65 |
| Payment for equipment | 14,870,556.23 | 15,081,542.43 |
| Total | 1,723,832,208.09 | 1,395,061,285.28 |
(2) Important accounts payable with the aging more than 1 year
Unit: yuan
| Item | Year-end balance | Reasons for being unpaid or unsettled |
| Costs | 16,941,906.91 | To be Settled |
| Total | 16,941,906.91 | -- |
Other description:
Note: As of December 31, 2020, the Company's important accounts payable with an age of more than one year were16,941,906.91 yuan, which is mainly for fees not yet settled.
37. No advance from customers
38. Contract liabilities
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Advances from customers | 949,591,228.35 | 966,602,948.89 |
| Total | 949,591,228.35 | 966,602,948.89 |
39. Payroll payable
(1) Presentation of payroll payable
Unit: yuan
| Item | Beginning balance | Increase in current period | Decrease in current period | Year-end balance |
| I. Short-term compensation | 116,643,991.68 | 763,965,081.65 | 757,116,917.37 | 123,492,155.96 |
| II. Welfare after dismission - defined contribution plan | 5,426,333.35 | 27,091,315.84 | 29,879,413.91 | 2,638,235.28 |
| III. Dismission welfare | 0.00 | 1,063,281.45 | 1,063,281.45 | 0.00 |
| Total | 122,070,325.03 | 792,119,678.94 | 788,059,612.73 | 126,130,391.24 |
(2) Presentation of short-term compensation
Unit: yuan
| Item | Beginning balance | Increase in current period | Decrease in current period | Year-end balance |
| 1. Wages, bonuses, allowances and subsidies | 112,088,149.01 | 657,338,070.20 | 650,495,489.28 | 118,930,729.93 |
| 2. Employee services and benefits | 0.00 | 27,021,217.81 | 27,021,217.81 | 0.00 |
| 3. Social insurance premium | 3,930,546.68 | 36,823,509.80 | 36,825,229.50 | 3,928,826.98 |
| Including: medical insurance premium | 3,388,855.20 | 35,636,997.54 | 35,178,167.16 | 3,847,685.58 |
| Industrial injury insurance premium | 172,761.56 | 830,554.45 | 922,174.61 | 81,141.40 |
| Birth insurance premium | 368,929.92 | 355,957.81 | 724,887.73 | 0.00 |
| 4. Housing fund | 272,101.00 | 30,729,770.56 | 30,719,723.56 | 282,148.00 |
| 5. Labor union expenditure and personnel education fund | 353,194.99 | 12,052,513.28 | 12,055,257.22 | 350,451.05 |
| Total | 116,643,991.68 | 763,965,081.65 | 757,116,917.37 | 123,492,155.96 |
(3) Presentation of defined contribution plans
Unit: yuan
| Item | Beginning balance | Increase in current | Decrease in current | Year-end balance |
| period | period | |||
| 1. Basic endowment insurance | 5,228,962.74 | 26,152,464.69 | 28,839,057.22 | 2,542,370.21 |
| 2. Unemployment insurance premium | 197,370.61 | 938,851.15 | 1,040,356.69 | 95,865.07 |
| Total | 5,426,333.35 | 27,091,315.84 | 29,879,413.91 | 2,638,235.28 |
40. Tax payable
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Corporate income tax | 111,445,197.66 | 89,992,149.62 |
| Added value tax | 61,150,126.40 | 9,811,740.89 |
| Tax on city maintenance and construction | 3,937,862.94 | 769,259.08 |
| Individual income tax | 1,526,364.72 | 1,190,263.26 |
| Education surcharge | 1,687,655.54 | 329,682.46 |
| Surcharge for local education | 1,125,103.76 | 219,788.34 |
| Stamp duty | 507,609.14 | 238,931.49 |
| Land use tax | 340,344.00 | 0.00 |
| House property tax | 166,973.35 | 0.00 |
| Disabled person employment security fund | 0.00 | 174,840.07 |
| Total | 181,887,237.51 | 102,726,655.21 |
41. Other payables
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Other payables | 242,559,615.30 | 241,641,864.89 |
| Total | 242,559,615.30 | 241,641,864.89 |
(1) Other payables
1) Other payables listed by nature
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Margin payable | 234,180,292.44 | 233,004,717.16 |
| Deposit payable | 4,539,028.30 | 4,995,172.30 |
| Collections for others | 2,616,338.90 | 1,486,383.22 |
| Equity incentive repurchase obligation | 0.00 | 0.00 |
| Other | 1,223,955.66 | 2,155,592.21 |
| Total | 242,559,615.30 | 241,641,864.89 |
2) Important other payable with the aging more than 1 year
Unit: yuan
| Item | Year-end balance | Reasons for being unpaid or unsettled |
| Sales deposit | 202,300,730.41 | |
| Total | 202,300,730.41 | -- |
Other description
Note: As of December 31, 2020, the Company's important other payables with an age of more than one yearwere 202,300,730.41 yuan, which is mainly for sales deposit.
42. No liabilities available for sale
43. No Non-current liabilities due within a year
44. Other current liabilities
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Pending changerover VAT on sales | 116,535,407.26 | 122,035,685.16 |
| Endorsed trade acceptance | 10,000,000.00 | 0.00 |
| Total | 126,535,407.26 | 122,035,685.16 |
45. Long-term borrowing N/A
46. Bonds payable N/A
47. Lease liabilities N/A
48. Long-term payable N/A
49. Long-term payroll payable N/A
50. Estimated liabilities N/A
51. Deferred income
Unit: yuan
| Item | Beginning balance | Increase in current period | Decrease in current period | Year-end balance | Forming reasons |
| Government subsidies | 114,851,263.30 | 51,479,585.00 | 16,167,324.40 | 150,163,523.90 | |
| Total | 114,851,263.30 | 51,479,585.00 | 16,167,324.40 | 150,163,523.90 | -- |
Other description:
| Government subsidized project | Year-beginning balance | Newly increased amount in current year | Annual amount recorded into the current profit and loss | Year-end balance | Assets/income related |
| Project fund of for intelligent manufacturing, integrated standardization and new mode application | 55,323,859.42 | 0.00 | 8,539,505.64 | 46,784,353.78 | 与资产相关 |
| Production and construction project of annual production of 2.25 million kitchen appliances | 27,478,633.08 | 0.00 | 2,573,781.24 | 24,904,851.84 | 与资产相关 |
| Construction project of kitchen appliance R&D, design and test center | 11,774,935.49 | 0.00 | 2,365,167.24 | 9,409,768.25 | 与资产相关 |
| Production and construction project allowance of annual production of 1 million kitchen appliances | 3,426,625.04 | 0.00 | 1,143,783.96 | 2,282,841.08 | 与资产相关 |
| Project of annual 108 embedded kitchen electric appliance products | 5,616,825.75 | 0.00 | 682,491.00 | 4,934,334.75 | 与资产相关 |
| New-generation environmentally friendly and energy-saving kitchen appliances and production line (regional major project) | 912,326.99 | 0.00 | 190,650.84 | 721,676.15 | 与资产相关 |
| Digital intelligent manufacturing workshop of intelligent household appliances | 741,075.72 | 0.00 | 159,426.72 | 581,649.00 | 与资产相关 |
| Project of annual production of 2.25 million digital workshops | 232,092.73 | 0.00 | 103,706.04 | 128,386.69 | 与资产相关 |
| Recycling transformation project | 543,686.97 | 0.00 | 91,610.16 | 452,076.81 | 与资产相关 |
| Subsidies for investment project of annual production of 150,000 range hoods | 147,871.71 | 0.00 | 58,882.80 | 88,988.91 | 与资产相关 |
| Academician expert workstation | 303,134.00 | 0.00 | 46,255.68 | 256,878.32 | 与资产相关 |
| Kitchen appliance R&D, design and test center | 50,196.40 | 0.00 | 7,624.80 | 42,571.60 | 与资产相关 |
| Technological upgrading project of manufacturing enterprises | 8,300,000.00 | 0.00 | 0.00 | 8,300,000.00 | 与资产相关 |
| Technological upgrading project of annual production of 500,000 | 0.00 | 2,622,600.00 | 31,200.93 | 2,591,399.07 | 与资产相关 |
| Unmaned intelligent factory based on 5G and Cloud technology | 0.00 | 20,000,000.00 | 173,237.35 | 19,826,762.65 | 与资产相关 |
| No.M2020-09 land fund subsidy of Chengnan New District | 0.00 | 28,856,985.00 | 0.00 | 28,856,985.00 | 与资产相关 |
| Total | 114,851,263.30 | 51,479,585.00 | 16,167,324.40 | 150,163,523.90 | — |
52. Other non-current liabilities N/A
53 Share capital
Unit: yuan
| Beginning balance | Increase/decrease (+, -) | Year-end balance | |||||
| New issue of shares | Share donation | Share capital increase from reserved funds | Other | Subtotal | |||
| Total amount of shares | 949,024,050.00 | 949,024,050.00 | |||||
54. Other equity instruments N/A
55. Capital reserve
Unit: yuan
| Item | Beginning balance | Increase in current period | Decrease in current period | Year-end balance |
| capital surplus ( capital stock surplus) | 401,799,332.67 | 401,799,332.67 | ||
| Total | 401,799,332.67 | 401,799,332.67 |
56. Treasury stock N/A
57. Other comprehensive income
Unit: yuan
| Item | Beginning balance | Amount incurred in current period | Year-end balance | |||||
| Amoun | Less: amount | Less: amount | Minus: | Attributabl | Attributabl | |||
| t before current income tax | included in other comprehensive income in previous period and included in profit and loss in current period | included in other comprehensive income in previous period and included in carryforward retained earnings in current period | income tax expenses | e to the parent company after tax | e to minority shareholders after tax | |||
| I. Other comprehensive income that can't be reclassified into profit and loss | -15,157,634.16 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | -15,157,634.16 | |
| Fair value change of other equity instrument investments | -15,157,634.16 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | -15,157,634.16 | |
| Total other comprehensive income | -15,157,634.16 | -15,157,634.16 |
58. Special reserve
59. Surplus reserves
Unit: yuan
| Item | Beginning balance | Increase in current period | Decrease in current period | Year-end balance |
| Statutory surplus reserves | 474,516,412.50 | 474,516,412.50 | ||
| Total | 474,516,412.50 | 474,516,412.50 |
60. Undistributed profit
Unit: yuan
| Item | Current period | Prior period |
| Undistributed profit at the end of prior period before adjustment | 5,054,206,720.45 | 4,223,611,112.65 |
| Undistributed profit at the beginning period after adjustment | 5,054,206,720.45 | 4,223,611,112.65 |
| Plus: Net profits attributable to the owners of parent company in current period | 1,660,749,958.89 | 1,589,814,847.80 |
| Common stock dividends payable | 474,512,025.00 | 759,219,240.00 |
| Undistributed profit at the end of the period | 6,240,444,654.34 | 5,054,206,720.45 |
61. Operating income and operating cost
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period | ||
| Income | Cost | Income | Cost | |
| Main business | 7,950,757,663.78 | 3,506,245,981.19 | 7,589,302,689.33 | 3,482,255,262.10 |
| Other businesses | 177,863,135.53 | 56,960,949.68 | 171,279,166.20 | 66,522,482.94 |
| Total | 8,128,620,799.31 | 3,563,206,930.87 | 7,760,581,855.53 | 3,548,777,745.04 |
62. Taxes and surcharges
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Tax on city maintenance and construction | 34,478,037.91 | 34,341,853.03 |
| Education surcharge | 24,627,169.96 | 24,458,728.04 |
| Stamp duty | 2,261,813.76 | 2,237,616.78 |
| Land use tax | 340,344.00 | 0.00 |
| House property tax | 194,014.14 | 5,553,841.54 |
| Vehicle and vessel use tax | 24,962.74 | 26,065.34 |
| Other | 30,288.37 | 0.00 |
| Total | 61,956,630.88 | 66,618,104.73 |
63. Selling expenses
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Sales and service fees | 717,952,394.72 | 554,487,943.73 |
| Advertising and promotion expenses | 511,075,473.36 | 457,851,289.50 |
| Traffic expense; | 258,544,222.83 | 256,384,472.63 |
| Employee compensation | 242,145,914.14 | 245,718,611.84 |
| Promotion fees | 154,130,738.31 | 103,809,175.17 |
| Booth decoration fee | 135,635,749.35 | 164,860,080.30 |
| Material consumption | 64,982,374.37 | 70,486,201.62 |
| Business entertainment expenses | 13,609,905.26 | 15,290,852.11 |
| Rental fees | 13,434,292.19 | 16,476,876.79 |
| Traveling expenses | 10,818,904.86 | 16,293,809.72 |
| Intermediary service charge | 10,691,046.91 | 11,520,390.31 |
| Office allowance | 6,327,286.95 | 10,496,374.50 |
| Other | 7,616,745.62 | 4,583,094.13 |
| Total | 2,146,965,048.87 | 1,928,259,172.35 |
64. Management costs
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Employee compensation | 156,332,380.80 | 153,718,556.87 |
| Depreciation and amortization | 44,483,666.82 | 39,728,076.92 |
| Consulting service charge | 29,904,258.97 | 18,353,153.39 |
| Maintenance expense | 12,833,205.67 | 13,647,891.43 |
| Office allowance | 11,475,519.47 | 8,545,422.15 |
| Rental fees | 7,249,751.59 | 9,640,922.28 |
| Traveling expenses | 6,210,428.73 | 7,830,459.53 |
| Material consumption | 3,471,188.77 | 5,933,828.15 |
| Business entertainment expenses | 5,061,075.24 | 5,478,604.83 |
| Communication expense | 4,880,481.20 | 4,846,988.25 |
| Car fare | 3,787,560.02 | 3,671,025.30 |
| Equity incentive fee | 0.00 | 109,531.25 |
| Other | 11,296,245.96 | 12,859,654.82 |
| Total | 296,985,763.24 | 284,364,115.17 |
65. Research and development expenses
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Employee compensation | 139,169,323.42 | 133,274,242.46 |
| Direct investment | 128,816,650.57 | 126,394,199.48 |
| Depreciation and amortization | 15,654,469.61 | 15,287,792.16 |
| Design fee | 7,071,597.30 | 9,951,440.23 |
| Other expenses | 12,635,514.91 | 14,561,452.21 |
| Total | 303,347,555.81 | 299,469,126.54 |
66. Financial expenses
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Interest expenses | 6,721,543.47 | 477,352.78 |
| Minus: Interest revenue | 160,282,611.34 | 84,590,717.34 |
| Plus: Exchange gain or loss | 2,177,052.47 | -293,264.98 |
| Plus: other expenses | 1,235,828.65 | 996,138.29 |
| Total | -150,148,186.75 | -83,410,491.25 |
67. Other income
Unit: yuan
| Other sources of income | Amount incurred in current period | Amount incurred in previous period |
| Financial support funds for enterprise cultivation | 54,039,120.00 | 45,262,300.00 |
| Deferred income amortization | 16,167,324.40 | 11,143,528.05 |
| Patent award fund | 7,509,809.00 | 3,294,500.00 |
| Special financial fund | 5,650,000.00 | 4,090,000.00 |
| Job subsidies and social insurance subsidies | 4,685,321.80 | 19,885,371.21 |
| Special fund for industry development | 2,749,907.00 | 2,271,934.44 |
| Individual income tax service charge refund | 1,111,062.72 | 458,689.01 |
| VAT exemption or reduction | 18,000.00 | 16,500.00 |
| Other subsidies | 251,700.00 | 32,000.00 |
| Total | 92,182,244.92 | 86,454,822.71 |
68. Investment income
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| long-term equity investment gains measured by employing the equity method | -715,569.20 | 1,550,487.63 |
| Investment income from trading financial assets during the holding period | 28,218,702.24 | 111,255,267.10 |
| Dividend income from other equity instrument investments in the holding period | 11,985,836.92 | 14,295,039.38 |
| Total | 39,488,969.96 | 127,100,794.11 |
69. Net exposure hedging gain
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
70. Gains from fair value change
71. Credit impairment loss
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Loss on bad debts of notes receivable | -33,316,740.51 | -27,416,736.00 |
| Loss on bad debts of accounts receivable | -27,309,380.51 | -17,613,423.11 |
| Loss on bad debts of other receivables | -3,511,997.51 | -3,793,172.36 |
| Total | -64,138,118.53 | -48,823,331.47 |
72. Assets impairment losses
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| II. Loss on price falling of inventory and impairment loss of contract performance costs | -21,977,893.76 | -9,321,963.35 |
| Total | -21,977,893.76 | -9,321,963.35 |
73. Income from disposal of assets
Unit: yuan
| Source of income from disposal of assets | Amount incurred in current period | Amount incurred in previous period |
| Income from disposal of non-current assets | -387,844.96 | -158,607.19 |
| Including: income from disposal of fixed assets | -387,844.96 | -158,607.19 |
| Total | -387,844.96 | -158,607.19 |
74. Non-operating income
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period | Amount recorded into non-recurring profit and loss in current period |
| Government subsidies | 131,475.00 | 1,658,983.38 | 131,475.00 |
| Other | 952,904.00 | 2,439,247.16 | 952,904.00 |
| Total | 1,084,379.00 | 4,098,230.54 | 1,084,379.00 |
Government subsidies included in current profit and loss:
Unit: yuan
| Item | Amount incurred in current year | Amount incurred in last year | Source and basis | Assets/income related |
| National stage III diesel vehicles early liquidation subsidies | 77,000.00 | 0.00 | Earnings related | |
| Corporate culture club award subsidies | 30,000.00 | 0.00 | Yuhang Civilization Office (2019) No.18 | Earnings related |
| Subsidies for training by working | 8,500.00 | 0.00 | Earnings related | |
| Mass entrepreneurship and innovation reward | 0.00 | 1,000,000.00 | Yuhang Economy and Information Office (2019) No.16 | Earnings related |
| The Lake public welfare program | 0.00 | 300,000.00 | Yuhang Culture and Creative Products Office (2019) No.9 | Earnings related |
| Fitter skills master studio | 0.00 | 100,000.00 | Yuhang Labor and Social Security Bureau (2019) No. 73 | Earnings related |
| Subsidies for municipal technical standard projects | 0.00 | 100,000.00 | Yuhang Market Supervisory Authority (2019) No.18 | Earnings related |
| Government subsidies for undergraduate internship in Hangzhou | 0.00 | 81,183.38 | Received government subsidies for notice on Printing and Distributing Hangzhou University Student Apprenticeship Training Implementation Measures | Earnings related |
| Fitter skills master studio | 0.00 | 50,000.00 | List of the fifth skill master studios in Yuhang District | Earnings related |
| Liming talent reward | 0.00 | 20,000.00 | Yuhang Development and Management Department (2018) No.31 | Earnings related |
| Talent project funds | 0.00 | 3,000.00 | Yuhang Labor and Social Security Bureau (2019) No. 24 | Earnings related |
| Special financial fund for business | 0.00 | 4,800.00 | Yuhang Commerce Department | Earnings |
| Item | Amount incurred in current year | Amount incurred in last year | Source and basis | Assets/income related |
| promotion in Zhejiang in 2018 | (2019) No.4 | related | ||
| Other | 15,975.00 | 0.00 | Earnings related | |
| Total | 131,475.00 | 1,658,983.38 | — | — |
75. Non-operating expenditure
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period | Amount recorded into non-recurring profit and loss in current period |
| Losses from impairment or breakage of non-current assets | 34,861.58 | 318,500.98 | 34,861.58 |
| External donations | 2,090,000.00 | 1,000,000.00 | 2,090,000.00 |
| Other | 1,828,383.76 | 3,005,052.74 | 1,828,383.76 |
| Total | 3,953,245.34 | 4,323,553.72 | 3,953,245.34 |
76. Income tax expenses
(1). Table of Income tax expenses
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Income tax expenses in current period | 303,369,646.88 | 290,542,610.55 |
| Deferred income tax expenses | -42,122,003.14 | -33,257,490.60 |
| Total | 261,247,643.74 | 257,285,119.95 |
(2) Accounting profit and income tax expense adjustment process
Unit: yuan
| Item | Amount incurred in current period |
| Total profit | 1,948,605,547.68 |
| The income tax expenses calculated based on statutory/applicable tax rates | 292,290,832.14 |
| Influences caused by different tax rates adopted by subsidiaries | 307,640.37 |
| Influences caused by adjustment on income tax of previous periods | -7,806,372.31 |
| Influences on non-taxable income | -398,460.70 |
| Influences caused by non-deductible cost, expenses and losses | 6,121,543.01 |
| Influences caused by non-confirmation of deductible losses of deferred income tax assets | -20.43 |
| Influences caused by non-confirmation of deductible temporary differences or deductible losses in current period | 2,426,651.51 |
| Influences on taxation caused by research and development expenses plus deduction (expressed with “-”) | -31,694,169.85 |
| Income tax expenses | 261,247,643.74 |
77. Other comprehensive income
See Note “VI. 31 Other comprehensive income”
78. Cash flow statement items
(1) Other cash received related to operating activities
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Income from deposit interest | 160,282,611.34 | 84,590,717.34 |
| Government subsidies | 127,625,980.52 | 120,943,978.04 |
| Agent business | 4,896,957.44 | 17,388,127.18 |
| Imprest | 2,627,693.78 | 22,993,319.48 |
| Margin and deposit | 422,768.10 | 41,884,916.66 |
| L/C deposit | 61,930.00 | 18,128,307.74 |
| Other payments | 2,880,904.80 | 7,897,733.58 |
| Total | 298,798,845.98 | 313,827,100.02 |
(2) Other cash paid related to operating activities
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Period charge | 1,659,646,233.71 | 1,590,751,809.98 |
| Agent business | 44,527,246.51 | 13,548,409.12 |
| Margin and deposit | 13,012,066.02 | 45,382,283.46 |
| L/C deposit | 10,192,656.02 | 24,475,893.97 |
| Imprest | 621,928.41 | 45,532,204.37 |
| Other | 17,300,131.65 | 7,125,291.22 |
| Total | 1,745,300,262.32 | 1,726,815,892.12 |
(3) Other cash received related to financing activities
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Factoring income from accounts receivable | 6,076,177.30 | 0.00 |
| Total | 6,076,177.30 | 0.00 |
79. Further information on cash flow statement
(1) Further information on cash flow statement
Unit: yuan
| Item | Amount incurred in current year | Amount incurred in last year |
| 1. Reconciliation from net profits to cash flows from operating activities: | ||
| Net profit | 1,687,357,903.94 | 1,614,245,354.63 |
| Plus: Provision for impairment of assets | 21,977,893.76 | 9,321,963.35 |
| Credit impairment loss | 64,138,118.53 | 48,823,331.47 |
| Depreciation of fixed assets, oil and gas assets and productive biological assets | 95,376,728.90 | 91,630,120.96 |
| Amortization of intangible assets | 13,619,877.40 | 13,057,457.00 |
| Amortization of long-term deferred expenses | 420,355.97 | 4,959,043.17 |
| Losses on disposal of fixed assets, intangible assets and other long-term assets (gains expressed with “-”) | 387,844.96 | 158,607.19 |
| Loss on retirement of fixed assets (gains expressed with “-”) | 34,861.58 | 318,500.98 |
| Loss from fair value change (gains expressed with “-”) | 0.00 | 0.00 |
| Financial expenses (gains expressed with “-”) | 7,763,829.30 | -535,267.76 |
| Investment losses (gains expressed with “-”) | -39,488,969.96 | -127,100,794.11 |
| Decreased in deferred income tax assets (increase expressed with “-”) | -41,614,914.62 | -28,638,199.06 |
| Increase in deferred income tax liabilities (decrease expressed with “-”) | -507,088.51 | -4,619,291.54 |
| Decrease in inventories (increase expressed with “-”) | -68,890,313.40 | -1,386,157.52 |
| Decrease in operating receivables (increase expressed with “-”) | -681,714,318.42 | -489,310,440.32 |
| Increase in operating payables (decrease expressed with “-”) | 478,438,149.28 | 424,296,698.46 |
| Other | 0.00 | 0.00 |
| Net cash flow from operating activities | 1,537,299,958.71 | 1,555,220,926.90 |
| 2. Significant investment and financing activities not involving cash deposit and withdrawal: | ||
| Conversion of debt into capital | 0.00 | 0.00 |
| Item | Amount incurred in current year | Amount incurred in last year |
| Convertible bonds due within one year | 0.00 | 0.00 |
| Fixed assets under financing lease | 0.00 | 0.00 |
| 3. Net changes in cash and cash equivalents: | ||
| Ending balance of cash | 3,886,096,513.56 | 4,029,296,265.50 |
| Less: Beginning balance of cash | 4,029,296,265.50 | 2,177,219,858.85 |
| Plus: Ending balance of cash equivalents | 0.00 | 0.00 |
| Less: Ending balance of cash equivalents | 0.00 | 0.00 |
| Net increase of cash and cash equivalents | -143,199,751.94 | 1,852,076,406.65 |
(2) Composition of cash and cash equivalents
Unit: yuan
| Item | Year-end balance | Beginning balance |
| I. Cash | 3,886,096,513.56 | 4,029,296,265.50 |
| Including: cash on hand | 110,770.11 | 218,775.77 |
| Bank deposit readily available for payment | 3,885,907,031.42 | 4,029,077,489.73 |
| Other monetary capital readily available for payment | 78,712.03 | 0.00 |
| III. Balance of cash and cash equivalents at the end of period | 3,886,096,513.56 | 4,029,296,265.50 |
80. Notes to items in statement of owner's equity
State the name of "other" items and the amount of adjustment to the ending balance of previous year:
81. Assets with ownership or use rights restricted
Unit: yuan
| Item | Book value at the end of period | Reasons for being limited |
| Monetary capital | 34,956,186.75 | L/C and bill deposit |
| Total | 34,956,186.75 | -- |
82. Foreign currency monetary items
(1) Foreign currency monetary items
Unit: yuan
| Item | Ending balance in foreign currency | Conversion exchange rate | Ending balance converted to RMB |
| Monetary capital | -- | -- | |
| Including: USD | 3,551,939.36 | 6.5249 | 23,176,049.13 |
| Euro | 646.24 | 8.0250 | 5,186.08 |
| AUD | 3.29 | 5.0163 | 16.50 |
| Accounts receivable | -- | -- | |
| Including: USD | 3,094,580.13 | 6.5249 | 20,191,825.89 |
| Euro | 11,503.56 | 8.0250 | 92,316.07 |
| AUD | 41,856.83 | 5.0163 | 209,966.42 |
83. No hedging
84. Government subsidies
(1) Basic information of government subsidies
Unit: yuan
| Type | Amount | Presented items | Amount recorded into the current profit/gain |
| Financial support funds for enterprise cultivation | 54,039,120.00 | Other incomes | 54,039,120.00 |
| No.M2020-09 land fund subsidy of Chengnan New District | 28,856,985.00 | Deferred income | 0.00 |
| Unmaned intelligent factory based on 5G and Cloud technology | 20,000,000.00 | Deferred income | 173,237.35 |
| Performance award of Shanghai Hongkou District Finance Bureau | 3,400,000.00 | Other incomes | 3,400,000.00 |
| Subsidies for technological upgrading project of annual production of 500,000 | 2,622,600.00 | Deferred income | 31,200.93 |
| Social insurance premium refund | 2,483,600.00 | Other incomes | 2,483,600.00 |
| The first batch of subsidies for Hangzhou Kunpeng enterprises | 2,000,000.00 | Other incomes | 2,000,000.00 |
| Subsidies from the Economic and Information Technology Bureau of Yuhang District | 2,000,000.00 | Other incomes | 2,000,000.00 |
| Steady post subsidies | 1,645,097.07 | Other incomes | 1,645,097.07 |
| Individual income tax service charge refund | 1,111,062.72 | Other incomes | 1,111,062.72 |
| Rewards on invention of utility model product and appearance | 1,031,000.00 | Other incomes | 1,031,000.00 |
| Subsidies for model enterprises of national intellectual property | 1,000,000.00 | Other incomes | 1,000,000.00 |
| Market supervision special financial supporting funds for | 800,000.00 | Other incomes | 800,000.00 |
| industrial development | |||
| The first batch of provincial industrial Internet platform reward funds | 750,000.00 | Other incomes | 750,000.00 |
| 2019 Yuhang District patent licensing rewards | 572,000.00 | Other incomes | 572,000.00 |
| High-Tech rewards | 500,000.00 | Other incomes | 500,000.00 |
| Stimulation funds for model innovation of E-commerce | 500,000.00 | Other incomes | 500,000.00 |
| Yuhang Commerce Department Subsidies | 500,000.00 | Other incomes | 500,000.00 |
| Support promotion projects for digital demonstration | 500,000.00 | Other incomes | 500,000.00 |
| Subsidies from Yuhang Market Supervisory Authority | 400,000.00 | Other incomes | 400,000.00 |
| 2019 corporate patents and trademarks protection | 362,885.00 | Other incomes | 362,885.00 |
| The 20th China Appearance Design Gold Medal Project | 300,000.00 | Other incomes | 300,000.00 |
| Subsidies from Yuhang District Employment Management Service Center | 256,836.00 | Other incomes | 256,836.00 |
| Production-university-research cooperation project | 250,000.00 | Other incomes | 250,000.00 |
| Industrialization of patent for invention in Yuhang District | 200,000.00 | Other incomes | 200,000.00 |
| Social security subsidies | 178,688.73 | Other incomes | 178,688.73 |
| 2019-2020 Provincial Industry New Products Awards | 150,000.00 | Other incomes | 150,000.00 |
| Subsidies from Yuhang Science and Technology Bureau | 147,300.00 | Other incomes | 147,300.00 |
| Business incentives | 137,207.00 | Other incomes | 137,207.00 |
| Subsidies for exhibition abroad | 112,700.00 | Other incomes | 112,700.00 |
| Subsidies for third-party platform deduction | 100,000.00 | Other incomes | 100,000.00 |
| Operating Skill Master Studio of Cheng Peng Processing Center | 100,000.00 | Other incomes | 100,000.00 |
| Shaoxing Industrial Design Center | 100,000.00 | Other incomes | 100,000.00 |
| Income subsidies | 92,700.00 | Other incomes | 92,700.00 |
| National stage III diesel vehicles early liquidation subsidies | 77,000.00 | Non-operating income | 77,000.00 |
| Financial subsidies from Yuhang Finance Bureau | 60,000.00 | Other incomes | 60,000.00 |
| Awards for key enterprises by Shanghai Hongkou District Investment Promotion Office | 60,000.00 | Other incomes | 60,000.00 |
| 2019 Hangzhou Embedded Microwave Oven Standardization Project Award | 58,000.00 | Other incomes | 58,000.00 |
| Robam Association for Science and Technology - Robam Appliance International Innovation Design Award | 30,000.00 | Other incomes | 30,000.00 |
| Corporate culture club award subsidies | 30,000.00 | Non-operating income | 30,000.00 |
| 2018 Fund Patent of Economic Policy of Industry | 28,544.00 | Other incomes | 28,544.00 |
| Subsidies for employment of disabled person | 20,100.00 | Other incomes | 20,100.00 |
| VAT exemption or reduction | 18,000.00 | Other incomes | 18,000.00 |
| Subsidies for training by working | 8,500.00 | Non-operating income | 8,500.00 |
| Cost of maintenance for patent invention | 8,080.00 | Other incomes | 8,080.00 |
| Hiring subsidies | 6,000.00 | Other incomes | 6,000.00 |
| Smart electricity subsidies | 5,000.00 | Other incomes | 5,000.00 |
| Subsidies from Yuhang District Federation of Trade Unions | 1,000.00 | Other incomes | 1,000.00 |
| Other | 15,975.00 | Non-operating income | 15,975.00 |
VIII. Changes in Consolidation Scope
On October 25, 2020, the Company's holding subsidiary Shengzhou Kinde and Gongqingcheng Binlan Investmentpartnership (limited partnership) (hereinafter referred to as "Binlan Investment") signed a Project CooperationAgreement. The agreement stipulates that both parties jointly contribute to the establishment of Cooking Future withregistered capital of 50 million yuan, including 35 million yuan contributed by Shengzhou Kinde, accounting for 70%of the equity, and 15 million yuan contributed by Binlan Investment, accounting for 30% of the equity. There are 7directors on the board of directors of Cooking Future, including 4 directors from Shengzhou Kinde and 3 directors fromBinglan Investment. The resolution of the board of directors must be approved by more than half of the members of theboard of directors, so Shengzhou Kinde controls Cooking Future. Cooking Future has completed the industrial andcommercial registration on November 16, 2020 and is currently in the preparation period.
IX. Rights in Other Main Bodies
1. Rights in subsidiaries
(1) Composition of enterprise group
| Subsidiary name | Principal place of business | Registration place | Business nature | Shareholding ratio | Way of obtaining | |
| Direct | Indirect | |||||
| Beijing Robam Electric Appliance Sales Co., Ltd. | Beijing | Beijing | Sales of kitchen electric appliance products | 100.00% | 0.00% | Business combination under common control |
| Shanghai Robam Electric Appliance Sales Co., Ltd. | Shanghai | Shanghai | Sales of kitchen electric appliance products | 100.00% | 0.00% | Business combination under common control |
| Hangzhou Mingqi Electric Co., Ltd. | Hangzhou | Hangzhou | Sales of kitchen electric appliance | 100.00% | 0.00% | Acquisition by establishment |
| products | ||||||
| Dize Home Appliance Trading (Shanghai) Co., Ltd. | Shanghai | Shanghai | Sales of kitchen electric appliance products | 51.00% | 0.00% | Acquisition by investment |
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | Shengzhou | Shengzhou | Production and sales of kitchen electric appliance products | 51.00% | 0.00% | Business combination not under common control |
| Hangzhou Robam Fuchuang Investment Management Co., Ltd. | Hangzhou | Hangzhou | Assets and investment management | 100.00% | 0.00% | Acquisition by establishment |
| Zhejiang Cooking Future Technology Co., Ltd. | Shengzhou | Shengzhou | Design of smart kitchen | 35.70% | Acquisition by establishment |
Note: The basis on which the Company holds 50% voting power of Cooking Future or lower but stillcontrols Cooking Future: as stated in note "VII. Changes in the Scope of Consolidation", since the Companycontrols Shengzhou Kinde, so it also controls holding subsidiaries of Shengzhou Kinde.
(2) Important non-wholly owned subsidiary
Unit: yuan
| Subsidiary name | Minority shareholding ratio | Current profits and losses attributable to minority shareholders | Current dividends declared to minority shareholders | Ending balance of minority equity |
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | 49.00% | 26,833,282.53 | 0.00 | 140,060,805.66 |
| Zhejiang Cooking Future Technology Co., Ltd. | 30.00% | -225,377.50 | 0.00 | 6,424,622.50 |
(3) Main financial information of important non-wholly owned subsidiaries
Unit: yuan
| Subsidiary name | Year-end balance | Beginning balance | ||||||||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | |
| Shengzhou Kinde Intellig | 302,562,407.94 | 177,615,050.45 | 480,177,458.39 | 153,846,712.26 | 34,067,744.74 | 187,914,457.00 | 230,113,578.72 | 85,542,835.32 | 315,656,414.04 | 78,861,987.98 | 5,717,848.25 | 84,579,836.23 |
| ent Kitchen Electric Co., Ltd. | ||||||||||||
| Zhejiang Cooking Future Technology Co., Ltd. | 23,647,941.39 | 56,337.05 | 23,704,278.44 | 305,536.79 | 0.00 | 305,536.79 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
Unit: yuan
| Subsidiary name | Amount incurred in current period | Amount incurred in previous period | ||||||
| Operating income | Net profit | Total comprehensive income | Cash flow from financing activities | Operating income | Net profit | Total comprehensive income | Cash flow from financing activities | |
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | 276,441,382.99 | 54,536,423.58 | 54,536,423.58 | 125,090,042.97 | 229,610,991.10 | 49,858,521.98 | 49,858,521.98 | 69,351,227.07 |
| Zhejiang Cooking Future Technology Co., Ltd. | 0.00 | -751,258.35 | -751,258.35 | -615,581.14 | 0.00 | 0.00 | 0.00 | 0.00 |
(3) Summary of financial information of unimportant cooperative enterprises and joint ventures
Unit: yuan
| Ending balance/amount incurred in current period | Beginning balance/amount incurred in previous period | |
| Cooperative enterprise: | -- | -- |
| Total book value of investment | 3,452,769.59 | 4,168,338.79 |
| Total number of following items by | -- | -- |
| shareholding ratio | ||
| - Joint venture: | -- | -- |
| Total number of following items by shareholding ratio | -- | -- |
| - Net profit | -715,569.20 | 1,550,487.63 |
| - Total comprehensive income | -715,569.20 | 1,550,487.63 |
Other description
| Name of cooperative enterprise | Principal place of business | Registration place | Business nature | Shareholding ratio（%） | Accounting treatment method of investment in joint ventures | |
| Direct | Indirect | |||||
| De Dietrich Trade (Shanghai) Co., Ltd. | Shanghai | Shanghai | Sales of kitchen appliances | 51.00 | 0.00 | Equity method |
X. Risks Related to Financial Tools
The main financial instruments of the Company include accounts receivable, accounts payable, etc. Thedetailed description of the financial instruments is shown in Note VI. The risks associated with thesefinancial instruments and the risk management policies adopted by the Company to mitigate these risks aredescribed below. The management of the Company shall manage and monitor these risk exposures to ensurethat the above risks are controlled within the limited scope.The Company's various risk management objectives and policies are as follows:
The Company’s risk management is to strike an appropriate balance between risks and benefits, minimize thenegative impact of risks on the Company's business performance and maximize the interests of shareholdersand other equity investors. Based on this risk management objective, the basic strategy of the Company's riskmanagement is to determine and analyze various risks faced by the Company, establish an appropriatebottom line for risk tolerance, make risk management and timely and reliably supervise various risks tocontrol the risks within the limited scope.
1. Market risk - Price risk
The Company sells the products at market prices and are therefore subject to price fluctuations.
2. Credit risk
As of December 31, 2020, the largest credit risk exposure that may cause financial losses of the Companymainly comes from the loss of financial assets of the Company caused by the failure of the other party tofulfill its obligations, including the book value of financial assets recognized in the consolidated balancesheet.In order to reduce credit risks, the Company shall assign special personnel to determine the credit limit,conduct credit examination and approval, and implement other monitoring procedures to ensure that
necessary measures are taken to recover overdue claims. Moreover, the Company shall review the recoveryof each single receivable on each balance sheet date to ensure that adequate bad debt provisions arewithdrawn for unrecoverable amounts. Therefore, the Company's management believes that the Company'scredit risk has been greatly reduced.The Company's working capital is deposited in banks with high credit rating, so the credit risk of workingcapital is low.There is no significant credit concentration risk due to the Company's risk exposure to multiple parties andcustomers.The Company has adopted the necessary policies to ensure that all trade debtors have good credit records,therefore there is no significant credit concentration risk.
3. Liquidity Risk
Liquidity risk refers to the risk that the Company is unable to perform its financial obligations at maturity.The Company manages its liquidity risk by ensuring that it has sufficient liquidity to meet maturingobligations without causing unacceptable losses or damage to the credibility of the business. Themanagement of the Company has conducted a detailed inspection on its working capital, and has madeperiodic analysis of liability structure, deadline and bank line of credit to ensure that funds is sufficient. Itconcluded that the Company has sufficient funds to meet the Company’s short-term debt and capitalexpenditures needs. The analysis of the financial assets and financial liabilities held by the Company basedon the maturity of the undiscounted remaining contract obligations is as follows:
Amount on December 31, 2020:
| Item | Within one year | One to two years | Two to five years | More than five years | Total |
| Financial assets | 9,170,579,881.17 | 9,170,579,881.17 | |||
| Monetary capital | 3,921,052,700.31 | 3,921,052,700.31 | |||
| Trading financial assets | 2,352,000,000.00 | 2,352,000,000.00 | |||
| Notes receivable | 1,832,701,443.08 | 1,832,701,443.08 | |||
| Accounts receivable | 1,008,235,946.40 | 1,008,235,946.40 | |||
| Other receivables | 56,589,791.38 | 56,589,791.38 | |||
| Financial liabilities | 2,976,936,298.11 | 2,976,936,298.11 | |||
| Short-term borrowing | 6,076,177.30 | 6,076,177.30 | |||
| Notes payable | 751,802,498.92 | 751,802,498.92 | |||
| Accounts payable | 1,723,832,208.09 | 1,723,832,208.09 | |||
| Other payables | 242,559,615.30 | 242,559,615.30 |
| Item | Within one year | One to two years | Two to five years | More than five years | Total |
| Payroll payable | 126,130,391.24 | 126,130,391.24 | |||
| Other current liabilities | 126,535,407.26 | 126,535,407.26 |
4. Foreign exchange risk
The Company's exchange rate risk is mainly related to US dollar, Euro, Hong Kong dollar and othercurrencies. The foreign exchange risk borne by the Company is mainly related to USD (which shall bemodified according to the actual situation), and the main business activities of the Company are denominatedand settled in RMB. As of December 31, 2020, the Company's assets and liabilities were RMB balance,except the foreign currency balance of the assets and liabilities in Note “VI. 51 Foreign currency monetaryitems”. The foreign exchange risks arising from the assets and liabilities of such foreign currency balancemay have an impact on the Company's business performance.The Company pays close attention to the exchange rate movement on its foreign exchange risks. and has nottaken any measures to avoid foreign exchange risks.XI. Fair Value Disclosure
1. Assets measured by fair value or fair value at end of period of debt
Unit: yuan
| Item | Ending fair value | |||
| Measurement of fair value at the first level | Measurement of fair value at the second level | Measurement of fair value at the third level | Total | |
| I. Continuous fair value measurement | -- | -- | -- | -- |
| (I) Trading financial assets | 0.00 | 0.00 | 2,352,000,000.00 | 2,352,000,000.00 |
| 1. FVTPL | 0.00 | 0.00 | 2,352,000,000.00 | 2,352,000,000.00 |
| (III) Other equity instrument investments | 102,116,023.22 | 102,116,023.22 | ||
| Total liabilities measured with continuous fair value continuously | 0.00 | 0.00 | 2,454,116,023.22 | 2,454,116,023.22 |
| II. Non-continuous fair value measurement | -- | -- | -- | -- |
2. Analysis on adjusted information of book value between the beginning and the end of period andsensibility of non-visible parameters for continous items measured by third-tier fair value
| Item | December 31, 2020 Fair value | Valuation technique | Significant unobservable value | Relationship between unobservable value and fair value |
| Bank financial products | 2,352,000,000.00 | Best estimate of fair value | Investment cost | — |
| Other equity instrument investments | 102,116,023.22 | Best estimate of fair value | Investment cost | — |
XII. Related Party and Related Trading
1. Parent company of the Company
| Parent company name | Registration place | Business nature | Registered capital | Shareholding ratio of the parent company in the Company | Voting right ratio of the parent company in the Company |
| Hangzhou Robam Industrial Group Co., Ltd. | Hangzhou, Zhejiang | Investment and industrial management | RMB 60 million | 49.68% | 49.68% |
2. Subsidies of the Company
See Note “ Composition of the Company” for the details of the subsidiaries.
3. Cooperative enterprise and joint venture of the Company
See Note “Important cooperative enterprises” for important cooperative enterprises or joint ventures of the Company.
4. Situation of other related parties
| Name of other related parties | Relationship between the Company with other related parties |
| Hangzhou Amblem Household Co., Ltd. | Controlled by the same parent company |
| Hangzhou Yuhang Robam Gas Station Co., Ltd. | Controlled by the same parent company |
| Hangzhou Nbond Nonwoven Co., Ltd. | Controlled by the same parent company |
| Hangzhou Yuhang Matt Spray Painting Factory | Controlled by the sister of the actual controller |
| Garden Hotel Hangzhou | Greatly influenced by the parent company |
| Hangzhou Bonyee Daily Necessity Technology Co., Ltd. | Controlled by the same parent company |
| Shaoxing Kinde Electric Appliance Co., Ltd. | Other shareholders of subsidiaries controlled by the Company |
| Hangzhou Guoguang Touring Commodity Co., Ltd. | Controlled by the same parent company |
5. Related trading
(1) Related transaction of purchases and sales of goods, provision and acceptance of servicesPurchase of goods/acceptance of services
Unit: yuan
| Related party | Content of related trading | Amount incurred in current period | Whether the transaction quota is exceeded | Amount incurred in previous period |
| Hangzhou Yuhang Matt Spray Painting Factory | Labor receiving | 11,303,674.25 | No | 13,955,880.37 |
| Hangzhou Bonyee Daily Necessity Technology Co., Ltd. | Product purchase | 2,019,569.34 | No | 3,616,184.73 |
| Hangzhou Amblem Household Co., Ltd. | Product purchase | 1,814,159.29 | No | 1,993,224.66 |
| Hangzhou Guoguang Touring Commodity Co., Ltd. | Product purchase | 857,890.96 | No | 0.00 |
| Hangzhou Yuhang Robam Gas Station Co., Ltd. | Product purchase | 678,662.70 | No | 1,008,020.11 |
| Hangzhou Nbond Nonwoven Co., Ltd. | Product purchase | 67,343.18 | No | 39,765.92 |
| Garden Hotel Hangzhou | Labor receiving | 0.00 | No | 16,466.04 |
| De Dietrich Trade (Shanghai) Co., Ltd. | Product purchase | 0.00 | No | 4,513.27 |
Table of selling commodities/ labor service providing
Unit: yuan
| Related party | Content of related trading | Amount incurred in current period | Amount incurred in previous period |
| Hangzhou Amblem Household Co., Ltd. | Selling commodities | 6,079,306.17 | 10,855,275.49 |
| Shaoxing Kinde Electric Appliance Co., Ltd. | Selling commodities | 1,955,652.51 | 24,532,147.26 |
| De Dietrich Trade (Shanghai) Co., Ltd. | Selling commodities | 0.00 | 68,820.97 |
(2) Related-party lease
The Company as the lessor:
Unit: yuan
| Name of lessee | Type of leased assets | Lease income recognized in the current period | Lease income recognized in the previous period |
| Hangzhou Robam Industrial Group Co., Ltd. | House | 28,800.00 | 28,800.00 |
The company as the lessee:
Unit: yuan
| Name of the Lessor | Type of leased assets | Rental fees confirmed in the current period | Rental fees confirmed in the previous period |
| Hangzhou Robam Industrial Group Co., Ltd. | House | 550,024.57 | 550,024.57 |
(3) Key management personnel remuneration
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| Total remuneration | 10,849,828.94 | 9,823,762 |
6. Accounts receivable and payable by related parties
(1) Receivables
Unit: yuan
(2) Payables
Unit: yuan
| Project name | Related party | Year-end book balance | Year-begining book balance |
| Accounts payable | Hangzhou Yuhang Matt Spray Painting Factory | 3,182,779.20 | 4,525,094.50 |
| Accounts payable | Hangzhou Yuhang Robam Gas Station Co., Ltd. | 2,257,834.37 | 1,490,945.55 |
| Accounts payable | Hangzhou Guoguang Touring Commodity Co., Ltd. | 22,336.73 | 0.00 |
| Accounts payable | Shaoxing Kinde Electric Appliance Co., Ltd. | 0.00 | 57,552.91 |
| Accounts payable | Hangzhou Amblem Household Co., Ltd. | 0.00 | 1,841.61 |
| Other payables | Hangzhou Yuhang Matt Spray Painting Factory | 200,000.00 | 200,000.00 |
| Other payables | Hangzhou Guoguang Touring Commodity Co., Ltd. | 2,000.00 | 0.00 |
| Advance from customers | Hangzhou Amblem Household Co., Ltd. | 0.00 | 139,622.44 |
| Project name | Related party | Year-end balance | Beginning balance | ||
| Book balance | Provision for bad debt | Book balance | Provision for bad debt | ||
| Advance to supplier | Hangzhou Amblem Household Co., Ltd. | 0.00 | 50,000.00 | ||
| Advance to supplier | Shaoxing Kinde Electric Appliance Co., Ltd. | 0.00 | 580,130.26 | ||
7. Related party commitment
Shengzhou Kinde, a subsidiary of the Company, made a commitment to invest 35 million yuan in Cooking Future. 17.5 million yuanhas been paid in, with 70% stock right. The remaining 17.5 million yuan shall be paid in full before December 31, 2021.XIII Share-based PaymentXIV Commitment Issues or Contingencies
1. Important commitment issues
Important commitment at the date of balance sheet:
Signed lease contracts that are being performed or are about to be performed and its financial influences
On December 31, 2020 (T), The Company has signed the irrevocable business leasing, which is beingperformed or about to be performed shall bear the following payments during the following periods:
| Period | Business Leasing |
| T+1 year | 1,676,569.00 |
| T+2 year | 2,037,031.35 |
| T+3 year | 2,112,477.00 |
| After T+ 3 years | 15,569,483.43 |
| Total | 21,395,560.78 |
Except for the aforementioned commitment issues , the Company has no other major commitment issues asof the date of presentation of the financial statements.
2. Contingencies
(1) Important contingencies at the date of balance sheet:
The Company had no significant contingencies to be disclosed as of December 31, 2020.
(2) Remarks are also required if there is no important contingencies to be disclosedThe Company has no important contingencies to be disclosed.XII Post-balance Sheet Events
21. Profit distribution
At the Company’s 5th meeting of the 5th Board of Directors on April 27, 2021, the Profit Distribution Plan for 2020was approved. Based on the total share capital of 949,024,050.00 as at December 31, 2020, the Company intends to paya cash dividend of 5.00 yuan (tax inclusive) per 10 shares to all shareholders, for a total of 474,512,025.00 yuan. Theproposal shall be approved by shareholders' general meeting
XVI. Other Important IssuesXVII. Notes on Main Items of Parent Company's Financial Statement
1. Accounts receivable
(1) Classified disclosure of accounts receivable
Unit: yuan
| Category | Year-end balance | Beginning balance | ||||||||
| Book balance | Provision for bad debt | Book value | Book balance | Provision for bad debt | Book value | |||||
| Amount | Proportion | Amount | Accruing proportion | Amount | Proportion | Amount | Accruing proportion | |||
| Accounts receivable of provision for bad debt by single item | 11,250,779.60 | 1.13% | 8,407,639.24 | 74.73% | 2,843,140.36 | |||||
| Including: | ||||||||||
| Accounts receivable of provision for bad debt by combination | 984,599,159.57 | 98.87% | 53,832,390.64 | 5.47% | 930,766,768.93 | 743,804,053.68 | 100.00% | 39,557,168.87 | 5.32% | 704,246,884.81 |
| Including: | ||||||||||
| Combination of related party | 26,572,541.50 | 2.67% | 0.00 | 0.00% | 26,572,541.50 | 22,246,710.00 | 2.99% | 0.00 | 0.00% | 22,246,710.00 |
| Accounts receivable of provision for bad debt by expected credit loss combination based on aging features | 958,026,618.07 | 96.20% | 53,832,390.64 | 5.62% | 904,194,227.43 | 721,557,343.68 | 97.01% | 39,557,168.87 | 5.48% | 682,000,174.81 |
| Total | 995,849,939.17 | 100.00% | 62,240,029.88 | 933,609,909.29 | 743,804,053.68 | 100.00% | 39,557,168.87 | 704,246,884.81 | ||
Provision for bad debt by single item:
Unit: yuan
| Name | Year-end balance | |||
| Book balance | Provision for bad debt | Accruing proportion | Reasons for provision | |
| Provision for bad debt by single item | 1,773,645.05 | 1,773,645.05 | 100.00% | Expected to be irrecoverable |
| Provision for bad debt | 9,477,134.55 | 6,633,994.19 | 70.00% | Expected risk of |
| by single item | recovery | |||
| Total | 11,250,779.60 | 8,407,639.24 | -- | -- |
Unit: yuan
| Name | Year-end balance | ||
| Book balance | Provision for bad debt | Accruing proportion | |
| Within 1 year | 900,370,064.21 | 45,018,503.20 | 5.00% |
| 1-2 years | 44,742,447.58 | 4,474,244.76 | 10.00% |
| 2-3 years | 8,364,305.72 | 1,672,861.14 | 20.00% |
| 3-4 years | 3,640,702.45 | 1,820,351.23 | 50.00% |
| 4-5 years | 313,338.98 | 250,671.18 | 80.00% |
| More than 5 years | 595,759.13 | 595,759.13 | 100.00% |
| Total | 958,026,618.07 | 53,832,390.64 | -- |
Provision for bad debt by combination: accounts receivable of provision for bad debt by combination of related party
Unit: yuan
| Name | Year-end balance | ||
| Book balance | Provision for bad debt | Accruing proportion | |
| Combination of related party | 26,572,541.50 | 0.00 | 0.00% |
| Total | 26,572,541.50 | -- | |
Disclosure by aging
Unit: yuan
| Aging | Book balance |
| Within 1 year (including 1 year) | 936,163,103.72 |
| Within 1 year (including 1 year) | 936,163,103.72 |
| 1-2 years | 44,934,833.62 |
| 2-3 years | 8,428,556.22 |
| More than 3 years | 6,323,445.61 |
| 3-4 years | 3,640,702.45 |
| 4-5 years | 313,338.98 |
| More than 5 years | 2,369,404.18 |
| Total | 995,849,939.17 |
(2) Provision, recovery or reversal of bad debt reserves in the current periodProvision for bad debts in current period:
Unit: yuan
| Category | Beginning balance | Changes in amount in current period | Year-end balance | |||
| Provision | Recovered or reversed | Canceled after verification | Other | |||
| Provision for bad debt of accounts receivable | 39,557,168.87 | 22,682,861.01 | 0.00 | 0.00 | 62,240,029.88 | |
| Total | 39,557,168.87 | 22,682,861.01 | 0.00 | 0.00 | 62,240,029.88 | |
(3) Accounts receivable actually written off at the current period N/A
(4) Receivables with top 5 ending balances by debtor
Unit: yuan
| Unit name | Ending balance of accounts receivable | Proportion in total ending balance of accounts receivable | Ending balance of bad debt provision |
| Unit 1 | 136,953,186.67 | 13.75% | 6,847,659.33 |
| Unit 2 | 106,880,264.70 | 10.73% | 5,344,013.24 |
| Unit 3 | 80,824,103.79 | 8.12% | 4,041,205.19 |
| Unit 4 | 22,204,462.73 | 2.23% | 1,568,955.14 |
| Unit 5 | 19,105,863.54 | 1.92% | 955,293.18 |
| Total | 365,967,881.43 | 36.75% |
2. Other receivables
Unit: yuan
| Item | Year-end balance | Beginning balance |
| Dividends receivable | 14,295,039.38 | |
| Other receivables | 49,092,820.31 | 91,471,115.57 |
| Total | 49,092,820.31 | 105,766,154.95 |
(1) Dividends receivable
Unit: yuan
| Project (or investee) | Year-end balance | Beginning balance |
| Suzhou Industrial Park Ruican Investment Enterprise (limited partnership) | 0.00 | 14,295,039.38 |
| Total | 14,295,039.38 |
(2) Other receivables
1) Other receivables classified by nature
Unit: yuan
| Fund nature | Year-end book balance | Year-begining book balance |
| Collection by third party | 20,064,674.31 | 63,604,415.88 |
| Deposit and margin | 33,786,199.08 | 32,288,103.90 |
| Associated transactions | 4,064,000.00 | 4,064,000.00 |
| Withheld amount | 2,256,187.63 | 2,174,992.54 |
| Imprest | 1,383,261.26 | 1,572,298.56 |
| Other | 3,199,125.99 | 457,769.11 |
| Total | 64,753,448.27 | 104,161,579.99 |
2) Provision for bad debt
Unit: yuan
| Provision for bad debt | Stage 1 | Stage 2 | Stage 3 | Total |
| Expected credit losses over the next 12 months | Expected credit loss for the entire duration (no credit impairment) | Expected credit loss for the entire duration (credit impairment has occurred) | ||
| Balance on January 01, 2020 | 12,690,464.42 | 0.00 | 0.00 | 12,690,464.42 |
| Balance on January 1, 2020 in current period | —— | —— | —— | —— |
| Withdrawn in current period | 2,970,163.54 | 0.00 | 0.00 | 2,970,163.54 |
| Balance on December 31, 2020 | 15,660,627.96 | 0.00 | 0.00 | 15,660,627.96 |
Large book balance change in the current period of provision for loss
□ Applicable √ Not applicable
Disclosure by aging
Unit: yuan
| Aging | Book balance |
| Within 1 year (including 1 year) | 33,938,330.46 |
| Within 1 year (including 1 year) | 33,938,330.46 |
| 1-2 years | 7,428,219.56 |
| 2-3 years | 2,771,023.85 |
| More than 3 years | 20,615,874.40 |
| 3-4 years | 15,763,946.00 |
| 4-5 years | 336,083.46 |
| More than 5 years | 4,515,844.94 |
| Total | 64,753,448.27 |
3) Provision, recovery or reversal of bad debt reserves in the current period
Provision for bad debts in current period:
Unit: yuan
| Category | Beginning balance | Changes in amount in current period | Year-end balance | |||
| Provision | Recovered or reversed | Canceled after verification | Other | |||
| Provision for bad debt of other receivables | 12,690,464.42 | 2,970,163.54 | 0.00 | 0.00 | 15,660,627.96 | |
| Total | 12,690,464.42 | 2,970,163.54 | 0.00 | 0.00 | 15,660,627.96 | |
4) Other receivables actually written off at the current period N/A
5) Other receivables with top 5 ending balances by debtor
Unit: yuan
| Unit name | Nature of payment | Year-end balance | Aging | Proportion in total other ending balance receivable | Ending balance of bad debt provision |
| Unit 1 | Deposit and margin | 14,778,000.00 | 3-4 years | 22.82% | 7,389,000.00 |
| Unit 2 | Collection by third party | 14,390,028.64 | Within 1 year | 22.22% | 719,501.43 |
| Unit 3 | Collection by third party | 3,852,394.93 | Within 1 year | 5.95% | 192,619.75 |
| Unit 4 | Deposit and margin | 3,000,000.00 | 1-2 years | 4.63% | 300,000.00 |
| Unit 5 | Deposit and margin | 2,218,384.00 | Within 1 year | 3.43% | 110,919.20 |
| Total | -- | 38,238,807.57 | -- | 59.05% | 8,712,040.38 |
3. Long-term equity investment
Unit: yuan
| Item | Year-end balance | Beginning balance | ||||
| Book balance | Provision for impairment | Book value | Book balance | Provision for impairment | Book value | |
| Investment to subsidiary company | 246,905,933.73 | 20,400,000.00 | 226,505,933.73 | 246,905,933.73 | 20,400,000.00 | 226,505,933.73 |
| Investment on joint ventures and cooperative enterprises | 3,452,769.59 | 0.00 | 3,452,769.59 | 4,168,338.79 | 0.00 | 4,168,338.79 |
| Total | 250,358,703.32 | 20,400,000.00 | 229,958,703.32 | 251,074,272.52 | 20,400,000.00 | 230,674,272.52 |
(1) Investment on subsidiaries
Unit: yuan
| Invested unit | Beginning balance (book value) | Increase or decrease in current period | Ending balance (book value) | Balance of impairment provision at the end of period | |||
| Further investment | Capital reduction | Provision for impairment | Other | ||||
| Shengzhou Kinde Intelligent Kitchen Electric Co., Ltd. | 162,320,000.00 | 0.00 | 0.00 | 0.00 | 162,320,000.00 | 0.00 | |
| Hangzhou Mingqi Electric Co., Ltd. | 51,901,780.81 | 0.00 | 0.00 | 0.00 | 51,901,780.81 | 0.00 | |
| Dize Home Appliance Trading (Shanghai) Co., Ltd. | 21,030,900.00 | 0.00 | 0.00 | 0.00 | 21,030,900.00 | 20,400,000.00 | |
| Shanghai | 5,838,272.10 | 0.00 | 0.00 | 0.00 | 5,838,272.10 | 0.00 | |
| Robam Electric Appliance Sales Co., Ltd. | |||||||
| Beijing Robam Electric Appliance Sales Co., Ltd. | 5,814,980.82 | 0.00 | 0.00 | 0.00 | 5,814,980.82 | 0.00 | |
| Total | 226,505,933.73 | 226,505,933.73 | 20,400,000.00 |
(2) Investment on joint ventures and cooperative enterprises
Unit: yuan
| Invested entity | Beginning balance (book value) | Increase or decrease in current period | Ending balance (book value) | Balance of impairment provision at the end of period | |||||||
| Further investment | Capital reduction | Investment gains and losses recognized by the equity method | Adjustment of other comprehensive income | Changes in other equity | Declared payment of cash dividends or profits | Provision for impairment | Other | ||||
| I. Joint enterprise | |||||||||||
| De Dietrich Trade (Shanghai) Co., Ltd. | 4,168,338.79 | 0.00 | 0.00 | -715,569.20 | 0.00 | 0.00 | 0.00 | 0.00 | 3,452,769.59 | ||
| Subtotal | 4,168,338.79 | 0.00 | 0.00 | -715,569.20 | 0.00 | 0.00 | 0.00 | 0.00 | 3,452,769.59 | ||
| II. Joint venture | |||||||||||
| Total | 4,168,338.79 | -715,569.20 | 3,452,769.59 | 0.00 | |||||||
4. Operating income and operating cost
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period | ||
| Income | Cost | Income | Cost | |
| Main business | 7,371,735,814.27 | 3,327,933,213.49 | 7,010,004,348.48 | 3,315,886,553.65 |
| Other businesses | 158,693,150.69 | 47,551,519.54 | 161,269,622.80 | 64,568,317.30 |
| Total | 7,530,428,964.96 | 3,375,484,733.03 | 7,171,273,971.28 | 3,380,454,870.95 |
5. Investment income
Unit: yuan
| Item | Amount incurred in current period | Amount incurred in previous period |
| long-term equity investment gains measured by employing the equity method | -715,569.20 | 1,550,487.63 |
| Investment income from trading financial assets during the holding period | 20,859,653.65 | 102,743,555.45 |
| Dividend income from other equity instrument investments in the holding period | 11,985,836.92 | 14,295,039.38 |
| Total | 32,129,921.37 | 118,589,082.46 |
XVIII. Further Information
1. Items of non-recurring profit and loss in current period
√Applicable □ Not applicable
Unit: yuan
| Item | Amount | Description |
| Profit/loss on disposal of non-current assets | -422,706.54 | |
| Government subsidies included into the current profits and losses, except those government subsidies, which are closely related to the business of a company and enjoyed in accordance with a certain standard quota or quantity of the state | 91,184,657.20 | |
| Income and expenditure other than those mentioned above | -2,965,479.76 | |
| Less: Amount affected by income tax | 11,202,215.16 | |
| Amount of influence of minority shareholders' equity | 428,863.68 | |
| Total | 76,165,392.06 | -- |
Explain the non-recurrent profit and loss items defined by the Company according to the Interpretative Announcement No. 1 onInformation Disclosure of Public Securities Issuing Companies - Non-recurrent Profits and Losses and defined from the
non-recurrent profit and loss items enumerated in the Interpretative Announcement No. 1 on Information Disclosure of PublicSecurities Issuing Companies - Non-recurrent Profits and Losses.
□ Applicable √ Not applicable
2. Return on net assets and earnings per share
| Reporting profit | Weighted average return on net assets | Earnings Per Share | |
| Basic EPS (yuan/share) | Diluted EPS (yuan/share) | ||
| Net profit attributable to common shareholders of the Company | 22.39% | 1.75 | 1.75 |
| Net margin attributable to the company’s common share holders after deducting non-recurring profit and loss | 21.36% | 1.67 | 1.67 |
3. Accounting data difference under domestic and foreign accounting standards
(1) Differences between net profits and net assets in financial statements disclosed according to theInternational Accounting Standards (IAS) and Chinese Accounting Standards simultaneously
□ Applicable √ Not applicable
(2) Differences between net profits and net assets in financial statements disclosed according to theOverseas Accounting Standards and Chinese Accounting Standards simultaneously
□ Applicable √ Not applicable
(3) Causes for differences in accounting data under domestic and foreign accounting standards. If thedifference adjustment has been made to the data audited by the overseas audit institution, the name of theoverseas audit institution shall be indicated
4. Others
Section 13: Reference file directory
I. Financial statements containing signatures of the legal representative, the head of accounting work, and thehead of accounting body with seals.II. Original audit report stamped by ShineWing Certified Public Accountants (Special general partnership) andsigned and stamped with the certified public accountants.III. Original copies of the documents and announcement of the Company published on the newspaper designatedby the CSRC in the reporting period.IV. 2020 annual report of the Company signed by the legal representative.V. Other relevant informationVI. Reference files kept at: board office.