China Fangda Group Co., Ltd.
2024 Interim Report
August 2024
Chapter 1 Important Statement, Table of Contents and Definitions
The members of the Board and the Company guarantee that theannouncement is free from any false information, misleading statement ormaterial omission and are jointly and severally liable for the information'struthfulness, accuracy and integrity.
Mr. Xiong Jianming, the Chairman of Board, Mr. Lin Kebin, the ChiefFinancial Officer, and Mr. Wu Bohua, the manager of accounting departmentdeclare: the Financial Report carried in this report is authentic and completed.
All the Directors have attended the meeting of the board meeting at whichthis report was examined.
This semi-annual report contains forward-looking statements such asfuture plans, which do not constitute a substantial commitment by theCompany to investors. Investors and related parties should maintain sufficientrisk awareness and understand the differences between plans, forecasts, andcommitments.The Company has detailed the risks that the Company may face in thisreport. Please refer to the content of Section III Management Discussion andAnalysis, X. Risks Facing the Company and Measures.
The Company distributed no cash dividends or bonus shares and has noreserve capitalization plan.
Contents
Chapter 1 Important Statement, Table of Contents and Definitions ...... 2
Chapter II About the Company and Financial Highlights ...... 7
1. Company Profile .......................................................................................................................................... 7
2. Contacts and liaisons ................................................................................................................................... 7
3. Other Information ....................................................................................................................................... 7
4. Financial Highlight ...................................................................................................................................... 8
5. Differences in accounting data under domestic and foreign accounting standards ............................... 8
6. Accidental gain/loss item and amount ........................................................................................................ 8
Chapter III Management Discussion and Analysis ...... 10
1. Major businesses of the Company during the report period ................................................................. 10
II. Core Competitiveness Analysis ................................................................................................................ 18
III. Core business analysis............................................................................................................................. 22
IV. Non-core business analysis ...................................................................................................................... 24
V. Assets and Liabilities ................................................................................................................................. 24
VI. Investment ................................................................................................................................................ 26
VII. Major assets and equity sales ................................................................................................................ 30
VIII. Analysis of major joint stock companies ............................................................................................ 30
IX. Structural entities controlled by the Company ..................................................................................... 31
X. Risks facing the Company and measures ............................................................................................... 31
1. Risks of macro environment and policy changes .................................................................................... 31
XI. Implementation of the Action Plan for "Double Improvement of Quality and Return" .................. 32
Chapter IV Corporation Governance ...... 33
I. Annual and extraordinary shareholder meetings held during the report period ................................. 33
II. Changes in the Directors, Supervisors and Senior Executives ............................................................. 33
III. Profit Distribution and Reserve Capitalization in the Report Period ................................................ 34
IV. Share incentive schemes, staff shareholding program or other incentive plans ................................. 34
V. Environmental and social responsibility ......................................................................................................... 35
1. Environmental protection ......................................................................................................................... 35
2. Social responsibilities ................................................................................................................................. 35
Chapter VI Significant Events ...... 37
I. Commitments that have been fulfilled and not fulfilled by actual controller, shareholders, relatedparties, acquirers of the Company ...... 37
II. Non-operating capital use by the controlling shareholder or related parties in the reporting term . 37III. Incompliant external guarantee ............................................................................................................. 37
IV. Engaging and dismissing of CPA ............................................................................................................ 37V. Statement of the Board on the “non-standard auditors' report” issued by the CPA on the currentreport period ...... 37
VI. Statement of the Board of Directors on the Non-standard Auditor's Report for H1 2014 ............... 37
VII. Bankruptcy and capital reorganizing .................................................................................................. 37
VIII. Lawsuit .................................................................................................................................................. 37
IX. Punishment and rectification.................................................................................................................. 38
X. Credibility of the Company, controlling shareholder and actual controller ........................................ 38
XI. Material related transactions ................................................................................................................. 38
XII. Significant contracts and performance ................................................................................................ 39
13. Other material events .............................................................................................................................. 46
XIV. Material events of subsidiaries............................................................................................................. 47
Chapter VII Changes in Share Capital and Shareholders ...... 48
I. Changes in shares ....................................................................................................................................... 48
II. Share placing and listing .......................................................................................................................... 49
III. Shareholders and shareholding .............................................................................................................. 49
IV. Changes in shareholding of Directors, Supervisors and Senior Management ................................... 52
V. Changes in controlling shareholder or actual controller ....................................................................... 52
Chapter VIII Preferred Shares ...... 53
Chapter IX Information about the Company's Securities ...... 54
Chapter X Financial Statements ...... 55
I. Auditor's report .......................................................................................................................................... 55
II. Financial statements ................................................................................................................................. 55
III. General Information ............................................................................................................................... 73
IV. Basis for the preparation of financial statements .................................................................................. 75
V. Significant Account Policies and Estimates ............................................................................................. 75
VI. Taxation .................................................................................................................................................. 134
VII. Notes to the consolidated financial statements .................................................................................. 137
VIII. R&D expenses ..................................................................................................................................... 180
IX. Change to Consolidation Scope ............................................................................................................ 181
X. Equity in Other Entities ......................................................................................................................... 181
XI. Government Subsidies .......................................................................................................................... 186
XII. Risks of Financial Tools ....................................................................................................................... 187
XIII. Fair Value ............................................................................................................................................ 192
XIV. Related Parties and Transactions ...................................................................................................... 194
XV. Commitment and Contingent Events ................................................................................................. 198
XVI. Other material events ......................................................................................................................... 202
XVII. Notes to Financial Statements of the Parent ................................................................................... 204
XVIII. Supplementary Materials ............................................................................................................... 210
Reference
1. Financial statements stamped and signed by the legal representative, CFO and accounting manager;
2. Originals of all documents and manuscripts of Public Notices of the Company disclosed in public.
Definitions
| Terms | Refers to | Description |
| Fangda Group, company, the Company | Refers to | China Fangda Group Co., Ltd. |
| Articles of Association | Refers to | Articles of Association of China Fangda Group Co., Ltd. |
| Meeting of shareholders | Refers to | Meetings of shareholders of China Fangda Group Co., Ltd. |
| Board of Directors | Refers to | Board of Directors of China Fangda Group Co., Ltd. |
| Supervisory Committee | Refers to | Supervisory Committee of China Fangda Group Co., Ltd. |
| Banglin Technology | Refers to | Shenzhen Banglin Technologies Development Co., Ltd. |
| Shilihe Co. | Refers to | Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise (limited partner) |
| Shengjiu Co. | Refers to | Shengjiu Investment Ltd. |
| Fangda Jianke | Refers to | Shenzhen Fangda Jianke Group Co., Ltd. |
| Fangda Zhiyuan | Refers to | Fangda Zhichuang Technology Co., Ltd. |
| Fangda Jiangxi New Material | Refers to | Fangda New Materials (Jiangxi) Co., Ltd. |
| Fangda New Resource | Refers to | Shenzhen Fangda New Energy Co., Ltd. |
| Fangda Property | Refers to | Shenzhen Fangda Property Development Co., Ltd. |
| Fangda Chengdu Technology | Refers to | Chengdu Fangda Construction Technology Co., Ltd. |
| Fangda Dongguan New Material | Refers to | Dongguan Fangda New Material Co., Ltd. |
| Kechuangyuan Software | Refers to | Shenzhen Qianhai Kechuangyuan Software Co., Ltd. |
| Fangda Property | Refers to | Shenzhen Fangda Property Management Co., Ltd. |
| Fangda Jiangxi Property | Refers to | Fangda (Jiangxi) Property Development Co., Ltd. |
| Fangda Hongjun Investment | Refers to | Shenzhen Hongjun Investment Co., Ltd. |
| Fangda Investment | Refers to | Shenzhen Fangda Investment Partnership (Limited Partnership) |
| Fangda Yunzhu | Refers to | Shenzhen Fangda Yunzhu Technology Co., Ltd. |
| Fangda Zhijian | Refers to | Shanghai Fangda Zhijian Technology Co., Ltd |
| Fangda Intelligent Manufacturing | Refers to | Jiangxi Fangda Intelligent Manufacturing Technology Co., Ltd. |
| SZSE | Refers to | Shenzhen Stock Exchange |
Chapter II About the Company and Financial Highlights
1. Company Profile
| Stock ID | Fangda Group, Fangda B | Stock code | 000055, 200055 |
| Modified stock ID (if any) | No | ||
| Stock Exchange | Shenzhen Stock Exchange | ||
| Chinese name | China Fangda Group Co., Ltd. | ||
| English name (if any) | Fangda Group | ||
| English name (if any) | CHINA FANGDA GROUP CO.,LTD. | ||
| English abbreviation (if any) | CFGC | ||
| Legal representative | Xiong Jianming | ||
2. Contacts and liaisons
| Secretary of the Board | Representative of Stock Affairs | |
| Name | Xiao Yangjian | Guo Linchen |
| Address | 39th Floor, Building T1, Fangda Town, No.2, Longzhu 4th Road, Nanshan District, Shenzhen | 39th Floor, Building T1, Fangda Town, No.2, Longzhu 4th Road, Nanshan District, Shenzhen |
| Telephone | 86(755) 26788571 ext. 6622 | 86(755) 26788571 ext. 6622 |
| Fax | 86(755)26788353 | 86(755)26788353 |
| zqb@fangda.com | zqb@fangda.com |
3. Other Information
1. Liaison
Changes to the Company's registration address, office address, post code, website or email during the report period
□ Applicable ? Inapplicable
Company's registration address, office address, post code, website or email have not changed during the report period. See AnnualReport 2023 for details.
2. Information disclosure and inquiring
Changes to the information disclosure and inquiring place
□ Applicable ? Inapplicable
The names and websites of the securities exchange websites and media where the company discloses its semi-annual report, aswell as the location of the company's semi-annual report, remain unchanged during the reporting period. Please refer to the 2023annual report for specific details.
3. Other information
Whether other relevant information has changed during the reporting period
□ Applicable ? Inapplicable
4. Financial Highlight
Whether the Company needs to make retroactive adjustment or restatement of financial data of previous years
□ Yes ? No
| This report period | Same period last year | Year-on-year change (%) | |
| Turnover (yuan) | 2,133,845,587.76 | 2,078,846,877.32 | 2.65% |
| Net profit attributable to shareholders of the listed company (yuan) | 116,795,117.62 | 182,155,268.18 | -35.88% |
| Net profit attributable to the shareholders of the listed company and after deducting of non-recurring gain/loss (yuan) | 111,689,105.39 | 172,484,336.75 | -35.25% |
| Net cash flow generated by business operation (yuan) | -171,530,998.21 | -37,313,711.13 | -359.70% |
| Basic earnings per share (yuan/share) | 0.11 | 0.17 | -35.29% |
| Diluted Earnings per share (yuan/share) | 0.11 | 0.17 | -35.29% |
| Weighted average net income/asset ratio | 1.95% | 3.14% | -1.19% |
| End of the report period | End of last year | Year-on-year change | |
| Total asset (yuan) | 13,756,615,957.93 | 13,376,351,856.86 | 2.84% |
| Net profit attributable to the shareholders of the listed company (RMB) | 6,019,556,660.44 | 5,960,140,567.07 | 1.00% |
The Company's operating income increased by 2.65% in the first half of 2024, while the net profit attributable to shareholdersof the listed company decreased by 35.88%. This is mainly due to the 3.3 percentage point decrease in the overall gross profitmargin caused by the differences in gross profit margins of different projects in the curtain wall and new materials industry and therail transit screen door industry; as well as the impact of economic downward pressure, the delay in project settlement andpayment progress has led to an increase in the bad debt loss of receivables accrued in this period.
5. Differences in accounting data under domestic and foreign accounting standards
1. Differences in net profits and assets in financial statements disclosed according to the international andChinese account standards
□ Applicable ? Inapplicable
There is no difference in net profits and assets in financial statements disclosed according to the international and Chinese accountstandards during the report period.
2. Differences in net profits and assets in financial statements disclosed according to the overseas andChinese account standards
□ Applicable ? Inapplicable
There is no difference in net profits and assets in financial statements disclosed according to the international and Chinese accountstandards during the report period.
6. Accidental gain/loss item and amount
? Applicable □ Inapplicable
In RMB
| Item | Amount | Notes |
| Non-current asset disposal gain/loss (including the write-off part for which assets impairment provision is made) | -1,490.22 | |
| Government grants recognized in the current period's profit or loss (except for government grants that are closely related to the Company's normal business operations, in line with national policies and in accordance with defined criteria, and have a continuous impact on the Company's profit or loss) | 7,230,976.70 | |
| Gains and losses from changes in the fair value of financial assets and liabilities held by non-financial corporations and gains and losses from the disposal of financial assets and liabilities, except for effective hedging operations related to the Company's normal business operations | -888,100.88 | |
| Gain/loss from change of fair value of investment property measured at fair value in follow-up measurement | 555,662.75 | |
| Other non-business income and expenditures other than the above | -356,942.93 | |
| Less: Influenced amount of income tax | 1,469,609.41 | |
| Influenced amount of minority shareholders' equity (after-tax) | -35,516.22 | |
| Total | 5,106,012.23 |
Other gain/loss items satisfying the definition of non-recurring gain/loss account:
□ Applicable ? Inapplicable
The Company has no other gain/loss items satisfying the definition of non-recurring gain/loss accountCircumstance that should be defined as recurrent profit and loss to Explanation Announcement of Information Disclosure No. 1 -Non-recurring gain/loss
□ Applicable ? Inapplicable
The Company has no circumstance that should be defined as recurrent profit and loss to Explanation Announcement ofInformation Disclosure No. 1 - Non-recurring gain/loss
Chapter III Management Discussion and Analysis
1. Major businesses of the Company during the report period
The Company mainly engages in smart curtain wall systems and new materials, rail transit smart screen door equipment, newenergy, and business management and services. The Company gives full play to its technical and brand advantages, and vigorouslypromotes intelligent manufacturing and green manufacturing. The Company's main products, such as smart curtain walls and railtransit intelligent screen door systems, have become benchmarks in the global industry. The urban rail transit platform screen doorsystem has been recognized as a "manufacturing individual champion product" by the Ministry of Industry and InformationTechnology of the People's Republic of China, and the comprehensive strength of smart curtain walls ranks among the top. TheCompany currently has 7 national high-tech enterprises, 6 "specialized and innovative" enterprises, 2 "national intellectualproperty advantageous enterprises," and 2 provincial-level engineering technology research centers. We have established a layoutwith Shenzhen as the headquarters and industrial bases in Dongguan, Nanchang, Shanghai, Chengdu, and Ganzhou (underconstruction). Branch offices have been set up in countries and regions along the Belt and Road Initiative, such as Singapore, India,Australia, Bangladesh, the United Arab Emirates, and Hong Kong.In the first half of 2024, the downward pressure on the global economy remained unabated, the external environment becamemore complex, severe and uncertain, domestic effective demand was still insufficient, and the industry faced pressure andchallenges. The Company actively perceived market opportunities, timely adjusted business strategies, focused on "controllingrisks, expanding markets, reducing inventories, and seeking innovation", further accelerated the pace of scientific andtechnological innovation, increased the intensity of refined management of improving quality and efficiency, worked together, andfaced difficulties, basically achieving the goals set at the beginning of the year. During the reporting period, the Companyachieved operating income of RMB2,133,845,600, an increase of 2.65% compared with the same period last year; the net profitattributable to the owners of the parent company was RMB116,795,100, a decrease of 35.88% compared with the same period lastyear. As of the end of the reporting period, the Company's order reserve was RMB9,031,660,800, an increase of 6.44% comparedwith the same period last year, which was 4.23 times the operating income in the first half of 2024, laying a good foundation forthe Company to achieve its future production and operation goals.(I) Smart curtain wall system and new materials
1. Industry development
The Company's smart curtain wall business has continued to grow with the development of urban construction and is one ofthe important industries in the national economic construction, closely linked to the level of macroeconomic development. In thefirst half of 2024, China's economic operation was generally stable. Data from the National Bureau of Statistics shows that thegross domestic product in the first half of 2024 was RMB61,683.6 billion, a year-on-year increase of 5.0%; the total output valueof the construction industry was RMB13,831.2 billion, a year-on-year increase of 4.8%, maintaining a steady growth.
China is vigorously promoting the construction of a modern industrial system, cultivating and developing new-qualityproductive forces through scientific and technological innovation. In May 2024, the State Council issued the "2024-2025 EnergyConservation and Carbon Reduction Action Plan", which proposed to "vigorously develop prefabricated buildings, activelypromote intelligent construction, and accelerate the construction of building photovoltaic integration". The country'simplementation of a series of measures to promote industrial innovation through scientific and technological innovation anddeploy energy conservation and carbon reduction actions has brought new opportunities for the optimization and upgrading of thecurtain wall industry chain. The in-depth application of digital technologies such as artificial intelligence and big data willaccelerate the high-end, intelligent, and green development of the curtain wall industry, injecting new momentum into the industry.The Guangdong-Hong Kong-Macao Greater Bay Area, the Yangtze River Delta, and other regions with economic developmentadvantages are the power sources for high-quality development. The acceleration of the construction of regional central cities and
the construction of urban supporting infrastructure will also promote the development of the curtain wall industry. The acceleratedconstruction of the national unified market has provided more market opportunities for the industry's leading enterprises. The high-quality construction of "One Belt, One Road" is going deeper and deeper, creating a favorable market environment for enterprisesto expand overseas markets.
2. Business Status
(1) Main products and purposes
The Company's smart curtain walls are widely used on the exterior walls or roofs of various buildings such as high-end officebuildings, corporate headquarters, urban complexes, hotels, large venues, enterprises, institutions, or government office buildings,and high-end residences. They can effectively improve the visual aesthetics of buildings, enhance the energy conservation andenvironmental protection of buildings, and better meet people's work and life needs. Smart curtain wall is a curtain wall solutionthat combines modern building technology and intelligent systems. It is a curtain wall technology developed on the basis ofintelligent buildings, integrating the moderate control of building supporting technologies (such as heating, cooling, lighting, andelectricity), and reducing the energy consumption of buildings through digital, artificial intelligence and other technologies. Withthe high-quality products trusted by customers, the Company's smart curtain wall products have won the Luban Prize (NationalQuality Engineering Award), the highest award in the field of architecture in China, many times. Its competitiveness ranks amongthe top in the global industry and is a well-known global curtain wall brand, reflecting the high-quality characteristics of the new-quality productive forces.The company also provides technical services and maintenance, functional renovation services forexisting building exterior maintenance systems, as well as building waterproofing, anti-corrosion, and insulation services.The Company has fully utilized its advantages to provide house and building testing, energy saving retrofit, building water-proof and corrosion-proof, technical services, and maintenance services. During the reporting period, the construction area of theabove-mentioned services provided by the Company reached over 7 million square meters.New materials, with the development direction of low carbon, environmental protection, intelligence, and sustainability, areone of the industries that the Company vigorously develops. The Company has strong R&D strength and an advanced productionand manufacturing base of PVDF aluminum veneer and aluminum honeycomb panel, and its products have been widely used inmajor projects in more than 160 cities around the world.
(2) Main business modes, specific risks and changes;
During the reporting period, the Company's main business model did not change. The Company's smart curtain wall design,installation and construction contracting orders are mainly obtained through the bidding (open bidding, invited bidding) method.According to the order requirements, the Company provides an overall solution of design, raw material procurement, productionand processing, installation and construction, and after-sales service. It has typical non-standardized and customized characteristics.The gross profit margin level of each order is affected by multiple factors, and there are certain differences due to the owner'scapital budget investment, the bidding process, product materials, the complexity of the building structure and construction, theproject duration, the construction site and cost management. In addition, due to the long period of order implementation, it isgreatly affected by national industrial policies, raw material prices, and fluctuations in the labor market. Different orders havedifferent technical requirements. It is impossible to simply copy the existing experience, and the requirements for technology andmanagement are relatively high. The engineering payment settlement process for orders is divided into stages such as engineeringadvance payment, engineering progress payment, completion acceptance, completion settlement payment, and quality guaranteedeposit. The specific settlement situation depends on the completion progress and contract agreement.
(3) Market competition pattern in which the Company is located and the Company'smarket position
In recent years, the domestic high-end curtain wall market has gradually matured, industry competition has intensified, andthe degree of industry concentration and scale will continue to deepen. The Company has the advantages of talents, technologyand brand, and the industry-leading enterprises that can undertake complex, innovative and comprehensive projects have shown
their advantages in market competition. The technological innovation based on technologies such as intelligence, modularassembly, BIM, and VR continues to deepen. In the future, with the wave of industrial upgrading, green buildings, technologicalinnovation, and digitalization will become important driving forces for the development of the industry.The Company has been deeply involved in the curtain wall industry for more than 30 years and has a profound technicalaccumulation. Fangda Jianke Co., Ltd., a wholly-owned subsidiary of the Company, has the highest qualifications for curtain walldesign and construction enterprises in China - the first-class qualification for professional contracting of architectural curtain wallengineering and the first-class qualification for architectural curtain wall engineering design. It is the leading enterprise in China'scurtain wall industry. Fangda Jianke has won the highest awards in the national construction industry, including "Luban Award","National Quality Engineering Award", "Zhan Tianyou Civil Engineering Award", "China Building Decoration Award", and over200 provincial and ministerial awards. Fangda Jianke has participated in the preparation of more than 22 national or industrialstandards such as the Design Standard for Energy Efficiency of Public Buildings, and has created 18 new records for Chineseenterprises. It is an intellectual property demonstration enterprise in Guangdong Province. It is the first one in the same industry inthe country to set up enterprise post-doctoral workstations, provincial engineering technology research centers, research anddesign institutes and other research and development institutions, with independent innovation capability and technology levelreaching the advanced level in the same industry in the country, with the innovative characteristics of new quality productivity.Good social credibility, high quality service quality, successfully established the company's brand awareness and reputation, fullydemonstrated the strength of the Company as the industry leader. The Company will closely follow the national strategicorientation, seize important opportunities such as domestic and international dual circulation, expanding domestic demand, unifiedlarge market, scientific and technological innovation, and green development, and continuously create new value and newmomentum by consolidating and enhancing the industry leading position of its existing core businesses, and achieve the goal ofcontinuous growth in scale.
(4) Business drive
① Sufficient order reserves and record high overseas orders
After more than 30 years of technical precipitation and experience accumulation, the Company's smart curtain wall systemand new materials industry have formed an integrated solution that integrates R&D, design, production, project management andconstruction, and maintenance services. The industrial supporting facilities are complete, and it has strong comprehensive strengthin terms of quality, cost and service, and has been highly recognized by the industry and many professionals, and has a goodreputation. During the reporting period, the Company continued to focus on expanding key regions and major projects, and deeplycultivated the high-end smart curtain wall field of projects such as super high-rise buildings, government public cultural venuesbuildings, and corporate headquarters buildings. In the context of intensified industry competition, the Company still signed anumber of high-quality curtain wall project orders, including: Shenzhen Bay Super Headquarters Base Project - Shenzhen BayCoastal Business Center Lot 1, Shenzhen ZTE Headquarters Building; Enterprise Headquarters Project - Shenzhen GanghongGroup Headquarters Building, Chengdu Beiyikang Manufacturing and R&D Center, Dongguan OPPO Binhaiwan Senior TalentHousing Project; High-end Industrial Park Project - Shenzhen Xinchuang Technology Building, Guangzhou Haihao BiologicalInnovation Port; Government Public Cultural Venue Project - Beijing China International Publishing Exchange Center; SuperHigh-rise Building - Shenzhen Bay Area Smart Plaza Project, etc. While the domestic business is steadily advancing, the overseasorder volume has reached a record high, and the amount of newly signed overseas curtain wall project orders in the reportingperiod increased by 59.56% compared with the same period last year. As of the end of the reporting period, the order reserveamount of the Company's smart curtain wall and new materials industry reached RMB6,756,657,000, an increase of 1.98%compared with the same period last year, which is 3.89 times the operating income of the Company's curtain wall system andmaterials industry in the first half of 2024.In order to further expand the demand for production capacity, the Company has newly built Fangda (Ganzhou) Low-carbonIntelligent Base, and the construction of the first phase of the project has been basically completed, and the commissioning ofproduction equipment is currently underway. The base has built a production and operation system integrating 5G, digitalization,
the Internet of Things and intelligence, and is leading the industry in terms of system innovation, product research anddevelopment, and production and manufacturing. It is a demonstration base for the new quality productive forces of the digitaleconomy. The commissioning of this base will further improve and upgrade the Company's industrial layout and provide aguarantee for the Company's sustainable development.
② Driven by innovation, continue to strengthen the construction of intelligent digitalizationThe Company continues to enhance its independent innovation ability, increase R&D investment, and strengthen theCompany's core competitiveness in various business fields through technological innovation and digital construction. In recentyears, the Company has accelerated technological innovation and the transformation of achievements, continuously madebreakthroughs in key core technologies, implemented the transformation of 30 scientific and technological achievements such asthe ultra-high curtain wall flat push window system, the high-airtight energy-saving ventilation unit curtain wall system, and theassembly technology of special-shaped large plates, and launched multiple innovative products such as fabricated curtain wallwindows, new heat-insulating window unit curtain wall systems, simple steel-aluminum combined keel glass curtain wallfabricated systems, and energy-saving internal circulation curtain walls, creating a number of "Chinese enterprise records". Inaddition, the Company independently developed an ultra-low energy consumption window-wall combination system to better meetthe domestic and foreign demand for high-end curtain walls and the requirements of green and low-carbon buildings. In the future,the Company will combine intelligent and Internet of Things technologies, continue to research and develop and promote theapplication of smart curtain walls, further accelerate the development of new-quality productive forces, and maintain the leadingposition in the industry. During the reporting period, the Company's R&D expenses were RMB85,639,600, accounting for 4.01%of operating income.During the reporting period, the Company accelerated the construction of "Digital Fangda", and completed the developmentand application of the contract management platform, refined management platform and cost management system on the basis ofthe independently developed PMS project management platform, MES production management platform, VPO suppliermanagement platform, and quality and safety management platform, and opened up the information management of the completechain in the process of contract execution, realizing the all-round monitoring and real-time sharing from material supply,production status, factory processing progress to project management status, which greatly simplifies the process of informationdata processing, provides real-time business data support for management decision-making, and meets the refined managementrequirements of curtain wall products. The Company combines artificial intelligence applications, continuously researches anddevelops and promotes the parametric design and blanking of curtain walls in the design end of curtain wall products throughCATIA, Rhino and other software and independent programming to improve design efficiency; in the processing end of curtainwall products, combined with the application of the original intelligent equipment and production lines, through technologicaltransformation to improve the application scope of intelligent manufacturing, improve the overall production efficiency andproduct quality.
During the reporting period, the Company completed the establishment of 40 R&D projects of smart curtain wall systemsand new materials, and newly applied for 5 patents and newly authorized 8 patents. It has successively obtained 665 patenttechnologies and 21 software copyrights for smart curtain wall systems and new materials, participated in the compilation of 22national/industry technical specifications and standards, and 6 subsidiaries engaged in the smart curtain wall system and newmaterials industry are national high-tech enterprises, of which 5 are "specialized, refined, and innovative" enterprises, and havesuccessively been awarded honors such as national intellectual property advantage enterprises, "specialized, refined, andinnovative" small giants, Guangdong Provincial Engineering Technology Research Center, Jiangxi Provincial EnterpriseTechnology Center, Jiangxi Provincial Intelligent Manufacturing Benchmarking Enterprise, Guangdong Provincial InnovativeSMEs, and enterprise innovation records, demonstrating the Company's leading position and comprehensive strength in curtainwall product design, manufacturing and installation technology.
③ Firmly implement the "going out" strategy and accelerate the pace of overseas market expansion
During the reporting period, the Company combined its own comprehensive advantages accumulated in the field of smartcurtain wall business, such as technological advantages, market advantages, advanced manufacturing advantages, and refinedmanagement, implemented the "going out" strategy, while consolidating the Australian market, vigorously expanded the marketsin Southeast Asia, the Middle East, Hong Kong, Japan, South Korea, and went to the international stage more widely and deeply,optimized the customer structure, and enhanced the Company's competitiveness and brand influence in the overseas market. Onthe premise of strictly controlling risks, establish an efficient overseas team organization structure and cultivate a project teamwith an international perspective. In the future, the Company will combine domestic and foreign project management experience,optimize and improve the overseas project planning management system and quality control system, strengthen the pre-planningand planning management of overseas projects, and promote the refined management of overseas projects. According to theprogress of overseas market business expansion, concentrate high-quality human and material resources to provide sufficientresource guarantee for overseas business to meet the needs of overseas business development.(II) Rail transport smart screen door business
1. Industry development
Rail transit intelligent platform screen door system is an indispensable and important part of the urban rail transit industrychain, which is closely related to the level of national economic development, urban rail transit development and constructionplanning. The "Outline of the 14th Five-Year Plan for National Economic and Social Development of the People's Republic ofChina and the Long-Term Goals for 2035" proposes to accelerate the construction of a transportation power, and it is expected thatduring the "14th Five-Year Plan" period, China will add 3,000 kilometers of urban rail transit operating mileage and 3,000kilometers of intercity railways and urban (suburban) railways.According to the statistics of the China Association of Metros, in the first half of 2024, a total of 194.06 kilometers of newurban rail transit operating lines were added, 6 new operating lines were added, and 4 sections of new post-opening sections orextensions of existing lines were added, and a total of 132 new operating stations were opened. As of June 30, 2024, a total of 58cities in the Chinese mainland have put into operation 11,409.79 kilometers of urban rail transit lines. It is expected that more than600 kilometers of urban rail transit operating lines will be opened in the second half of 2024, and the total length of new urban railtransit lines put into operation throughout the year is expected to exceed 800 kilometers.With the continuous increase in the number of operating mileage of urban rail transit, China has become a country with thelongest operating mileage and a high-density line network in the world. The rail transit platform screen door system that was putinto operation in the early stage has gradually entered a critical period of maintenance, and the rail transit industry is entering animportant stage where construction and operation and maintenance go hand in hand. The expansion of operation and maintenancedemand indicates the huge potential of the rail transit aftermarket. Especially against the background of the increasing independentinnovation ability in our country, the huge operation and maintenance market will bring new development opportunities andbusiness growth space to rail transit aftermarket enterprises.With the Belt and Road countries and regions increasing investment in urban rail transit construction, Chinese high-endequipment manufacturing enterprises are expected to play a greater role in the international market. As a leader and promoter inthe field of construction and operation and maintenance of rail transit platform screen door systems, the Company will continue tobe guided by national strategies and related industrial policies, comply with industrial development trends and market demands,increase technological innovation efforts, continuously improve its core competitiveness, focus on developing high-tech value-added products, and further improve the Company's market share in rail transit platform screen door systems.
2. Business Status
(1) Main products and purposes
The Company's main products are platform screen smart door systems applied to urban rail transit, and also provide operationand maintenance services for the above products. The platform screen door system of urban rail transit is installed at the edge ofthe platform of urban rail transit station to isolate the running track area from the waiting area of the platform. It is equipped with acontinuous movable door body barrier corresponding to the train door, which can be opened and closed by multi-level control,
including the full-height closed screen door system, the full-height non-closed screen door system, and the half-height screen doorsystem. In addition, the Company has successfully developed the platform safety door system that can be applied to the complexenvironment of high-speed railroads, which can realize the opening of platform safety doors according to different models ofincoming high-speed railways and intelligent corresponding train doors, which will open up new application scenarios and newmarket space in the future.The platform screen door system isolates the track from the platform waiting area, effectively ensuring the safety ofpassengers, preventing them from falling off the track, and also preventing unauthorized entry into the tunnel; In case of fire orother fault modes, it can be linked and controlled with relevant systems to achieve rapid smoke exhaust and passenger evacuationand escape functions. At the same time, the platform screen door system can effectively reduce the dust, noise, and tunnel windpressure entering the platform from the tunnel, providing passengers with a quiet, comfortable, and safe riding environment. Inaddition, the platform screen door system doors also have a passenger flow counting function, which can guide passengers to low-density carriages during peak passenger hours. The platform screen door system can also serve as a platform for passengerconsultation systems, achieving multimedia interaction functions such as information broadcasting, consultation dissemination,and commercial promotion for passengers.
(2) Main business model
The operating entity of the Company's rail transit smart screen door equipment business is its subsidiary, Fangda Zhiyuan.Fangda Zhiyuan is a supplier and service provider of rail transit smart screen door systems that integrates research anddevelopment, design, manufacturing, installation, and technical services, with a complete industrial chain. A mature and completemanagement system for research and development, procurement, production, sales and O&M has been established. In terms ofresearch and development, the Company has formed a research and development project initiation mechanism that combinesindependent basic research with project needs; In terms of procurement, suppliers are mainly selected and purchased by the project,and a special procurement team is set up to carry out the procurement work; In terms of production, manage the Company'sproduction activities according to contract requirements and customer's production instructions; In terms of sales, the Company'scustomers are metro companies around the world and electromechanical general contracting units in the rail transit industry, all ofwhich are direct sales, and there is no distribution; in terms of operation and maintenance, the Company already has an intelligentoperation and maintenance guarantee system for platform screen doors, which can monitor the operation data in real time andquickly diagnose and eliminate faults.
(3) Market competition pattern in which the Company is located and the Company's market position
As a world-class rail transit platform screen door system supplier, the Company continues to consolidate its leading positionin the industry. The Company's rail transit intelligent platform screen door system has a coverage rate of more than 60% in thedomestic cities where the subway is in operation, covering more than 100 lines in more than 40 cities around the world, andcontinues to lead the way strongly. The Company continues to strengthen the expansion of overseas markets, and the forward-looking layout has achieved a first-mover advantage. It has won a good reputation in the industry in many international high-quality projects such as Singapore, Malaysia, Hong Kong and India, which has effectively enhanced the Company's brand powerand influence in the global rail transit industry, and is gradually becoming an important participant in the field of international railtransit platform screen door systems.
The Company has been dedicated to operating in the field of rail transit platform screen doors for more than 20 years, and hassuccessfully developed a rail transit intelligent platform screen door system with independent intellectual property rights andmaintained a technological leading advantage. The Company has a comprehensive team of professional talents in R&D, design,manufacturing, installation and technical services, and has edited the first industry standard for rail transit platform screen doors,"Urban Rail Transit Platform Screen Doors" (CJ/T236-2022), and participated in the preparation of the group standard "Urban RailTransit Fully Automatic Operation System Acceptance Specification" (T/URTA0009-2022). Currently, it is leading the drafting ofthe first national standard in the industry, "Urban Rail Transit Platform Screen Door System", fully demonstrating the Company'sdeep technical accumulation and leading position. In addition, the Company's urban rail transit platform safety door has been
recognized as a "manufacturing single champion product" by the Ministry of Industry and Information Technology of the People'sRepublic of China. Fangda Zhiyuan has received various honors and qualifications, including being recognized as a NationalIntellectual Property Advantage Enterprise, winning the Guangdong Science and Technology Award, obtaining the National KeyNew Product Certificate, being certified as a demonstration project in the National Torch Program for industrialization,establishing the Guangdong Intelligent Rail Transit Platform Door Engineering Research Center, winning the Shenzhen Scienceand Technology Progress Award, and being awarded the title of "Specialized, Refined, Special, and New" Enterprise in Shenzhen.Additionally, the company has obtained the International Railway Industry Standard (IRIS) management system and RAMScertifications. The Company has domestic and foreign patents and computer software copyrights, forming a core technology groupand intellectual property system with independent intellectual property rights.The technology in the field of rail transit platform screen door systems continues to develop and progress, and the marketcompetition is becoming increasingly fierce. The Company will continue to grasp the opportunities of the global rail transit marketdevelopment and become a leading enterprise in rail transit platform screen doors with more leading technological innovation,more reliable system safety, more advanced management level, and more trusted brand image.
(4) Business drive
① Deeply Cultivate the Overseas Market and Build a Good Market Pattern
As a pioneer and leader in the rail transit platform screen door industry, the Company firmly implements the national strategyof "going out", actively responds to the "Belt and Road Initiative", continuously enhances the intrinsic value of the brand, andgains recognition in domestic and foreign markets through innovative technologies, high-quality products, and excellent servicesbased on its own advantages. For more than ten years, the Company has continued to deeply cultivate the overseas market, makeforward-looking layouts, seize opportunities, and has obtained heavyweight rail transit platform screen door system projects incountries and regions along the "Belt and Road Initiative" such as Singapore, Malaysia, Hong Kong, China, Taipei, China,Thailand, India, Greece, and Colombia, and has received high recognition and praise from the industry. The "going out" businessterritory has gradually expanded, and "Fangda Manufacturing" has become a shining Chinese business card for the world's railtransit platform screen door. In the future, it will continue to help China's manufacturing move towards a high-quality developmentpath through continuous technological innovation. During the reporting period, the domestic operating income of the Company'srail transit intelligent platform screen door industry accounted for approximately 57.05%, and the overseas operating incomeaccounted for approximately 42.95%, forming a new development pattern of mutual promotion between the domestic andinternational double cycles. With the in-depth expansion of the Company's overseas business, the Company's overseas businesswill continue to grow. As of the end of the reporting period, the Company's rail transit intelligent platform screen door industryhad an order reserve of RMB2,275,003,800, which was 8.64 times the operating income of the rail transit intelligent platformscreen door industry in the first half of 2024. The order reserve was sufficient, laying a solid foundation for ensuring thecontinuous release of subsequent performance. Despite the weak global economic recovery and insufficient domestic demand, therail transit platform smart door industry of the Company has shown strong vitality, demonstrating its comprehensive strength intechnology, brand, market, and strong competitiveness, as well as significant advantages in new production capacity.
② Continuously Promote Technological Innovation and Strive to Build Industry Benchmarks
The core technology threshold of the rail transit platform screen door industry is high, and there are extremely highrequirements for the safety, reliability, stability and sustainability of products and services. The Company is a national high-techenterprise engaged in the R&D, design, manufacturing, installation and operation and maintenance of rail transit platform screendoor systems, and has an independent intellectual property rights rail transit platform screen door control system. The Company'surban rail transit platform safety door products have been awarded the national "manufacturing single champion product" by theMinistry of Industry and Information Technology, and has edited and revised the first industry standard for rail transit platformscreen doors, "Urban Rail Transit Platform Screen Doors" (CJ/T236-2022), and participated in the preparation of the groupstandard "Urban Rail Transit Fully Automatic Operation System Acceptance Specification" (T/URTA0009-2022). During thereporting period, the Company led the drafting of the first national standard "Urban Rail Transit Platform Screen Door System",
which will have important guiding significance for the development of rail transit platform screen doors in China. As of the end ofthe reporting period, the Company has 134 domestic and foreign patents for the intelligent platform screen door system of urbanrail transit (including 56 invention patents and 20 international PCT patents), and 12 computer software copyrights, forming a coretechnology group and intellectual property system with completely independent intellectual property rights.The Company promotes the self-reliance and self-improvement of the industry's science and technology through innovation.Through the completely independent intellectual property rights of the rail transit platform screen door control system, it integratesartificial intelligence and big data technology to continuously innovate. It has successively developed platform screen doorsystems that match "driverless" trains, and health prediction technology for key components of platform screen doors based on bigdata, which have been successfully applied in multiple projects. It has important demonstration significance for promoting theconstruction of smart metros and leading the technological upgrading of the rail transit industry. The urban rail transit visualmultimedia full-height platform screen door product developed by the Company has been recognized as a "Shenzhen EnterpriseInnovation Record". Furthermore, the Company has successfully developed a platform safety door system suitable for high-speedrailway environments. This system allows intelligent opening of platform safety doors based on different train models entering thestation. The product has obtained 36 patents. This technology solves the problem of adding to existing high-speed rail platforms,and can also be applied to new high-speed rail platforms. Currently, the Company is actively promoting the product in the marketto realize its application as soon as possible, opening up new application scenarios and market opportunities.
During the reporting period, in order to meet the market demand for adding platform screen doors to old rail transit lines, theCompany independently developed a three-module full-height platform screen door structure product, which is a product betweenthe fabricated platform screen door structure and the bulk platform screen door structure. It not only solves the operation problemssuch as installation space, operation time, and restricted use of rail vehicles, but also greatly improves the installation qualitythrough large modular factory assembly. This product fills the market gap and has important demonstration significance forpromoting the quality and efficiency improvement and green development of the rail transit industry. During the reporting period,Fangda Zhiyuan was selected into the "2023 Guangdong-Hong Kong-Macao Greater Bay Area Innovation Achievement List".
③ The demand for maintenance is constantly expanding, and the maintenance business is growing year by year
With the continuous increase in the number of operating mileage of urban rail transit, China has become a country with thelongest operating mileage and a high-density line network in the world. Professional maintenance and repair have become thelong-term necessary work for rail transit operation. The expansion of operation and maintenance demand indicates the hugepotential of the rail transit aftermarket. The Company has the technical service advantages of the entire industrial chain of the railtransit platform screen door system. The independently developed intelligent operation and maintenance guarantee system forplatform screen doors can accurately locate the possible faulty components, faulty positions, and faulty reasons of the system byreal-time monitoring, statistics, and analysis of the operating conditions of site equipment, reduce the personnel input of systemoperation and maintenance, improve the reliability and safety of the platform screen door system, and improve the intelligent levelof station operation. At the same time, the technical service team can also combine the operation and maintenance system toprovide customers with professional technical support in a timely and efficient manner. During the reporting period, theCompany's rail transit platform screen door industry maintenance revenue was RMB32,532,100, an increase of 4.31% comparedwith the same period last year, accounting for 12.35% of the revenue of the rail transit platform screen door business. The gooddevelopment opportunities of the Company's professional technical maintenance service business have gradually emerged.
(3) New energy industry
The Company's photovoltaic building integration (BIPV) and distributed solar photovoltaic power plants are importantcomponents of the Company's new energy business. Against the backdrop of the national dual carbon strategy and greendevelopment, the Company has been practicing the concepts of low-carbon, energy saving, green and environmental protection. Itis an early developer and application of photovoltaic building integration (BIPV) and photovoltaic power generation system design,manufacturing, integration and operation, and has mature technology experience. In China, the Company has completed theearliest integrated photovoltaic buildings (BIPV) and multiple distributed solar photovoltaic power stations. Jiangxi Pingxiang
distributed photovoltaic power station, Jiangxi Isuzu automobile parking lot photovoltaic power station in Nanchang City, andSongshan Lake Base photovoltaic power station in Dongguan, Guangdong, have all operated efficiently, contributing to theCompany's stable profitability and cash flow.
(4) Business Management and Services
The commercial development management and property service projects operated by the Company are mainly in ShenzhenCity and Nanchang City. As a first-tier city, Shenzhen has a relatively high market activity. At the same time, with the in-depthadvancement of the construction of the Guangdong-Hong Kong-Macao Greater Bay Area, Shenzhen's strong development trendand the positive signals continuously released by national policies have been highly recognized by the market, and the sales andrental de-stocking rate of the Company's Shenzhen Fangda City project is relatively fast. At the end of the reporting period, thesales rate of Shenzhen Fangda Town project was 98.70%, and the leasing rate of self owned properties was 81.67%. Thecompany's Fangda Center project is located in Honggutan New District, Nanchang City, with obvious geographical advantagesand good market expectations. At the end of the reporting period, the sale rate of Nanchang Fangda Center project was 42.21%,and the occupancy rate of self-owned properties was 91.68%.
The two urban renewal projects of the Company located in Shenzhen are also continuously advancing, among which theShenzhen Henggang Dakang Project is orderly promoting the planning and approval work; the Shenzhen Fuyong FangdaBangshen Project is steadily advancing the review of the renewal plan.
II. Core Competitiveness Analysis
(I) Smart curtain wall system and material
1. Technological Innovation Advantage
Adhering to the business philosophy of "technology-oriented and innovation-driven", the Company continuously strengthenstechnological innovation, grasps the development trend of the curtain wall industry in the process of meeting market demand, andimproves the competitiveness of the Company's products, solutions and services. The Company has successively participated inthe formulation of 22 national or industry standards such as the "Design Standard for Energy Efficiency of Public Buildings", andhas taken the lead in establishing R&D institutions such as enterprise postdoctoral workstations, provincial engineering technologyresearch centers, and research and design institutes in the same industry across the country. The independent innovation ability andtechnical level have reached the advanced level in the domestic same industry. Six subsidiaries engaged in the intelligent curtainwall system and materials industry are national high-tech enterprises, five of which are "specialized, refined, and innovative"enterprises, providing strong platform support for the Company to achieve high-quality innovative development. They have beenawarded honors such as national intellectual property advantage enterprises, "specialized, refined, and innovative" little giants,Guangdong Provincial Engineering Technology Research Center, Jiangxi Provincial Enterprise Technology Center, JiangxiProvincial Intelligent Manufacturing Benchmarking Enterprise, and Guangdong Provincial Innovative SMEs. The Company'sindependent innovation and continuous innovation have created the Company's leading technological level and product deliverycapabilities.
As a leading enterprise in the curtain wall industry, the Company accelerates scientific and technological innovation and thetransformation of achievements, continuously breaks through key core technologies, and creates many enterprise records. TheCompany vigorously promotes intelligent construction and refined management, applies emerging technologies such as big data,cloud computing, and 5G to production and management, independently develops a "contract-centered" full-chain informationmanagement system, builds a modern factory through digital and intelligent production line construction, continuously improvesthe level of scientific decision-making and operational efficiency, effectively enhances the Company's competitiveness, andprovides an important guarantee for the Company's development.
2. Brand Value Advantage
The Company's brand advantage can bring more business opportunities and partnerships. The Company has been deeplyengaged in the curtain wall field for more than 30 years, always adheres to quality first, and has received high recognition from theindustry and many professionals with its long-term excellent product advantages and service quality, and has a good reputation. Itis one of the preferred brands in the domestic high-end curtain wall system materials industry. At the same time, the Companyconsolidates the brand value advantage and actively promotes the Company's business development by continuously improvingproduct quality and optimizing service efficiency. The Company has won "National Quality Award", "Luban Award (NationalQuality Engineering Award)", Zhan Tianyou award, China Architectural Decoration Award and more than 200 provincial andministerial awards. It has created thousands of landmark projects worldwide and has become the leading brands in the field ofhigh-end curtain wall. The Fangda trademark has been recognized as a "China Well-known Trademark," and has also beenawarded the titles of "International Reputation Brand" and "Shenzhen Old Brand."
3. Industrial layout advantages
Through years of development, the Company has established a nationwide industrial layout centered around its Shenzhenheadquarters, with production bases in Shanghai, Chengdu, Nanchang, Dongguan, and Ganzhou (under construction). TheCompany possesses a comprehensive solution that integrates research and development, design, manufacturing, projectmanagement, construction, and maintenance services, thus creating a complete industrial chain in the curtain wall systems andmaterials sector. Among them, Dongguan Songshanhu Base is one of the most advanced high-end curtain wall system productionbases in the industry, with industry-leading capabilities in R&D design, manufacturing, and smart curtain wall system delivery.The construction of the first phase of the Ganzhou Base has been basically completed, and the production equipment is currentlybeing debugged. In the future, it will be an industry-leading digital economy new quality productivity demonstration baseintegrating system innovation, R & D, and manufacturing.The Company's well-established production base layout and complete industry chain optimize production costs, enhancesefficiency, and enable rapid response to changes in market demand, providing an important guarantee for increasing market shareand overall competitiveness.
4. Talent
The Company implements an innovation-driven development strategy, speeds up the training of innovative talents throughmultiple channels, actively introduces and nurtures various professional and technical and management talents, and is committedto building an innovative and efficient management and operation team. After years of development, the Company has anexperienced and international senior management team and a professional and highly effective middle management team. It has acomplete talent training system and talent reserve, as well as a smooth career development path for talents. At the same time, it hasa complete incentive and evaluation system for the transformation of scientific and technological achievements, which fullystimulates the innovation vitality of R & D personnel, supports and leads the Company's quality improvement and efficiencyincrease, and sustainable and healthy development with scientific and technological innovation, and unswervingly takes the roadof independent innovation, truly becoming a force to promote high-quality development of the enterprise. During the reportingperiod, the Company recruited 97 fresh graduates, laying a solid foundation for the Company's talent reserve.
(II) Rail transport screen door business
1. Technical R&D advantage
The Company adheres to independent innovation and was the first in China to develop a proprietary railway platform screendoor system, breaking the monopoly of foreign companies in China's railway platform screen door market. Through years ofcontinuous engineering practice and technological innovation, the Company has accumulated profound technical expertise andpossesses a strong advantage in technology research and development. The Company has established a mature technology researchand development system. Fangda Zhiyuan's platform screen door system research center has been awarded the GuangdongProvincial Engineering Technology Center by the Guangdong Provincial Department of Science and Technology. The R&D teampossesses strong technological innovation capabilities, and its research outcomes have successively won Guangdong ProvincialScience and Technology Awards and Shenzhen Municipal Science and Technology Progress Awards. The Company's urban rail
transit platform screen doors have been recognized as a "single-champion product in manufacturing" by the Ministry of Industryand Information Technology. Fangda Zhiyuan has been selected as a "National Intellectual Property Advantage Enterprise" and aShenzhen "specialized and innovative" enterprise. The Company has taken the lead in compiling the first Chinese industrystandard for "Urban Rail Transit Platform Screen Doors" and is currently leading the drafting of the first national standard for"Urban Rail Transit Platform Screen Doors". The R&D project of urban rail transit visual multimedia full-height platform screendoors has been recognized as a "Shenzhen Enterprise Innovation Record", demonstrating Fangda's continuous comprehensiveleading position and industry benchmark status in the field of urban rail transit equipment.
During the operation and development, the Company has always maintained a high level of R&D investment, formed awealth of innovative achievements, and obtained a number of intellectual property rights in the structure, electrical, control,system reliability and safety of PSD system. Through the accumulation of its own patents, software copyrights and proprietarytechnologies, the Company has built a completely independent and controllable platform for the basic technology of platform doorcontrol system. They are developed and produced by the Company, which can quickly diagnose and eliminate various systemcontrol problems. On the basis of the basic platform, the Company has successively developed anti-pinch system based on imagerecognition, embedded display system, intelligent operation and maintenance system and other modules, which can be flexiblycustomized according to specific requirements and can better meet customer needs.
The Company has innovatively developed a safety door product for high-speed rail platforms, specifically targeting high-speed or intercity platforms where multiple train models dock. The product allows for the arbitrary setting of door unit positionsand sizes, accommodating different train body specifications and door opening positions. It serves as an ideal platform doorsolution for high-speed and intercity platforms with multiple train models docking or uncertain train models docking. This productsatisfies the needs of trunk railways, intercity railways, urban (suburban) railways, and seamless integration scenarios betweenurban rail transit systems. It can automatically open and close doors at any position and ensures passenger safety protection onstation platforms. Currently, the Company is actively promoting the product in the market to achieve early implementation andexplore new application scenarios and market opportunities.
2. Industry chain advantage
As the first enterprise to enter the metro screen door industry in China, the Company is able to provide R & D, design,manufacturing, engineering construction, technical services, technical training, system maintenance, spare parts supply as part ofthe whole industry chain. A complete industrial chain helps the Company to realize resource sharing at all stages and meet themarket demand for specialized products and services, thereby effectively reducing the Company's production and managementcosts and improving profitability and competitive advantages.
With the continuous increase in the number of operating miles of urban rail transit in China, China has become a majorcountry in rail transit with the longest operating mileage and a high-density line network in the world. Many subway platformscreen door systems have entered the maintenance period, and the Company actively expands subway maintenance business. Theintelligent maintenance management system developed by the Company can count and analyze the operation status of siteequipment in real time, remotely guide the on-site technical service team, and provide professional technical support to customersin a timely and efficient manner. The Company's operations and maintenance service team is now present in over 30 citiesworldwide. With the continuous improvement of service capabilities and customer recognition, the contribution of technicalservice revenue is expected to increase year by year.
3. Brand and Market Position Advantage
As an early entrant into the platform screen door system field in China, the Company has received high praise and recognitionfrom many customers with its outstanding advantages such as product safety, reliability, usability, and sustainability, and hasestablished the Fangda brand advantage and market position. During the reporting period, Fangda Zhiyuan won the "2023Excellent Equipment Supplier" and "Shenzhen Metro Line 8 Phase II Project Excellent Contribution Unit" of Shenzhen MetroConstruction Group, and the maintenance project was rated as the "2023 Platform Door Professional Outsourcing Service Project"
of the Mechanical and Electrical Center of Wuhan Metro Operation Co., Ltd. and the "Excellent Outsourcing MaintenanceProject" of Wuhan Railway Transport Service Media Co., Ltd.According to the information released by RT Rail Transit Network, Fangda Zhiyuan topped the list of successful bidders forurban rail transit platform screen doors in China in 2023, ranking first in the number of bid-winning stations. It won 6 urban railplatform screen door system projects throughout the year, involving 5 lines and 123 stations. During the reporting period, relyingon a good brand image and market awareness, the Company successively won and signed orders for platform screen door systemprojects such as Hefei Rail Transit Line 8, Shenyang Metro Line 1 East Extension, and Shenyang Metro Line 3 Phase I. At thesame time, it also obtained orders for professional technical maintenance services for rail transit platform screen doors in NanningMetro Line 5, Wuhan Rail Transit Line 6, Wuhan-Xiaogan Intercity Railway, Wuhan-Xianning Intercity Railway, and otherprojects. In addition, the Company took the lead in going to the international market and has obtained several important projects inSingapore, Hong Kong, China, Malaysia, India, Greece, Colombia, and other countries and regions. The Company's productdesign capabilities, delivery timeliness, and product quality stability have been fully recognized by overseas customers. TheCompany's good brand image and market awareness help to continuously improve the Company's competitiveness and lay a solidfoundation for the healthy development of the Company.
4. Organizational structure advantage
The Company offers customized urban rail transit platform screen door systems, which involve various management stagesfrom order acquisition to final project delivery, including research and development, design, manufacturing, testing, installation,and maintenance. These services are characterized by high contract work refinement and long performance cycles. To providemore comprehensive services, the Company has established an organizational structure that meets customer needs, equipped withprofessionals in each service stage.The Company possesses outstanding professional capabilities and a well-configured research and development team, capableof providing technical solutions for customers' special requirements. In terms of product design, the Company's technical team hasextensive experience. In product manufacturing, the Company owns a large-scale production factory and has a complete andreliable supply chain. For product testing, the Company has well-equipped and professional testing equipment and methods. Interms of installation, the Company holds the first-level qualification of national construction mechanical and electrical installationengineering, enabling it to independently undertake installation work as stipulated by contracts. In terms of maintenance, theCompany has an operations and maintenance center with professional maintenance teams. Maintenance centers are established atcustomer locations and project sites, allowing for faster and more considerate services.
(3) New energy industry
The Company's new energy industry primarily focuses on the application of new energy and energy-saving technologies,such as solar photovoltaic power plants and building-integrated photovoltaics (BIPV). Its business scope spans across theconstruction and photovoltaic power generation industries. The Company has been actively developing solar photovoltaic curtainwall system technology for over twenty years. It is one of the domestic enterprises that started early in the design, manufacturing,and integration of solar photovoltaic building-integrated (BIPV) systems.Distributed solar power PV power generation is closely related to the Company's curtain wall business. Part of the distributedsolar power PV systems are closely related to construction. Moreover, in terms of product system integration, the Company hasover twenty years of experience in electromechanical product integration and project management. It possesses professionalqualifications in mechanical and electrical installation, among others.
(4) Business Management and Services
Located in the core area of the Guangdong-Hong Kong-Macao Greater Bay Area, the Company adopts a differentiationcompetition strategy, with a focus on operating self-owned properties like Fangda Town, and accelerating two urban renewalprojects in Shenzhen. Meanwhile, through years of operation services, the Company has established a professional and capableteam, efficient management processes and information systems, and accumulated rich experience, which can provide high-qualitymanagement and services.
III. Core business analysis
OverviewSee I. Major businesses of the Company during the Report PeriodYear-on-year changes in major financial data
In RMB
| This report period | Same period last year | YOY change (%) | Reason | |
| Turnover | 2,133,845,587.76 | 2,078,846,877.32 | 2.65% | |
| Operating cost | 1,737,599,184.98 | 1,624,230,468.63 | 6.98% | |
| Sales expense | 23,558,271.96 | 28,143,556.79 | -16.29% | |
| Administrative expense | 84,841,558.95 | 79,590,941.46 | 6.60% | |
| Financial expenses | 31,489,983.09 | 33,743,857.79 | -6.68% | |
| Income tax expenses | 16,519,019.26 | 28,189,905.44 | -41.40% | Mainly due to a decrease in total profit |
| R&D investment | 85,639,602.88 | 88,989,510.66 | -3.76% | |
| Cash flow generated by business operations, net | -171,530,998.21 | -37,313,711.13 | -359.70% | Mainly due to the decrease in cash flow from operating activities of the curtain wall and materials business compared to the same period last year. |
| Cash flow generated by investment activities, net | -166,718,423.79 | -60,178,421.86 | -177.04% | The net outflow of investment activities in this period is mainly due to the construction of Fangda (Ganzhou) Low-carbon Intelligent Manufacturing Base and the investment in machinery and equipment. |
| Net cash flow generated by financing activities | 465,466,353.53 | 58,776,644.90 | 691.92% | Mainly due to the increase in net inflow of bank financing activities in this period. |
| Net increase in cash and cash equivalents | 128,801,152.42 | -35,005,223.01 | 467.95% | Mainly due to the changes in the net cash flow from operating activities, investing activities, and financing activities. |
| Credit impairment ("-" for loss) | -7,874,799.00 | 20,274,577.59 | -138.84% | Mainly due to the increase in the bad debt provision for accounts receivable in this period. |
| Investment impairment loss ("-" for loss) | -15,876,085.85 | -14,673,904.92 | -8.19% | |
| After-tax net of other misc. income attributed to the shareholders of the parent company | 28,592,893.06 | -10,103,043.90 | 383.01% | Mainly due to the conversion of some self-used properties to rentals in this period, from fixed assets to investment properties measured at fair value. |
Major changes in profit composition or sources during the report period
□ Applicable ? Inapplicable
The profit composition or sources of the Company have remained largely unchanged during the report period.Turnover composition
In RMB
| This report period | Same period last year | YOY change (%) | |||
| Amount | Proportion in operating costs (%) | Amount | Proportion in operating costs (%) | ||
| Total turnover | 2,133,845,587.76 | 100% | 2,078,846,877.32 | 100% | 2.65% |
| Industry | |||||
| Metal production | 1,737,754,739.77 | 81.44% | 1,654,849,166.62 | 79.60% | 5.01% |
| Railroad industry | 263,455,042.38 | 12.35% | 291,615,462.85 | 14.03% | -9.66% |
| Commercial real estate | 118,828,634.36 | 5.57% | 115,913,190.77 | 5.58% | 2.52% |
| New energy industry | 7,061,695.63 | 0.33% | 8,947,285.78 | 0.43% | -21.07% |
| Others | 6,745,475.62 | 0.32% | 7,521,771.30 | 0.36% | -10.32% |
| Product | |||||
| Curtain wall system and new materials | 1,737,754,739.77 | 81.44% | 1,654,849,166.62 | 79.60% | 5.01% |
| Subway screen door and service | 263,455,042.38 | 12.35% | 291,615,462.85 | 14.03% | -9.66% |
| Commercial real estate leasing and property services | 118,828,634.36 | 5.57% | 115,913,190.77 | 5.58% | 2.52% |
| PV power generation products | 7,061,695.63 | 0.33% | 8,947,285.78 | 0.43% | -21.07% |
| Others | 6,745,475.62 | 0.32% | 7,521,771.30 | 0.36% | -10.32% |
| District | |||||
| In China | 1,955,457,106.44 | 91.64% | 1,831,339,689.35 | 88.09% | 6.78% |
| Out of China | 178,388,481.32 | 8.36% | 247,507,187.97 | 11.91% | -27.93% |
Industries, products or districts that take more than 10% of the Company's business turnover or profit? Applicable □ Inapplicable
In RMB
| Turnover | Operating cost | Gross margin | Year-on-year change in operating revenue | Year-on-year change in operating costs | Year-on-year change in gross margin | |
| Industry | ||||||
| Metal production | 1,737,754,739.77 | 1,498,853,634.92 | 13.75% | 5.01% | 8.29% | -2.61% |
| Railroad industry | 263,455,042.38 | 204,334,717.47 | 22.44% | -9.66% | -1.59% | -6.36% |
| Commercial real estate | 118,828,634.36 | 30,419,966.05 | 74.40% | 2.52% | 6.58% | -0.98% |
| Product | ||||||
| Curtain wall system and new materials | 1,737,754,739.77 | 1,498,853,634.92 | 13.75% | 5.01% | 8.29% | -2.61% |
| Subway screen | 263,455,042.38 | 204,334,717.47 | 22.44% | -9.66% | -1.59% | -6.36% |
| door and service | ||||||
| Commercial real estate leasing and property services | 118,828,634.36 | 30,419,966.05 | 74.40% | 2.52% | 6.58% | -0.98% |
| District | ||||||
| In China | 1,955,457,106.44 | 1,607,183,210.73 | 17.81% | 6.78% | 10.04% | -2.44% |
Main business statistics adjusted in the recent one year with the statistics criteria adjusted in the report period
□ Applicable ? Inapplicable
IV. Non-core business analysis
? Applicable □ Inapplicable
In RMB
| Amount | Profit percentage | Reason | Whether continuous | |
| Investment income | -2,082,121.20 | -1.55% | No | |
| Gain/loss caused by changes in fair value | 558,364.87 | 0.42% | No | |
| Assets impairment | -15,876,085.85 | -11.81% | Provision for impairment of contract assets | No |
| Non-operating revenue | 178,760.55 | 0.13% | No | |
| Non-business expenses | 535,703.48 | 0.40% | No | |
| Credit impairment loss | -7,874,799.00 | -5.86% | Mainly the bad debt provision for accounts receivable. | No |
V. Assets and Liabilities
1. Major changes in assets composition
In RMB
| End of the report period | End of last year | Change (% ) | Notes | |||
| Amount | Proportion in total assets | Amount | Proportion in total assets | |||
| Monetary capital | 1,685,006,677.59 | 12.25% | 1,425,151,116.24 | 10.65% | 1.60% | |
| Account receivable | 1,022,698,982.69 | 7.43% | 911,486,914.19 | 6.81% | 0.62% | |
| Contract assets | 2,615,862,223.46 | 19.02% | 2,488,429,802.41 | 18.60% | 0.42% | |
| Inventory | 752,777,729.07 | 5.47% | 755,624,486.51 | 5.65% | -0.18% | |
| Investment real estate | 5,684,258,283.56 | 41.32% | 5,756,809,168.26 | 43.04% | -1.72% | |
| Long-term | 54,722,057.88 | 0.40% | 54,757,017.40 | 0.41% | -0.01% | |
| share equity investment | ||||||
| in fixed assets | 723,454,635.28 | 5.26% | 620,828,178.38 | 4.64% | 0.62% | |
| Construction in process | 242,897,579.60 | 1.77% | 109,414,347.33 | 0.82% | 0.95% | |
| Use right assets | 23,987,257.81 | 0.17% | 20,776,829.58 | 0.16% | 0.01% | |
| Short-term loans | 2,428,741,196.99 | 17.66% | 2,208,055,039.21 | 16.51% | 1.15% | |
| Contract liabilities | 217,382,606.30 | 1.58% | 198,164,209.47 | 1.48% | 0.10% | |
| Long-term loans | 880,000,000.00 | 6.40% | 660,000,000.00 | 4.93% | 1.47% | |
| Lease liabilities | 12,122,587.89 | 0.09% | 6,675,870.04 | 0.05% | 0.04% |
2. Major foreign assets
□ Applicable ? Inapplicable
3. Assets and liabilities measured at fair value
? Applicable □ Inapplicable
In RMB
| Item | Opening amount | Gain/loss caused by changes in fair value | Accumulative changes in fair value accounting into the income account | Impairment provided in the period | Amount purchased in the period | Amount sold in the period | Other change | Closing amount | |
| Financial assets | |||||||||
| 1. Transactional financial assets (excluding derivative financial assets) | 0.00 | 0.00 | |||||||
| 2. Derivative financial assets | 173,737.06 | 0.00 | |||||||
| 3. Other non-current financial assets | 7,455,617.17 | 2,702.12 | -1,087,037.25 | 6,371,282.04 | |||||
| 4. Receivable financing | 6,979,428.14 | 4,668,854.47 | |||||||
| Subtotal | 14,608,782.37 | 2,702.12 | -1,087,037.25 | 11,040,136.51 | ||||
| Investment real estate | 5,747,572,171.31 | 555,662.75 | 103,340,456.61 | 3,189,499.43 | -69,692,344.00 | 5,675,245,990.63 | ||
| Total | 5,762,180,953.68 | 558,364.87 | 103,340,456.61 | 0.00 | 0.00 | 3,189,499.43 | -70,779,381.25 | 5,686,286,127.14 |
| Financial liabilities | 0.00 | 0.00 | 628,367.00 |
Other changeThe other changes in other non-current financial assets RMB-1,087,037.25 were due to the recovery of some investments; theother changes in investment real estate RMB-69,692,344.00, mainly due to the increase of RMB84,275,738.00 caused by thetransfer of inventory and fixed assets, and the decrease of RMB153,968,082.00 caused by the transfer of investment real estate toself-used fixed assets.Major changes in the assets measurement property of the Company in the report period
□ Yes ? No
4. Right restriction of assets at the end of the period
| Item | Book value on June 30, 2024 (RMB) | Reason |
| Monetary capital | 776,544,406.75 | Various deposits |
| Notes receivable | 21,096,517.86 | Bills endorsed or discounted but not yet due |
| Account receivable | 34,843,474.59 | Loan by pledge |
| Construction in process | 228,077,468.49 | Loan by pledge |
| in fixed assets | 141,500,759.61 | Loan by pledge |
| Investment real estate | 1,827,299,718.88 | Loan by pledge |
| Intangible assets | 23,454,260.19 | Loan by pledge |
| Equity pledge | 200,000,000.00 | 100% stake in Fangda Property Development held by the Company |
| Total | 3,252,816,606.37 |
VI. Investment
1. General situation
? Applicable □ Inapplicable
| Investment (yuan) in the report period | Investment (yuan) in the previous period | Change |
| 205,541,120.00 | 29,500,000.00 | 596.75% |
2. Major equity investment in the report period
□ Applicable ? Inapplicable
3. Major non-equity investment in the report period
? Applicable □ Inapplicable
In RMB
| Project name | Method of investment | Whether it is fixed assets investment | Industries involved in investment projects | Investment in the report period | Actual investment by the end of the report period | Capital source | Progress | Estimate return | Accumulated income realized by the end of the reporting period | Reasons for failing to reach the planned progress and expected income | Disclosure date (if any) | Disclosure source (if any) |
| Phase 1 of Fangda (Ganzhou) Low Carbon Intelligent Manufacturing Headquarters Base | Self-built | Yes | Mainly produce PVDF aluminum veneer, nano aluminum veneer and other new materials, smart curtain wall system, photovoltaic building integration system, aluminum alloy compo | 205,541,120.00 | 275,541,120.00 | Self-owned fund | 73.26% | -- | December 17, 2022 | Announcement on Investment and Construction of Fangda (Ganzhou) Low Carbon Intelligent Manufacturing Headquarters Base released on http://www.cninfo.com.cn/ |
| nents, and precision steel components. | ||||||||||||
| Total | -- | -- | -- | 205,541,120.00 | 275,541,120.00 | -- | 73.26% | -- | -- | -- | -- | -- |
4. Financial assets investment
(1) Securities investment
□ Applicable ? Inapplicable
The Company made no investment in securities in the report period
2. Derivative investment
? Applicable □ Inapplicable
1) Derivative investments for hedging purposes during the reporting period
? Applicable □ Inapplicable
In RMB10,000
| Type | Initial investment amount | Opening amount | Gain/loss caused by changes in fair value | Accumulative changes in fair value accounting into the income account | Amount in this period | Amount sold in this period | Closing amount | Proportion of closing investment amount in the closing net assets in the report period |
| Forward foreign exchange | 6,210.72 | 6,210.72 | -80.21 | -62.84 | 1,001.00 | 4,530.88 | 2,680.84 | 0.45% |
| Total | 6,210.72 | 6,210.72 | -80.21 | -62.84 | 1,001.00 | 4,530.88 | 2,680.84 | 0.45% |
| Accounting policies and specific accounting principles of hedging business during the reporting period, as well as | The forward foreign exchange business of the Company meets the applicable conditions of hedge accounting specified in the accounting standards and are applicable to hedge accounting, which are classified as cash flow hedging. The corresponding accounting policies and accounting principles have not changed from the previous reporting period. | |||||||
| whether there are significant changes compared with the previous reporting period | |
| Description of actual profit and loss during the reporting period | During the reporting period, the gains and losses generated by the forward foreign exchange hedging instrument offset the value changes of the hedged items due to exchange rate fluctuations. |
| Description of hedging effect | The profit and loss generated by the company's hedging instrument can offset the value change of the hedged item, and the hedging effect of the hedging business is good. |
| Capital source | Self-owned fund |
| Risk analysis and control measures for the derivative holding in the report period (including without limitation market, liquidity, credit, operation and legal risks) | The aluminum futures hedging and foreign exchange derivatives trading businesses carried out by the Company are derivative investment businesses. The derivative investment business carried out by the Company follows the basic principle of locking the price and exchange rate of raw materials, does not carry out speculative trading operations, and carries out strict risk control when signing hedging contracts and closing positions. The Company has established and implemented the "Derivatives Investment Business Management Measures" and "Commodity Futures Hedging Business Internal Control and Risk Management System". It has made clear regulations on the approval authority, business management, risk management, information disclosure and file management of derivatives trading business, which can effectively control the risk of the Company's derivatives holding positions. |
| Changes in the market price or fair value of the derivative in the report period, the analysis of the derivative's fair value should disclose the method used and related | Fair value of derivatives are measured at open prices in the open market |
| assumptions and parameters. | |
| Lawsuit (if any) | No |
| Disclosure date of derivative investment approval by the Board of Directors (if any) | October 30, 2023 |
2) Derivative investment for the purpose of speculation during the reporting period
□ Applicable ? Inapplicable
During the reporting period, there was no derivative investment for the purpose of speculation.
5. Use of raised capital
□ Applicable ? Inapplicable
The Company used no raised capital in the report period.VII. Major assets and equity sales
1. Major assets sales
□ Applicable ? Inapplicable
The Company sold no assets in the report period.
2. Major equity sales
□ Applicable ? Inapplicable
VIII. Analysis of major joint stock companies? Applicable □ InapplicableMajor subsidiaries and joint stock companies affecting more than 10% of the Company's net profit
In RMB
| Company | Type | Main business | Registered capital | Total assets | Net assets | Turnover | Operation profit | Net profit |
| Fangda Jianke | Subsidiaries | Curtain wall system and materials | 600,000,000.00 | 5,948,864,608.12 | 1,811,503,620.79 | 1,578,189,190.18 | 46,841,972.51 | 47,857,077.16 |
| Fangda Zhiyuan | Subsidiaries | Subway screen door and service | 105,000,000.00 | 1,021,524,281.13 | 317,724,568.13 | 263,455,042.38 | 20,534,500.56 | 17,975,469.57 |
| Fangda Property | Subsidiaries | Real estate sales | 200,000,000.00 | 5,692,737,095.14 | 2,625,192,476.55 | 69,807,930.73 | 29,267,733.01 | 21,916,684.66 |
| Fangda Property Management | Subsidiaries | Property management service | 10,000,000.00 | 72,310,714.92 | 51,234,334.12 | 39,240,929.86 | 16,363,554.84 | 12,287,341.85 |
Acquisition and disposal of subsidiaries in the report period? Applicable □ Inapplicable
| Company | Acquisition and disposal of subsidiaries in the report period | Impacts on overall production, operation and performance |
| Fangda Curtain Wall Singapore | Newly set | None |
| Shenzhen Fangda Investment Partnership (Limited Partnership) | Decrease due to liquidation and cancellation | None |
Major joint-stock companiesDuring this reporting period, the operating income of Fangda Construction Technology Co., Ltd. was RMB1,578,189,190.18, ofwhich the main business income was RMB1,573,343,071.67, and the operating profit was RMB46,841,972.51, of which the mainbusiness profit was RMB45,444,687.42; the operating income of Fangda Zhiyuan Co., Ltd. was RMB263,455,042.38, of whichthe main business income was RMB263,135,057.05, and the operating profit was RMB20,534,500.56, of which the main businessprofit was RMB20,415,148.95; the operating income of Fangda Real Estate Co., Ltd. was RMB69,807,930.73, of which the mainbusiness income was RMB69,397,823.54, and the operating profit was RMB29,267,733.01, of which the main business profit wasRMB28,857,625.82; the operating income of Fangda Property Management Co., Ltd. was RMB39,240,929.86, of which the mainbusiness income was RMB39,240,929.86, and the operating profit was RMB16,363,554.84, of which the main business profit wasRMB16,363,554.84.
IX. Structural entities controlled by the Company
□ Applicable ? Inapplicable
X. Risks facing the Company and measures
1. Risks of macro environment and policy changes
The Company's main business segments are closely related to macroeconomic and industrial policies and are greatly affectedby the overall macro environment. The year 2024 is a year in which the Company takes significant strides towards the globalmarket. If there are adverse changes in the international and domestic macroeconomic environment, weak economic momentumand reduced investment in fixed assets in the future, which will affect the demand of public building curtain wall industry and railtransit equipment industry, or face industry depression or excessive competition, which will have an adverse impact on theCompany's future profitability, even project delay or suspension, deferred payment of projects under construction, etc., thusaffecting the Company's operating performance.In order to better respond to the opportunities and challenges brought about by changes in the economic environment andpolicies, the Company will closely monitor changes in the domestic and international macroeconomic and policy situations, adjustthe Company's business strategies in a timely manner, make overall use of domestic and international markets and resources,further enhance the competitiveness of products and the ability to operate and manage, and increase market share. The coretechnology will be actively extended to other industries, centering on the key strategic directions of the country, and efforts will bemade to build a diversified industrial pattern with a reasonable structure, scientific layout, and collaborative efficiency to copewith the risks brought about by changes in the macro environment and policies.
2. Market competition risks
The overall design level and quality requirements of China's curtain wall industry are constantly improving. Although theindustry concentration is low, in the high-end market, especially the majority of the national landmark and regional key curtainwall projects are contracted by the leading domestic curtain wall enterprises, regional competition will become more intense, andthe Company's traditional competitive products will face price space compression. The Company will face certain marketcompetition risks in the future. In this regard, the Company will continue to adopt a stable business policy, improve thecompetitive advantage of products through technological innovation and fine management, accelerate the return of funds, andimprove the operation efficiency and market competitiveness of the Company. In addition, industry competition and opportunitiescoexist, and market development puts forward high requirements for the combination of new technology applications, and thestandards for product design, development, and upgrading are improved. If market demand research is not sufficient, or the futuredevelopment and changes of technology cannot be accurately predicted, it may lead to the insufficient combination of moderntechnology and the Company's existing technology, which is not conducive to the company maintaining its leading position inforward-looking and leading scientific and technological innovation.In response, the Company will continue to adopt a proactive and prudent business policy, strengthen resource support for keyareas, enhance product competitive advantages through technological innovation and refined management, accelerate thepromotion of leading scientific research projects, carry out digital and intelligent technology research and application, form aworking mechanism integrating market and R&D, and timely formulate countermeasures in terms of technology R&D and marketoperation, and strengthen communication with existing partners. Accelerate the return of funds and improve the Company'soperational efficiency and market competitiveness. While consolidating the domestic market, the Company will step up the effortsin exploring overseas markets, thus elevating our competitiveness in global markets and improving our resistance to risks.
3. Risk of Accounts Receivable Recovery
Some of the smart curtain wall projects contracted by the Company have the characteristics of long construction period, largeinvestment, slow settlement, and lagging recovery. In recent years, with the growth of the Company's revenue scale, the amount ofaccounts receivable has also been increasing, which may cause the Company's capital turnover speed and operational efficiency todecrease, resulting in liquidity risks and bad debt losses.
The Company will further strengthen the risk prevention awareness of accounts receivable recovery, strengthen customercredit evaluation, carefully select partners and customers, and prioritize capital risk control. Regularly analyze and dynamicallymonitor the contract assets and accounts receivable of key projects, strengthen incentives and constraints, and take multiplemeasures and comprehensive measures to promote the recovery of funds through normalized and listed management and control.
4. Management risks
With the continuous expansion of the Company's asset scale, personnel scale, and business scale, and the increase in thenumber of subsidiaries, the difficulty of the Company's daily management work is increasing, and it may face the management riskof industrial scale expansion. In addition, in recent years, the regulatory requirements for listed companies have been continuouslyimproved and deepened. The Company needs to further strengthen management, continue to promote management reform,constantly optimize process and organizational structure, improve various rules and regulations, and vigorously introduce high-quality, highly skilled and multidisciplinary technology and management talents, gradually optimize the allocation of humanresources, optimize the echelon structure, and effectively reduce the management risks brought by business development.XI. Implementation of the Action Plan for "Double Improvement of Quality and Return"Has the Company disclosed an action plan for "Double Improvement of Quality and Return".
□ Yes ? No
Chapter IV Corporation GovernanceI. Annual and extraordinary shareholder meetings held during the report period
1. Annual shareholder meeting during the report period
| Meeting | Type | Participation of investors | Date | Date of disclosure | Meeting resolution |
| 1st Provisional Shareholders' Meeting 2024 | Extraordinary shareholders' meeting | 23.93% | January 8, 2024 | January 9, 2024 | Please refer to the information published on http://www.cninfo.com.cn Announcement on the Resolution of the 2024 1st Extraordinary Meeting of Shareholders of China Fangda Group Co., Ltd. |
| 2023 Annual Shareholder Meeting | Annual shareholders' meeting | 24.21% | April 22, 2024 | April 23, 2024 | Please refer to the information published on http://www.cninfo.com.cn Announcement on the Resolution of the 2023 General Meeting of Shareholders of China Fangda Group Co., Ltd. |
2. Shareholders of preference shares of which voting right resume convening an extraordinaryshareholders' meeting
□ Applicable ? Inapplicable
II. Changes in the Directors, Supervisors and Senior Executives? Applicable □ Inapplicable
| Name | Job | Type | Date | Reason |
| Huang Yaying | Independent director | Resigned | January 8, 2024 | Huang Yaying has resigned due to personal reasons |
| Song Ming | Independent director | Elected | January 8, 2024 | Was elected as an independent director of the Company at the first extraordinary general meeting of |
| shareholders in 2024 | ||||
| Xiong Xi | Vice chairman | Elected | March 18, 2024 | Was elected as the Vice Chairman at the seventh meeting of the 10th Board of Directors. |
III. Profit Distribution and Reserve Capitalization in the Report Period
□ Applicable ? Inapplicable
The Company distributed no cash dividends or bonus shares and has no reserve capitalization plan.IV. Share incentive schemes, staff shareholding program or other incentive plans
□ Applicable ? Inapplicable
There is no share incentive schemes, staff shareholding program or other incentive plans in the report period
V. Environmental and social responsibility
1. Environmental protection
Whether the Company and its subsidiaries are key polluting companies disclosed by the environmental protection authority
□ Yes ? No
Administrative penalties for environmental problems during the reporting period
| Company or subsidiary | Reason | Violations | Punishment result | Impact on the production and operation of listed companies | Rectification measures of the Company |
| Inapplicable | Inapplicable | Inapplicable | Inapplicable | Inapplicable | Inapplicable |
Refer to other environmental information disclosed by key pollutant discharge unitsDuring the reporting period, the listed company and its subsidiaries were not key pollutant discharge units announced by theenvironmental protection department, and there were no administrative penalties for environmental problems.Measures and effects taken to reduce carbon emissions during the reporting period? Applicable □ InapplicableSince its inception, the Company has adhered to the mission of green and environmental protection, actively exploring thepath of environmental friendliness and complementary development of the enterprise. The Company's smart curtain wall,photovoltaic building integration (BIPV) project, rail transit PSD system, solar photovoltaic power station and other industrieshave energy-saving and environmental protection attributes. Combined with the characteristics of the industry, the Company hassuccessively developed national and provincial key environmental protection new products such as ventilated and photovoltaiccurtain walls, nano self-cleaning and fireproof honeycomb aluminum composite plates, and takes the lead in developing therailway transport PSD system with independent intellectual property rights in China. The Company's "full height open platformscreen door of rail transit" technology has reduced the energy consumption of air conditioning and ventilation system by more than20%, and the products of double-layer breathing curtain wall system save energy by more than 30% compared with the traditionalcurtain wall. During the reporting period, the Company continued to increase its research and development efforts in green andlow-carbon technologies, independently developed ultra-low energy consumption window-wall combination curtain wall systems,three-module full-height platform screen door structure products, etc., and adhered to integrating the concept of greendevelopment into the entire life cycle of product design, manufacturing and installation, and service operation, continuouslypromoting the transformation of production methods to green and low-carbon.During the reporting period, the new energy industry's solar photovoltaic power generation was 7.262 million kWh,equivalent to saving 2,614.24 tons of standard coal, reducing carbon dioxide emissions by nearly 7,240 tons, reducing sulfurdioxide emissions by 85 tons, and reducing water resource usage by 29,048 tons, continuously contributing to the realization ofcarbon peak and carbon neutrality goals.Reasons for non-disclosure of other environmental informationInapplicable
2. Social responsibilities
While creating economic value, the Company attaches great importance to the sustainable development of the environmentand society, actively fulfills corporate social responsibility, and has voluntarily issued social responsibility reports for 6
consecutive years. By setting a positive example in the fields of ecological environment protection and promoting socialdevelopment, it demonstrates the responsibility of the enterprise. The Company has carried out industrial support in Guangdong,Shaanxi, Guizhou, Jiangxi and Tibet, helping rural areas to plant cash crops such as tea mushrooms and lilies according to localconditions, supporting rural collective breeding industry projects, constructing greenhouse photovoltaic power stations, distributedphotovoltaic power stations and other rural industrial "blood-creation" projects, and fostering new impetus to the development ofrural economy, helping to build a thriving industry and ecological development. Helping to build a beautiful countryside in thenew era of prosperous industry, ecological livability, civilized countryside, effective governance, and affluent life, which hasachieved good social effects and gained high praise from all walks of life.
In addition, the Company actively participates in various public welfare activities, involving many aspects such as publicwelfare education, public health, rural medical assistance, disaster relief, environmental protection, and rural revitalization, fulfillscorporate social responsibility, and contributes to building a harmonious society and promoting social progress. During thereporting period, the Company once again won the honor of "Outstanding Enterprise in Fulfilling Social Responsibility".
Chapter VI Significant Events
I. Commitments that have been fulfilled and not fulfilled by actual controller, shareholders,related parties, acquirers of the Company
□ Applicable ? Inapplicable
There is no commitment that has not been fulfilled by actual controller, shareholders, related parties, acquirers of the CompanyII. Non-operating capital use by the controlling shareholder or related parties in thereporting term
□ Applicable ? Inapplicable
The controlling shareholder and its affiliates occupied no capital for non-operating purpose of the Company during the reportperiod.III. Incompliant external guarantee
□ Applicable ? Inapplicable
The Company made no incompliant external guarantee in the report period.IV. Engaging and dismissing of CPA
Whether the interim financial report is audited
□ Yes ? No
The interim report for H1 2015 has not been audited.V. Statement of the Board on the “non-standard auditors' report” issued by the CPA on thecurrent report period
□ Applicable ? Inapplicable
VI. Statement of the Board of Directors on the Non-standard Auditor's Report for H1 2014
□ Applicable ? Inapplicable
VII. Bankruptcy and capital reorganizing
□ Applicable ? Inapplicable
The Company has no bankruptcy or reorganization events in the report period.
VIII. Lawsuit
Significant lawsuit and arbitration
□ Applicable ? Inapplicable
The Company has no significant lawsuit or arbitration affair in the report period.
Other lawsuits? Applicable □ Inapplicable
| Basic information of litigation (arbitration) | Amount (in RMB10,000) | Whether estimated liabilities are formed | Progress of litigation (arbitration) | Litigation (arbitration) hearing results and impact | Enforcement of litigation (arbitration) judgment | Date of disclosure | Index for information disclosure |
| Summary of matters in which the subsidiaries as the plaintiff fail to meet the disclosure standards of major litigation (arbitration) | 43,569.07 | No | In the stage of filing, trial, or execution | Some cases are under trial, and it is expected that they will not have a significant impact on the company's operations and financial situation; for some cases, the judgment has come into effect, and the final actual impact shall be subject to the execution result | Some cases are under execution | ||
| Summary of matters where the Company and its subsidiaries as defendants fail to meet the disclosure standards of major litigation (arbitration) | 6,905.83 | No | At trial | The case has not been closed yet, and it is not expected to have a significant impact on the company's operation and financial status | Inapplicable |
IX. Punishment and rectification
□ Applicable ? Inapplicable
The Company received no major penalty and made no correction in the report period.X. Credibility of the Company, controlling shareholder and actual controller
□ Applicable ? Inapplicable
XI. Material related transactions
1. Related transactions related to routine operation
□ Applicable ? Inapplicable
The Company made no related transaction related to daily operating in the report period.
2. Related transactions related to assets transactions
□ Applicable ? Inapplicable
The Company made no related transaction of assets or equity requisition and sales in the report period.
3. Related transactions related to joint external investment
□ Applicable ? Inapplicable
The Company made no related transaction of joint external investment in the report period.
4. Related credits and debts
□ Applicable ? Inapplicable
The Company had no related debt in the report period.
5. Transactions with related financial companies
□ Applicable ? Inapplicable
There is no deposit, loan, credit or other financial business between the company and the related financial company.
6. Transactions between financial companies controlled by the company and related parties
□ Applicable ? Inapplicable
There is no deposit, loan, credit or other financial business between the financial company controlled by the company and itsrelated parties.
7. Other major related transactions
□ Applicable ? Inapplicable
The Company has no other significant related transaction in the report period.XII. Significant contracts and performance
1. Asset entrusting, leasing, contracting
(1) Asset entrusting
□ Applicable ? Inapplicable
The Company made no custody in the report period.
(2) Contracting
□ Applicable ? Inapplicable
The Company made no contract in the report period
(3) Leasing
□ Applicable ? Inapplicable
There is no leasing during the reporting period.
2. Significant guarantee
? Applicable □ Inapplicable
In RMB10,000
| External guarantees made by the Company and subsidiaries (exclude those made for subsidiaries) | ||||||||||
| Guarantee provided to | Date of disclosure | Guarantee amount | Actual date | Actual amount of guarantee | Type of guarantee | Collateral (if any) | Counter guarantee (if any) | Term | Completed or not | Related party |
| No | ||||||||||
| Guarantee provided to subsidiaries | ||||||||||
| Guarantee provided to | Date of disclosure | Guarantee amount | Actual date | Actual amount of guarantee | Type of guarantee | Collateral (if any) | Counter guarantee (if any) | Term | Completed or not | Related party |
| Fangda Jianke | February 28, 2023 | 93,000 | December 28, 2023 | 65,159.21 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jianke | April 2, 2024 | 24,000 | May 27, 2024 | 21,746.4 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jianke | February 28, 2023 | 30,000 | September 25, 2023 | 19,116.9 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jianke | February 28, 2023 | 50,000 | September 28, 2023 | 29,076.89 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jianke | February 28, 2023 | 30,000 | October 20, 2023 | 19,085.99 | Joint and several liability guarantee | No | No | since engage of contract to 3 years | No | Yes |
| upon due of debt | ||||||||||
| Fangda Jianke | February 28, 2023 | 39,000 | January 24, 2024 | 24,300.15 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jianke | April 2, 2024 | 15,000 | May 11, 2024 | 15,000 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jianke | February 28, 2023 | 48,000 | December 15, 2023 | 30,817.45 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jianke | February 28, 2023 | 50,000 | October 23, 2023 | 50,000 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jianke | February 28, 2023 | 11,400 | August 16, 2023 | 3,146.6 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jianke | February 28, 2023 | 20,000 | October 9, 2023 | 9,900 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jianke | April 2, 2024 | 4,000 | June 20, 2024 | 4,000 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jianke | April 2, 2024 | 60,000 | June 27, 2024 | 35,000 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jianke | February 28, 2023 | 30,000 | December 21, 2023 | 19,961.82 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jianke | February 28, 2023 | 20,000 | November 2, 2023 | 10,000 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Zhiyuan | April 2, 2024 | 36,000 | June 27, 2024 | 15,271.84 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Zhiyuan | April 2, 2024 | 15,000 | May 30, 2024 | 2,162.36 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Zhiyuan | February 28, 2023 | 20,000 | October 7, 2023 | 2,713.31 | Joint and several liability guarante | No | No | since engage of contract | No | Yes |
| e | to 3 years upon due of debt | |||||||||
| Fangda Zhiyuan | February 28, 2023 | 15,000 | September 25, 2023 | 9,716.51 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Zhiyuan | April 2, 2024 | 10,000 | May 11, 2024 | 997.57 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Zhiyuan | February 28, 2023 | 18,000 | December 15, 2023 | 6,098.37 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Zhiyuan | February 28, 2023 | 15,550 | November 21, 2023 | 7,880.7 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Zhiyuan | February 28, 2023 | 10,000 | September 25, 2023 | 70.41 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Zhiyuan | February 28, 2023 | 10,000 | December 21, 2023 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of | No | Yes |
| debt | ||||||||||
| Fangda Yunzhu | April 2, 2024 | 600 | June 3, 2024 | 24.15 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Yunzhu | April 2, 2024 | 1,000 | May 7, 2024 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes | |
| Fangda Yunzhu | April 2, 2024 | 1,000 | June 28, 2024 | 1,000 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jiangxi New Material | February 28, 2023 | 8,500 | November 2, 2023 | 4,987.16 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Jiangxi New Material | February 28, 2023 | 10,000 | April 18, 2023 | 2,064.07 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Property | December 4, 2019 | 135,000 | February 25, 2020 | 66,000 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Zhijian | April 2, 2024 | 7,000 | May 8, 2024 | 5,774.01 | Joint and several | No | No | since engage | No | Yes |
| liability guarantee | of contract to 3 years upon due of debt | |||||||||
| Fangda Intelligent Manufacturing | December 23, 2023 | 30,000 | February 22, 2024 | 25,000 | Joint and several liability guarantee | No | No | since engage of contract to 3 years upon due of debt | No | Yes |
| Fangda Zhiyuan | December 23, 2023 | 31,896.02 | February 17, 2024 | 31,896.02 | Joint and several liability guarantee | No | No | From the date of issuance of the guarantee letter to the completion of the project contract | No | Yes |
| Fangda Zhiyuan | December 23, 2023 | 24,885.16 | February 17, 2024 | 24,885.16 | Joint and several liability guarantee | No | No | From the date of issuance of the guarantee letter to the completion of the project contract | No | Yes |
| Total of guarantee to subsidiaries approved in the report term (B1) | 788,831.18 | Total of guarantee to subsidiaries actually occurred in the report term (B2) | 371,236.68 | |||||||
| Total of guarantee to subsidiaries approved as of the report term (B3) | 923,831.18 | Total of balance of guarantee actually provided to the subsidiaries as of end of report term (B4) | 562,853.05 | |||||||
| Guarantee provided to subsidiaries | ||||||||||
| Guarantee provided to | Date of disclosure | Guarantee amount | Actual date | Actual amount of guarantee | Type of guarantee | Collateral (if any) | Counter guarantee (if any) | Term | Completed or not | Related party |
| No | ||||||||||
| Total of guarantee provided by the Company (total of the above three) | ||||||||||
| Total of guarantee approved in the report term (A1+B1+C1) | 788,831.18 | Total of guarantee occurred in the report term (A2+B2+C2) | 371,236.68 |
| Total of guarantee approved as of end of report term (A3+B3+C3) | 923,831.18 | Total of guarantee occurred as of the end of report term (A4+B4+C4) | 562,853.05 |
| Percentage of the total guarantee occurred (A4+B4+C4) on net asset of the Company | 93.50% | ||
| Including: | |||
| Balance of guarantees provided to shareholders, actual controllers, and their affiliates(D) | 0 | ||
| Guarantee provided directly or indirectly to objects with over 70% of liability on asset ratio (E) | 0 | ||
| Amount of guarantee over 50% of the net asset (F) | 261,875.22 | ||
| Total of the above 3 (D+E+F) | 261,875.22 | ||
| For the unexpired guarantee contract, the guarantee liability has occurred during the reporting period or there is evidence that it is possible to bear joint and several repayment liability (if any) | No | ||
| Statement of external guarantees violating the procedure (if any) | No | ||
Note of compound guaranteeNo
3. Entrusted wealth management
□ Applicable ? Inapplicable
The Company made no trust investment in the report period
4. Other significant contracts
□ Applicable ? Inapplicable
The Company entered into no other significant contract in the report.
13. Other material events
? Applicable □ InapplicableTo meet the needs of future business development, the 17th meeting of the 9th board of directors of the Company reviewedand approved the "Proposal on the Investment and Construction of Fangda (Ganzhou) Low-carbon Intelligent ManufacturingHeadquarters Base", and agreed that the Company would invest in the construction of Fangda (Ganzhou) Low-carbon IntelligentBase in Zhanggong District, Ganzhou, Jiangxi Province. For details, please refer to the relevant announcement disclosed by the
Company on the website of Juchao Information on December 17, 2022. As of the date of this report's disclosure, the constructionof the first phase of Fangda (Ganzhou) Low-carbon Intelligent Base has been basically completed, the main large-scale equipmenthas been purchased and installed as planned, and the commissioning of production equipment is currently underway.
XIV. Material events of subsidiaries
□ Applicable ? Inapplicable
Chapter VII Changes in Share Capital and ShareholdersI. Changes in shares
1. Changes in shares
In share
| Before the change | Change (+,-) | After the change | |||||||
| Quantity | Proportion | Issued new shares | Bonus shares | Transferred from reserves | Others | Subtotal | Quantity | Proportion | |
| I. Shares with trade restriction conditions | 3,861,043 | 0.36% | 0 | 3,861,043 | 0.36% | ||||
| 1. State-owned shares | 0 | ||||||||
| 2. State-owned legal person shares | 0 | ||||||||
| 3. Other domestic shares | 3,861,043 | 0.36% | 0 | 3,861,043 | 0.36% | ||||
| Including: Shares held by domestic legal persons | 0 | ||||||||
| Domestic natural person shares | 3,861,043 | 0.36% | 0 | 3,861,043 | 0.36% | ||||
| 4. Shares held by foreign investors | 0 | ||||||||
| Including: Shares held by foreign legal persons | 0 | ||||||||
| Domestic natural person shares | 0 | ||||||||
| II. | 1,070,013,184 | 99.64% | 0 | 1,070,013,184 | 99.64 | ||||
| Unrestricted shares | % | ||||||||
| 1. Common shares in RMB | 675,854,429 | 62.94% | 0 | 675,854,429 | 62.94% | ||||
| 2. Foreign shares in domestic market | 394,158,755 | 36.70% | 0 | 394,158,755 | 36.70% | ||||
| 3. Foreign shares in overseas market | 0 | ||||||||
| 4. Others | 0 | ||||||||
| III. Total of capital shares | 1,073,874,227 | 100.00% | 0 | 1,073,874,227 | 100.00% |
Reasons
□ Applicable ? Inapplicable
Approval of the change
□ Applicable ? Inapplicable
Share transfer
□ Applicable ? Inapplicable
Progress in the implementation of share repurchase
□ Applicable ? Inapplicable
Progress in the implementation of the reduction of shareholding shares by means of centralized bidding
□ Applicable ? Inapplicable
Impacts on financial indicators including basic and diluted earnings per share, net assets per share attributable to commonshareholders of the Company in the most recent year and period
□ Applicable ? Inapplicable
Others that need to be disclosed as required by the securities supervisor
□ Applicable ? Inapplicable
2. Changes in conditional shares
□ Applicable ? Inapplicable
II. Share placing and listing
□ Applicable ? Inapplicable
III. Shareholders and shareholding
In share
| Number of shareholders of common shares at the end of the report period | 48,268 | Number of shareholders of preferred stocks of which voting rights recovered in the report period (if any) | 0 | |||||
| Shareholding situation of ordinary shareholders holding more than 5% or the top 10 ordinary shareholders (excluding lending shares through refinancing) | ||||||||
| Name of shareholder | Nature of shareholder | Shareholding percentage | Number of common shares held at the end of the report period | Change in the reporting period | Conditional common shares | Unconditional common shares | Pledge, marking or freezing | |
| Share status | Quantity | |||||||
| Shenzhen Banglin Technologies Development Co., Ltd. | Domestic non-state legal person | 11.11% | 119,332,846 | 0 | 0 | 119,332,846 | Inapplicable | 0 |
| Shengjiu Investment Ltd. | Foreign legal person | 10.25% | 110,116,276 | 0 | 0 | 110,116,276 | Inapplicable | 0 |
| Fang Wei | Domestic natural person | 4.31% | 46,252,139 | 1,923,600 | 0 | 46,252,139 | Inapplicable | 0 |
| Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise (limited partner) | Domestic non-state legal person | 1.48% | 15,860,609 | 0 | 0 | 15,860,609 | Inapplicable | 0 |
| Zhou Youming | Domestic natural person | 1.02% | 10,974,910 | 213,700 | 0 | 10,974,910 | Inapplicable | 0 |
| Wu Xuandong | Domestic natural person | 0.54% | 5,827,436 | 441,686 | 0 | 5,827,436 | Inapplicable | 0 |
| Shenwan Hongyuan Securities (Hong Kong) Co., Ltd. | Foreign legal person | 0.51% | 5,470,550 | 0 | 0 | 5,470,550 | Inapplicable | 0 |
| Xiong Jianming | Domestic natural person | 0.48% | 5,110,257 | 0 | 3,832,693 | 1,277,564 | Inapplicable | 0 |
| Zhuang Liangjin | Domestic natural person | 0.42% | 4,550,000 | 281,000 | 0 | 4,550,000 | Inapplicable | 0 |
| Qu Chunlin | Domestic natural person | 0.41% | 4,444,000 | 0 | 0 | 4,444,000 | Inapplicable | 0 |
| Strategic investors or | No | |||||||
| general legal persons become the top 10 ordinary shareholders due to the placement of new shares (if any) | |||
| Notes to top ten shareholder relationship or "action in concert" | Among the shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu Investment Co., Ltd. are parties action-in-concert with Xiong Jianming. Shenzhen Banglin Technology Development Co., Ltd. and its parties action-in-concert and Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise are related parties. The Company is not notified of other action-in-concert or related parties among the other holders. | ||
| Description of the above shareholders involved in entrusted / entrusted voting right and waiver of voting right | No | ||
| Special instructions on the existence of special repurchase account among the top 10 shareholders (if any) | No | ||
| Shareholding of the top 10 unrestricted ordinary shareholders (excluding lending shares through refinancing and executive restricted shares) | |||
| Name of shareholder | Amount of common shares without sales restriction | Category of shares | |
| Category of shares | Quantity | ||
| Shenzhen Banglin Technologies Development Co., Ltd. | 119,332,846 | RMB common shares | 119,332,846 |
| Shengjiu Investment Ltd. | 110,116,276 | Domestically listed foreign shares | 110,116,276 |
| Fang Wei | 46,252,139 | RMB common shares | 46,252,139 |
| Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise (limited partner) | 15,860,609 | RMB common shares | 15,860,609 |
| Zhou Youming | 10,974,910 | RMB common shares | 10,974,910 |
| Wu Xuandong | 5,827,436 | RMB common shares | 5,827,436 |
| Shenwan Hongyuan Securities (Hong Kong) Co., Ltd. | 5,470,550 | Domestically listed foreign shares | 5,470,550 |
| Zhuang Liangjin | 4,550,000 | RMB common shares | 4,550,000 |
| Qu Chunlin | 4,444,000 | RMB common | 4,444,000 |
| shares | |||
| VANGUARD EMERGING MARKETS STOCK INDEX FUND | 4,200,804 | Domestically listed foreign shares | 4,200,804 |
| No action-in-concert or related parties among the top10 unconditional common share shareholders and between the top10 unconditional common share shareholders and the top10 common share shareholders | Among the shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu Investment Co., Ltd. are parties action-in-concert with Xiong Jianming. Shenzhen Banglin Technology Development Co., Ltd. and its parties action-in-concert and Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise are related parties. The Company is not notified of other action-in-concert or related parties among the other holders. | ||
| Top-10 common share shareholders participating in margin trade (if any) | Wu Xuandong holds 5,827,436 shares of the company through the margin trading security deposit account of Huaxi Securities Co., Ltd.; Zhuang Liangjin holds 4,550,000 shares of the company through the margin trading security deposit account of Great Wall Securities Co., Ltd. | ||
The situation of lending shares by shareholders holding more than 5% of the shares, the top 10 shareholders, and the top 10unrestricted tradable shareholders in the refinancing business.
□ Applicable ? Inapplicable
The top 10 shareholders and the top 10 unrestricted tradable shareholders have changed compared with the previous period due tothe lending/returning of refinancing.
□ Applicable ? Inapplicable
Agreed re-purchasing by the Company's top 10 shareholders of common shares and top 10 shareholders of unconditional commonshares in the report period
□ Yes ? No
No agreed re-purchasing by the Company's top 10 shareholders of common shares and top 10 shareholders of unconditionalcommon shares in the report periodIV. Changes in shareholding of Directors, Supervisors and Senior Management
□ Applicable ? Inapplicable
The Company’s Directors, supervisors and senior management shareholding has remained unchanged during the report period. Fordetails, please refer to the 2023 annual report.V. Changes in controlling shareholder or actual controllerChanges in the controlling shareholder in the reporting period
□ Applicable ? Inapplicable
No change in the controlling shareholder in the report periodChange in the actual controller in the report period
□ Applicable ? Inapplicable
No change in the actual shareholder in the report period
Chapter VIII Preferred Shares
□ Applicable ? Inapplicable
The Company had no preferred share in the report period.
Chapter IX Information about the Company's Securities
□ Applicable ? Inapplicable
Chapter X Financial StatementsI. Auditor's report
Whether the interim report is audited
□ Yes ? No
The financial statements for H1 2014 have not been audited.
II. Financial statementsUnit for statements in notes to financial statements: RMB yuan
1. Consolidated Balance Sheet
Prepared by: China Fangda Group Co., Ltd.
June 30, 2024
In RMB
| Item | Closing balance | Opening balance |
| Current asset: | ||
| Monetary capital | 1,685,006,677.59 | 1,425,151,116.24 |
| Settlement provision | ||
| Outgoing call loan | ||
| Transactional financial assets | ||
| Derivative financial assets | 173,737.06 | |
| Notes receivable | 35,745,717.64 | 47,372,881.27 |
| Account receivable | 1,022,698,982.69 | 911,486,914.19 |
| Receivable financing | 4,668,854.47 | 6,979,428.14 |
| Prepayment | 40,683,545.08 | 33,976,569.36 |
| Insurance receivable | ||
| Reinsurance receivable | ||
| Provisions of Reinsurance contracts receivable | ||
| Other receivables | 151,311,534.99 | 145,113,323.33 |
| Including: interest receivable | ||
| Dividend receivable | ||
| Repurchasing of financial assets | ||
| Inventory | 752,777,729.07 | 755,624,486.51 |
| Including: data assets | ||
| Contract assets | 2,615,862,223.46 | 2,488,429,802.41 |
| Assets held for sales | ||
| Non-current assets due in 1 year | 327,120,273.54 | |
| Other current assets | 281,266,692.03 | 248,401,322.80 |
| Total current assets | 6,590,021,957.02 | 6,389,829,854.85 |
| Non-current assets: | ||
| Loan and advancement provided | ||
| Debt investment | ||
| Other debt investment | ||
| Long-term receivables | ||
| Long-term share equity investment | 54,722,057.88 | 54,757,017.40 |
| Investment in other equity tools | ||
| Other non-current financial assets | 6,371,282.04 | 7,455,617.17 |
| Investment real estate | 5,684,258,283.56 | 5,756,809,168.26 |
| in fixed assets | 723,454,635.28 | 620,828,178.38 |
| Construction in process | 242,897,579.60 | 109,414,347.33 |
| Productive biological assets | ||
| Gas & petrol | ||
| Use right assets | 23,987,257.81 | 20,776,829.58 |
| Intangible assets | 136,750,123.83 | 140,073,209.88 |
| Including: data assets | ||
| R&D expense | ||
| Including: data assets | ||
| Goodwill | ||
| Long-term amortizable expenses | 5,074,172.96 | 6,749,314.04 |
| Deferred income tax assets | 189,628,993.91 | 182,858,549.07 |
| Other non-current assets | 99,449,614.04 | 86,799,770.90 |
| Total of non-current assets | 7,166,594,000.91 | 6,986,522,002.01 |
| Total of assets | 13,756,615,957.93 | 13,376,351,856.86 |
| Current liabilities | ||
| Short-term loans | 2,428,741,196.99 | 2,208,055,039.21 |
| Loans from Central Bank | ||
| Call loan received | ||
| Transactional financial liabilities | ||
| Derivative financial liabilities | 628,367.00 | |
| Notes payable | 930,323,177.19 | 868,886,946.79 |
| Account payable | 1,871,295,313.20 | 1,972,293,782.27 |
| Prepayment received | 1,799,054.73 | 1,432,885.03 |
| Contract liabilities | 217,382,606.30 | 198,164,209.47 |
| Selling of repurchased financial assets | ||
| Deposit received and held for others | ||
| Entrusted trading of securities | ||
| Entrusted selling of securities | ||
| Employees' wage payable | 33,499,836.34 | 74,063,112.26 |
| Taxes payable | 50,598,844.92 | 42,375,068.55 |
| Other payables | 117,203,529.49 | 117,581,764.15 |
| Including: interest payable |
| Dividend payable | 6,962,732.02 | |
| Fees and commissions payable | ||
| Reinsurance fee payable | ||
| Liabilities held for sales | ||
| Non-current liabilities due in 1 year | 44,012,088.95 | 64,135,136.46 |
| Other current liabilities | 47,206,729.29 | 53,524,655.05 |
| Total current liabilities | 5,742,690,744.40 | 5,600,512,599.24 |
| Non-current liabilities: | ||
| Insurance contract provision | ||
| Long-term loans | 880,000,000.00 | 660,000,000.00 |
| Bond payable | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Lease liabilities | 12,122,587.89 | 6,675,870.04 |
| Long-term payable | 48,400,000.00 | |
| Long-term employees' wage payable | ||
| Anticipated liabilities | 4,325,637.41 | 4,842,411.47 |
| Deferred earning | 10,987,372.47 | 8,978,678.72 |
| Deferred income tax liabilities | 1,019,250,955.77 | 1,012,146,459.12 |
| Other non-current liabilities | ||
| Total of non-current liabilities | 1,926,686,553.54 | 1,741,043,419.35 |
| Total liabilities | 7,669,377,297.94 | 7,341,556,018.59 |
| Owner's equity: | ||
| Share capital | 1,073,874,227.00 | 1,073,874,227.00 |
| Other equity tools | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Capital reserves | 11,397,609.25 | 11,459,588.40 |
| Less: Shares in stock | ||
| Other miscellaneous income | 51,714,763.85 | 23,121,870.79 |
| Special reserves | ||
| Surplus reserve | 79,324,940.43 | 79,324,940.43 |
| Common risk provisions | ||
| Retained profit | 4,803,245,119.91 | 4,772,359,940.45 |
| Total of owner's equity belong to the parent company | 6,019,556,660.44 | 5,960,140,567.07 |
| Minor shareholders' equity | 67,681,999.55 | 74,655,271.20 |
| Total of owners' equity | 6,087,238,659.99 | 6,034,795,838.27 |
| Total of liabilities and owner's interest | 13,756,615,957.93 | 13,376,351,856.86 |
Legal representative: Xiong Jianming CFO: Lin Kebing Accounting Manager: Wu Bohua
2. Balance Sheet of the Parent Company
In RMB
| Item | Closing balance | Opening balance |
| Current asset: | ||
| Monetary capital | 20,165,378.71 | 45,926,194.32 |
| Transactional financial assets | ||
| Derivative financial assets | ||
| Notes receivable | ||
| Account receivable | 1,262,717.75 | 683,592.53 |
| Receivable financing | ||
| Prepayment | 3,743.53 | 324,209.77 |
| Other receivables | 1,699,175,362.68 | 1,684,718,397.92 |
| Including: interest receivable | ||
| Dividend receivable | 62,142,383.24 | |
| Inventory | ||
| Including: data assets | ||
| Contract assets | ||
| Assets held for sales | ||
| Non-current assets due in 1 year | ||
| Other current assets | 1,853,974.86 | 1,849,530.81 |
| Total current assets | 1,722,461,177.53 | 1,733,501,925.35 |
| Non-current assets: | ||
| Debt investment | ||
| Other debt investment | ||
| Long-term receivables | ||
| Long-term share equity investment | 1,657,062,530.00 | 1,526,831,253.00 |
| Investment in other equity tools | ||
| Other non-current financial assets | 30,000,001.00 | 30,000,001.00 |
| Investment real estate | 384,737,300.00 | 333,236,768.00 |
| in fixed assets | 47,583,051.05 | 63,599,689.10 |
| Construction in process | ||
| Productive biological assets | ||
| Gas & petrol | ||
| Use right assets | 9,815,568.14 | 8,346,277.85 |
| Intangible assets | 789,827.08 | 852,064.55 |
| Including: data assets | ||
| R&D expense | ||
| Including: data assets | ||
| Goodwill | ||
| Long-term amortizable expenses | 342,110.12 | 472,845.61 |
| Deferred income tax assets | ||
| Other non-current assets | ||
| Total of non-current assets | 2,130,330,387.39 | 1,963,338,899.11 |
| Total of assets | 3,852,791,564.92 | 3,696,840,824.46 |
| Current liabilities | ||
| Short-term loans | 300,270,416.67 | |
| Transactional financial liabilities |
| Derivative financial liabilities | ||
| Notes payable | ||
| Account payable | 794,548.40 | 804,004.81 |
| Prepayment received | 838,815.46 | 736,644.20 |
| Contract liabilities | ||
| Employees' wage payable | 1,145,268.30 | 2,781,026.66 |
| Taxes payable | 862,779.03 | 364,147.97 |
| Other payables | 1,492,940,467.78 | 1,041,696,906.24 |
| Including: interest payable | ||
| Dividend payable | ||
| Liabilities held for sales | ||
| Non-current liabilities due in 1 year | 3,465,350.33 | 3,936,569.69 |
| Other current liabilities | 67,307.52 | 41,741.14 |
| Total current liabilities | 1,500,114,536.82 | 1,350,631,457.38 |
| Non-current liabilities: | ||
| Long-term loans | ||
| Bond payable | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Lease liabilities | 6,396,978.38 | 5,464,762.02 |
| Long-term payable | ||
| Long-term employees' wage payable | ||
| Anticipated liabilities | ||
| Deferred earning | ||
| Deferred income tax liabilities | 45,249,920.10 | 37,279,049.28 |
| Other non-current liabilities | ||
| Total of non-current liabilities | 51,646,898.48 | 42,743,811.30 |
| Total liabilities | 1,551,761,435.30 | 1,393,375,268.68 |
| Owner's equity: | ||
| Share capital | 1,073,874,227.00 | 1,073,874,227.00 |
| Other equity tools | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Capital reserves | 360,835.52 | 360,835.52 |
| Less: Shares in stock | ||
| Other miscellaneous income | 18,309,808.71 | -10,082,945.37 |
| Special reserves | ||
| Surplus reserve | 79,324,940.43 | 79,324,940.43 |
| Retained profit | 1,129,160,317.96 | 1,159,988,498.20 |
| Total of owners' equity | 2,301,030,129.62 | 2,303,465,555.78 |
| Total of liabilities and owner's interest | 3,852,791,564.92 | 3,696,840,824.46 |
3. Consolidated Income Statement
In RMB
| Item | H1 2024 | H1 2023 |
| 1. Total revenue | 2,133,845,587.76 | 2,078,846,877.32 |
| Incl. Business income | 2,133,845,587.76 | 2,078,846,877.32 |
| Interest income | ||
| Insurance fee earned | ||
| Fee and commission received | ||
| 2. Total business cost | 1,985,288,554.65 | 1,877,202,076.89 |
| Incl. Business cost | 1,737,599,184.98 | 1,624,230,468.63 |
| Interest expense | ||
| Fee and commission paid | ||
| Insurance discharge payment | ||
| Net claim amount paid | ||
| Net insurance policy responsibility reserves provided | ||
| Insurance policy dividend paid | ||
| Reinsurance expenses | ||
| Taxes and surcharges | 22,159,952.79 | 22,503,741.56 |
| Sales expense | 23,558,271.96 | 28,143,556.79 |
| Administrative expense | 84,841,558.95 | 79,590,941.46 |
| R&D cost | 85,639,602.88 | 88,989,510.66 |
| Financial expenses | 31,489,983.09 | 33,743,857.79 |
| Including: interest cost | 29,211,652.87 | 48,188,161.19 |
| Interest income | 11,466,633.99 | 12,097,319.82 |
| Add: other gains | 11,462,337.51 | 8,563,782.32 |
| Investment gains ("-" for loss) | -2,082,121.20 | -2,361,833.19 |
| Incl. Investment gains from affiliates and joint ventures | -34,959.52 | 294.42 |
| Financial assets de-recognized as a result of amortized cost | -1,123,208.42 | -2,362,127.61 |
| Exchange gains ("-" for loss) | ||
| Net open hedge gains ("-" for loss) | ||
| Gains from change of fair value ("-" for loss) | 558,364.87 | 129,892.00 |
| Credit impairment ("-" for loss) | -7,874,799.00 | 20,274,577.59 |
| Investment impairment loss ("-" for loss) | -15,876,085.85 | -14,673,904.92 |
| Investment gains ("-" for loss) | -1,490.22 | 373,352.08 |
| 3. Operational profit ("-" for loss) | 134,743,239.22 | 213,950,666.31 |
| Plus: non-operational income | 178,760.55 | 204,046.54 |
| Less: non-operational expenditure | 535,703.48 | 569,862.59 |
| 4. Gross profit ("-" for loss) | 134,386,296.29 | 213,584,850.26 |
| Less: Income tax expenses | 16,519,019.26 | 28,189,905.44 |
| 5. Net profit ("-" for net loss) | 117,867,277.03 | 185,394,944.82 |
| (1) By operating consistency | ||
| 1. Net profit from continuous operation ("-" for net loss) | 117,867,277.03 | 185,394,944.82 |
| 2. Net profit from discontinuous operation ("-" for net loss) | ||
| (2) By ownership | ||
| 1. Net profit attributable to the shareholders of the parent company | 116,795,117.62 | 182,155,268.18 |
| 2. Gains and losses of minority shareholders (net losses are | 1,072,159.41 | 3,239,676.64 |
| shown in "-") | ||
| 6. After-tax net amount of other misc. incomes | 28,588,475.40 | -10,092,487.98 |
| After-tax net amount of other misc. incomes attributed to parent's owner | 28,592,893.06 | -10,103,043.90 |
| (1) Other misc. incomes that cannot be re-classified into gain and loss | -8,976,730.40 | |
| 1. Re-measure the change in the defined benefit plan | ||
| 2. Other comprehensive income that cannot be transferred to profit or loss under the equity method | ||
| 3. Fair value change of investment in other equity tools | -8,976,730.40 | |
| 4. Fair value change of the Company's credit risk | ||
| 5. Others | ||
| (2) Other misc. incomes that will be re-classified into gain and loss | 28,592,893.06 | -1,126,313.50 |
| 1. Other comprehensive income that can be transferred to profit or loss under the equity method | ||
| 2. Fair value change of other debt investment | ||
| 3. Gains and losses from changes in fair value of available-for-sale financial assets | ||
| 4. Other credit investment credit impairment provisions | ||
| 5. Cash flow hedge reserve | -676,913.84 | -1,579,210.04 |
| 6. Translation difference of foreign exchange statement | -320,041.06 | 452,896.54 |
| 7. Others | 29,589,847.96 | |
| After-tax net of other misc. income attributed to minority shareholders | -4,417.66 | 10,555.92 |
| 7. Total of misc. incomes | 146,455,752.43 | 175,302,456.84 |
| Total of misc. incomes attributable to the owners of the parent company | 145,388,010.68 | 172,052,224.28 |
| Total misc gains attributable to the minor shareholders | 1,067,741.75 | 3,250,232.56 |
| 8. Earnings per share: | ||
| (1) Basic earnings per share | 0.11 | 0.17 |
| (2) Diluted earnings per share | 0.11 | 0.17 |
Net profit contributed by entities merged under common control in the report period was RMB0.00, net profit realized by partiesmerged during the previous period is RMB0.00.Legal representative: Xiong Jianming CFO: Lin Kebing Accounting Manager: Wu Bohua
4. Income Statement of the Parent Company
In RMB
| Item | H1 2024 | H1 2023 |
| 1. Turnover | 10,908,179.61 | 12,358,317.34 |
| Less: Operation cost | 38,387.33 | |
| Taxes and surcharges | 800,435.12 | 659,523.84 |
| Sales expense | ||
| Administrative expense | 14,985,010.04 | 14,762,448.49 |
| R&D cost | ||
| Financial expenses | 4,743,454.39 | 3,690,612.01 |
| Including: interest cost | 4,028,333.33 | 3,898,333.33 |
| Interest income | 176,948.43 | 404,455.21 |
| Add: other gains | 92,490.50 | 78,916.83 |
| Investment gains ("-" for loss) | 62,189,550.62 |
| Incl. Investment gains from affiliates and joint ventures | ||
| Financial assets de-recognized as a result of amortized cost ("-" for loss) | ||
| Net open hedge gains ("-" for loss) | ||
| Gains from change of fair value ("-" for loss) | ||
| Credit impairment ("-" for loss) | -87,996.70 | 398,974.45 |
| Investment impairment loss ("-" for loss) | ||
| Investment gains ("-" for loss) | 1,053,415.23 | |
| 2. Operational profit ("-" for loss) | 53,588,352.38 | -6,276,375.72 |
| Plus: non-operational income | 5,025.00 | 44,168.06 |
| Less: non-operational expenditure | 5,000.00 | 33,194.93 |
| 4. Gross profit ("-" for loss) | 53,588,377.38 | -6,265,402.59 |
| Less: Income tax expenses | -1,493,380.54 | -1,403,545.41 |
| 4. Net profit ("-" for net loss) | 55,081,757.92 | -4,861,857.18 |
| 1. Net profit from continuous operation ("-" for net loss) | 55,081,757.92 | -4,861,857.18 |
| 2. Net profit from discontinuous operation ("-" for net loss) | ||
| 5. After-tax net amount of other misc. incomes | 28,392,754.08 | -8,976,730.40 |
| (1) Other misc. incomes that cannot be re-classified into gain and loss | -8,976,730.40 | |
| 1. Re-measure the change in the defined benefit plan | ||
| 2. Other comprehensive income that cannot be transferred to profit or loss under the equity method | ||
| 3. Fair value change of investment in other equity tools | -8,976,730.40 | |
| 4. Fair value change of the Company's credit risk | ||
| 5. Others | ||
| (2) Other misc. incomes that will be re-classified into gain and loss | 28,392,754.08 | |
| 1. Other comprehensive income that can be transferred to profit or loss under the equity method | ||
| 2. Fair value change of other debt investment | ||
| 3. Gains and losses from changes in fair value of available-for-sale financial assets | ||
| 4. Other credit investment credit impairment provisions | ||
| 5. Cash flow hedge reserve | ||
| 6. Translation difference of foreign exchange statement | ||
| 7. Others | 28,392,754.08 | |
| 6. Total of misc. incomes | 83,474,512.00 | -13,838,587.58 |
| 7. Earnings per share: | ||
| (1) Basic earnings per share | ||
| (2) Diluted earnings per share |
5. Consolidated Cash Flow Statement
In RMB
| Item | H1 2024 | H1 2023 |
| 1. Net cash flow from business operations: | ||
| Cash received from sales of products and providing of | 2,015,279,577.92 | 1,920,455,087.38 |
| services | ||
| Net increase of customer deposits and capital kept for brother company | ||
| Net increase of loans from central bank | ||
| Net increase of inter-bank loans from other financial bodies | ||
| Cash received against original insurance contract | ||
| Net cash received from reinsurance business | ||
| Net increase of client deposit and investment | ||
| Cash received as interest, processing fee, and commission | ||
| Net increase of inter-bank fund received | ||
| Net increase of repurchasing business | ||
| Net cash received from trading securities | ||
| Tax refunded | 3,542,492.79 | 4,515,868.70 |
| Other cash received from business operation | 43,910,264.70 | 43,447,921.80 |
| Sub-total of cash inflow from business operations | 2,062,732,335.41 | 1,968,418,877.88 |
| Cash paid for purchasing products and services | 1,575,961,682.07 | 1,366,927,959.80 |
| Net increase of client trade and advance | ||
| Net increase of savings in central bank and brother company | ||
| Cash paid for original contract claim | ||
| Net increase in funds dismantled | ||
| Cash paid for interest, processing fee and commission | ||
| Cash paid for policy dividend | ||
| Cash paid to and for the staff | 265,431,660.16 | 238,020,813.88 |
| Taxes paid | 80,833,799.58 | 136,324,121.29 |
| Other cash paid for business activities | 312,036,191.81 | 264,459,694.04 |
| Sub-total of cash outflow from business operations | 2,234,263,333.62 | 2,005,732,589.01 |
| Cash flow generated by business operations, net | -171,530,998.21 | -37,313,711.13 |
| 2. Cash flow generated by investment: | ||
| Cash received from investment recovery | 985,601.68 | |
| Cash received as investment profit | 101,435.57 | |
| Net cash retrieved from disposal of fixed assets, intangible assets, and other long-term assets | 266,715.00 | 27,880.04 |
| Net cash received from disposal of subsidiaries or other operational units | ||
| Other investment-related cash received | ||
| Sub-total of cash inflow generated from investment | 1,353,752.25 | 27,880.04 |
| Cash paid for construction of fixed assets, intangible assets and other long-term assets | 167,181,373.04 | 60,206,301.90 |
| Cash paid as investment | ||
| Net increase of loan against pledge | ||
| Net cash paid for acquiring subsidiaries and other operational units | ||
| Other cash paid for investment | 890,803.00 | |
| Subtotal of cash outflows | 168,072,176.04 | 60,206,301.90 |
| Cash flow generated by investment activities, net | -166,718,423.79 | -60,178,421.86 |
| 3. Cash flow generated by financing activities: | ||
| Cash received from investment | ||
| Incl. Cash received from investment attracted by subsidiaries from minority shareholders | ||
| Cash received from borrowed loans | 2,253,971,200.00 | 1,173,858,273.98 |
| Other cash received from financing activities | 330,600,944.44 | |
| Subtotal of cash inflow from financing activities | 2,584,572,144.44 | 1,173,858,273.98 |
| Cash paid to repay debts | 1,769,800,000.00 | 946,000,000.00 |
| Cash paid as dividend, profit, or interests | 124,740,119.51 | 100,394,812.98 |
| Incl. Dividend and profit paid by subsidiaries to minority shareholders | ||
| Other cash paid for financing activities | 224,565,671.40 | 68,686,816.10 |
| Subtotal of cash outflow from financing activities | 2,119,105,790.91 | 1,115,081,629.08 |
| Net cash flow generated by financing activities | 465,466,353.53 | 58,776,644.90 |
| 4. Influence of exchange rate changes on cash and cash equivalents | 1,584,220.89 | 3,710,265.08 |
| 5. Net increase in cash and cash equivalents | 128,801,152.42 | -35,005,223.01 |
| Plus: Balance of cash and cash equivalents at the beginning of term | 779,661,118.42 | 783,677,929.06 |
| 6. Balance of cash and cash equivalents at the end of the period | 908,462,270.84 | 748,672,706.05 |
6. Cash Flow Statement of the Parent Company
In RMB
| Item | H1 2024 | H1 2023 |
| 1. Net cash flow from business operations: | ||
| Cash received from sales of products and providing of services | 14,751,757.54 | 9,210,418.74 |
| Tax refunded | ||
| Other cash received from business operation | 1,300,660,929.18 | 2,268,519,986.44 |
| Sub-total of cash inflow from business operations | 1,315,412,686.72 | 2,277,730,405.18 |
| Cash paid for purchasing products and services | 1,426,152.31 | 1,697,321.13 |
| Cash paid to and for the staff | 9,514,951.33 | 10,382,381.77 |
| Taxes paid | 760,711.10 | 928,005.61 |
| Other cash paid for business activities | 808,337,232.77 | 2,241,886,586.57 |
| Sub-total of cash outflow from business operations | 820,039,047.51 | 2,254,894,295.08 |
| Cash flow generated by business operations, net | 495,373,639.21 | 22,836,110.10 |
| 2. Cash flow generated by investment: | ||
| Cash received from investment recovery | 235,323,000.00 | |
| Cash received as investment profit | 47,167.38 | |
| Net cash retrieved from disposal of fixed assets, intangible assets, and other long-term assets | ||
| Net cash received from disposal of subsidiaries or other operational units | ||
| Other investment-related cash received | ||
| Sub-total of cash inflow generated from investment | 235,370,167.38 | |
| Cash paid for construction of fixed assets, intangible assets and other long-term assets | 26,733.00 | 1,350.00 |
| Cash paid as investment | 365,554,277.00 | 29,500,000.00 |
| Net cash paid for acquiring subsidiaries and other operational units | ||
| Other cash paid for investment | ||
| Subtotal of cash outflows | 365,581,010.00 | 29,501,350.00 |
| Cash flow generated by investment activities, net | -130,210,842.62 | -29,501,350.00 |
| 3. Cash flow generated by financing activities: | ||
| Cash received from investment | ||
| Cash received from borrowed loans | 300,000,000.00 | |
| Other cash received from financing activities | ||
| Subtotal of cash inflow from financing activities | 300,000,000.00 | |
| Cash paid to repay debts | 300,000,000.00 | 300,000,000.00 |
| Cash paid as dividend, profit, or interests | 90,940,972.34 | 57,788,711.35 |
| Other cash paid for financing activities |
| Subtotal of cash outflow from financing activities | 390,940,972.34 | 357,788,711.35 |
| Net cash flow generated by financing activities | -390,940,972.34 | -57,788,711.35 |
| 4. Influence of exchange rate changes on cash and cash equivalents | 17,360.14 | 78,018.03 |
| 5. Net increase in cash and cash equivalents | -25,760,815.61 | -64,375,933.22 |
| Plus: Balance of cash and cash equivalents at the beginning of term | 45,676,194.32 | 87,460,288.64 |
| 6. Balance of cash and cash equivalents at the end of the period | 19,915,378.71 | 23,084,355.42 |
7. Statement of Change in Owners' Equity (Consolidated)
Amount of the Current Term
In RMB
| Item | H1 2024 | ||||||||||||||
| Owners' Equity Attributable to the Parent Company | Minor shareholders' equity | Total of owners' equity | |||||||||||||
| Share capital | Other equity tools | Capital reserves | Less: Shares in stock | Other miscellaneous income | Special reserves | Surplus reserve | Common risk provisions | Retained profit | Others | Subtotal | |||||
| Preferred share | Perpetual bond | Others | |||||||||||||
| 1. Balance at the end of last year | 1,073,874,227.00 | 11,459,588.40 | 23,121,870.79 | 79,324,940.43 | 4,772,359,940.45 | 5,960,140,567.07 | 74,655,271.20 | 6,034,795,838.27 | |||||||
| Plus: Changes in accounting policies | |||||||||||||||
| Correction of previous errors | |||||||||||||||
| Others | |||||||||||||||
| 2. Balance at the beginning of current year | 1,073,874,227.00 | 11,459,588.40 | 23,121,870.79 | 79,324,940.43 | 4,772,359,940.45 | 5,960,140,567.07 | 74,655,271.20 | 6,034,795,838.27 | |||||||
| 3. Change amount in the current period ("-" for decrease) | -61,979.15 | 28,592,893.06 | 30,885,179.46 | 59,416,093.37 | -6,973,271.65 | 52,442,821.72 | |||||||||
| (1) Total of misc. incomes | 28,592,893.06 | 116,795,117.62 | 145,388,010.68 | 1,067,741.75 | 146,455,752.43 | ||||||||||
| (2) Investment or decreasing of capital by owners | |||||||||||||||
| 1. Common shares invested by owners | |||||||||||||||
| 2. Capital contributed by other equity instrument holders | |||||||||||||||
| 3. Amount of shares paid and accounted as owners' equity | |||||||||||||||
| 4. Others | |||||||||||||||
| (3) Profit allotment | -85,909,938.16 | -85,909,938.16 | -6,962,732.02 | -92,872,670.18 | |||||||||||
| 1. Provision of surplus reserves | |||||||||||||||
| 2. Common risk provision | |||||||||||||||
| 3. Distribution to owners (or shareholders) | -85,909,938.16 | -85,909,938.16 | -6,962,732.02 | -92,872,670.18 | |||||||||||
| 4. Others | |||||||||||||||
| (4) Internal carry-over of owners' equity | |||||||||||||||
| 1. Capitalizing of capital reserves (or share capital) | |||||||||||||||
| 2. Capitalizing of surplus reserves (or share capital) | |||||||||||||||
| 3. Surplus reserves used to cover losses | |||||||||||||||
| 4. Retained gain |
| transferred due to change in set benefit program | |||||||||||||||
| 5. Other miscellaneous income | |||||||||||||||
| 6. Others | |||||||||||||||
| (5) Special reserves | |||||||||||||||
| 1. Provided this year | |||||||||||||||
| 2. Used this period | |||||||||||||||
| (6) Others | -61,979.15 | -61,979.15 | -1,078,281.38 | -1,140,260.53 | |||||||||||
| 4. Balance at the end of this period | 1,073,874,227.00 | 11,397,609.25 | 51,714,763.85 | 79,324,940.43 | 4,803,245,119.91 | 6,019,556,660.44 | 67,681,999.55 | 6,087,238,659.99 |
Amount of Last Year
In RMB
| Item | H1 2023 | ||||||||||||||
| Owners' Equity Attributable to the Parent Company | Minor shareholders' equity | Total of owners' equity | |||||||||||||
| Share capital | Other equity tools | Capital reserves | Less: Shares in stock | Other miscellaneous income | Special reserves | Surplus reserve | Common risk provisions | Retained profit | Others | Subtotal | |||||
| Preferred share | Perpetual bond | Others | |||||||||||||
| 1. Balance at the end of last year | 1,073,874,227.00 | 11,459,588.40 | 31,986,716.79 | 79,324,940.43 | 4,553,295,402.30 | 5,749,940,874.92 | 70,444,287.33 | 5,820,385,162.25 | |||||||
| Plus: Changes in accounting policies | |||||||||||||||
| Correction of previous errors | |||||||||||||||
| Others | |||||||||||||||
| 2. Balance at the beginning of current year | 1,073,874,227.00 | 11,459,588.40 | 31,986,716.79 | 79,324,940.43 | 4,553,295,402.30 | 5,749,940,874.92 | 70,444,287.33 | 5,820,385,162.25 | |||||||
| 3. Change | - | 128, | 118, | 3,25 | 121, | ||||||||||
| amount in the current period ("-" for decrease) | 10,103,043.90 | 461,556.83 | 358,512.93 | 0,232.56 | 608,745.49 | ||||||||||
| (1) Total of misc. incomes | -10,103,043.90 | 182,155,268.18 | 172,052,224.28 | 3,250,232.56 | 175,302,456.84 | ||||||||||
| (2) Investment or decreasing of capital by owners | |||||||||||||||
| 1. Common shares invested by owners | |||||||||||||||
| 2. Capital contributed by other equity instrument holders | |||||||||||||||
| 3. Amount of shares paid and accounted as owners' equity | |||||||||||||||
| 4. Others | |||||||||||||||
| (3) Profit allotment | -53,693,711.35 | -53,693,711.35 | -53,693,711.35 | ||||||||||||
| 1. Provision of surplus reserves | |||||||||||||||
| 2. Common risk provision | |||||||||||||||
| 3. Distribution to owners (or shareholders) | -53,693,711.35 | -53,693,711.35 | -53,693,711.35 | ||||||||||||
| 4. Others | |||||||||||||||
| (4) Internal carry-over of owners' equity | |||||||||||||||
| 1. Capitalizing |
| of capital reserves (or share capital) | |||||||||||||||
| 2. Capitalizing of surplus reserves (or share capital) | |||||||||||||||
| 3. Surplus reserves used to cover losses | |||||||||||||||
| 4. Retained gain transferred due to change in set benefit program | |||||||||||||||
| 5. Other miscellaneous income | |||||||||||||||
| 6. Others | |||||||||||||||
| (5) Special reserves | |||||||||||||||
| 1. Provided this year | |||||||||||||||
| 2. Used this period | |||||||||||||||
| (6) Others | |||||||||||||||
| 4. Balance at the end of this period | 1,073,874,227.00 | 11,459,588.40 | 21,883,672.89 | 79,324,940.43 | 4,681,756,959.13 | 5,868,299,387.85 | 73,694,519.89 | 5,941,993,907.74 |
8. Statement of Change in Owners' Equity (Parent Company)
Amount of the Current Term
In RMB
| Item | H1 2024 | |||||||||||
| Share capital | Other equity tools | Capital reserves | Less: Shares in stock | Other miscellaneous income | Special reserves | Surplus reserve | Retained profit | Others | Total of owners' equity | |||
| Preferred share | Perpetual bond | Others | ||||||||||
| 1. Balance at the end of last year | 1,073,874,227.00 | 360,835.52 | -10,082,945.37 | 79,324,940.43 | 1,159,988,498.20 | 2,303,465,555.78 | ||||||
| Plus: Changes in | ||||||||||||
| accounting policies | ||||||||||||
| Correction of previous errors | ||||||||||||
| Others | ||||||||||||
| 2. Balance at the beginning of current year | 1,073,874,227.00 | 360,835.52 | -10,082,945.37 | 79,324,940.43 | 1,159,988,498.20 | 2,303,465,555.78 | ||||||
| 3. Change amount in the current period ("-" for decrease) | 28,392,754.08 | -30,828,180.24 | -2,435,426.16 | |||||||||
| (1) Total of misc. incomes | 28,392,754.08 | 55,081,757.92 | 83,474,512.00 | |||||||||
| (2) Investment or decreasing of capital by owners | ||||||||||||
| 1. Common shares invested by owners | ||||||||||||
| 2. Capital contributed by other equity instrument holders | ||||||||||||
| 3. Amount of shares paid and accounted as owners' equity | ||||||||||||
| 4. Others | ||||||||||||
| (3) Profit allotment | -85,909,938.16 | -85,909,938.16 | ||||||||||
| 1. Provision of surplus reserves | ||||||||||||
| 2. Distribution to owners (or shareholders) | -85,909,938.16 | -85,909,938.16 | ||||||||||
| 3. Others | ||||||||||||
| (4) Internal |
| carry-over of owners' equity | ||||||||||||
| 1. Capitalizing of capital reserves (or share capital) | ||||||||||||
| 2. Capitalizing of surplus reserves (or share capital) | ||||||||||||
| 3. Surplus reserves used to cover losses | ||||||||||||
| 4. Retained gain transferred due to change in set benefit program | ||||||||||||
| 5. Other miscellaneous income | ||||||||||||
| 6. Others | ||||||||||||
| (5) Special reserves | ||||||||||||
| 1. Provided this year | ||||||||||||
| 2. Used this period | ||||||||||||
| (6) Others | ||||||||||||
| 4. Balance at the end of this period | 1,073,874,227.00 | 360,835.52 | 18,309,808.71 | 79,324,940.43 | 1,129,160,317.96 | 2,301,030,129.62 |
Amount of Last Year
In RMB
| Item | H1 2023 | |||||||||||
| Share capital | Other equity tools | Capital reserves | Less: Shares in stock | Other miscellaneous income | Special reserves | Surplus reserve | Retained profit | Others | Total of owners' equity | |||
| Preferred share | Perpetual bond | Others | ||||||||||
| 1. Balance at the end of last year | 1,073,874,227.00 | 360,835.52 | -1,106,214.97 | 79,324,940.43 | 1,225,449,092.72 | 2,377,902,880.70 | ||||||
| Plus: Changes in accounting policies | ||||||||||||
| Correction of previous errors | ||||||||||||
| Others | ||||||||||||
| 2. Balance at the beginning of current year | 1,073,874,227.00 | 360,835.52 | -1,106,214.97 | 79,324,940.43 | 1,225,449,092.72 | 2,377,902,880.70 | ||||||
| 3. Change amount in the current period ("-" for decrease) | -8,976,730.40 | -58,555,568.53 | -67,532,298.93 | |||||||||
| (1) Total of misc. incomes | -8,976,730.40 | -4,861,857.18 | -13,838,587.58 | |||||||||
| (2) Investment or decreasing of capital by owners | ||||||||||||
| 1. Common shares invested by owners | ||||||||||||
| 2. Capital contributed by other equity instrument holders | ||||||||||||
| 3. Amount of shares paid and accounted as owners' equity | ||||||||||||
| 4. Others | ||||||||||||
| (3) Profit allotment | -53,693,711.35 | -53,693,711.35 | ||||||||||
| 1. Provision of surplus reserves | ||||||||||||
| 2. Distribution to owners (or | -53,693,711.35 | -53,693,711.35 |
| shareholders) | ||||||||||||
| 3. Others | ||||||||||||
| (4) Internal carry-over of owners' equity | ||||||||||||
| 1. Capitalizing of capital reserves (or share capital) | ||||||||||||
| 2. Capitalizing of surplus reserves (or share capital) | ||||||||||||
| 3. Surplus reserves used to cover losses | ||||||||||||
| 4. Retained gain transferred due to change in set benefit program | ||||||||||||
| 5. Other miscellaneous income | ||||||||||||
| 6. Others | ||||||||||||
| (5) Special reserves | ||||||||||||
| 1. Provided this year | ||||||||||||
| 2. Used this period | ||||||||||||
| (6) Others | ||||||||||||
| 4. Balance at the end of this period | 1,073,874,227.00 | 360,835.52 | -10,082,945.37 | 79,324,940.43 | 1,166,893,524.19 | 2,310,370,581.77 |
III. General Information
China Fangda Group Co., Ltd. (the "Company" or the "Group") is a joint stock company registered in Shenzhen,Guangdong and was approved by the Government of Shenzhen with Document 深府办函 (1995) 194号, and was founded, on thebasis of Shenzhen Fangda Construction Material Co., Ltd., by way of share issuing in October 1995. The unified social credit code
is: 91440300192448589C; registered address: Fangda Technology Building, Keji South 12th Road, South District, High-techIndustrial Park, Nanshan District, Shenzhen. Mr. Xiong Jianming is the legal representative.The Company issued foreign currency shares (B shares) and local currency shares (A shares) and listed in November 1995and April 1996 respectively in Shenzhen Stock Exchange. The Company received the Reply to the Non-public Share Issuance ofFangda China Group Co., Ltd. (CSRC License [2016] No.825) to allow the Company to conduct non-public issuance of32,184,931 A-shares in June 20116. According to the 2016 profit distribution plan approved by the 2016 general meeting ofshareholders, based on the total share capital of 789,094,836 shares as of December 31, 2016, the Company transferred 5 sharesfor every 10 shares to all shareholders with the capital reserve. The registered capital at the end of 2017 was RMB1,183,642,254.00. The Company repurchased and canceled 28,160,568.00 B shares in August 2018, 32,097,497.00 B shares inJanuary 2019, 35,105,238.00 B shares in May 2020, 14404724.00 B shares in April 2021 and cancelled in April 2021. Theexisting registered capital is RMB1,073,874,227.00 yuan.The Company has established the corporate governance structure of the General Meeting of Shareholders, the Board ofDirectors and the Board of Supervisors. At present, it has set up the President's Office, the Administration Department, the HumanResources Department, the Enterprise Management Department, the Finance Department, the Audit and Supervision Department,the Securities Department, the Legal Department, the Information Management Department, the Technology InnovationDepartment, the Development Planning Department and other departments, and has Shenzhen Fangda Construction TechnologyGroup Co., Ltd. (hereinafter referred to as Fangda Construction Technology Co., Ltd.) Fangda Zhiyuan Technology Co., Ltd.(hereinafter referred to as Fangda Zhiyuan Technology Co., Ltd.), Fangda Jiangxi New Materials Co., Ltd., Fangda Real EstateCo., Ltd., Fangda New Energy Co., Ltd. and other subsidiaries.The business nature and main business activities of the Company and its subsidiaries include: (1) curtain wall division,production and sales of curtain wall materials, design, production and installation of building curtain walls, and curtain wall testingand maintenance services; (2) Rail transit branch, assembly and processing of subway screen doors, screen door detection andmaintenance services; (3) The real estate division is engaged in real estate development, operation and property management onthe land that has legally obtained the right to use; (4) New energy division, photovoltaic power generation and sales; R&D,installation and sales of photovoltaic equipment, design and installation of photovoltaic power station project.Date of financial statement approval: This financial statement is approved by the Board of Directors of the Company onAugust 26, 2024.
IV. Basis for the preparation of financial statements
1. Preparation basis
The Company prepares the financial statements based on continuous operation and according to actual transactions andevents, with figures confirmed and measured in compliance with the Accounting Standards for Business Enterprises and otherspecific account standards, application guide and interpretations. The Company has also disclosed related financial informationaccording to the requirement of the Regulations of Information Disclosure No.15 – General Provisions for Financial Statements(Revised in 2023) issued by the CSRC.
2. Continuous operation
The Company prepares the financial statements based on continuous operation and according to actual transactions andevents, with figures confirmed and measured in compliance with the Accounting Standards for Business Enterprises and otherspecific account standards, application guide and interpretations. The Company has also disclosed related financial informationaccording to the requirement of the Regulations of Information Disclosure No.15 – General Provisions for Financial Statements(Revised in 2023) issued by the CSRC.V. Significant Account Policies and Estimates
The following major accounting policies and accounting estimates shall be formulated in accordance with the accountingstandards of the enterprise. Unmentioned operations are carried out in accordance with the relevant accounting policies in theenterprise accounting standards.
1. Statement of compliance to the Enterprise Accounting Standard
These financial statements meet the requirements of the Accounting Standards for Business Enterprises and truly and fullyreflect the Company's financial status, performance result, changes in shareholders' equity and cash flows.
2. Fiscal Period
The Company The fiscal period ranges between January 1 and December 31 of the Gregorian calendar.
3. Operation period
Our normal business cycle is one year
4. Bookkeeping standard money
The Company's bookkeeping standard currency is Renminbi, and overseas subsidiaries are based on the currency of themain economic environment in which they operate.
5. Method for determining importance criteria and selection criteria
? Applicable □ Inapplicable
| Item | Importance criteria |
| Amount of bad debt reserves recovered or reversed for important accounts receivable in the current period; important accounts receivable write off | Amount greater than 5% of the total consolidated profit and greater than RMB5 million |
| Important ongoing projects | Amount greater than 1% of total consolidated net assets |
| Important payables with an aging of over 1 year | A single project is greater than 0.1% of the combined total assets |
| Major non wholly-owned subsidiaries | Individual net assets greater than 1% of the total consolidated net assets |
| Important joint ventures and associates | The investment return is greater than 5% of the total consolidated profit and is greater than RMB5 million |
6. Accounting treatment of the entities under common and different control
(1) Consolidation of entities under common control
The assets and liabilities acquired by the Company in a business combination are measured at the book value of thecombined party in the consolidated financial statements of the ultimate controlling party on the date of combination. Among them,if the accounting policy adopted by the merger party is different from that adopted by the Company before the merger, theaccounting policy is unified based on the principle of importance, that is, the book value of the assets and liabilities of the mergerparty is adjusted according to the accounting policy of the Company. If there is a difference between the book value of the netassets acquired by the Company in the business combination and the book value of the consideration paid, first adjust the balanceof the capital reserve (capital premium or equity premium), the balance of the capital reserve (capital premium or equity premium)If it is insufficient to offset, the surplus reserve and undistributed profits will be offset in sequence.
For the accounting treatment method of business combination not under the same control through step-by-step transactions,see Chapter X, V. important accounting policies and accounting estimates 7. (6).
(2) Consolidation of entities under different control
All identifiable assets and liabilities acquired by the Company during the merger shall be measured at its fair value on thedate of purchase. Among them, if the accounting policy adopted by the merger party is different from that adopted by theCompany before the merger, the accounting policy is unified based on the principle of importance, that is, the book value of the
assets and liabilities of the merger party is adjusted according to the accounting policy of the Company. The merger cost of theCompany on the date of purchase is greater than the fair value of the assets and liabilities recognized by the purchaser in themerger, and is recognized as goodwill. If the merger cost is less than the difference between the identifiable assets and the fairvalue of the liabilities obtained by the purchaser in the enterprise merger, the merger cost and the fair value of the identifiableassets and the liabilities obtained by the purchaser in the enterprise merger are reviewed, and the merger cost is still less than thefair value of the identifiable assets and liabilities obtained by the purchaser after the review, the difference is considered as theprofit and loss of the current period of the merger.For the accounting treatment method of business combination not under the same control through step-by-step transactions,see Chapter X, V. important accounting policies and accounting estimates. 7. (6).
(3) Treatment of related transaction fee in enterprise merger
Agency expenses and other administrative expenses such as auditing, legal consulting, or appraisal services occurredrelating to the merger of entities are accounted into current income account when occurred. The transaction fees of equitycertificates or liability certificates issued by the purchaser for payment for the acquisition are accounted at the initial amount of thecertificates.
7. Judgment criteria for control and preparation methods for consolidated financial statements
(1) Determination of control criteria and consolidation scope
Control means the power possessed by the Company on invested entities to share variable returns by participating inrelated activities of the invested entities and to impact the amount of the returns by using the power. The definition of controlincludes three basic elements: first, the investor has the power over the investee; second, enjoys variable returns due toparticipation in the investee's related activities; and third, has the ability to use the power over the investee to influence its returnamount. When the Company's investment in the invested party meets the above three elements, it indicates that the Company cancontrol the invested party.
The consolidated scope of the consolidated financial statements is determined on a control basis and includes not onlysubsidiaries determined on the basis of voting rights (or similar voting rights) themselves or in conjunction with otherarrangements, but also structured subjects determined on the basis of one or more contractual arrangements.
The subsidiary company is the subject controlled by the Company (including the enterprise, the divisible part of theinvested unit and the structured subject controlled by the enterprise, etc.). The structured subject is the subject which is notdesigned to determine the controlling party by taking the voting right or similar right as the decisive factor.
(2) Special provisions regarding the parent company being an investment entity
If the parent company is an investment entity, only those subsidiary companies that provide services related to investmentactivities of the investment entity shall be included in the consolidation scope. Other subsidiary companies shall not beconsolidated and their equity investments shall be recognized as financial assets measured at fair value with changes in fair valuerecognized in profit or loss.
The parent company qualifies as an investment entity when it simultaneously meets the following conditions:
① The company obtains funds from one or more investors with the purpose of providing investment management servicesto the investors.
② The sole purpose of the company's operations is to generate returns for the investors through capital appreciation,investment income, or both.
③ The company evaluates and assesses the performance of almost all of its investments based on fair value.
When the parent company changes from a non-investment entity to an investment entity, it shall only include thosesubsidiary companies that provide relevant services for its investment activities in the preparation of consolidated financialstatements. Other subsidiary companies shall no longer be consolidated, and the principle of recognizing partially disposedsubsidiary companies' equity while retaining control shall be applied.
When the parent company changes from an investment entity to a non-investment entity, the subsidiary companies that werepreviously not included in the consolidation financial statements shall be included as of the date of the change. The fair value ofthese subsidiary companies on the date of the change shall be regarded as the transaction price of the acquisition and accounted forusing the accounting treatment for business combinations under common control.
(3) Preparation of Consolidated Financial Statements
The Company prepares consolidated financial statements based on the financial statements of itself and its subsidiaries andbased on other relevant information.
The Company compiles consolidated financial statements, regards the whole enterprise group as an accounting entity,reflects the overall financial status, operating results and cash flow of the enterprise group according to the confirmation,
measurement and presentation requirements of the relevant enterprise accounting standards, and the unified accounting policy andaccounting period.
① Merge the assets, liabilities, owner's rights and interests, income, expenses and cash flow of parent company andsubsidiary company.
② Offset the long-term equity investment of the parent company to the subsidiary company and the share of the parentcompany in the ownership rights of the subsidiary company.
③ Offset the influence of internal transaction between parent company, subsidiary company and subsidiary company. If aninternal transaction indicates that the relevant asset has suffered an impairment loss, the part of the loss shall be confirmed in full.
④ adjust the special transaction from the angle of enterprise group.
(4) Processing of subsidiaries during the reporting period
① Increase of subsidiaries or business
A. Subsidiary or business increased by business combination under the same control
(A) When preparing the consolidated balance sheet, adjust the opening number of the consolidated balance sheet and adjustthe related items of the comparative statement. The same report entity as the consolidated balance sheet will exist from the time ofthe final control party.
(B) When preparing the consolidated cash flow statement, the cash flows of the subsidiary and the business combinationfrom the beginning of the current period to the end of the reporting period are included in the consolidated cash flow statement,and the related items of the comparative statement are adjusted, which is regarded as the combined report body since the final Thecontroller has been there since the beginning of control.
(C) When preparing the consolidated cash flow statement, the cash flows of the subsidiary and the business combinationfrom the beginning of the current period to the end of the reporting period are included in the consolidated cash flow statement,and the related items of the comparative statement are adjusted, which is regarded as the combined report body since the final Thecontroller has been there since the beginning of control.
B. Subsidiary or business increased by business combination under the same control
(A) When preparing the consolidated balance sheet, the opening number of the consolidated balance sheet is not adjusted.
(B) When preparing the consolidated profit statement, the income, expense and profit of the subsidiary company and thebusiness Purchase date and Closing balance shall be included in the consolidated profit statement.(C) When the consolidated cash flow statement is prepared, the cash flow from the purchase date of the subsidiary to theend of the reporting period is included in the consolidated cash flow statement.
② Disposal of subsidiaries or business
A. When preparing the consolidated balance sheet, the opening number of the consolidated balance sheet is not adjusted.
B. When preparing the consolidated profit statement, the income, expense and profit of the subsidiary company and thebusiness opening and disposal date shall be included in the consolidated profit statement.
C. When the consolidated cash flow statement is prepared, the cash flow from the Beginning of the period of the subsidiaryto the end of the reporting period is included in the consolidated cash flow statement.
(5) Special considerations in consolidation offsets
① The long-term equity investment held by a subsidiary company shall be regarded as the inventory shares of theCompany as a subtraction of the owner's rights and interests, which shall be listed under the item of "subtraction: Stock shares"under the item of owner's rights and interests in the consolidated balance sheet.
The long-term equity investments held by the subsidiaries are offset by the shares of the shareholders of the subsidiaries.
② The "special reserve" and "general risk preparation" projects, because they are neither real capital (or share capital) norcapital reserve, but also different from the retained income and undistributed profits, are restored according to the ownership of theparent company after the long-term equity investment is offset by the ownership rights and interests of the subsidiary company.
③ If there is a temporary difference between the book value of assets and liabilities in the consolidated balance sheet andthe taxable basis of the taxpayer due to the offset of the unrealized internal sales gain or loss, the deferred income tax asset or thedeferred income tax liability is confirmed in the consolidated balance sheet, and the income tax expense in the consolidated profitstatement is adjusted, with the exception of the deferred income tax related to the transaction or event directly included in theowner's equity and the merger of the enterprise.
④ The unrealized internal transaction gains and losses incurred by the Company from selling assets to subsidiaries shall befully offset against the "net profit attributable to the owners of the parent company". The unrealized internal transaction gains andlosses arising from the sale of assets by the subsidiary to the Company shall be offset between the "net profit attributable to theowners of the parent company" and the "minority shareholder gains and losses" in accordance with the Company's distribution
ratio to the subsidiary. The unrealized internal transaction gains and losses arising from the sale of assets between subsidiariesshall be offset between the "net profit attributable to the owners of the parent company" and the "minority shareholders' gains andlosses" in accordance with the Company's distribution ratio to the seller's subsidiary .
⑤ If the current loss shared by the minority shareholders of the subsidiary exceeds the share of the minority shareholders inthe owner 's equity of the subsidiary at the beginning of the period, the balance should still be offset against the minorityshareholders 'equity.
(6) Accounting treatment of special transactions
① Purchase minority shareholders' equity
The Company purchases the shares of the subsidiaries owned by the minority shareholders of the subsidiaries. In theindividual financial statements, the investment costs of the newly acquired long-term investments of the minority shares shall bemeasured at the fair value of the price paid. In the consolidated financial statements, the difference between the newly acquiredlong-term equity investment due to the purchase of minority equity and the share of net assets that should be continuouslycalculated by the subsidiary since the purchase date or the merger date should be adjusted according to the new shareholding ratio.The product (capital premium or equity premium), if the capital reserve is insufficient to offset, the surplus reserve andundistributed profits are offset in turn.
② Step-by-step acquisition of control of the subsidiary through multiple transactions
A. Enterprise merger under common control through multiple transactions
On the date of the merger, the Company determines the initial investment cost of the long-term equity investment in theindividual financial statements based on the share of the subsidiary 's net assets that should be enjoyed after the merger in the finalcontroller 's consolidated financial statements; the initial investment cost and the difference between the book value of the long-term equity investment before the merger plus the book value of the consideration paid for new shares acquired on the merger date,the capital reserve (capital premium or equity premium) is adjusted, and the capital reserve (capital premium or equity premium) isinsufficient to offset Reduced, in turn offset the surplus reserve and undistributed profits.
In consolidated financial statements, assets and liabilities obtained by the merging party from the merged party should bemeasured at the book value in the final controlling party's consolidated financial statements other than the adjustment made due todifferences in accounting policies; adjust the capital surplus (share premium) according to the difference between the initialinvestment cost and the book value of the held investment before merger plus the book value of the consideration paid on themerger date. Where the capital surplus falls short, the retained income should be adjusted.
If the merging party holds the equity investment before acquiring the control of the merged party and is accounted foraccording to the equity method, the date of acquiring the original equity and the merging party and the merged party are in thesame party's final control from the later date to the merger date The relevant gains and losses, other comprehensive income andother changes in owner's equity have been confirmed between them, and the retained earnings at the beginning of the comparativestatement period should be offset separately.A. Enterprise merger under common control through multiple transactionsOn the merger day, in individual financial statements, the initial investment cost of the long-term equity investment on themerger day is based on the book value of the long-term equity investment previously held plus the sum of the additionalinvestment costs on the merger day.In the consolidated financial statements, the equity of the purchaser held prior to the date of purchase is revalued accordingto the fair value of the equity at the date of purchase, and the difference between the fair value and its book value is credited to thecurrent investment income; If the shares held by the purchaser prior to the date of purchase involve other consolidated gains underthe equity law accounting, the other consolidated gains related thereto shall be converted to the current gains on the date ofpurchase, with the exception of the other consolidated gains arising from the remeasurement of the net assets or net liabilities ofthe merged party. The Company disclosed in the notes the fair value of the equity of the purchased party held before the purchasedate and the amount of related gains or losses remeasured according to the fair value.
(3) The Company disposes of long-term equity investment in subsidiaries without losing control
The parent company partially disposes of the long-term equity investment in the subsidiary company without losing control.In the consolidated financial statements, the disposal price corresponds to the disposal of the long-term equity investment. Thedifference between the shares is adjusted for the capital reserve (capital premium or equity premium). If the capital reserve isinsufficient to offset, the retained earnings are adjusted.
④ The Company disposes of long-term equity investment in subsidiaries and loses control
A. One transaction disposition
If the Company loses control over the Invested Party due to the disposal of part of the equity investment, it shall remeasurethe remaining equity according to its fair value at the date of loss of control when compiling the consolidated financial statement.The sum of the consideration obtained from the disposal of equity and the fair value of the remaining equity minus the differencebetween the share of the original subsidiary 's net assets that should be continuously calculated from the purchase date or themerger date, calculated as the loss of control The investment income of the current period.
Other comprehensive income and other owner's equity changes related to the equity investment of the atomic company aretransferred to the current profit and loss when the control is lost, except for other comprehensive income arising from theremeasurement of the net benefits or net assets of the defined benefit plan by the investee. .
B. Multi-transaction step-by-step disposition
In consolidated financial statements, you should first determine whether a step-by-step transaction is a "blanket transaction".
If the step-by-step transaction does not belong to a "package deal", in the individual financial statements, for eachtransaction before the loss of control of the subsidiary, the book value of the long-term equity investment corresponding to eachdisposal of equity is carried forward, the price received and the disposal The difference between the book value of the long-termequity investment is included in the current investment income; in the consolidated financial statements, it should be handled inaccordance with the relevant provisions of "the parent company disposes of the long-term equity investment in the subsidiarywithout losing control."
If a step-by-step transaction belongs to a "blanket transaction", the transaction shall be treated as a transaction that disposesof the subsidiary and loses control; In individual financial statements, the difference between each disposal price before the loss ofcontrol and the book value of the long-term equity investment corresponding to the equity being disposed of is first recognized asother consolidated gains and then converted to the current loss of control at the time of the loss of control; In the consolidatedfinancial statements, for each transaction prior to the loss of control, the difference between the disposition of the price and thedisposition of the investment corresponding to the share in the net assets of the subsidiary shall be recognized as otherconsolidated gains and shall, at the time of the loss of control, be transferred to the loss of control for the current period.
Where the terms, conditions, and economic impact of each transaction meet one or more of the following conditions,usually multiple transactions are treated as a "package deal":
(a) These transactions were concluded at the same time or in consideration of mutual influence.
(b) These transactions can only achieve the business result as a whole;
(c) The effectiveness of one transaction depends the occurrence of at least another transaction;
(d) A single transaction is not economic and is economic when considered together with other transactions.
(5) Proportion of minority shareholders in factor companies who increase capital and dilute ownership of parent companiesProportion of Others ( minority shareholders in factor companies who increase capital , dilute Subsidiaries of parentcompanies. In the consolidated financial statements, the share of the parent company in the net book assets of the former
subsidiary of the capital increase is calculated according to the share ratio of the parent company before the capital increase, thedifference between the share and the net book assets of the latter subsidiary after the capital increase is calculated according to theshare ratio of the parent company, the capital reserve (capital premium or capital premium), the capital reserve (capital premium orcapital premium) is not offset, and the retained income is adjusted.
8. Recognition of cash and cash equivalents
Cash refers to cash in stock and deposits that can be used for payment at any time. Cash equivalents refer to investmentswith a short holding period (generally referring to expiry within three months from the date of purchase), strong liquidity, easy toconvert to a known amount of cash, and little risk of value change.
9.Foreign exchange business and foreign exchange statement translation
(1) Methods for determining conversion rates in foreign currency transactions
The Company translates foreign currency transactions into the functional currency at the initial recognition using the spotexchange rate on the transaction date or an approximate exchange rate that is determined according to a reasonable method and isclose to the spot exchange rate on the transaction date. The resulting amount is recorded in the accounting currency.
(2) Methods of conversion of foreign currency currency currency items on balance sheet days
At the balance sheet date, foreign currency items are translated on the spot exchange rate of the balance sheet date. Theexchange differences caused by the difference in exchange rates on the balance sheet date and initial recognizing date or previousbalance sheet date are included in the current profits and losses. Non-monetary items accounted in foreign currency and onhistorical costs are exchanged with the spot exchange rate on the transaction date. Non-monetary items accounted in foreigncurrency and on fair value are exchanged with the spot exchange rate on the determination date of the fair value. The exchangedifference between the accounting standard-currency amount and the original accounting standard-currency amount are includedin the current profits and losses.
(3) Translation of foreign exchange statements
Prior to the conversion of the financial statements of an enterprise's overseas operations, the accounting period and policy ofthe overseas operations should be adjusted to conform to the accounting period and policy of the enterprise. The financialstatements of the corresponding currency (other than the functional currency) should be prepared according to the adjustedaccounting policy and the accounting period. The financial statements of the overseas operations should be converted according tothe following methods:
① The assets and liabilities items in the balance sheet are translated at the spot exchange rate on the balance sheet date.Except for the "undistributed profits" items, the owner's equity items are translated at the spot exchange rate when they occur.
② The income and expense items in the profit statement are converted at the spot exchange rate on the transaction date orthe approximate exchange rate of the spot exchange rate.
③ The foreign currency cash flow and the foreign subsidiary's cash flow are converted using the immediate exchange rateor the approximate exchange rate at the date of the cash flow. The impact of exchange rate changes on cash should be used as anadjustment item and presented separately in the cash flow statement.
④ During the preparation of the consolidated financial statements, the resulting foreign currency financial statementconversion variance is presented separately under the owner's equity item in the consolidated balance sheet.
When foreign operations are disposed of and the control rights are lost, the difference in foreign currency statements relatedto the overseas operations that are listed in the shareholders' equity items in the balance sheet is transferred to the profit or loss forthe current period, either in whole or in proportion to the disposal of the foreign operations.
10. Financial instrument
Financial instrument refers to a company's financial assets and contracts that form other units of financial liabilities orequity instruments.
(1) Recognition and de-recognition of financial instrument
The Company recognizes a financial asset or liability when it becomes one party in the financial instrument contract.
Financial asset is derecognized when:
① The contractual right to receive the cash flows of the financial assets is terminated;
② The financial asset is transferred and meets the following derecognition condition.
If the current obligation of a financial liability (or part of it) has been discharged, the Company derecognises the financialliability (or part of the financial liability). When the Company (borrower) and lender enter into an agreement to replace theoriginal financial liabilities by undertaking new financial liabilities and the contract terms for the new financial liabilities areessentially different from those for the original one, the original financial liabilities will be derecognized and new financialliabilities will be recognized. Where the Company makes substantial amendments to the contract terms of the original financial
liability (or part thereof), it shall terminate the original financial liability and confirm a new financial liability in accordance withthe amended terms.Financial asset transactions in regular ways are recognized and de-recognized on the transaction date. The conventional saleof financial assets means the delivery of financial assets in accordance with the contractual terms and conditions, at the time setout in the regulations or market practices. Transaction date refers to the date when the Company promises to buy or sell financialassets.
(2) Classification and subsequent measurement of financial assets
At initial recognition, the Company classifies financial assets into the following three categories based on the businessmodel of managing financial assets and the contractual cash flow characteristics of financial assets: financial assets measured atamortized cost are measured at fair value and their changes are included in other financial assets with current profit and loss andfinancial assets measured at fair value through profit or loss. Unless the Company changes the business model for managingfinancial assets, in this case, all affected financial assets are reclassified on the first day of the first reporting period after thebusiness model changes, otherwise the financial assets may not be initially confirmed.Financial assets are measured at the fair value at the initial recognition. For financial assets measured at fair value withvariations accounted into current income account, related transaction expenses are accounted into the current income. For otherfinancial assets, the related transaction expenses are accounted into the initial recognized amounts. Bills receivable and accountsreceivable arising from the sale of commodities or the provision of labor services that do not contain or do not consider significantfinancing components, the Company performs initial measurement according to the transaction price defined by the incomestandard.
The subsequent measurement of financial assets depends on their classification:
① Financial assets measured at amortized cost
Financial assets that meet the following conditions at the same time are classified as financial assets measured at amortizedcost: The Company's business model for managing this financial asset is to collect contractual cash flows as its goal; the contractterms of the financial asset stipulate that Cash flow is only the payment of principal and interest based on the outstanding principalamount. For such financial assets, the actual interest rate method is used for subsequent measurement according to the amortizedcost. The gains or losses arising from the termination of recognition, amortization or impairment based on the actual interest ratemethod are included in the current profit and loss.
② Financial assets measured at fair value and whose changes are included in other comprehensive income
Financial assets that meet the following conditions at the same time are classified as financial assets measured at fair valueand their changes are included in other comprehensive income: The Company's business model for managing this financial asset isto both target the collection of contractual cash flows and the sale of financial assets. Objective; The contractual terms of thefinancial asset stipulate that the cash flow generated on a specific date is only for the payment of principal and interest based onthe outstanding principal amount. For such financial assets, fair value is used for subsequent measurement. Except for impairmentlosses or gains and exchange gains and losses recognized as current gains and losses, changes in the fair value of such financialassets are recognized as other comprehensive income. Until the financial asset is derecognized, its accumulated gains or losses aretransferred to current gains and losses. However, the relevant interest income of the financial asset calculated by the actual interestrate method is included in the current profit and loss.The Company irrevocably chooses to designate a portion of non-tradable equity instrument investment as a financial assetmeasured at fair value and whose variation is included in other consolidated income. Only the relevant dividend income isincluded in the current profit and loss, and the variation of fair value is recognized as other consolidated income.
③ Financial assets measured at fair value with variations accounted into current income account
The above financial assets measured at amortized cost and other financial assets measured at fair value and whose changesare included in other comprehensive income are classified as financial assets measured at fair value and whose changes areincluded in the current profit and loss. For such financial assets, fair value is used for subsequent measurement, and all changes infair value are included in current profit and loss.
(3) Classification and measurement of financial liabilities
The Company classifies financial liabilities into financial liabilities measured at fair value and their changes included in thecurrent profit and loss, loan commitments and financial guarantee contract liabilities for loans below market interest rates, andfinancial liabilities measured at amortized cost.
The subsequent measurement of financial liabilities depends on their classification:
① Financial liabilities measured at fair value with variations accounted into current income account
Such financial liabilities include transactional financial liabilities (including derivatives that are financial liabilities) andfinancial liabilities designated as at fair value through profit or loss. After the initial recognition, the financial liabilities aresubsequently measured at fair value. Except for the hedge accounting, the gains or losses (including interest expenses) arerecognized in profit or loss. However, for the financial liabilities designated as fair value and whose variations are included in theprofits and losses of the current period, the variable amount of the fair value of the financial liability due to the variation of credit
risk of the financial liability shall be included in the other consolidated income. When the financial liability is terminated, thecumulative gains and losses previously included in the other consolidated income shall be transferred out of the other consolidatedincome and shall be included in the retained income.
② Loan commitments and financial security contractual liabilities
A loan commitment is a promise that the Company provides to customers to issue loans to customers with establishedcontract terms within the commitment period. Loan commitments are provided for impairment losses based on the expected creditloss model.A financial guarantee contract refers to a contract that requires the Company to pay a specific amount of compensation tothe contract holder who suffered a loss when a specific debtor is unable to repay the debt in accordance with the original ormodified debt instrument terms. Financial guarantee contract liabilities are subsequently measured based on the higher of the lossreserve amount determined in accordance with the principle of impairment of financial instruments and the initial recognitionamount after deducting the accumulated amortization amount determined in accordance with the revenue recognition principle.
③ Financial liabilities measured at amortized cost
After initial recognition, other financial liabilities are measured at amortized cost using the effective interest method.
Except in special circumstances, financial liabilities and equity instruments are distinguished according to the followingprinciples:
a. If the Company cannot unconditionally avoid delivering cash or other financial assets to fulfill a contractual obligation,the contractual obligation meets the definition of financial liability. While some financial instruments do not explicitly containterms and conditions for the delivery of cash or other financial assets, they may indirectly form contractual obligations throughother terms and conditions.
B. If a financial instrument is required to be settled with or can be settled with the Company's own equity instruments, theCompany's own equity instrument used to settle the instrument needs to be considered as a substitute for cash or other financialassets or for the holder of the instrument to enjoy the remaining equity in the assets after all liabilities are deducted. If it is theformer, the instrument is the financial liabilities of the issuer; if it is the latter, the instrument is the equity instrument of the issuer.In some cases, a financial instrument contract provides that the Company shall or may use its own instrument of interest, in whichthe amount of a contractual right or obligation is equal to the amount of the instrument of its own interest which may be acquiredor delivered multiplied by its fair value at the time of settlement, whether the amount of the contractual right or obligation is fixed
or is based entirely or in part on a variation of a variable other than the market price of the instrument of its own interest, such asthe rate of interest, the price of a commodity or the price of a financial instrument, the contract is classified as a financial liability.
(4) Derivative financial instruments and embedded derivatives
Derivative financial instruments are initially measured at the fair value of the day when the derivative transaction contract issigned, and are subsequently measured at their fair values. Derivative financial instruments with a positive fair value arerecognized as asset, and instruments with a negative fair value are recognized as liabilities.The gains and losses arising from the change in fair value of derivatives are directly included in the profits and losses of thecurrent period, except that the part of the cash flow that is valid in the hedge is included in the other consolidated income andtransferred out when the hedged item affects the gain and loss of the current period.For a hybrid instrument containing an embedded derivative instrument, if the principal contract is a financial asset, thehybrid instrument as a whole applies the relevant provisions of the financial asset classification. If the main contract is not afinancial asset, and the hybrid instrument is not measured at fair value and its changes are included in the current profit and lossfor accounting, the embedded derivative does not have a close relationship with the main contract in terms of economiccharacteristics and risks, and it is If the instruments with the same conditions and exist separately meet the definition of derivativeinstruments, the embedded derivative instruments are separated from the mixed instruments and treated as separate derivativefinancial instruments. If the fair value of the embedded derivative on the acquisition date or the subsequent balance sheet datecannot be measured separately, the hybrid instrument as a whole is designated as a financial asset or financial liability measured atfair value and whose changes are included in the current profit or loss.
(5) Financial instrument Less
The Company shall confirm the preparation for loss on the basis of expected credit loss for financial assets measured atamortization costs, creditor's rights investments measured at fair value, contractual assets, leasing receivables, loan commitmentsand financial guarantee contracts, etc.
① Measurement of expected credit losses of accounts receivable
The expected credit loss refers to the weighted average of the credit losses of financial instruments that are weighted by therisk of default. Credit loss refers to the difference between all contractual cash flows receivable from the contract and all cashflows expected to be received by the Company at the original actual interest rate, that is, the present value of all cash shortages.Among them, the financial assets which have been purchased or born by the Company shall be discounted according to the actualrate of credit adjustment of the financial assets.
The expected lifetime credit loss is the expected credit loss due to all possible default events during the entire expected lifeof the financial instrument.Expected credit losses in the next 12 months are expected to result from possible defaults in financial instruments within 12months after the balance sheet date (or estimated duration of financial instruments if the expected duration is less than 12 months)Credit losses are part of the expected lifetime credit loss.On each balance sheet day, the Company measures the expected credit losses of financial instruments at different stages.Where the credit risk has not increased significantly since the initial confirmation of the financial instrument, it is in the first stage.The Company measures the preparation for loss according to the expected credit loss in the next 12 months. Where the credit riskhas increased significantly since the initial confirmation but the credit impairment has not occurred, the financial instrument is inthe second stage. Where a credit impairment has occurred since the initial confirmation of the financial instrument, it shall be inthe third stage, and the Company shall prepare for measuring the expected credit loss of the whole survival period of theinstrument.For financial instruments with low credit risk on the balance sheet date, the Company assumes that the credit risk has notincreased significantly since the initial recognition, and measures the loss provision based on the expected credit losses in the next12 months.
For financial instruments that are in the first and second stages and with lower credit risk, the Company calculates interestincome based on their book balances and actual interest rates without deduction for impairment provision. For financialinstruments in the third stage, interest income is calculated based on the amortized cost and the actual interest rate after the bookbalance minus the provision for impairment.
Regarding bills receivable, accounts receivable and financing receivables, regardless of whether there is a significantfinancing component, the Company measures the loss provision based on the expected credit losses throughout the duration.
Accounts receivable/contract assets
Where there is objective evidence of impairment, as well as other receivable instruments, receivables, other receivables,receivables financing and long-term receivables applicable to individual assessments, separate impairment tests are performed toconfirm expected credit losses and prepare individual impairment. For notes receivable, accounts receivable, other receivables,financing of receivables, long-term receivables, and contract assets for which there is no objective evidence of impairment, orwhen individual financial assets cannot be assessed at a reasonable cost, the Company divides bills receivable, accounts receivable,other receivables, receivable financing, long-term receivables, and contract assets into several combinations based on credit risk
characteristics, and calculates expected credit losses on the basis of the combination. The basis for determining the combination isas follows:
The basis for determining the combination of notes receivable is as follows:
Notes Receivable Combination 1 Commercial Acceptance BillNotes Receivable Combination 2 Bank Acceptance BillFor Notes receivable divided into portfolios, the Company refers to historical credit loss experience, combined with currentconditions and predictions of future economic conditions, and calculates through default risk exposure and expected credit lossrate within the next 12 months or the entire duration Expected credit losses.The basis for determining the combination of accounts receivable is as follows:
Accounts receivable combination 1 Accounts receivable businessAccounts receivable combination 2 Real estate receivable businessAccounts receivable combination 3 Others receivable businessOther receivable portfolio 4 Receivables from related parties within the scope of consolidationFor the accounts receivable divided into a combination, the Company refers to the historical credit loss experience,combined with the current situation and the forecast of the future economic situation, compiles the account receivable age and thewhole expected credit loss rate table, and calculates the expected credit loss.The basis for determining the combination of other receivables is as follows:
Other receivable portfolio 1 Interest receivablePortfolio of other receivables 2 Dividends receivableOther combinations of receivables 3 Deposit and margin receivableOther receivable portfolio 4 Receivable advancesCombination of other receivables 5 Value-added tax receivable is increased and refundedOther receivable portfolio 6 Receivables from related parties within the scope of consolidationOther receivables portfolio 7 Other receivables
For other receivables divided into portfolios, the Company refers to historical credit loss experience, combined with currentconditions and predictions of future economic conditions, and calculates through default risk exposure and expected credit lossrate within the next 12 months or the entire duration Expected credit losses.The basis for determining the combination of receivables financing is as follows:
Receivables financing portfolio 1 bank acceptance bill
For Notes receivable divided into portfolios, the Company refers to historical credit loss experience, combined with currentconditions and predictions of future economic conditions, and calculates through default risk exposure and expected credit lossrate within the next 12 months or the entire duration Expected credit losses.
The basis for determining the portfolio of contract assets is as follows:
Contract assets portfolio 1 conditional collection right of sales
Contract assets portfolio 2 Completed and unsettled project not meeting collection conditions
Contract assets portfolio 3 Quality guarantee deposit not meeting collection conditions
For contract assets divided into portfolios, the Company refers to historical credit loss experience, combined with currentconditions and predictions of future economic conditions, and calculates through default risk exposure and expected credit lossrate within the next 12 months or the entire duration Expected credit losses.
Other debt investment
For other receivables divided into portfolios, the Company refers to historical credit loss experience, combined with currentconditions and predictions of future economic conditions, and calculates through default risk exposure and expected credit lossrate within the next 12 months or the entire duration Expected credit losses.
② Lower credit risk
If the risk of default on financial instruments is low, the borrower's ability to meet its contractual cash flow obligations inthe short term is strong, and even if the economic situation and operating environment are adversely changed over a long period oftime, it may not necessarily reduce the receivables' performance of their contractual cash. The ability of the flow obligation, thefinancial instrument is considered to have a lower credit risk.
③ Significant increase in credit risk
The Company compares the default probability of the financial instrument during the expected lifetime determined by thebalance sheet date with the default probability of the expected lifetime during the initial confirmation to determine the relativeprobability of the default probability of the financial instrument during the expected lifetime Changes to assess whether the creditrisk of financial instruments has increased significantly since initial recognition.
In determining whether the credit risk has increased significantly since the initial recognition, the Company considersreasonable and evidenced information, including forward-looking information, that can be obtained without unnecessaryadditional costs or effort. The information considered by the Company includes:
A. Significant changes in internal price indicators resulting from changes in credit risk;
B. Adverse changes in business, financial or economic conditions that are expected to cause significant changes in thedebtor's ability to perform its debt service obligations;
C. Whether the actual or expected operating results of the debtor have changed significantly; whether the regulatory,economic or technical environment of the debtor has undergone significant adverse changes;
D. Whether there is a significant change in the value of the collateral used as debt collateral or the guarantee provided by athird party or the quality of credit enhancement. These changes are expected to reduce the debtor's economic motivation forrepayment within the time limit specified in the contract or affect the probability of default;
E. Whether there is a significant change in the economic motivation that is expected to reduce the debtor's repaymentaccording to the contractual deadline;
F. Anticipated changes to the loan contract, including whether the expected violation of the contract may result in theexemption or revision of contract obligations, granting interest-free periods, rising interest rates, requiring additional collateral orguarantees, or making other changes to the contractual framework of financial instruments change;
G. Whether the expected performance and repayment behavior of the debtor has changed significantly;
H. Whether the contract payment is overdue for more than (including) 30 days.
Based on the nature of financial instruments, the Company assesses whether credit risk has increased significantly on thebasis of a single financial instrument or combination of financial instruments. When conducting an assessment based on acombination of financial instruments, the Company can classify financial instruments based on common credit risk characteristics,such as overdue information and credit risk ratings.
If the overdue period exceeds 30 days, the Company has determined that the credit risk of financial instruments hasincreased significantly. Unless the Company does not have to pay excessive costs or efforts to obtain reasonable and warrantedinformation, it proves that although it has exceeded the time limit of 30 days agreed upon in the Contract, credit risks have notincreased significantly since the initial confirmation.
④ Financial assets with credit impairment
The Company assesses on the balance sheet date whether financial assets measured at amortized cost and credit investmentsmeasured at fair value and whose changes are included in other comprehensive income have undergone credit impairment. Whenone or more events that adversely affect the expected future cash flows of a financial asset occur, the financial asset becomes afinancial asset that has suffered a credit impairment. Evidence that credit impairment has occurred in financial assets includes thefollowing observable information:
Major financial difficulties have occurred to the issuer or the debtor; Breach of contract by the debtor, such as payment ofinterest or default or overdue of principal; (B) The concession that the debtor would not make under any other circumstances foreconomic or contractual considerations relating to the financial difficulties of the debtor; The debtor is likely to be bankrupt orundertake other financial restructuring; The financial difficulties of the issuer or debtor lead to the disappearance of the activemarket for the financial asset; To purchase or generate a financial asset at a substantial discount, which reflects the fact that acredit loss has occurred.
⑤ Presentation of expected credit loss measurement
In order to reflect the changes in the credit risk of financial instruments since the initial recognition, the Company re-measures the expected credit losses on each balance sheet date, and the increase or reversal of the loss provision resultingtherefrom is included as an impairment loss or gain. Current profit and loss. For financial assets measured at amortized cost, theloss allowance offsets the book value of the financial asset listed on the balance sheet; for debt investments measured at fair valueand whose changes are included in other comprehensive income, the Company Recognition of its loss provisions in gains does notoffset the book value of the financial asset.
⑥ Canceled
If it is no longer reasonably expected that the contract cash flow of the financial assets will be fully or partially recovered,the book balance of the financial assets will be directly reduced. Such write-off constitute the derecognition of related financialassets. This usually occurs when the Company determines that the debtor has no assets or sources of income that generatesufficient cash flow to cover the amount that will be written down.
If the financial assets that have been written down are recovered in the future, the reversal of the impairment loss is includedin the profit or loss of the current period.
(6) Transfer of financial assets
The transfer of financial assets refers to the following two situations:
A. Transfer the contractual right to receive cash flow of financial assets to another party;
B. Transfers the financial assets to the other party in whole or in part, but reserves the contractual right to collect the cashflow of the financial assets and undertakes the contractual obligation to pay the collected cash flow to one or more recipients.
① De-identification of transferred financial assets
Those who have transferred almost all risks and rewards in the ownership of financial assets to the transferee, or haveneither transferred nor retained almost all the risks and rewards in the ownership of financial assets, but have given up control ofthe financial assets, terminate the confirmation The financial asset.
In determining whether control over the transferred financial asset has been waived, the actual capacity of the transferor tosell the financial asset is determined. If the transferor is able to sell the transferred financial assets wholly to a third party that doesnot have a relationship with them, and has no additional conditions to limit the sale, it indicates ds has waived control over thefinancial assets.
The Company pays attention to the essence of financial asset transfer when judging whether financial asset transfer meetsthe condition of financial asset termination.
If the overall transfer of financial assets meets the conditions for termination of confirmation, the difference between thefollowing two amounts is included in the current profit and loss:
A. Continuing identification of transferred Book value；
B. The sum of the amount received as a result of the transfer and the amount accrued as a result of the change in the fairvalue of the transfer in respect of the termination recognized portion of the amount previously charged directly to the otherconsolidated proceeds (the financial assets involved in the transfer are those classified in accordance with Article 18 of EnterpriseAccounting Standard No. 22 - Financial Instruments Recognition and Measurement as measured by the fair value and whosechange is charged to the other consolidated proceeds).
If the partial transfer of financial assets meets the conditions for derecognition, the book value of the entire transferredfinancial assets will be included in the derecognized part and the unterminated part (in this case, the retained service assets are
regarded as part of the continued recognition of financial assets) Between them, they are apportioned according to their respectiverelative fair values on the transfer date, and the difference between the following two amounts is included in the current profit andloss:
A. Termination of the book value of the recognized portion on the date of derecognition;B. The sum of the amount received as a result of the transfer and the amount accrued as a result of the change in the fairvalue of the transfer in respect of the termination recognized portion of the amount previously charged to the other consolidatedproceeds (the financial assets involved in the transfer are those classified in accordance with Article 18 of Enterprise AccountingStandard No. 22 - Financial Instruments Recognition and Measurement as measured by the fair value and whose change is chargedto the other consolidated proceeds).
② Continue to be involved in the transferred financial assets
If neither transfer nor retain almost all the risks and rewards of the ownership of financial assets, and have not given upcontrol of the financial assets, the relevant financial assets should be confirmed according to the extent of their continuedinvolvement in the transferred financial assets, and the relevant liabilities should be recognized accordingly.The extent to which the transferred financial assets continue to be involved refers to the extent to which the enterpriseundertakes the risk or compensation of the value change of the transferred financial assets.
(III) Continuing identification of transferred financial assets
Where almost all risks and remuneration in relation to ownership of the transferred financial assets are retained, the wholeof the transferred financial assets shall continue to be recognized and the consideration received shall be recognized as a financialliability.
The financial asset and the recognized related financial liabilities shall not offset each other. In the subsequent accountingperiod, the enterprise shall continue to recognize the income (or gain) generated by the financial asset and the costs (or losses)incurred by the financial liability.
(7) Deduction of financial assets and liabilities
Financial assets and financial liabilities should be listed separately in the balance sheet, and cannot be offset against eachother. However, if the following conditions are met, the net amount offset by each other is listed in the balance sheet:
The Company has a statutory right to offset the confirmed amount, and such legal right is currently enforceable;
The Company plans to settle the net assets or realize the financial assets and liquidate the financial liabilities at the sametime.
The transferring party shall not offset the transferred financial assets and related liabilities if it does not meet the conditionsfor terminating the recognition.
(8) Recognition of fair value of Finance instruments
For the method for determining the fair value of financial assets and financial liabilities, see 33 (3) in Chapter X, V.Important accounting policies and accounting estimates.
11. Notes receivable
See Chapter X, V, Important Accounting Policies and Accounting Estimates 10. Financial Tools.
12. Account receivable
See Chapter X, V, Important Accounting Policies and Accounting Estimates 10. Financial Tools.The Company needs to comply with the disclosure requirements of the decoration and decoration industry in the Guidelines forthe Self-discipline and Supervision of Listed Companies of Shenzhen Stock Exchange No. 3 - Industry Information Disclosure.
13. Receivable financing
See Chapter X, V, Important Accounting Policies and Accounting Estimates 10. Financial Tools.
14. Other receivables
See Chapter X, V, Important Accounting Policies and Accounting Estimates 10. Financial Tools.
15. Contract assets
The Company presents contract assets or liabilities in the balance sheet according to the relationship between performanceobligation and customer payment. The consideration for which the Company is entitled to receive (subject to factors other than thepassage of time) for the transfer of goods or the provision of services to customers is listed as contract assets. The Company'sobligation to transfer goods or provide services to customers for consideration received or receivable from customers is listed ascontractual liabilities.
Contract assets and contract liabilities are listed separately in the balance sheet. Contract assets and contract liabilities underthe same contract are listed in net amount. If the net amount is the debit balance, it shall be listed in "contract assets" or "other noncurrent assets" according to its liquidity; if the net amount is the credit balance, it shall be listed in "contract liabilities" or "other
non current liabilities" according to its liquidity. Contract assets and contract liabilities under different contracts cannot offset eachother.For the determination method and accounting treatment method of the Company's expected credit loss of contract assets,see 10. Financial instruments in Chapter X, V. Important accounting policies and accounting estimates.
16. Inventories
(1) Classification of inventories
Inventory refers to the finished products or commodities held by the Company for sale in daily activities, the products inprocess of production, the materials and materials consumed in the process of production or providing labor services, includingentrusted processing materials, raw materials, products in process, materials in transit, stored goods, low value consumables,development costs, development products and contract performance costs, etc.
(2) Pricing of delivering inventory
Inventories are measured at cost when procured. Raw materials, products in process and commodity stocks in transit aremeasured by the weighted average method.
The inventory of real estate business mainly includes inventory materials, development costs, development products, etc.The actual costs of development products include land transfer payment, infrastructure and facility costs, installation engineeringcosts, borrows before completion of the development and other costs during the development process. The special maintenancefunds collected in the first period are included in the development overheads. When the control right of development products istransferred, the individual valuation method is used to determine its actual cost.
(3) Inventory system
The Company inventory adopts the perpetual inventory system, counting at least once a year, the inventory profit and lossamount is included in the current year's profit and loss.
(4) Criteria for recognizing and providing for provision for decline in value of inventories
On the balance sheet date, inventories are accounted depending on which is lower between the cost and the net realizablevalue. If the cost is higher than the net realizable value, the impairment provision will be made.
The realizable net value of inventory should be recognized based on solid evidence with the purpose of the inventory andafter-balance-sheet-date events taken into consideration.
(1) In the course of normal production and operation, the net realizable value of finished goods, commodities and materialsdirectly used for sale shall be determined by the estimated price of the inventory minus the estimated cost of sale and related taxes.The inventory held for the execution of a sales contract or a labor contract shall be measured on the basis of the contract price asits net realizable value; If the quantity held is greater than the quantity ordered under the sales contract, the net realizable value ofthe excess inventory is measured on the basis of the general sales price. For materials used for sale, the market price shall be usedas the measurement basis for the net realizable value.
②In the normal production and operation process, the inventory of materials that need to be processed is determined by theamount of the estimated selling price of the finished product minus the estimated cost to be incurred at the time of completion,estimated sales expenses and related taxes Realize the net value. If the net realizable value of the finished product produced by it ishigher than the cost, the material is measured at cost; If the decrease in the price of the material indicates that the net realizablevalue of the finished product is lower than the cost, the material is measured as the net realizable value and the inventory isprepared for a decrease based on its difference.
③ If the factors affecting the previous write-down of inventory value have disappeared on the balance sheet date, theamount of the write-down will be restored and transferred back within the amount of inventory depreciation reserve that has beenaccrued, and the amount returned will be included in the current profit and loss.
(5) Methods of amortization of swing materials
Low-value consumables are amortized on on-off amortization basis at using.
17. Long-term share equity investment
The Group's long-term equity investment includes control on invested entities and significant impacts on equity investment.Invested entities on which the Group has significant impacts are associates of the Group.
(1) Basis for recognition of common control and major influence on invested entities
Common control refers to the common control of an arrangement in accordance with the relevant agreement, and therelevant activities of the arrangement must be agreed upon by the participants who share control. In determining whether there iscommon control, the first step is to determine whether all or a group of participants collectively control the arrangement, which isconsidered collective control by all or a group of participants if all or a group of participants must act together to determine theactivities associated with the arrangement. Secondly, it is judged whether the decision on related activities of the arrangement mustbe agreed by the participants who collectively control the arrangement. If there is a combination of two or more parties that can
collectively control an arrangement, it does not constitute joint control. When judging whether there is joint control, the protectiverights enjoyed are not considered.Major influence refers to the power to participate in decision-making of financial and operation policies of a company, butcannot control or jointly control the making of the policies. When considering whether the Company can impose significantimpacts on the invested entity, impacts of conversion of shares with voting rights held directly or indirectly by the investor andvoting rights that can be executed in this period held by the investor and other party into shares of the invested entity should beconsidered.If the Company directly or through subsidiaries holds more than 20% (inclusive) but less than 50% of the shares with votingrights of the invested entity, unless there is clear evidence proving that the Company cannot participate the decision-making ofproduction and operation of the invested entity, the Company has major influence on the invested entity.
(2) Recognition of initial investment costs
? Long-term equity investments formed by merger of enterprises shall be determined in accordance with the followingprovisions:
A. In the case of an enterprise merger under the same control, where the merging party makes a valuation of the merger bypayment of cash, transfer of non-cash assets or undertaking liabilities, the share of the book value of the owner's interest in thefinal controlling party's consolidated financial statements as the initial investment cost of the long-term equity investment at thedate of the merger. The difference between the initial investment cost of long-term equity investment and the cash paid, thetransferred non-cash assets and the book value of the debt assumed shall be adjusted to the capital reserve; if the capital reserve isinsufficient to offset, the retained earnings shall be adjusted;
Long-term equity investment generated by enterprise merger: for long-term equity investment obtained by merger ofenterprises under common control, the obtained share of book value of the interests of the merged party's owner in the consolidatefinancial statements on the merger date is costs; for long-term equity investment obtained by merger of enterprises not undercommon control, the merger cost is the investment cost. Adjust the capital reserve according to the difference between the initialinvestment cost of long-term equity investment and the total face value of the issued shares. If the capital reserve is insufficient tooffset or reduce, the retained income shall be adjusted;
For merger of entities under different control, the merger cost is the fair value of the asset paid, liability undertaken, andequity securities issued for exchanging of control power over the entities at the day of acquisition. Agency expenses and other
administrative expenses such as auditing, legal consulting, or appraisal services occurred relating to the merger of entities areaccounted into current income account when occurred.
? Long-term equity investments formed by merger of enterprises shall be determined in accordance with the followingprovisions:
For long-term equity investment obtained by cash, the actually paid consideration is the initial investment cost. Initialinvestment costs include expenses, taxes and other necessary expenditures directly related to the acquisition of long-term equityinvestments;
B. Long-term equity investments acquired from the issuance of interest securities are the initial investment costs based onthe fair value of the issue interest securities;
C. For long-term equity investments obtained through non-monetary asset exchanges, if the exchange has commercialsubstance and the fair value of the exchanged assets or exchanged assets can be reliably measured, the fair value of the exchangedassets and relevant taxes shall be used as the initial Investment cost, the difference between the fair value and book value of theswapped-out asset is included in the current profit and loss; if the non-monetary asset exchange does not meet the above twoconditions at the same time, the book value of the swapped-out asset and relevant taxes will be used as the initial investment cost.
D. Long-term equity investments acquired through debt restructuring determine their recorded value at the fair value of thewaived claims and other costs such as taxes directly attributable to the assets and account for the difference between the fair valueand the book value of the waived claims.
(3) Subsequent measurement and recognition of gain/loss
The Company uses the cost method to measure long-term share equity investment in which the Company can control theinvested entity; and uses the equity method to measure long-term share equity investment in which the Company has substantialinfluence on the invested entity.
① Cost
For the long-term equity investment measured on the cost basis, except for the announced cash dividend or profit includedin the practical cost or price when the investment was made, the cash dividends or profit distributed by the invested entity arerecognized as investment gains in the current gain/loss account.
Equity
Gains from long-term equity investment measured by equity
When the equity method is used to measure long-term equity investment, the investment cost will not be adjusted if theinvestment cost of the long-term equity investment is larger than the share of fair value of the recognizable assets of the investedentity. When it is smaller than the share of fair value of the recognizable assets of the invested entity, the book value will beadjusted and the difference is included in the current gains of the investment.
When the equity method is used, the current investment gain is the share of the net gain realized in the current year that canbe shared or borne, recognized as investment gain and other misc. income. The book value of the long-term equity investment isadjusted accordingly. The book value of the long-term equity investment should be accordingly decreased based on the share ofprofit or cash dividend announced by the invested entity; according to other changes in the owner's equity except for net profit andloss, other misc income and profit distribution of the invested entity, adjust the book value of the long-term equity investment andrecord it in the capital surplus (other capital surplus). When the share of the net gains that can be enjoyed is recognized, it isrecognized after the net profit of the invested entity is adjusted based on the fair value of the recognizable assets of the investedentity according to the Company's accounting policies and accounting period. Where the accounting policy and accounting periodadopted by the Invested unit are inconsistent with the Company, the financial statements of the Invested unit shall be adjusted inaccordance with the accounting policy and accounting period of the Company, and the investment income and other consolidatedincome shall be recognized. Internal transaction gain not realized between the Company and affiliates is measured according to theshareholding proportion and the investment gains is recoginzied after deduction. The unrealized internal transaction loss betweenthe Company and the invested entity is the impairment loss of transferred assets and should not be written off.
Where substantial influence on invested entities is imposed or joint control is implemented due to increase in investment,the sum of the fair value of the original equity and increased investment on the conversion date is the initial investment cost underthe equity method. If the equity investment originally held is classified as other equity instrument investment, the differencebetween the fair value and the book value, as well as the accumulated gains or losses originally included in other comprehensiveincome, shall be transferred out of other comprehensive income and included in retained income in the current period when theequity method is adopted.
Where joint control or substantial influence on invested entities is lost due to disposal of part of investment, the remainingequity after the disposal should be treated according to the Enterprise Accounting Standard No.22 – Recognition and Measurementof Financial Instruments from the date of losing the joint control or substantial influence. The difference between the fair valueand book value should be accounted the profit and loss of the current period. For other misc. incomes of original share equityinvestment determined using the equity method, when the equity method is no longer used, it should be treated based on the same
basis of the treatment of related assets or liability of the invested entities; the other owners' interests related to the original shareequity investment should be transferred to gain/loss of the current period.
(4) Equity investment held for sale
For the remaining equity investments not classified as assets held for sale, the equity method is adopted for accountingtreatment.Equity investments classified as held for sale to associates that are no longer eligible to hold classified assets for sale areretrospectively adjusted using the equity method starting from the date that they are classified as held for sale. The classification isadjusted to hold the financial statements for the period to be sold.
(5) Impairment examination and providing of impairment provision
For investments in subsidiaries, associates and joint ventures, the method of accruing asset impairment is shown in 23.Long-term asset impairment in Chapter X, V. Important accounting policies and accounting estimates.XVIII. Investment real estate
(1) Classification of investment real estate
Investment real estate are held for rent or capital appreciation, or both. These include, inter alia:
① Leased land using right
(2) the right to use the land that is transferred after holding and preparing for the increment.
③ Leased building
(2) Measurement of investment real estate
For investment real estate with an active real estate transaction market and the Company can obtain market price and otherinformation of same or similar real estate to reasonably estimate the investment real estate' fair value, the Company will use thefair value mode to measure the investment real estate subsequently. Variations in fair value are accounted into the current gain/lossaccount.
The fair value of investment real estate is determined with reference to the current market prices of same or similar realestate in active markets; when no such price is available, with reference to the recent transaction prices and consideration offactors including transaction background, date and district to reasonably estimate the fair value; or based on the estimated leasegains and present value of related cash flows.
For investment real estate under construction (including investment real estate under construction for the first time), if thefair value cannot be reliably determined but the expected fair value of the real estate after completion is continuously and reliablyobtained, the investment real estate under construction is measured by cost. When the fair value can be measured reliably or aftercompletion (the earlier one), it is measured at fair value. For an investment real estate whose fair value is proven unable to beobtained continuously and reliably by objective evidence, the real estate will be measured at cost basis until it is disposed and noresidual value remains as assumed.
If the cost model is used for subsequent measurement of investment real estate, depreciation or amortization is calculatedaccording to the straight-line method after the cost of investment real estate minus accumulated impairment and net residual value.See this Chapter X V. Important accounting policies, for the method of accruing asset impairment 23. Impairment of long-termassets in accounting estimates.
The types of investment real estate, estimated economic useful life and estimated net residual value rate are determined asfollows:
| Type | Service year (year) | Residual rate % | Annual depreciation rate % |
| Houses & buildings | 20-50 | 10.00 | 1.80-4.50 |
19. Fixed assets
(1) Recognition conditions
Fixed assets are recognized at the actual cost of acquisition when the following conditions are met: (1) The economic benefitsassociated with the fixed assets are likely to flow into the enterprise.Fixed assets are recognized at the actual cost of acquisition when the following conditions are met: (1) The economic benefitsassociated with the fixed assets are likely to flow into the enterprise.
② The cost of the fixed assets can be measured reliably.
Overhaul cost generated by regular examination on fixed assets is recognized as fixed assets costs when there is evidence provingthat it meets fix assets recognition conditions. If not, it will be accounted into the current gain/loss account.
(2) Depreciation method
| Type | Depreciation method | Service year (year) | Residual rate % | Annual depreciation rate % |
| Houses & buildings | Average age | 20-50 | 10.00 | 1.80-4.50 |
| Mechanical equipment | Average age | 10 | 10.00 | 9.00 |
| Transportation facilities | Average age | 5 | 10.00 | 18.00 |
| Electronics and other devices | Average age | 5 | 10.00 | 18.00 |
| PV power plants | Average age | 20 | 5.00 | 4.75 |
20. Construction in process
(1) Construction in progress is accounted for by project classification.
(2) Standard and timing for transferring construction in process into fixed assets
The full expenditure incurred on the construction-in-progress project as a fixed asset is recorded as the value of the assetbefore the asset is constructed to the intended usable state. This includes construction costs, the original cost of equipment, othernecessary expenditures incurred in order to enable the construction works to reach the intended usable status and the borrowingcosts incurred for the specific borrowing of the project and the general borrowing expenses incurred before the assets reach theintended usable status. Construction in process will be transferred to fixed assets when it reaches the preset service condition. Thefixed assets that have reached the intended usable state but have not been completed shall be transferred to the fixed assetsaccording to the estimated value according to the estimated value according to the estimated value according to the project budget,cost or actual project cost, etc. The depreciation of the fixed assets shall be accrued according to the Company's fixed assetsdepreciation policy. The original estimated value shall be adjusted according to the actual cost after the completion.XXI. Borrowing expenses
(1) Recognition principles for capitalization of borrowing expenses
Borrowing expenses occurred to the Company that can be accounted as purchasing or production of asset satisfying theconditions of capitalizing, are capitalized and accounted as cost of related asset.
(1) Asset expenditure has occurred;
② The borrowing expense has already occurred;
③ Purchasing or production activity, which is necessary for the asset to reach the useful status, has already started.
Other interest on loans, discounts or premiums and exchange differences are included in the income and loss incurred in thecurrent period.
If the construction or production of assets satisfying the capitalizing conditions is suspended abnormally for over 3 months,capitalizing of borrowing expenses shall be suspended. During the normal suspension period, borrowing expenses will becapitalized continuously.When the asset satisfying the capitalizing conditions has reached its usable or sellable status, capitalizing of borrowingexpenses shall be terminated.
(2) Calculation of the capitalization amount of borrowing expense
Interest expenses generated by special borrowings less the interests income obtained from the deposit of unused borrowingsor investment gains from temporary investment is capitalized; the capitalization amount for general borrowing is determined basedon the capitalization rate which is the exceeding part of the accumulative assets expense over weighted average of the assetsexpense of the special borrowing/used general borrowing.
If the assets that are constructed or produced under the condition of capitalization occupy the general borrowing, the interestamount to be capitalized in the general borrowing shall be calculated and determined by multiplying the capital rate of the generalborrowing by the weighted average of the asset expenditure of the accumulated assets whose expenditure exceeds that of thespecialized borrowing. The capitalization ratio is the weighted average interest rate of general borrowings.XXII. Intangible assets
Recorded at the actual cost of acquisition.
(1) Amortization of intangible assets
① Useful life of intangible assets with limited useful life
| Item | Estimated useful life | Basis |
| Land using right | Term | Use right assets |
| Trademarks and patents | 10 | Reference to determine the lifetime of a company for which it can bring economic benefits |
| Proprietary technology | 10 | Reference to determine the lifetime of a company for which it can bring economic benefits |
| Software | 5. 10 years | Reference to determine the lifetime of a company for which it can bring economic benefits |
At the end of each year, the Company will reexamine the useful life and amortization basis of intangible assets with limiteduseful life. Upon review, the service life and amortization methods of intangible assets at the end of the period are not differentfrom those previously estimated.
(2) Intangible assets which cannot be foreseeable to bring economic benefits to enterprises shall be regarded as intangibleassets whose useful life is uncertain. For intangible assets with uncertain service life, the Company reviews the service life ofintangible assets with uncertain service life at the end of each year. If it is still uncertain after rechecking, it shall conduct animpairment test on the balance sheet date.
③ Amortization of intangible assets
For intangible assets with limited service life, the Company shall determine their service life at the time of acquisition, andshall use the straight line method system to reasonably amortize their service life, and the amortization amount shall be included inthe profit and loss of the current period according to the beneficial items. The specific amortization amount is the amount after thecost is deducted from the estimated residual value. For fixed assets for which depreciation provision is made, the depreciation ratewill be determined after the accumulative depreciation provision amount is deducted. The residual value of an intangible assetwith limited useful life is treated as zero, except where a third party undertakes to purchase the intangible asset at the end of itsuseful life or to obtain expected residual value information based on the active market, which is likely to exist at the end of itsuseful life.
Intangible assets with uncertain service life will not be amortized. At the end of each year, the useful life of intangible assetswith uncertain useful life is reviewed, and if there is evidence that the useful life of intangible assets is limited, the useful life isestimated and the system is reasonably amortized within the expected useful life.
(2) Scope of R&D expenditures and related accounting treatment
Specific standard for distinguish between research and development stage
① The Company takes the information and related preparatory activities for further development activities as the researchstage, and the intangible assets expenditure in the research stage is included in the current profit and loss period.
② The development activities carried out after the Company has completed the research stage as the development stage.
Specific conditions for capitalization of expenditures in the development phase
Expenditures in the development phase can be recognized as intangible assets only when the following conditions are met:
A. It is technically feasible to complete the intangible asset so that it can be used or sold;
B. Have the intention to complete the intangible asset and use or sell it;C. The way intangible assets generate economic benefits, including the ability to prove that the products produced by theintangible assets exist in the market or the intangible assets themselves exist in the market, and the intangible assets will be usedinternally, which can prove their usefulness;D. Have sufficient technical, financial and other resource support to complete the development of the intangible asset, andhave the ability to use or sell the intangible asset;
E. The expenditure attributable to the development stage of the intangible asset can be reliably measured.
23. Assets impairment
The Group uses the cost mode to continue measuring the assets impairment to investment real estate, fixed assetsconstruction in progress, intangible assets and goodwill (except for the inventories, investment real estate measured by the fairvalue mode, deferred income tax assets and financial assets). The method is determined as follows:
The Company judges whether there is a sign of impairment to assets on the balance sheet day. If such sign exists, theCompany estimates the recoverable amount and conducts the impairment test. Impairment test is conducted annually for goodwillgenerated by mergers and intangible assets that have not reached the useful condition no matter whether the impairment sign exists.
The recoverable amount is determined by the higher of the net of fair value minus disposal expense and the present value ofthe predicted future cash flow. The Company estimates the recoverable amount on the individual asset item basis; whether it ishard to estimate the recoverable amount on the individual asset item basis, determine the recoverable amount based on the assetgroup that the assets belong to. The assets group is determined by whether the main cash flow generated by the Group isindependent from those generated by other assets or assets groups.
When the recoverable amount of the assets or assets group is lower than its book value, the Company writes down the bookvalue to the recoverable amount, the write-down amount is accounted into the current income account and the assets impairmentprovision is made.
For goodwill impairment test, the book value of goodwill generated by mergers is amortized through reasonable measuressince the purchase day to related asset groups; those cannot be amortized to related assets groups are amortized to relatedcombination of asset groups. The related asset groups or combination of asset groups refer to those that can benefit from thesynergistic effect of mergers and must not exceed to the reporting range determined by the Company.
When the impairment test is conducted, if there is sign of impairment to the asset group or combination of asset groupsrelated to goodwill, first perform impair test for asset group or combination of asset groups without goodwill and calculate therecoverable amount and recognize the related impairment loss. Then conduct impairment test on those with goodwill, compare thebook value with recoverable amount. If the recoverable amount is lower than the book value, recognize the impairment loss of thegoodwill.Once recognized, the asset impairment loss cannot be written back in subsequent accounting period.
24. Long-term amortizable expenses
The long-term deferred expenses shall be used to calculate the expenses that have occurred but should be borne by theCompany in the current and subsequent periods with a amortization period of more than one year. The Company's long-termdeferred expenses are amortized averagely during the benefit period.
25. Contract liabilities
See 15. Contract assets in Chapter X, V. Important Accounting Policies and Accounting Estimates for details.
26. Staff remuneration
(1) Accounting of operational leasing
① Basic salary of employees (salary, bonus, allowance, subsidy)
In the accounting period for which the staff and workers provide services, the Company shall confirm the actual short-termremuneration as liabilities and shall account for the current income and loss, except as required or permitted by other accountingstandards.
② Employee welfare
The employee benefits incurred by the Company shall be included in the current profit and loss or related asset costsaccording to the actual amount incurred. Where the employee's benefit is non-monetary, it shall be measured on the basis of fairvalue.
③ Social insurance premiums and housing accumulation funds such as health insurance premiums, work injury premiums,birth insurance premiums, trade union funds and staff and education funds
The Company pays the medical insurance premiums, work injury insurance premiums, birth insurance premiums, etc. socialinsurance premiums and housing accumulation funds for the staff and workers, as well as the union funds and the staff and
workers education funds according to the regulations, in the accounting period for which the staff and workers provide services,the corresponding salary amount of the staff and workers, and confirms the corresponding liabilities, which are included in thecurrent profit and loss or related asset costs.
④ Short-term paid leave
The Company accumulates the salary of the employees who are absent from work with pay when the employees provideservice, thus increasing their future right of absence with pay. The Company confirms the salary of the employee related to theabsence of non-cumulative salary during the actual absence accounting period.
⑤ Short-term profit share program
If the profit-sharing plan meets the following conditions at the same time, the Company shall confirm the salary payable tothe staff and workers:
A. The legal or presumptive obligation of the enterprise to pay the remuneration of its employees as a result of past matters;
B. The amount of employee compensation obligations due to the profit sharing plan can be reliably estimated.
(2) Accounting of post-employment welfare
The Company's post-employment benefit plan is defined contribution plan. Defined contribution plans include basicendowment insurance, unemployment insurance, etc. During the accounting period when employees provide services for them, theCompany shall recognize the deposit amount calculated according to the defined deposit plan as liabilities and include it in thecurrent profits and losses or related asset costs.
(3) Accounting of dismiss welfare
If the Company provides termination benefits to employees, the employee compensation liabilities arising from thetermination benefits shall be recognized at the earliest of the following two and shall be included in the current profit and loss:
① An enterprise may not unilaterally withdraw the resignation benefits provided for by the dismissal plan or reductionproposal;
② When the enterprise recognizes the costs or expenses related to the reorganization involving the payment of resignationbenefits.
27. Anticipated liabilities
(1) Recognition standards of anticipated liabilities
When responsibilities occurred in connection to contingent issues, and all of the following conditions are satisfied, they arerecognized as expectable liability in the balance sheet:
① This responsibility is a current responsibility undertaken by the Company;
② Execution of this responsibility may cause financial benefit outflow from the Company;
③ Amount of the liability can be reliably measured.
(2) Measurement of anticipated liabilities
Expected liabilities are initially measured at the best estimation on the expenses to exercise the current responsibility, andwith considerations to the relative risks, uncertainty, and periodic value of currency. On each balance sheet date, review the bookvalue of the estimated liabilities. Where there is conclusive evidence that the book value does not reflect the current best estimate,the book value is adjusted to the current best estimate.
28. Revenue
(1) General principles
Income is the total inflow of economic benefits formed in the daily activities of the Company, which will lead to theincrease of shareholders' equity and has nothing to do with the capital invested by shareholders.
The Company has fulfilled the performance obligation in the contract, that is, the revenue is recognized when the customerobtains the control right of relevant goods. To obtain the control right of the relevant commodity means to be able to dominate theuse of the commodity and obtain almost all the economic benefits from it.
If there are two or more performance obligations in the contract, the Company will allocate the transaction price to eachsingle performance obligation according to the relative proportion of the separate selling price of the goods or services promisedby each single performance obligation on the start date of the contract, and measure the income according to the transaction priceallocated to each single performance obligation.
The transaction price refers to the amount of consideration that the Company is expected to be entitled to receive due to thetransfer of goods or services to customers, excluding the amount collected on behalf of a third party. When determining thecontract transaction price, if there is a variable consideration, the Company shall determine the best estimate of the variable
consideration according to the expected value or the most likely amount, and include it in the transaction price with the amount notexceeding the accumulated recognized income when the relevant uncertainty is eliminated, which is most likely not to have asignificant reversal. If there is a significant financing component in the contract, the Company will determine the transaction priceaccording to the amount payable in cash when the customer obtains the control right of the commodity. The difference betweenthe transaction price and the contract consideration will be amortized by the effective interest method during the contract period. Ifthe interval between the control right transfer and the customer's payment is less than one year, the Company will not consider thefinancing component Points.If one of the following conditions is met, the performance obligation shall be performed within a certain period of time;otherwise, the performance obligation shall be performed at a certain point of time:
① When the customer performs the contract in the Company, he obtains and consumes the economic benefits brought bythe Company's performance;
② Customers can control the goods under construction during the performance of the contract;
③ The goods produced by the Company in the process of performance have irreplaceable uses, and the Company has theright to collect money for the performance part that has been completed so far during the whole contract period.
For the performance obligations performed within a certain period of time, the Company shall recognize the revenueaccording to the performance progress within that period, except that the performance progress cannot be reasonably determined.The Company determines the progress of performance for the provision of services on the basis of the input (or output) method.When the progress of performance cannot be reasonably determined, if the cost incurred by the Company is expected to becompensated, the revenue shall be recognized according to the amount of cost incurred until the progress of performance can bereasonably determined.
For the performance obligation performed at a certain time point, the Company recognizes the revenue at the time pointwhen the customer obtains the control right of relevant goods. In determining whether a customer has acquired control of goods orservices, the Company will consider the following signs:
① The Company has the right to receive payment for the goods or services, that is, the customer has the obligation to payfor the goods;
② The Company has transferred the legal ownership of the goods to the customer, that is, the customer has the legalownership of the goods;
③ The Company has transferred the goods in kind to the customer, that is, the customer has possessed the goods in kind;
④ The Company has transferred the main risks and rewards of the ownership of the goods to the customer, that is, thecustomer has obtained the main risks and rewards of the ownership of the goods;
⑤ The product has been accepted by the customer.
Sales return clause
For the sales with sales return clauses, when the customer obtains the control right of the relevant goods, the Company shallrecognize the revenue according to the amount of consideration it is entitled to obtain due to the transfer of the goods to thecustomer, and recognize the amount expected to be returned due to the sales return as the estimated liability; at the same time, theCompany shall deduct the estimated cost of recovering the goods according to the book value of the expected returned goods at thetime of transfer( The balance after deducting the value of the returned goods is recognized as an asset, that is, the cost of returnreceivable, which is carried forward by deducting the net cost of the above assets according to the book value of the transferredgoods at the time of transfer. On each balance sheet date, the Company re estimates the return of future sales and re measures theabove assets and liabilities.
Warranty obligations
According to the contract and legal provisions, the Company provides quality assurance for the goods sold and the projectsconstructed. For the guarantee quality assurance to ensure that the goods sold meet the established standards, the Companyconducts accounting treatment in accordance with the accounting standards for Business Enterprises No. 13 - contingencies. Forthe service quality assurance which provides a separate service in addition to guaranteeing that the goods sold meet the establishedstandards, the Company takes it as a single performance obligation, allocates part of the transaction price to the service qualityassurance according to the relative proportion of the separate selling price of the goods and service quality assurance, andrecognizes the revenue when the customer obtains the service control right. When evaluating whether the quality assuranceprovides a separate service in addition to assuring customers that the goods sold meet the established standards, the Companyconsiders whether the quality assurance is a statutory requirement, the quality assurance period, and the nature of the Company'scommitment to perform the task.
Customer consideration payable
If there is consideration payable to the customer in the contract, unless the consideration is to obtain other clearlydistinguishable goods or services from the customer, the Company will offset the transaction price with the consideration payable,
and offset the current income at the later time of confirming the relevant income or paying (or promising to pay) the customer'sconsideration.
Contractual rights not exercised by customersIf the Company advances sales of goods or services to customers, the amount shall be recognized as liabilities first, and thenconverted into income when relevant performance obligations are fulfilled. When the Company does not need to return theadvance payment and the customer may give up all or part of the contract rights, if the Company expects to have the right to obtainthe amount related to the contract rights given up by the customer, the above amount shall be recognized as income in proportionaccording to the mode of the customer exercising the contract rights; otherwise, the Company only has the very low possibility ofthe customer requiring to perform the remaining performance obligations The relevant balance of the above liabilities is convertedinto income.Contract changeWhen the construction contract between the Company and the customer is changed:
① If the contract change increases the clearly distinguishable construction service and contract price, and the new contractprice reflects the separate price of the new construction service, the Company will treat the contract change as a separate contractfor accounting;
② If the contract change does not belong to the above-mentioned situation (1), and there is a clear distinction between thetransferred construction service and the non transferred construction service on the date of contract change, the Company willregard it as the termination of the original contract, and at the same time, combine the non performance part of the originalcontract and the contract change part into a new contract for accounting treatment;
③ If the contract change does not belong to the above situation (1), and there is no clear distinction between the transferredconstruction services and the non transferred construction services on the date of contract change, the Company will take thecontract change part as an integral part of the original contract for accounting treatment, and the resulting impact on the recognizedincome will be adjusted to the current income on the date of contract change.
(2) The specific methods of revenue recognition of the Company are as follows:
? Commodity sales contract
The commodity sales contract between the company and the customer includes the performance obligation of transferringcurtain wall materials, screen door materials, electric energy, etc., which belongs to the performance obligation at a certain timepoint.Revenue from domestic sales of products is recognized at the time when the customer obtains the right of control of thegoods on the basis of comprehensive consideration of the following factors: the Company has delivered the products to thecustomer according to the contract, the customer has accepted the goods, the payment for goods has been recovered or the receipthas been obtained, and the relevant economic benefits are likely to flow in, the main risks and rewards of the ownership of thegoods have been transferred, the legal ownership has been transferred;The following conditions should be met for the recognition of export product revenue: the Company has declared theproduct according to the contract, obtained the bill of lading, collected the payment for goods or obtained the receipt certificate,and the relevant economic benefits are likely to flow in, the main risks and rewards of the ownership of goods have beentransferred, and the legal ownership of goods has been transferred.? Service contractThe service contract between the Company and its customers includes the performance obligations of metro platform screendoor operation maintenance, curtain wall maintenance and property services. As the Company's performance at the same time, thecustomers obtain and consume the economic benefits brought by the Company's performance, the Company takes it as theperformance obligation within a certain period of time and allocates it equally during the service provision period.? Engineering contractThe project contract between the Company and the customer includes the performance obligations of curtain wall projectand metro platform screen door project construction. As the customer can control the goods under construction in the process ofthe Company's performance, the Company takes them as the performance obligations within a certain period of time, andrecognizes the income according to the performance progress, except that the performance progress cannot be reasonablydetermined. The Company determines the performance schedule of providing construction services according to the input method.The performance schedule shall be determined according to the proportion of the actual contract cost to the estimated total contractcost.? Real estate sales contract
The income of the Company's real estate development business is recognized when the control of the property is transferred tothe customer. The income is recognized when the customer obtains the physical ownership or legal ownership of the completedproperty and the Company has obtained the current right of collection and is likely to recover the consideration. When confirmingthe contract transaction price, if the financing component is significant, the Company will adjust the contract commitmentconsideration according to the financing component of the contract.
(3) Adoption of different business models for the same type of business involving different revenue recognition andmeasurement methodsThere is no difference in revenue recognition due to the adoption of different accounting policies for similar businesses.
29. Contract costs
Contract cost is divided into contract performance cost and contract acquisition cost.The cost incurred by the Company in performing the contract shall be recognized as an asset when the following conditionsare met simultaneously:
The cost is directly related to a current or expected contract, including direct labor, direct materials, manufacturing expenses(or similar expenses), clearly borne by the customer, and other costs incurred only due to the contract;
② This cost increases the Company's future resources for fulfilling its performance obligations.
③ The cost is expected to be recovered.
If the incremental cost incurred by the Company to obtain the contract is expected to be recovered, it shall be recognized asan asset as the contract acquisition cost.
The assets related to the contract cost shall be amortized on the same basis as the income from goods or services related tothe assets; however, if the amortization period of the contract acquisition cost is less than one year, the Company shall include it inthe current profit and loss when it occurs.
If the book value of the assets related to the contract cost is higher than the difference between the following two items, theCompany will make provision for impairment for the excess part and recognize it as the loss of asset impairment, and furtherconsider whether the estimated liabilities related to the loss contract should be made:
① The residual consideration expected to be obtained due to the transfer of goods or services related to the asset;
② The estimated cost to be incurred for the transfer of the relevant goods or services.
If the above provision for impairment of assets is subsequently reversed, the book value of the asset after reversal shall notexceed the book value of the asset on the reversal date without provision for impairment.
The contract performance cost recognized as an asset with an amortization period of no more than one year or one normalbusiness cycle at the time of initial recognition shall be listed in the "inventory" item, and the amortization period of no more thanone year or one normal business cycle at the time of initial recognition shall be listed in the "other non current assets" item.
The contract acquisition cost recognized as an asset shall be listed in the item of "other current assets" when theamortization period does not exceed one year or one normal business cycle at the time of initial recognition, and listed in the itemof "other non current assets" when the amortization period exceeds one year or one normal business cycle at the time of initialrecognition.
30. Government subsidy
(1) Government subsidy
Government subsidies are recognized when the following conditions are met:
① Requirements attached to government subsidies;
② The Company can receive government subsidies.
(2) Government subsidy
When a government subsidy is monetary capital, it is measured at the received or receivable amount. None monetary capitalare measured at fair value; if no reliable fair value available, recognized at RMB1.
(3) Recognition of government subsidies
① Assets-related
Government subsidies related to assets are obtained by the Company to purchase, build or formulate in other manners long-term assets; or subsidies related to benefits. If the asset-related government subsidy is recognized as deferred gain, should berecorded in gain and loss in the service life. Government subsidy measured at the nominal amount is accounted into currentincome account. If the relevant assets are sold, transferred, scrapped or damaged before the end of their useful life, the unallocatedrelevant deferred income balance shall be transferred to the profit and loss of the current period of disposition of the assets.
Gain-related government subsidy should be accounted as follows:
The Company divides government subsidies into assets-related and earnings-related government subsidies. Gain-relatedgovernment subsidy should be accounted as follows:
Subsidy that will be used to compensate related future costs or losses should be recognized as deferred gain and recorded inthe gain and loss of the current report and offset related cost;
Subsidy that is used to compensate existing cost or loss should be recorded in the gain and loss of the current period oroffset related cost.
For government subsidies that include both asset-related and income-related parts, separate different parts for accountingtreatment; It is difficult to distinguish between the overall classification of government subsidies related to benefits.
Government subsidy related to routine operations should be recorded in other gains or offset related cost. Governmentsubsidy not related to routine operations should be recorded in non-operating income or expense.
③ Policy preferential loan discount
The policy-based preferential loan obtained has interest subsidy. If the government allocates the interest-subsidy funds tothe lending bank, the loan amount actually received will be used as the entry value of the loan, and the borrowing cost will becalculated based on the loan principal and policy-based preferential interest rate.
If the government allocates the interest-bearing funds directly to the Group, discount interest will offset the borrowing costs.
④ Government subsidy refund
When a confirmed government subsidy needs to be returned, the book value of the asset is adjusted against the book valueof the relevant asset at initial recognition. If there is a related deferred income balance, the book balance of the related deferredincome is written off and the excess is credited to the current profit or loss; In other cases, it is directly included in the currentprofit and loss.
31. Differed income tax assets and differed income tax liabilities
The Company uses the temporary difference between the book value of the assets and liabilities on the balance sheet dayand the tax base and the liabilities method to recognize the deferred income tax. 26. Deferred income tax assets and deferredincome tax liabilities
(1) Deferred income tax assets
For deductible temporary discrepancies, deductible losses and tax offsets that can be carried forward for future years, theimpact on income tax is calculated at the estimated income tax rate for the transfer-back period and the impact is recognized asdeferred income tax assets, provided that the Company is likely to obtain future taxable income for deductible temporarydiscrepancies, deductible losses and tax offsets.At the same time, the impact on income tax of deductible temporary discrepancies resulting from the initial recognition ofassets or liabilities in transactions or matters with the following characteristics is inconclusive as deferred income tax assets:
A. The transaction is not a business combination;
B. the transaction is not a merger and the transaction does not affect the accounting profit or taxable proceeds;
In the event of temporary discrepancy of deductible investment related to subsidiaries, joint ventures and joint ventures, andmeeting the following two conditions, the amount of impact (talent) on income tax shall be deemed as deferred income tax assets:
A. Temporary discrepancies are likely to be reversed in the foreseeable future;
B. In the future, it is likely to obtain taxable income that can be used to offset the deductible temporary differences;
On the balance sheet date, if there is conclusive evidence that sufficient taxable income is likely to be obtained in the futureto offset the deductible temporary differences, the deferred income tax assets that have not been recognized in the previous periodare recognized.
On the balance sheet day, the Company re-examines the book value of the deferred income tax assets. If it is unlikely tohave adequate taxable proceeds to reduce the benefits of the deferred income tax assets, less the deferred income tax assets' bookvalue. When there is adequate taxable proceeds, the lessened amount will be reversed.
(2) Deferred income tax assets
All provisional differences in taxable income of the Company shall be measured on the basis of the estimated income taxrate for the period of transfer-back and shall be recognized as deferred income tax liabilities, except that:
At the same time, the impact on income tax of deductible temporary discrepancies resulting the initial recognition of assetsor liabilities in transactions or matters with the following characteristics is inconclusive as deferred income tax Liabilities:
A. Initial recognition of goodwill;
B. Initial recognition of goodwill, or of assets or liabilities generated in transactions with the following features: thetransaction is not a merger and the transaction does not affect the accounting profit or taxable proceeds;
② In the event of temporary discrepancy of deductible investment related to subsidiaries, Joint venture joint ventures, andmeeting the two conditions, the amount of impact (talent) on income tax shall be deemed as deferred income tax assets:
A. The Company is able to control the time of temporary discrepancy transfers;
B Temporary discrepancies are likely to be reversed in the foreseeable future;
(3) Deferred income tax assets
(1) Deferred income tax liabilities or assets associated with enterprise consolidation
Temporary difference of taxable tax or deductible temporary difference generated by enterprise merger under non-samecontrol. When deferred income tax liability or deferred income tax asset is recognized, related deferred income tax expense (orincome) is usually adjusted as recognized goodwill in enterprise merger.
② Amount of shares paid and accounted as owners' equity
Except for the adjustment goodwill generated by mergers or deferred income tax related to transactions or events directlyaccounted into the owners' equity, income tax is accounted as income tax expense into the current gain/loss account. The effects oftemporary discrepancy on income tax include the following: Other integrated benefits such as fair value change of financial assetsavailable for sale, retroactive adjustment of accounting policy changes or retroactive restatement of accounting error correctiondiscrepancy to adjust the initial retained income, and mixed financial instruments including liabilities and equity.
③ Compensation for losses and tax deductions
A. Compensable losses and tax deductions from the Company's own operations
Deductible losses refer to the losses calculated and determined in accordance with the provisions of the tax law that areallowed to be made up with the taxable income of subsequent years. The uncovered losses (deductible losses) and tax deductionsthat can be carried forward in accordance with the tax law are treated as deductible temporary differences. When it is expected thatsufficient taxable income is likely to be obtained in the future period when it is expected to be available to make up for losses ortax deductions, the corresponding deferred income tax assets are recognized within the limit of the taxable income that is likely tobe obtained, while reducing the current period Income tax expense in the income statement.
B. Compensable uncovered losses of the merged company due to business merger
In a business combination, if the Company obtains the deductible temporary difference of the purchased party and does notmeet the deferred income tax asset recognition conditions on the purchase date, it shall not be recognized. Within 12 months afterthe purchase date, if new or further information is obtained indicating that the relevant conditions on the purchase date already
exist, and the economic benefits brought about by the temporary difference are expected to be deducted on the purchase date,confirm the relevant delivery. Deferred income tax assets, while reducing goodwill, if the goodwill is not enough to offset, thedifference is recognized as the current profit and loss; except for the above circumstances, the deferred tax assets related to thebusiness combination are recognized and included in the current profit and loss.
④Temporary difference caused by merger offset
If there is a temporary difference between the book value of assets and liabilities in the consolidated balance sheet and thetaxable basis of the taxpayer due to the offset of the unrealized internal sales gain or loss, the deferred income tax asset or thedeferred income tax liability is confirmed in the consolidated balance sheet, and the income tax expense in the consolidated profitstatement is adjusted, with the exception of the deferred income tax related to the transaction or event directly included in theowner's equity and the merger of the enterprise.
⑤ Share payment settled by equity
If the tax law provides for allowable pre-tax deduction of expenses related to share payment, within the period for which thecost and expense are recognized in accordance with the accounting standards, the Company shall calculate the tax basis andtemporary discrepancy based on the estimated pre-tax deduction amount at the end of the accounting period and confirm therelevant deferred income tax if it meets the conditions for confirmation. Of these, the amount that can be deducted before tax in thefuture exceeds the cost related to share payment recognized in accordance with the accounting standards, and the excess incometax shall be directly included in the owner's equity.
(4) Basis for presentation of deferred tax assets and deferred tax liabilities on a net basis
The deferred income tax assets and deferred income tax liabilities of the company are presented as a net amount afteroffsetting when the following conditions are met simultaneously:
The Company has a legal right to offset current income tax assets and current income tax liabilities on a net basis.
The deferred income tax assets and deferred income tax liabilities are related to income taxes levied by the same taxauthority on the same taxable entity, or are related to income taxes levied by different tax authorities but the significant deferredincome tax assets and deferred income tax liabilities will be settled on a net basis for current income taxes or simultaneousacquisition of assets and settlement of liabilities within each future period in which the related taxable entity intends to settle thecurrent income tax assets and liabilities on a net basis.
32. Leasing
(1) Identification of lease
On the commencement date of the contract, the company evaluates whether the contract is a lease or includes a lease. If oneparty in the contract transfers the right to control the use of one or more identified assets within a certain period in exchange forconsideration, the contract is a lease or includes a lease. In order to determine whether the contract transfers the right to control theuse of the identified assets within a certain period, the company evaluates whether the customers in the contract have the right toobtain almost all the economic benefits arising from the use of the identified assets during the use period, and have the right todominate the use of the identified assets during the use period.
(2) Separate identification of lease
If the contract includes multiple separate leases at the same time, the company will split the contract and conduct accountingtreatment for each separate lease. If the following conditions are met at the same time, the right to use the identified assetconstitutes a separate lease in the contract: ① the lessee can profit from using the asset alone or together with other easilyavailable resources; ② The asset is not highly dependent or highly related to other assets in the contract.
(3) Accounting treatment method of the Company as lessee
On the beginning date of the lease term, the Company recognizes the lease with a lease term of no more than 12 months andexcluding the purchase option as a short-term lease; When a single leased asset is a brand-new asset, the lease with lower value isrecognized as a low value asset lease. If the Company sublets or expects to sublet the leased assets, the original lease is notrecognized as a low value asset lease.
For all short-term leases and low value asset leases, the Company will record the lease payment amount into the relevantasset cost or current profit and loss according to the straight-line method (or other systematic and reasonable methods) in eachperiod of the lease term.
In addition to the above short-term leases and low value asset leases with simplified treatment, the Company recognizes theright to use assets and lease liabilities for the lease on the beginning date of the lease term.
① Use right assets
The term "right to use assets" refers to the right of the lessee to use the leased assets during the lease term.
At the beginning of the lease term, the right of use assets are initially measured at cost. This cost includes:
? The initial measurement amount of lease liabilities;? For the lease payment paid on or before the beginning of the lease term, if there is lease incentive, the relevant amount of
lease incentive enjoyed shall be deducted;? Initial direct expenses incurred by the lessee;? The estimated cost incurred by the lessee for dismantling and removing the leased assets, restoring the site where the
leased assets are located or restoring the leased assets to the state agreed in the lease terms. The Company recognizes and
measures the cost in accordance with the recognition standards and measurement methods of estimated liabilities. See 27.
Estimated liabilities in Chapter X, V. important accounting policies and accounting estimates for details. If the above
costs are incurred for the production of inventories, they will be included in the cost of inventories.Depreciation of right of use assets is accrued by using the straight-line method. If it can be reasonably determined that theownership of the leased asset will be obtained at the expiration of the lease term, the depreciation rate shall be determinedaccording to the asset category of the right to use and the estimated net residual value rate within the expected remaining servicelife of the leased asset; If it is impossible to reasonably determine that the ownership of the leased asset will be obtained at theexpiration of the lease term, the depreciation rate shall be determined according to the asset category of the right of use within theshorter of the lease term and the remaining service life of the leased asset.
② Lease liabilities
The lease liabilities are initially measured Company shall according to the present value of the unpaid lease payments at thebeginning of the lease term. The lease payment includes the following five items:
? Fixed payment amount and substantial fixed payment amount. If there is lease incentive, the relevant amount of leaseincentive shall be deducted;? Variable lease payments depending on index or ratio;? The exercise price of the purchase option, provided that the lessee reasonably determines that the option will beexercised;
? The amount to be paid for exercising the option to terminate the lease, provided that the lease term reflects that the lesseewill exercise the option to terminate the lease;
? The amount expected to be paid according to the residual value of the guarantee provided by the lessee.
When calculating the present value of lease payments, the implicit interest rate of the lease is used as the discount rate. Ifthe implicit interest rate of the lease cannot be determined, the incremental borrowing interest rate of the company is used as thediscount rate. The difference between the lease payment amount and its present value is regarded as unrecognized financingexpenses, and the interest expenses are recognized according to the discount rate of the present value of the lease payment amountduring each period of the lease term and included in the current profit and loss. The amount of variable lease payments notincluded in the measurement of lease liabilities shall be included in the current profit and loss when actually incurred.
After the beginning date of the lease term, when the actual fixed payment amount changes, the expected payable amount ofthe guaranteed residual value changes, the index or ratio used to determine the lease payment amount changes, the evaluationresults or actual exercise of the purchase option, renewal option or termination option changes, the Company remeasures the leaseliability according to the present value of the changed lease payment amount, And adjust the book value of the right to use assetsaccordingly.
(4) Accounting treatment method of the Company as lessor
On the lease commencement date, the Company classifies leases that have substantially transferred almost all the risks andrewards related to the ownership of the leased assets as financial leases, and all other leases are operating leases.
① Operating lease
During each period of the lease term, the Company recognizes the lease receipts as rental income according to the straight-line method (or other systematic and reasonable methods), and the initial direct expenses incurred are capitalized, amortized on thesame basis as the recognition of rental income, and included in the current profit and loss by stages. The variable lease paymentsobtained by the Company related to operating leases that are not included in the lease receipts are included in the current profitsand losses when actually incurred.
② Finance lease
On the lease beginning date, the Company recognizes the financial lease receivables according to the net amount of thelease investment (the sum of the unsecured residual value and the present value of the lease receipts not received on the leasebeginning date discounted according to the lease embedded interest rate), and terminates the recognition of the financial leaseassets. During each period of the lease term, the Company calculates and recognizes the interest income according to the interestrate embedded in the lease.
The amount of variable lease payments obtained by the Company that are not included in the measurement of net leaseinvestment shall be included in the current profit and loss when actually incurred.
(5) Accounting treatment of lease change
① Change of lease as a separate lease
If the lease changes and meets the following conditions at the same time, the Company will treat the lease change as aseparate lease for accounting: a. the lease change expands the lease scope by increasing the use right of one or more leased assets;
B. The increased consideration is equivalent to the amount adjusted according to the conditions of the contract at the separate pricefor most of the expansion of the lease scope.
② The lease change is not treated as a separate lease
A. The Company as lesseeOn the effective date of the lease change, the Company reconfirmed the lease term and discounted the changed leasepayment at the revised discount rate to re-measure the lease liability. When calculating the present value of the lease payment afterthe change, the implicit interest rate of the lease during the remaining lease period shall be used as the discount rate; If it isimpossible to determine the implicit interest rate of the lease for the remaining lease period, the incremental loan interest rate onthe effective date of the lease change shall be used as the discount rate.The impact of the above lease liability adjustment shall be accounted for according to the following circumstances:
? If the lease scope is reduced or the lease term is shortened due to the lease change, the book value of the right to use
assets shall be reduced, and the relevant gains or losses of partial or complete termination of the lease shall be includedin the current profits and losses;? For other lease changes, the book value of the right to use assets shall be adjusted accordingly.The Company as leasorIf the operating lease is changed, the Company will treat it as a new lease for accounting from the effective date of thechange, and the amount of lease receipts received in advance or receivable related to the lease before the change is regarded as theamount of new lease receipts.If the change of financial lease is not accounted for as a separate lease, the Company will deal with the changed lease underthe following circumstances: if the change of lease takes effect on the lease commencement date and the lease will be classified asan operating lease, the Company will account for it as a new lease from the effective date of lease change, and take the net leaseinvestment before the effective date of lease change as the book value of leased assets; If the lease change takes effect on the leasecommencement date, the lease will be classified as a financial lease, and the Company will conduct accounting treatment inaccordance with the provisions on modifying or renegotiating the contract.
(6) Sale and lease-back
The Company assesses and determines whether the asset transfer in the sale and leaseback transaction is a sale inaccordance with the provisions of 28. Income in Chapter X, V, Important accounting policies and accounting estimates.
? The Company as seller (lessee)
If the asset transfer in the sale and leaseback transaction does not belong to sales, the Company will continue to recognizethe transferred assets, recognize a financial liability equal to the transfer income, and conduct accounting treatment for thefinancial liability in accordance with 10。 Financial instruments in Chapter X, V, Important accounting policies and accountingestimates. If the asset transfer belongs to sales, the Company measures the right to use assets formed by sale and leasebackaccording to the part of the book value of the original assets related to the right to use obtained by leaseback, and only recognizesthe relevant gains or losses on the rights transferred to the lessor.? The Company as buyer (lessor)If the asset transfer in the sale and leaseback transaction does not belong to sales, the company does not recognize thetransferred asset, but recognizes a financial asset equal to the transfer income, and carries out accounting treatment on the financialasset in accordance with 10. Financial instruments in Chapter X, V. Important accounting policies and accounting estimates. If theasset transfer belongs to sales, the Company shall conduct accounting treatment for asset purchase and asset lease in accordancewith other applicable accounting standards for business enterprises.
33. Other significant accounting policies and estimates
(1) Accounting of hedging
(1.1) Classification of inventories
The Company divides its hedging strategies into fair value hedges, cash flow hedges, and net investment hedges.
① Fair value hedge. It refers to hedging activities conducted to mitigate the risk of changes in the fair value of recognizedassets or liabilities, unrecognized firm commitments, or components of the aforementioned items. The fair value changes arecaused by specific risks that will impact the Company's profit or other comprehensive income.
① Cash flow hedging refers to the hedging of cash flow risk. The change in cash flow is derived from specific risksassociated with recognized assets or liabilities, expected transactions that are likely to occur, or with respect to the components ofthe above-mentioned project and will affect the profits and losses of the enterprise.
③ Net investment hedge for overseas operations refers to hedging activities conducted to mitigate the foreign exchangerisk exposure of the net investment in overseas operations. The hedged risk in the net investment hedge is the translationdifference between the functional currency of the overseas operations and the reporting currency of the parent company.
(1.2) Hedging tools and hedged projectsHedging means a financial instrument designated by the Company for the purpose of hedging, whose fair value or cash flowvariation is expected to offset the fair value or cash flow variation of the hedged item, including:
① Financial liabilities measured at fair value with variations accounted into current income account Check-out options canonly be used as a hedging tool if the option is hedged, including those embedded in a hybrid contract. Derivatives embedded in ahybrid contract but not split cannot be used as separate hedging tools.
② Non-derivative financial assets or non-derivative financial liabilities that are measured at fair value and whose changesare included in the current profit and loss, but designated as fair value and whose changes are included in the current profit andloss, and their own credit risk changes caused by changes in fair value except for financial liabilities included in othercomprehensive income.
Own equity instruments are not financial assets or financial liabilities and cannot be used as hedging instruments.
A hedged item refers to an item that exposes the Company to the risk of changes in fair value or cash flow and is designatedas the hedged object and can be reliably measured. The Company designates the following individual projects, project portfolios ortheir components as hedged projects:
① Confirmed assets or liabilities.
② Confirmed commitments that have not yet been confirmed. Confirmed commitment refers to a legally bindingagreement to exchange a specific amount of resources at an agreed price on a specific date or period in the future.
③ Expected transactions that are likely to occur. Anticipated transactions refer to transactions that have not yet beencommitted but are expected to occur.
④ Net investment in overseas operations.
The above-mentioned project components refer to the parts that are less than the overall fair value or cash flow changes ofthe project. The Company designates the following project components or their combinations as hedged items:
① The part of the change in fair value or cash flow (risk component) that is only caused by one or more specific risks in theoverall fair value or cash flow changes of the project. According to the assessment in a specific market environment, the riskcomponent should be able to be individually identified and reliably measured. The risk component also includes the part where thefair value or cash flow of the hedged item changes only above or below a specific price or other variables.
② One or more selected contractual cash flows.
③ The component of the nominal amount of the project, that is, the specific part of the whole amount or quantity of theproject, may be a certain proportion of the whole project, or may be a certain level of the whole project. If a certain level includesearly repayment rights and the fair value of the early repayment rights is affected by changes in the risk of the hedge, the levelshall not be designated as the hedged item of the fair value hedge, but in the measurement of the hedged item except when the fairvalue has included the influence of the prepayment right.(1.3) Evaluation of hedging relationshipWhen the hedging relationship is initially specified, the Group officially specifies the related hedging relationships withofficial documents recording the hedging relationships, risk management targets and hedging strategies. This document sets outthe hedging tools, hedged items, the nature of hedged risks, and the Company's assessment of hedged effectiveness. Hedgingmeans a financial instrument designated by the Company for the purpose of hedging, whose fair value or cash flow variation isoffset the fair value or cash flow variation of the hedged item, including: Such hedges are continuously evaluated on and after theinitial specified date to meet the requirements for hedging validity.If the hedging instrument has expired, been sold, the contract is terminated or exercised (but the extension or replacement aspart of the hedging strategy is not treated as expired or contract termination), or the risk management objective changes, resultingin hedging The relationship no longer meets the risk management objectives, or the economic relationship between the hedgeditem and the hedging instrument no longer exists, or the impact of credit risk begins to dominate in the value changes caused bythe economic relationship between the hedged item and the hedging instrument, or when the hedge no longer meets the otherconditions of the hedge accounting method, the Company terminates the use of hedge accounting.If the hedging relationship no longer meets the requirements for hedging effectiveness due to the hedging ratio, but the riskmanagement objective of the designated hedging relationship has not changed, the Company shall rebalance the hedgingrelationship.
(1.4) Revenue the of revenue recognition and measurement
If the conditions for applying hedge accounting method are met, it shall be handled according to the following methods:
① Fair value hedging
Gains or losses arising from hedging instruments are recognized in the current period's income statement. If the hedging isconducted for specified non-derivative equity investments (or components thereof) measured at fair value with changes in fairvalue recognized in other comprehensive income, gains or losses from the hedging instruments are recognized in othercomprehensive income. Gains or losses arising from the hedged items due to the hedging risk exposure are recognized in the
income statement. At the same time, the carrying amount of the designated hedged items that are not measured at fair value isadjusted. If the hedged item is a specified non-derivative equity investment (or component thereof) measured at fair value withchanges in fair value recognized in other comprehensive income, gains or losses resulting from the hedging risk exposure arerecognized in other comprehensive income, and the carrying amount of the hedged item has already been measured at fair valueand does not require adjustment.Regarding fair value hedges related to financial instruments (or components thereof) measured at amortized cost, anyadjustments made to the carrying amount of the hedged item are amortized using the effective interest rate recalculated from thedate of the commencement of amortization and recognized in the income statement. The amortization date for adjustments shouldbegin from the adjustment date and should not be later than the point at which hedging gains and losses are adjusted upontermination of the hedged item. For hedged items that are financial assets (or components thereof) measured at fair value withchanges in fair value recognized in other comprehensive income, the accumulated hedging gains or losses should be amortized inthe same manner and recognized in the income statement. However, the carrying amount of the financial assets (or componentsthereof) should not be adjusted.For hedged items that are unrecognized firm commitments (or components thereof), the cumulative fair value changescaused by the hedging risk after the hedging relationship is designated should be recognized as an asset or liability. The relatedgains or losses should be recognized in the income statement. When fulfilling a firm commitment and acquiring an asset orassuming a liability, the initial recognized amount of the asset or liability should be adjusted to include the cumulative fair valuechanges of the designated hedged item that have been recognized.
② Cash flow hedging
The part of hedging tool gains or losses that is valid for hedging is recognized as other comprehensive income as a cashflow hedging reserve, and the part that is invalid for hedging (that is, other gains or losses after deducting other comprehensiveincome), are counted Into the current profit and loss. The amount of cash flow hedging reserve is determined according to thelower of the absolute amounts of the following two items: ①accumulated gains or losses of hedging instruments since the hedging.The amount in the effective arbitrage is recognized by the accumulative gains or losses from the starting of arbitrage andaccumulative changes to the current value of future forecast cash flows from the start of arbitrage.If the expected transaction of the hedged asset is subsequently recognized as a non-financial asset or non-financial liability,or if the expected transaction of the non-financial asset or non-financial liability forms a defined commitment to the applicable fairvalue hedge accounting, the amount of the cash flow hedge reserve originally recognized in the other consolidated income is
transferred out to account for the initial recognized amount of the asset or liability. For the remaining cash flow hedges, during thesame period when the expected cash flow to be hedged affects the profit and loss, if the expected sales occur, the cash flow hedgereserve recognized in other comprehensive income is transferred out and included in the current profit and loss.
③ Net investment in overseas operations hedge
For hedging of foreign operation net investments, the portion of gains or losses from the hedging instruments that qualify aseffective hedges is directly recognized in other comprehensive income. The portion of gains or losses from the hedginginstruments that do not qualify as effective hedges is recognized in the income statement. Upon disposal of the foreign operation,the previously recognized gains or losses from the hedging instruments reflected in other comprehensive income are reclassified tothe income statement.
(2) Repurchase of the Company's shares
① In the event of a reduction in the Company's share capital as approved by legal procedure, the Company shall reduce theshare capital by the total amount of the written-off shares, adjust the owner's equity by the difference between the price paid by thepurchased stocks (including transaction costs) and the total amount of the written-off shares, offset the capital reserve (sharecapital premium), surplus reserve and undistributed profits in turn; A portion of a capital reserve (share capital premium) that isless than the total face value and less than the total face value.
② The total expenditure of the repurchase shares of the Company, which is managed as an inventory share before they arecancelled or transferred, is converted to the cost of the inventory shares.
③ Increase in the capital reserve (capital premium) at the time of transfer of an inventory unit, the portion of the transferincome above the cost of the inventory unit; Lower than the inventory stock cost, the capital reserve (share capital premium),surplus reserve, undistributed profits in turn.
(3) Measurement of Fair Value
Fair value refers to the amount of asset exchange or liabilities settlement by both transaction parties familiar with thesituation in a fair deal on a voluntary basis.
The Company measures the fair value of related assets or liabilities at the prices in the main market. If there is no majormarket, the Company measures the fair value of the relevant assets or liabilities at the most favorable market prices. The Groupuses assumptions that market participants use to maximize their economic benefits when pricing the asset or liability.
The main market refers to the market with the highest transaction volume and activity of the related assets or liabilities. Themost favorable market means the market that can sell the related assets at the highest amount or transfer the related liabilities at thelowest amount after considering the transaction cost and transportation cost.
For financial assets or liabilities in an active market, The Company determines their fair value based on quotations in theactive market. If there is no active market, the Company uses evaluation techniques to determine the fair value.
For the measurement of non-financial assets at fair value, the ability of market participants to use the assets for optimalpurposes to generate economic benefits, or the ability to sell the assets to other market participants that can be used for optimalpurposes to generate economic benefits.
① Valuation technology
The Company adopts valuation techniques that are applicable in the current period and are supported by sufficient data andother information. The valuation techniques used mainly include market method, income method and cost method. The Companyuses a method consistent with one or more of the valuation techniques to measure fair value. If multiple valuation techniques areused to measure fair value, the reasonableness of each valuation result shall be considered, and the fair value shall be selected asthe most representative of fair value under the current circumstances. The amount of value is regarded as fair value.
The The Company equipment are applicable in the current circumstances and have sufficient available data and otherinformation to support the use of the relevant observable input values prioritized. Unobservable input values are used only whenthe observable input value cannot be obtained or is not feasible. Observable input values are input values that can be obtained frommarket data. The Group uses assumptions that market participants use to maximize their economic benefits when pricing the assetor liability. Non-observable input values are input values that cannot be obtained from market data. The input value is obtainedbased on the best information available on assumptions used by market participants in pricing the relevant asset or liability.
②Fair value hierarchy
This company divides the input value used in fair value measurement into three levels, and first uses the first level inputvalue, then uses the second level input value, and finally uses the third level input value. First level: quotation of same assets orliabilities in an active market (unadjusted) The second level input value is a directly or indirectly observable input value of theasset or liability in addition to the first level input value. The input value of the third level is the unobservable input value of therelated asset or liability.
(4) Significant accounting judgment and estimate
The Company continuously reviews significant accounting judgment and estimate adopted for the reasonable forecast offuture events based on its historical experience and other factors. Significant accounting judgment and assumptions that may leadto major adjustment of the book value of assets and liabilities in the next accounting year are listed as follows:
Classification of financial assets
The major judgements involved in the classification of financial assets include the analysis of business model and contractcash flow characteristics.
The company determines the business mode of managing financial assets at the level of financial asset portfolio, taking intoaccount such factors as how to evaluate and report financial asset performance to key managers, the risks that affect financial assetperformance and how to manage it, and how to obtain remuneration for related business managers.
When the company assesses whether the contractual cash flow of financial assets is consistent with the basic borrowingarrangement, there are the following main judgments: whether the principal may change due to early repayment and other reasonsduring the duration of the period or the amount of change; whether the interest Including the time value of money, credit risk,other basic borrowing risks, and consideration of costs and profits. For example, does the amount paid in advance reflect only theunpaid principal and the interest based on the unpaid principal, as well as the reasonable compensation paid for early terminationof the contract.
Measurement of expected credit losses of accounts receivable
The Company calculates the expected credit loss of accounts receivable through the risk exposure of accounts receivabledefault and the expected credit loss rate, and determines the expected credit loss rate based on the default probability and thedefault loss rate. When determining the expected credit loss rate, the Company uses internal historical credit loss experience andother data, combined with current conditions and forward-looking information to adjust the historical data. When consideringforward-looking information, the indicators used by the Company include the risks of economic downturn, changes in the externalmarket environment, technological environment, and customer conditions. The Company regularly monitors and reviewsassumptions related to the calculation of expected credit losses.
Deferred income tax assets
If there is adequate taxable profit to deduct the loss, the deferred income tax assets should be recognized by all the unusedtax loss. This requires the management to make a lot of judgment to forecast the time and amount of future taxable profit anddetermine the amount of the deferred tax assets based on the taxation strategy.
Income recognitionThe Company's revenue from providing curtain wall construction and metro platform screen door installation services isrecognized over a period of time. The recognition of the income and profit of such engineering installation services depends on theCompany's estimation of the contract results and performance progress. If the actual amount of total revenue and total cost ishigher or lower than the estimated value of the management, it will affect the amount of revenue and profit recognition of theCompany in the future.Engineering contractThe management shall make relevant judgment to confirm the income and expenses of project contracting businessaccording to the performance progress. If losses are expected to occur in the project contract, such losses shall be recognized ascurrent expenses. The management of the Company estimates the possible losses according to the budget of the project contract.The Company determines the transaction price according to the terms of the contract and in combination with previous customarypractices, and considers the influence of variable consideration, major financing components in the contract and other factors.During the performance of the contract, the Company continuously reviews the estimated total contract revenue and the estimatedtotal contract cost. When the initial estimate changes, such as contract changes, claims and awards, the estimated total contractrevenue and the estimated total contract cost are revised. When the estimated total contract cost exceeds the total contract revenue,the main business cost and estimated liabilities shall be recognized according to the loss contract to be executed.Estimate of fair valueThe Company uses fair value to measure investment real estate and needs to estimate the fair value of investment real estateat least quarterly. This requires the management to reasonably estimate the fair value of the investment real estate with the help ofvaluation experts.
Development costFor property that has been handed over with income recognized, but whose public facilities have not been constructed or notbeen completed, the management will estimate the development cost for the part that has not been started according to the budgetto reflect the operation result of the property sales.
34. Major changes in accounting policies and estimates
1. Changes in important accounting policies
□ Applicable ? Inapplicable
(2) Changes in major accounting estimates
□ Applicable ? Inapplicable
(3) Implementation of new accounting standards adjustment for the first time starting from 2024, and implementation offinancial statement related items at the beginning of the year for the first time
□ Applicable ? Inapplicable
VI. Taxation
1. Major taxes and tax rates
| Tax | Tax basis | Tax rate (%) |
| VAT | Taxable income | 1, 3, 5, 6, 9, and 13 |
| City maintenance and construction tax | Taxable turnover | 1, 5, 7 |
| Education surtax | Taxable turnover | 3 |
| Local education surtax | Taxable turnover | 2 |
| Enterprise income tax | Taxable income | See the following table |
Tax rates applicable for different tax payers
| Tax payer | Income tax rate |
| The Company | 25% |
| Shenzhen Fangda Jianke Co., Ltd. (hereinafter Fangda Jianke) | 15% |
| Fangda Zhiyuan Technology Co., Ltd. (hereinafter Fangda Zhiyuan) | 15% |
| Fangda New Material (Jiangxi) Co., Ltd. (hereinafter Fangda Jiangxi New Material) | 15% |
| Chengdu Fangda Construction Technology Co., Ltd. (hereinafter Fangda Chengdu Technology) | 15% |
| Dongguan Fangda New Material Co., Ltd. (hereinafter Fangda Dongguan New Material) | 25% |
| Shenzhen Fangda Property Development Co., Ltd. (hereinafter Fangda Property Development) | 25% |
| Shenzhen Fangda New Energy Co., Ltd. (hereinafter Fangda New Energy) | 25% |
| Shenzhen Fangda Property Development Co., Ltd. (hereinafter Fangda Property Development) | 25% |
| Jiangxi Fangda Property Development Co., Ltd. (hereinafter Fangda Jiangxi Property Development) | 25% |
| Pingxiang Fangda Luxin New Energy Co., Ltd. (hereinafter Fangda Luxin New Energy) | 25% |
| Nanchang Xinjian Fangda New Energy Co., Ltd. (hereinafter Fangda Xinjian New Energy) | 25% |
| Dongguan Fangda New Energy Co., Ltd. (hereinafter Fangda Dongguan New Energy) | 25% |
| Shenzhen QIanhai Kechuangyuan Software Co., Lt.d (hereinafter Kechuangyuan Software) | 25% |
| Fangda Zhiyuan Technology (Hong Kong) Co., Ltd, (Fangda Zhiyuan Hong Kong) | 16.50% |
| Fangda Zhiyuan Technology (Wuhan) Co., Ltd, (Fangda Wuhan Zhiyuan) | 25% |
| Fangda Zhiyuan Technology (Nanchang) Co., Ltd, (Fangda Nanchang Zhiyuan) | 25% |
| Fangda Zhiyuan Railway Transportation Equipment (Dongguan) Co., Ltd. (hereinafter referred to as Fangda Zhiyuan Dongguan) | 25% |
| General Rail Technology Private Limited | 17% |
| Shihui International Holding Co., Ltd. (hereinafter Fangda Shihui International) | 16.50% |
| Shenzhen Hongjun Investment Co., Ltd. (hereinafter Fangda Hongjun Investment) | 25% |
| Fangda Australia Pty Ltd (hereinafter Fangda Australia) | 30% |
| Shanghai Fangda Zhijian Technology Co., Ltd. (hereinafter referred to as Fangda Shanghai Zhijian company) | 15% |
| Shenzhen Fangda Yunzhi Technology Co., Ltd. (hereinafter Fangda Yunzhi) | 25% |
| Shanghai Fangda Jianzhi Technology Co., Ltd. (hereinafter Fangda Shanghai Jianzhi) | 25% |
| Shenzhen Zhongrong Litai Investment Co. Ltd. (Zhongrong Litai) | 25% |
| Chengdu Fangda Curtain Wall Technology Co., Ltd. (hereinafter Fangda Chengdu Curtain Wall) | 25% |
| Fangda Southeast Asia Co., Ltd. (hereinafter Fangda Southeast Asia) | 20% |
| Shenzhen Xunfu Investment Co., Ltd. (hereinafter referred to as Fangda Xunfu Investment) | 25% |
| Shenzhen Lifu Investment Co., Ltd. (hereinafter referred to as Fangda Lifu Investment) | 25% |
| Shenzhen Fangda Investment Partnership (Limited Partnership) (hereinafter referred to as Fangda Investment) | Inapplicable |
| Fangda Jianke (Hong Kong) Co., Ltd. (hereinafter Fangda Jianke Hong Kong) | 16.50% |
| Shenzhen Fangda Yunzhu Technology Co., Ltd. (hereinafter Fangda Yunzhu) | 15% |
| Shenzhen Yunzhu Testing Technology Co., Ltd. (Hereinafter Fangda Yunzhu Testing) | 25% |
| Jiangxi Fangda Intelligent Manufacturing Technology Co., Ltd. (hereinafter referred to as Fangda Intelligent Manufacturing Company) | 15% |
| Shenzhen Fangda Jianchuang Technology Co., Ltd. (hereinafter Fangda Jianchuang) | 25% |
| Fangda Curtain Wall Singapore Co., Ltd. (hereinafter Singapore Curtain Wall) | 17% |
2. Tax preference
(1) On December 23, 2021, the subsidiary Fangda Jianke obtained the certificate of high-techenterprise jointly issued by Shenzhen Science and Technology Innovation Commission, ShenzhenFinance Bureau, State Administration of Taxation and Shenzhen Taxation Bureau. The certificatenumber is GR202144200527. Within three years after obtaining the qualification of high-techenterprise (from December 2021 to December 2024), the income tax will be levied at 15%.
(2) On December 23, 2021, the subsidiary Fangda Zhiyuan Technology Co., Ltd. obtainedthe certificate of high tech enterprise jointly issued by Shenzhen Science and TechnologyInnovation Commission, Shenzhen Finance Bureau, State Administration of Taxation andShenzhen Taxation Bureau. The certificate number is GR202144205924. Within three years afterobtaining the qualification of high tech enterprise (from December 2021 to December 2024), theincome tax will be levied at 15%.
(3) On November 3, 2021, the subsidiary Fangda Jiangxi New Material Co., Ltd. obtainedthe certificate of high tech enterprise jointly issued by Jiangxi Provincial Department of Scienceand Technology, Jiangxi Provincial Department of Finance, State Administration of Taxation andJiangxi Provincial Bureau of Taxation. The certificate number is GR202136000174. Within three
years after obtaining the qualification of high tech enterprise (from November 2021 to November2024), the income tax will continue to be levied at 15%.
(4) On October 16, 2023, our subsidiary, Fangda Chengdu Technology Company, obtainedthe "High-tech Enterprise Certificate" jointly issued by the Science and Technology Departmentof Sichuan Province, the Finance Department of Sichuan Province, and the State Taxation Bureauof Sichuan Province. The certificate number is GR202351000927. For the next three years (fromOctober 2023 to October 2026) following the qualification as a high-tech enterprise, the incometax will continue to be levied at a rate of 15%.
(5) The subsidiary Kechuangyuan Software is an enterprise located in Qianhai ShenzhenHong Kong Modern Service Industry Cooperation Zone. Its main business meets the conditionsof Preferential Catalogue of Enterprise Income Tax in Qianhai Shenzhen Hong Kong ModernService Industry Cooperation Zone (2021), and the income tax is levied at 15% from January 1,2021 to December 31, 2021.
(9) On November 15, 2023, the subsidiary Fangda Shanghai Zhijian obtained the certificateGR202331002267 of high tech enterprise jointly issued by Shanghai Science and TechnologyCommission, Shanghai Finance Bureau and Shanghai Taxation Bureau. Within three years (fromNovember 2023 to November 2026) after obtaining the qualification of high tech enterprise, theincome tax will continue to be charged at 15%.
(7) On December 11, 2021, the subsidiary Fangda Yunzhu Co., Ltd. obtained the certificateof high tech enterprise jointly issued by Shenzhen Science and Technology InnovationCommission, Shenzhen Finance Bureau, State Administration of Taxation and Shenzhen TaxationBureau. The certificate number is GR202344205791. Within three years after obtaining thequalification of high tech enterprise (from November 2023 to November 2026), the income taxwill be levied at 15%.
(8) According to the "Announcement on Continuing the Enterprise Income Tax Policy forthe Western Development" jointly issued by the Ministry of Finance, the State TaxationAdministration, and the National Development and Reform Commission ([2020] No. 23), fromJanuary 1, 2021 to December 31, 2030, for eligible encouraged industrial enterprises located in
the western region, the enterprise income tax will be levied at a reduced rate of 15%. Theenterprise income tax policy of Ganzhou City, Jiangxi Province is implemented by referring tothat of the western region. The subsidiary Fangda Intelligent Manufacturing belongs to anencouraged industrial enterprise established in Ganzhou City, and is applicable to the preferentialtax rate of 15%.
(9) According to the Announcement of the Ministry of Finance and the State Administrationof Taxation on Further Implementing Income Tax Preferential Policies for Small and MicroEnterprises (Announcement No. 13 of 2022) and the Announcement of the Ministry of Financeand the State Administration of Taxation on Income Tax Preferential Policies for Small and MicroEnterprises and Individual Industrial and Commercial Households (Announcement No. 6 of 2023),some companies belong to small and micro profit enterprises in 2024, Their income shall besubject to corporate income tax in accordance with the provisions of the aforementioneddocuments.VII. Notes to the consolidated financial statements
1. Monetary capital
In RMB
| Item | Closing balance | Opening balance |
| Inventory cash: | 28,569.08 | 752.40 |
| Bank deposits | 910,364,188.39 | 787,363,734.05 |
| Other monetary capital | 774,613,920.12 | 637,786,629.79 |
| Total | 1,685,006,677.59 | 1,425,151,116.24 |
| Including: total amount deposited in overseas | 54,843,904.16 | 45,201,676.97 |
(1) Among the ending balance of bank deposits, RMB16,281,762.80 of restricted funds are mainly the deposits of the laborinsurance special account and the peasant workers' wage special account; among the ending balance of other monetary funds,RMB760,262,643.95 of restricted funds are mainly the deposit for bank draft guarantee, guarantee deposit for letter of guarantee,etc. In the preparation of the cash flow statement, the above-mentioned deposits and other restricted deposits are not used as cashand cash equivalents.
(2) In addition, there are no other funds in the monetary funds at the end of the period that have restrictions on use and potentialrecovery risks due to mortgages, pledges or freezing.
2. Derivative financial assets
In RMB
| Item | Closing balance | Opening balance |
| Forward foreign exchange contract | 173,737.06 | |
| Total | 173,737.06 |
3. Notes receivable
(1) Classification of notes receivable
In RMB
| Item | Closing balance | Opening balance |
| Bank acceptance | 23,120,212.57 | 21,487,899.17 |
| Commercial acceptance | 12,625,505.07 | 25,884,982.10 |
| Total | 35,745,717.64 | 47,372,881.27 |
(2) Disclosure by bad debt accrual method
In RMB
| Type | Closing balance | Opening balance | ||||||||
| Remaining book value | Bad debt provision | Book value | Remaining book value | Bad debt provision | Book value | |||||
| Amount | Proportion | Amount | Provision rate | Amount | Proportion | Amount | Provision rate | |||
| Notes receivable with provision for bad debts by portfolio | 35,886,466.21 | 100.00% | 140,748.57 | 0.39% | 35,745,717.64 | 47,778,354.93 | 100.00% | 405,473.66 | 0.85% | 47,372,881.27 |
| Including: | ||||||||||
| Commercial acceptance | 12,766,253.64 | 35.57% | 140,748.57 | 1.10% | 12,625,505.07 | 26,290,455.76 | 55.03% | 405,473.66 | 1.54% | 25,884,982.10 |
| Bank acceptance | 23,120,212.57 | 64.43% | 23,120,212.57 | 21,487,899.17 | 44.97% | 21,487,899.17 | ||||
| Total | 35,886,466.21 | 100.00% | 140,748.57 | 0.39% | 35,745,717.64 | 47,778,354.93 | 100.00% | 405,473.66 | 0.85% | 47,372,881.27 |
Category name for bad debt provision by combination: commercial acceptance bill
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Commercial acceptance | 12,766,253.64 | 140,748.57 | 1.10% |
| Total | 12,766,253.64 | 140,748.57 |
Group recognition basis:
See 10. Financial Tools in Chapter X, V, Important Accounting Policies and Accounting Estimates for the recognition criteria andinstructions for withdrawing bad debt reserves by portfolioProvision for bad debts by combination: commercial acceptance
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Bank acceptance | 23,120,212.57 | 0.00 | 0.00% |
| Total | 23,120,212.57 | 0.00 | |
If the provision for bad debts on accounts receivable is being made based on the expected credit loss general model:
□ Applicable ? Inapplicable
(3) Bad debt provision made, returned or recovered in the period
Bad debt provision made in the period:
In RMB
| Type | Opening balance | Change in the period | Closing balance | |||
| Provision | Written-back or recovered | Canceled | Others | |||
| Commercial acceptance | 405,473.66 | -264,725.09 | 140,748.57 | |||
| Total | 405,473.66 | -264,725.09 | 140,748.57 | |||
Including significant recovery or reversal:
□ Applicable ? Inapplicable
(4) The Group has no endorsed or discounted immature receivable notes at the end of the period.
In RMB
| Item | De-recognized amount | Not de-recognized amount |
| Bank acceptance | 13,762,837.86 | |
| Commercial acceptance | 7,400,000.00 | |
| Total | 21,162,837.86 |
4. Account receivable
(1) Account age
In RMB
| Age | Closing balance of book value | Opening balance of book value |
| Within 1 year (inclusive) | 538,042,036.66 | 480,886,398.43 |
| 1-2 years | 206,145,753.93 | 202,348,687.37 |
| 2-3 years | 131,541,359.44 | 158,881,321.32 |
| Over 3 years | 420,378,866.26 | 335,427,049.97 |
| 3-4 years | 128,856,475.72 | 134,723,171.92 |
| 4-5 years | 71,173,297.55 | 50,830,831.78 |
| Over 5 years | 220,349,092.99 | 149,873,046.27 |
| Total | 1,296,108,016.29 | 1,177,543,457.09 |
The Company needs to comply with the disclosure requirements of the decoration and decoration industry in the Guidelines for theSelf-discipline and Supervision of Listed Companies of Shenzhen Stock Exchange No. 3 - Industry Information Disclosure.Significant individual amounts of accounts receivable in the curtain wall and materials industry that have exceeded three years inage
| Customer | Balance of accounts receivable of over 3 years (RMB) | Balance of provision for bad debts (RMB) | Reason of the age | Whether there is a risk of recovery |
| Customer 1 | 84,240,997.92 | 30,548,361.04 | Customer credit status deteriorates | Yes |
| Customer 2 | 54,873,223.21 | 54,873,223.21 | Customer credit status deteriorates | Yes |
| Customer 3 | 28,415,073.84 | 28,415,073.84 | Customer credit status deteriorates | Yes |
| Customer 4 | 26,737,669.61 | 13,195,726.65 | Customer credit status deteriorates | Yes |
| Customer 5 | 17,374,148.42 | 17,374,148.42 | Customer credit status deteriorates | Yes |
(2) Disclosure by bad debt accrual method
In RMB
| Type | Closing balance | Opening balance | ||||||||
| Remaining book value | Bad debt provision | Book value | Remaining book value | Bad debt provision | Book value | |||||
| Amount | Proportion | Amount | Provision rate | Amount | Proportion | Amount | Provision rate | |||
| Account receivable for which bad debt provision is made by group | 80,430,339.27 | 6.21% | 74,382,698.73 | 92.48% | 6,047,640.54 | 80,430,339.27 | 6.83% | 74,382,698.73 | 92.48% | 6,047,640.54 |
| Including: | ||||||||||
| Customer 1 | 54,873,223.21 | 4.23% | 54,873,223.21 | 100.00% | 0.00 | 54,873,223.21 | 4.67% | 54,873,223.21 | 100.00% | 0.00 |
| Customer 2 | 13,461,834.96 | 1.04% | 13,461,834.96 | 100.00% | 0.00 | 13,461,834.96 | 1.14% | 13,461,834.96 | 100.00% | 0.00 |
| Customer 3 | 7,096,421.00 | 0.55% | 3,548,210.50 | 50.00% | 3,548,210.50 | 7,096,421.00 | 0.60% | 3,548,210.50 | 50.00% | 3,548,210.50 |
| Customer 4 | 4,998,860.10 | 0.39% | 2,499,430.06 | 50.00% | 2,499,430.04 | 4,998,860.10 | 0.42% | 2,499,430.06 | 50.00% | 2,499,430.04 |
| Account | 1,215,67 | 93.79% | 199,026, | 16.37% | 1,016,65 | 1,097,11 | 93.17% | 191,673, | 17.47% | 905,439, |
| receivable for which bad debt provision is made by group | 7,677.02 | 334.87 | 1,342.15 | 3,117.82 | 844.17 | 273.65 | ||||
| Including: | ||||||||||
| Portfolio 1: Engineering operations section | 990,710,144.67 | 76.44% | 188,170,141.80 | 18.99% | 802,540,002.87 | 881,971,973.34 | 74.90% | 181,121,184.71 | 20.54% | 700,850,788.63 |
| Portfolio 2: Real estate business payments | 141,312,996.69 | 10.90% | 7,950,412.66 | 5.63% | 133,362,584.03 | 144,374,822.98 | 12.26% | 8,293,566.86 | 5.74% | 136,081,256.12 |
| Portfolio 3: Other business models | 83,654,535.66 | 6.45% | 2,905,780.41 | 3.47% | 80,748,755.25 | 70,766,321.50 | 6.01% | 2,259,092.60 | 3.19% | 68,507,228.90 |
| Total | 1,296,108,016.29 | 100.00% | 273,409,033.60 | 21.09% | 1,022,698,982.69 | 1,177,543,457.09 | 100.00% | 266,056,542.90 | 22.59% | 911,486,914.19 |
Category name for bad debt provision by individual: customer
In RMB
| Name | Opening balance | Closing balance | ||||
| Remaining book value | Bad debt provision | Remaining book value | Bad debt provision | Provision rate | Reason | |
| Customer 1 | 54,873,223.21 | 54,873,223.21 | 54,873,223.21 | 54,873,223.21 | 100.00% | Customer credit status deteriorates |
| Customer 2 | 13,461,834.96 | 13,461,834.96 | 13,461,834.96 | 13,461,834.96 | 100.00% | Customer credit status deteriorates |
| Customer 3 | 7,096,421.00 | 3,548,210.50 | 7,096,421.00 | 3,548,210.50 | 50.00% | Customer credit status deteriorates |
| Customer 4 | 4,998,860.10 | 2,499,430.06 | 4,998,860.10 | 2,499,430.06 | 50.00% | Customer credit status deteriorates |
| Total | 80,430,339.27 | 74,382,698.73 | 80,430,339.27 | 74,382,698.73 | ||
Category name for bad debt provision by combination: combination 1: engineering business payments
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Less than 1 year | 410,147,721.97 | 8,038,895.37 | 1.96% |
| 1-2 years | 156,913,107.59 | 8,881,281.90 | 5.66% |
| 2-3 years | 128,038,088.80 | 16,337,660.87 | 12.76% |
| 3-4 years | 125,154,409.76 | 24,730,511.37 | 19.76% |
| 4-5 years | 70,856,833.66 | 30,581,809.40 | 43.16% |
| Over 5 years | 99,599,982.89 | 99,599,982.89 | 100.00% |
| Total | 990,710,144.67 | 188,170,141.80 |
Group recognition basis:
See 10. Financial Tools in Chapter X, V, Important Accounting Policies and Accounting Estimates for the recognition criteria andinstructions for withdrawing bad debt reserves by portfolioCategory name for bad debt provision by combination: combination 2: real estate business payments
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Less than 1 year | 78,334,238.26 | 783,342.40 | 1.00% |
| 1-2 years | 22,791,467.48 | 1,139,573.37 | 5.00% |
| 2-3 years | 5,967.48 | 298.38 | 5.00% |
| 3-4 years | 53,645.28 | 8,046.79 | 15.00% |
| 4-5 years | |||
| Over 5 years | 40,127,678.19 | 6,019,151.72 | 15.00% |
| Total | 141,312,996.69 | 7,950,412.66 | |
Category name for bad debt provision by combination: combination 3: other business payments.
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Less than 1 year | 49,560,076.43 | 361,788.56 | 0.73% |
| 1-2 years | 26,441,178.86 | 555,264.76 | 2.10% |
| 2-3 years | 3,497,303.16 | 294,472.93 | 8.42% |
| 3-4 years | 3,215,774.37 | 796,868.88 | 24.78% |
| 4-5 years | 316,463.89 | 273,646.33 | 86.47% |
| Over 5 years | 623,738.95 | 623,738.95 | 100.00% |
| Total | 83,654,535.66 | 2,905,780.41 | |
If the provision for bad debts on accounts receivable is being made based on the expected credit loss general model:
□ Applicable ? Inapplicable
(3) Bad debt provision made, returned or recovered in the period
Bad debt provision made in the period:
In RMB
| Type | Opening balance | Change in the period | Closing balance | |||
| Provision | Written-back or recovered | Canceled | Others | |||
| Separate bad debt provision | 74,382,698.73 | 74,382,698.73 | ||||
| Provision for bad debts by combination | 191,673,844.17 | 7,352,490.70 | 199,026,334.87 | |||
| Total | 266,056,542.90 | 7,352,490.70 | 273,409,033.60 |
(4) Accounts receivable and contract assets with the top-5 ending balances, grouped by party owed
In RMB
| Entity | Closing balance of accounts receivable | Closing balance of contract assets | Closing balance of accounts receivable and contract assets | Percentage of total ending balance of accounts receivable and contract assets | Closing balance of provision for bad debts on accounts receivable and impairment of contract assets |
| No.1 | 113,529,244.60 | 9,903,379.39 | 123,432,623.99 | 2.95% | 38,677,733.03 |
| No.2 | 22,323,291.93 | 68,916,683.63 | 91,239,975.56 | 2.18% | 1,788,303.51 |
| No.3 | 3,666,410.41 | 78,035,049.65 | 81,701,460.06 | 1.95% | 1,601,348.62 |
| No.4 | 21,396,066.95 | 59,077,533.44 | 80,473,600.39 | 1.92% | 2,842,446.62 |
| No.5 | 12,549,200.00 | 63,839,194.54 | 76,388,394.54 | 1.83% | 2,876,197.40 |
| Total | 173,464,213.89 | 279,771,840.65 | 453,236,054.54 | 10.83% | 47,786,029.18 |
5. Contract assets
(1) Contract assets
In RMB
| Item | Closing balance | Opening balance | ||||
| Remaining book value | Bad debt provision | Book value | Remaining book value | Bad debt provision | Book value | |
| Completed and unsettled project funds that fail to meet the collection conditions | 2,687,858,269.95 | 186,296,016.55 | 2,501,562,253.40 | 2,536,843,592.06 | 179,066,040.85 | 2,357,777,551.21 |
| Quality guarantee deposit that fails to meet the collection conditions | 132,592,961.98 | 21,761,252.78 | 110,831,709.20 | 157,921,009.28 | 13,409,302.47 | 144,511,706.81 |
| Sales funds with conditional collection right | 64,321,843.25 | 731,669.90 | 63,590,173.35 | 51,338,008.75 | 436,594.78 | 50,901,413.97 |
| Less: Contract assets shown in other non-current assets | 65,754,345.90 | 5,632,433.41 | 60,121,912.49 | 69,887,873.01 | 5,127,003.43 | 64,760,869.58 |
| Total | 2,819,018,729.28 | 203,156,505.82 | 2,615,862,223.46 | 2,676,214,737.08 | 187,784,934.67 | 2,488,429,802.41 |
(2) The amount and reason for the significant change in the book value during the reporting period
In RMB
| Item | Change | Reason |
| Completed and unsettled project funds that fail to meet the collection conditions | 143,784,702.19 | This is mainly due to the unsettled project funds with conditional collection rights arising from the revenue recognized in the project contract during the reporting period |
| Quality guarantee deposit that fails to meet the collection conditions | -33,679,997.61 | Mainly attributable to the decrease in warranty deposits for which collection conditions have not been met |
| Total | 110,104,704.58 | —— |
(3) Disclosure by bad debt accrual method
In RMB
| Type | Closing balance | Opening balance | ||||||||
| Remaining book value | Bad debt provision | Book value | Remaining book value | Bad debt provision | Book value | |||||
| Amount | Proportion | Amount | Provision rate | Amount | Proportion | Amount | Provision rate | |||
| Separate bad debt provision | 16,288,576.53 | 0.58% | 9,033,247.20 | 55.46% | 7,255,329.33 | 16,288,576.53 | 0.61% | 9,033,247.20 | 55.46% | 7,255,329.33 |
| Including: | ||||||||||
| Customer 1 | 14,510,658.66 | 0.52% | 7,255,329.33 | 50.00% | 7,255,329.33 | 14,510,658.66 | 0.54% | 7,255,329.33 | 50.00% | 7,255,329.33 |
| Customer 2 | 1,777,917.87 | 0.06% | 1,777,917.87 | 100.00% | 1,777,917.87 | 0.07% | 1,777,917.87 | 100.00% | ||
| Provision for bad debts by combination | 2,802,730,152.75 | 99.42% | 194,123,258.62 | 6.93% | 2,608,606,894.13 | 2,659,926,160.55 | 99.39% | 178,751,687.47 | 6.72% | 2,481,174,473.08 |
| Including: | ||||||||||
| Sales funds with conditional collection right | 64,321,843.25 | 2.28% | 731,669.90 | 1.14% | 63,590,173.35 | 51,338,008.75 | 1.92% | 436,594.78 | 0.85% | 50,901,413.97 |
| Completed and unsettled project funds that fail to meet the collectio | 2,671,569,693.42 | 94.77% | 177,262,769.35 | 6.64% | 2,494,306,924.07 | 2,519,643,302.99 | 94.15% | 169,724,313.35 | 6.74% | 2,349,918,989.64 |
| n conditions | ||||||||||
| Quality guarantee deposit that fails to meet the collection conditions | 66,838,616.09 | 2.37% | 16,128,819.37 | 24.13% | 110,831,709.20 | 88,944,848.81 | 3.32% | 8,590,779.34 | 9.66% | 80,354,069.47 |
| Total | 2,819,018,729.28 | 100.00% | 203,156,505.82 | 7.21% | 2,615,862,223.46 | 2,676,214,737.08 | 100.00% | 187,784,934.67 | 7.02% | 2,488,429,802.41 |
Category name for bad debt provision by individual: customer
In RMB
| Name | Opening balance | Closing balance | ||||
| Remaining book value | Bad debt provision | Remaining book value | Bad debt provision | Provision rate | Reason | |
| Customer 1 | 14,510,658.66 | 7,255,329.33 | 14,510,658.66 | 7,255,329.33 | 50.00% | Customer credit status deteriorates |
| Customer 2 | 1,777,917.87 | 1,777,917.87 | 1,777,917.87 | 1,777,917.87 | 100.00% | Customer credit status deteriorates |
| Total | 16,288,576.53 | 9,033,247.20 | 16,288,576.53 | 9,033,247.20 | ||
Category name for bad debt provision by combination: combination 1: conditional receivable sales payments.
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Combination 1: sales payment with conditional collection right | 64,321,843.25 | 731,669.90 | 1.14% |
| Total | 64,321,843.25 | 731,669.90 | |
Group recognition basis:
See 10. Financial Tools in Chapter X, V, Important Accounting Policies and Accounting Estimates for the recognition criteria andinstructions for withdrawing bad debt reserves by portfolioCategory name for bad debt provision by combination: combination 2: Completed and unsettled project funds that fail to meet thecollection conditions
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Portfolio 2: Completed and unsettled project funds that fail to meet the collection conditions | 2,671,569,693.42 | 177,262,769.35 | 6.64% |
| Total | 2,671,569,693.42 | 177,262,769.35 | |
Category name for bad debt provision by combination: combination 3: warranty deposits that have not met the collection
conditions
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Portfolio 3: Quality guarantee deposit not meeting collection conditions | 66,838,616.09 | 16,128,819.37 | 24.13% |
| Total | 66,838,616.09 | 16,128,819.37 | |
Provision for bad debts based on general model of expected credit losses
□ Applicable ? Inapplicable
(4) Bad debt provision made, returned or recovered in the period
In RMB
| Item | Provision | Recovered or reversed during the period | Written off in the current period | Reason |
| Separate bad debt provision | ||||
| Provision for bad debts by combination | 15,370,105.21 | |||
| Total | 15,370,105.21 |
6. Receivable financing
(1) Presentation of receivables financing classification
In RMB
| Item | Closing balance | Opening balance |
| Notes receivable | 4,668,854.47 | 6,979,428.14 |
| Total | 4,668,854.47 | 6,979,428.14 |
(2) Disclosure by bad debt accrual method
In RMB
| Type | Closing balance | Opening balance | ||||||||
| Remaining book value | Bad debt provision | Book value | Remaining book value | Bad debt provision | Book value | |||||
| Amount | Proportion | Amount | Provision rate | Amount | Proportion | Amount | Provision rate | |||
| Provision for bad debts by combination | 4,668,854.47 | 100.00% | 0.00 | 0.00% | 4,668,854.47 | 6,979,428.14 | 100.00% | 0.00 | 0.00% | 6,979,428.14 |
| Including: | ||||||||||
| Bank acceptance | 4,668,854.47 | 100.00% | 0.00 | 0.00% | 4,668,854.47 | 6,979,428.14 | 100.00% | 0.00 | 0.00% | 6,979,428.14 |
| Total | 4,668,854.47 | 100.00% | 0.00 | 0.00% | 4,668,854.47 | 6,979,428.14 | 100.00% | 0.00 | 0.00% | 6,979,428.14 |
Provision for bad debts by combination: commercial acceptance
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Bank acceptance | 4,668,854.47 | 0.00 | 0.00% |
| Total | 4,668,854.47 | 0.00 | |
Group recognition basis:
See 10. Financial Tools in Chapter X, V, Important Accounting Policies and Accounting Estimates for the recognition criteria andinstructions for withdrawing bad debt reserves by portfolio
7. Other receivables
In RMB
| Item | Closing balance | Opening balance |
| Other receivables | 151,311,534.99 | 145,113,323.33 |
| Total | 151,311,534.99 | 145,113,323.33 |
(1) Other receivables
1) Other receivables are disclosed by nature
In RMB
| By nature | Closing balance of book value | Opening balance of book value |
| Deposit and pledge paid | 97,601,305.37 | 96,041,429.79 |
| Construction borrowing and advanced payment | 38,430,117.45 | 41,180,355.37 |
| Staff borrowing and petty cash | 3,512,780.85 | 2,515,436.58 |
| VAT refund receivable | 5,274,354.49 | 798,918.77 |
| Others | 14,671,948.26 | 11,974,398.52 |
| Total | 159,490,506.42 | 152,510,539.03 |
(2) Account age
In RMB
| Age | Closing balance of book value | Opening balance of book value |
| Within 1 year (inclusive) | 26,881,138.43 | 30,123,678.94 |
| 1-2 years | 7,113,971.42 | 4,793,018.03 |
| 2-3 years | 3,835,355.43 | 5,310,261.72 |
| Over 3 years | 121,660,041.14 | 112,283,580.34 |
| 3-4 years | 3,940,181.05 | 9,787,862.62 |
| 4-5 years | 2,561,827.97 | 7,701,603.22 |
| Over 5 years | 115,158,032.12 | 94,794,114.50 |
| Total | 159,490,506.42 | 152,510,539.03 |
The Company needs to comply with the disclosure requirements of the decoration and decoration industry in the Guidelines for the
Self-discipline and Supervision of Listed Companies of Shenzhen Stock Exchange No. 3 - Industry Information Disclosure.Significant individual amounts of other accounts receivable in the curtain wall and materials industry that have exceeded threeyears in age
| Customer | Balance of other receivables older than three years (RMB) | Balance of provision for bad debts (RMB) | Reason of the age | Whether there is a risk of recovery |
| Customer 1 | 1,970,381.89 | 1,970,381.89 | Customer credit status deteriorates | Yes |
(3) Disclosure by bad debt accrual method
? Applicable □ Inapplicable
In RMB
| Type | Closing balance | Opening balance | ||||||||
| Remaining book value | Bad debt provision | Book value | Remaining book value | Bad debt provision | Book value | |||||
| Amount | Proportion | Amount | Provision rate | Amount | Proportion | Amount | Provision rate | |||
| Provision for bad debts by combination | 159,490,506.42 | 100.00% | 8,178,971.43 | 5.13% | 151,311,534.99 | 152,510,539.03 | 100.00% | 7,397,215.70 | 4.85% | 145,113,323.33 |
| Including: | ||||||||||
| Portfolio 1: First stage | 150,589,231.75 | 94.42% | 2,243,303.28 | 1.49% | 148,345,928.47 | 143,789,155.16 | 94.28% | 2,143,506.61 | 1.49% | 141,645,648.55 |
| Portfolio 2: Second stage | 3,057,326.32 | 1.92% | 91,719.80 | 3.00% | 2,965,606.52 | 3,574,882.60 | 2.34% | 107,207.82 | 3.00% | 3,467,674.78 |
| Portfolio 3: Third stage | 5,843,948.35 | 3.66% | 5,843,948.35 | 100.00% | 0.00 | 5,146,501.27 | 3.38% | 5,146,501.27 | 100.00% | 0.00 |
| Total | 159,490,506.42 | 100.00% | 8,178,971.43 | 5.13% | 151,311,534.99 | 152,510,539.03 | 100.00% | 7,397,215.70 | 4.85% | 145,113,323.33 |
Category name for bad debt provision by combination: combination 1: First stage
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Portfolio 1: First stage | 150,589,231.75 | 2,243,303.28 | 1.49% |
| Total | 150,589,231.75 | 2,243,303.28 | |
Description of the basis for determining the portfolio: Provision for bad debts is made on the basis of the general model ofexpected credit losses.Category name for bad debt provision by combination: combination 2: Second stage
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Portfolio 2: Second stage | 3,057,326.32 | 91,719.80 | 3.00% |
| Total | 3,057,326.32 | 91,719.80 | |
Category name for bad debt provision by combination: combination 3: Third stage
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Portfolio 3: Third stage | 5,843,948.35 | 5,843,948.35 | 100.00% |
| Total | 5,843,948.35 | 5,843,948.35 | |
Provision for bad debts based on general model of expected credit losses
In RMB
| Bad debt provision | First stage | Second stage | Third stage | Total |
| Expected credit losses in 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 1, 2024 | 2,143,506.61 | 107,207.82 | 5,146,501.27 | 7,397,215.70 |
| Balance on January 1, 2024 in the current period | ||||
| Provision | 99,914.43 | -15,488.02 | 697,447.08 | 781,873.49 |
| Other change | -117.76 | -117.76 | ||
| Balance on June 30, 2024 | 2,243,303.28 | 91,719.80 | 5,843,948.35 | 8,178,971.43 |
Changes in book balances with significant changes in the current period
□ Applicable ? Inapplicable
4) Bad debt provision made, returned or recovered in the period
Bad debt provision made in the period:
In RMB
| Type | Opening balance | Change in the period | Closing balance | |||
| Provision | Written-back or recovered | Write-off | Others | |||
| Provision for bad debts by combination | 7,397,215.70 | 781,873.49 | -117.76 | 8,178,971.43 | ||
| Total | 7,397,215.70 | 781,873.49 | -117.76 | 8,178,971.43 | ||
5) Balance of top 5 other receivables at the end of the period
In RMB
| Entity | By nature | Closing balance | Age | Percentage (%) | Balance of bad debt provision at the end of the period |
| Shenzhen Yikang Real Estate Co. Ltd. | Margin and current account | 6,000,000.00 | 1-2 years | 47.69% | 1,133,333.87 |
| 62,675.83 | 3-4 years | ||||
| 2,000,000.00 | 4-5 years | ||||
| 68,000,000.00 | Over 5 years | ||||
| Bangshen Electronics (Shenzhen) Co., Ltd. | Deposit | 20,000,000.00 | Over 5 years | 12.54% | 298,000.00 |
| Shenzhen Dakang Co., Ltd. | Deposit | 8,000,000.00 | Over 5 years | 5.02% | 119,200.00 |
| Ganshang Joint Investment | Others | 3,791,089.25 | Over 5 years | 2.38% | 56,487.23 |
| Xin Song | Others | 1,970,381.89 | Over 5 years | 1.24% | 1,970,381.89 |
| Total | 109,824,146.97 | 68.87% | 3,577,402.99 |
8. Prepayment
(1) Account ages of prepayments
In RMB
| Age | Closing balance | Opening balance | ||
| Amount | Proportion | Amount | Proportion | |
| Less than 1 year | 31,968,676.69 | 78.58% | 29,398,144.01 | 86.53% |
| 1-2 years | 2,766,458.69 | 6.80% | 1,713,380.35 | 5.04% |
| 2-3 years | 1,422,909.99 | 3.50% | 648,638.59 | 1.91% |
| Over 3 years | 4,525,499.71 | 11.12% | 2,216,406.41 | 6.52% |
| Total | 40,683,545.08 | 33,976,569.36 | ||
At the end of the period, there are no important prepayments exceeding one year in age.
(2) Balance of top 5 prepayments at the end of the period
The total of top5 prepayments in terms of the prepaid entities in the period is RMB13,164,657.14,accounting for 32.36% of the total prepayments at the end of the period.
9. Inventories
Whether the Company needs to comply with disclosure requirements of the real estate industry.No
(1) Classification of inventories
In RMB
| Item | Closing balance | Opening balance | ||||
| Remaining book value | Provision for inventory depreciation or contract performance cost impairment provision | Book value | Remaining book value | Provision for inventory depreciation or contract performance cost impairment provision | Book value | |
| Raw materials | 139,497,627.54 | 139,497,627.54 | 131,800,215.01 | 131,800,215.01 | ||
| Product in | 90,803,158.18 | 90,803,158.18 | 120,647,582.06 | 120,647,582.06 | ||
| process | ||||||
| Finished goods in stock | 12,594,988.59 | 12,594,988.59 | 11,240,201.57 | 11,240,201.57 | ||
| Contract performance costs | 114,564,484.57 | 114,564,484.57 | 90,470,830.76 | 90,470,830.76 | ||
| Goods delivered | 17,930,849.81 | 17,930,849.81 | 23,270,292.17 | 23,270,292.17 | ||
| Development cost | 227,990,392.09 | 227,990,392.09 | 224,969,147.17 | 224,969,147.17 | ||
| Development products | 127,826,621.64 | 127,826,621.64 | 134,821,091.47 | 134,821,091.47 | ||
| Low price consumable | 209,033.64 | 209,033.64 | 171,286.80 | 171,286.80 | ||
| OEM materials | 19,410,229.21 | 19,410,229.21 | 15,096,929.98 | 15,096,929.98 | ||
| Materials in transit | 1,950,343.80 | 1,950,343.80 | 3,136,909.52 | 3,136,909.52 | ||
| Total | 752,777,729.07 | 752,777,729.07 | 755,624,486.51 | 755,624,486.51 |
(2) Balance at the end of the period includes capitalization of borrowing expenseAs at June 30, 2024, the amount of the capitalization of borrowing costs in the balance of the end-of-periodinventory was RMB5,005,567.86.
(3) Explanation of the current amortization amount of contract performance costThe current amortization amount of contract performance costs is included in operating costs.
10. Non-current assets due in 1 year
In RMB
| Item | Closing balance | Opening balance |
| Large-scale time deposit principal and interest | 327,120,273.54 | |
| Total | 327,120,273.54 |
11. Other current assets
In RMB
| Item | Closing balance | Opening balance |
| Reclassification of VAT debit balance | 270,013,064.65 | 230,260,579.29 |
| Overpayment and prepayment of income tax | 6,758,701.47 | 2,852,830.41 |
| Other prepaid taxes | 1,491,084.02 | 3,836,971.59 |
| Payment to be collected on behalf of suppliers | 3,003,841.89 | 3,003,841.89 |
| Pending development products | 8,447,099.62 | |
| Total | 281,266,692.03 | 248,401,322.80 |
12. Long-term share equity investment
In RMB
| Invested entity | Opening book value | Beginning balance of impairment provisions | Change (+,-) | Closing book value | Balance of impairment provision at the end of the period | |||||||
| Increased investment | Decreased investment | Investment gain and loss recognized using the equity method | Other miscellaneous income adjustment | Other equity change | Cash dividend or profit announced | Impairment provision | Others | |||||
| Associate | ||||||||||||
| Ganshang Joint Investment | 2,402,065.72 | 450.08 | 2,402,515.80 | |||||||||
| Jiangxi Business Innovative Property Joint Stock Co., Ltd. | 52,354,951.68 | -35,409.60 | 52,319,542.08 | |||||||||
| Total | 54,757,017.40 | -34,959.52 | 54,722,057.88 | |||||||||
The recoverable amount is determined as the net amount after deducting the disposal costs from the fair value.
□ Applicable ? Inapplicable
The recoverable amount is determined based on the present value of estimated future cash flows.
□ Applicable ? Inapplicable
13. Other non-current financial assets
In RMB
| Item | Closing balance | Opening balance |
| Financial assets measured at fair value with variations accounted into current income account | 6,371,282.04 | 7,455,617.17 |
| Total | 6,371,282.04 | 7,455,617.17 |
14. Investment real estate
(1) Investment real estate measured at costs
? Applicable □ Inapplicable
In RMB
| Item | Houses & buildings | Total |
| I. Book value | ||
| 1. Opening balance | 17,388,824.39 | 17,388,824.39 |
| 2. Increase in this period | ||
| 3. Decrease in this period | ||
| 4. Closing balance | 17,388,824.39 | 17,388,824.39 |
| II. Accumulative depreciation and amortization | ||
| 1. Opening balance | 8,151,827.44 | 8,151,827.44 |
| 2. Increase in this period | 224,704.02 | 224,704.02 |
| (1) Provision or amortization | 224,704.02 | 224,704.02 |
| 3. Decrease in this period | ||
| 4. Closing balance | 8,376,531.46 | 8,376,531.46 |
| III. Impairment provision | ||
| 1. Opening balance | ||
| 2. Increase in this period | ||
| 3. Decrease in this period | ||
| 4. Closing balance | ||
| IV. Book value | ||
| 1. Closing book value | 9,012,292.93 | 9,012,292.93 |
| 2. Opening book value | 9,236,996.95 | 9,236,996.95 |
(2) Investment real estate measured at fair value
? Applicable □ Inapplicable
In RMB
| Item | Houses & buildings | Total |
| I. Opening balance | 5,747,572,171.31 | 5,747,572,171.31 |
| II. Change in this period | -72,326,180.68 | -72,326,180.68 |
| Add: Transfer-in from inventory\fixed assets\construction in progress | 84,275,738.00 | 84,275,738.00 |
| Less: disposal | 3,189,499.43 | 3,189,499.43 |
| Transfer-out to fixed assets | 153,968,082.00 | 153,968,082.00 |
| Add: Change in fair value | 555,662.75 | 555,662.75 |
| III. Closing balance | 5,675,245,990.63 | 5,675,245,990.63 |
(3) Conversion to investment real estate and measurement using fair value
In RMB
| Item | Pre-conversion accounting | Amount | Conversion reason | Approval procedure | Impact on profit and loss | Impact on other comprehensive income |
| Part of the property of Building 2, Nanchang Fangda Center | Inventory | 8,237,822.00 | Inventory for sale transferred to lease | Approved in accordance with the Company's management system. | 0.00 | 1,197,093.88 |
| Part of Fangda Building | in fixed assets | 76,037,916.00 | Self-use to lease | Approved in accordance with the Company's management system. | 0.00 | 28,392,754.08 |
| Total | 84,275,738.00 |
(4) Investment real estate without ownership certificate
In RMB
| Item | Book value | Reason |
| Lanzhou Railway - City Dawn | 13,037,841.00 | In the process of going through the relevant acceptance and filing procedures. |
15. Fixed assets
In RMB
| Item | Closing balance | Opening balance |
| in fixed assets | 723,454,635.28 | 620,828,178.38 |
| Total | 723,454,635.28 | 620,828,178.38 |
(1) Fixed assets
In RMB
| Item | Houses & buildings | Mechanical equipment | Transportation facilities | Electronics and other devices | PV power plants | Total |
| I. Original book value: | ||||||
| 1. Opening balance | 604,581,780.49 | 133,179,843.02 | 20,556,336.60 | 52,612,038.36 | 129,596,434.84 | 940,526,433.31 |
| 2. Increase in this period | 153,968,082.00 | 800,536.18 | 91,503.55 | 928,720.14 | 155,788,841.87 | |
| (1) Purchase | 800,536.18 | 89,133.29 | 928,176.85 | 1,817,846.32 | ||
| (2) Other increases | 153,968,082.00 | 2,370.26 | 543.29 | 153,970,995.55 | ||
| 3. Decrease in this period | 47,282,629.09 | 417,001.12 | 47,699,630.21 | |||
| (1) Disposal or | 417,001.12 | 417,001.12 |
| retirement | ||||||
| (2) Other decrease | 47,282,629.09 | 47,282,629.09 | ||||
| 4. Closing balance | 711,267,233.40 | 133,980,379.20 | 20,647,840.15 | 53,123,757.38 | 129,596,434.84 | 1,048,615,644.97 |
| II. Accumulative depreciation | ||||||
| 1. Opening balance | 127,270,899.06 | 95,754,806.52 | 15,333,003.26 | 34,440,400.13 | 46,802,676.46 | 319,601,785.43 |
| 2. Increase in this period | 8,048,837.12 | 2,003,784.68 | 529,978.66 | 1,281,937.87 | 3,074,220.06 | 14,938,758.39 |
| (1) Provision | 8,048,837.12 | 2,003,784.68 | 528,389.85 | 1,261,845.64 | 3,074,220.06 | 14,917,077.35 |
| 3. Decrease in this period | 9,101,718.53 | 374,285.10 | 9,476,003.63 | |||
| (1) Disposal or retirement | 374,285.10 | 374,285.10 | ||||
| (2) Other decrease | 9,101,718.53 | 9,101,718.53 | ||||
| 4. Closing balance | 126,218,017.65 | 97,758,591.20 | 15,862,981.92 | 35,348,052.90 | 49,876,896.52 | 325,064,540.19 |
| III. Impairment provision | ||||||
| 1. Opening balance | 79,843.20 | 16,626.30 | 96,469.50 | |||
| 2. Increase in this period | ||||||
| 3. Decrease in this period | ||||||
| 4. Closing balance | 79,843.20 | 16,626.30 | 96,469.50 | |||
| IV. Book value | ||||||
| 1. Closing book value | 585,049,215.75 | 36,141,944.80 | 4,784,858.23 | 17,759,078.18 | 79,719,538.32 | 723,454,635.28 |
| 2. Opening book value | 477,310,881.43 | 37,345,193.30 | 5,223,333.34 | 18,155,011.93 | 82,793,758.38 | 620,828,178.38 |
(2) Fixed assets without ownership certificate
In RMB
| Item | Book value | Reason |
| Yuehai Office Building C 502 | 103,313.13 | Historical reasons |
Others:
a. As of June 30, 2024, the net value of some of the houses and buildings held by the Company,amounting to RMB141,500,759.61, has been mortgaged to China Construction Bank Shenzhen OverseasChinese Town Branch for loans.
b. In this period's changes, there was an increase of RMB153,968,082.00 in other items of houses andbuildings, and a decrease of RMB47,282,629.09, which was caused by the conversion with investment realestate.
16. Construction in process
In RMB
| Item | Closing balance | Opening balance |
| Construction in process | 242,897,579.60 | 109,414,347.33 |
| Total | 242,897,579.60 | 109,414,347.33 |
(1) Construction in progress
In RMB
| Item | Closing balance | Opening balance | ||||
| Remaining book value | Impairment provision | Book value | Remaining book value | Impairment provision | Book value | |
| Phase 1 of Ganzhou Intelligent Manufacturing Headquarters Base | 242,897,579.60 | 242,897,579.60 | 109,181,428.63 | 109,181,428.63 | ||
| Fangda Building monitoring system remodeling | 232,918.70 | 232,918.70 | ||||
| Total | 242,897,579.60 | 242,897,579.60 | 109,414,347.33 | 109,414,347.33 | ||
(2) Changes in major construction in process in this period
In RMB
| Project name | Budget | Opening balance | Increase in this period | Amount transfer-in to fixed assets in this period | Other decrease in this period | Closing balance | Proportion of accumulative engineering investment in the budget | Project progress | Accumulative capitalized interest | Including: capitalized interest for the current period | Interest capitalization rate | Capital source |
| Phase 1 of Ganzhou Intelligent Manuf | 331,540,000.00 | 109,181,428.63 | 133,716,150.97 | 242,897,579.60 | 73.26% | Construction in process | 2,310,000.00 | 2,310,000.00 | 100.00% | Own funds and loans from financial |
| acturing Headquarters Base | institutions | |||||||||||
| Total | 331,540,000.00 | 109,181,428.63 | 133,716,150.97 | 242,897,579.60 | 2,310,000.00 | 2,310,000.00 | 100.00% |
(3) Provision for impairment of construction in progress during the current periodAs of June 30, 2024, there was no indication of impairment for construction in progress.
(4) Impairment testing of construction in progress
□ Applicable ? Inapplicable
17. Use right assets
(1) Right-to-use assets
In RMB
| Item | Houses & buildings | Transportation facilities | Total |
| I. Book value | |||
| 1. Opening balance | 39,794,489.03 | 1,959,448.83 | 41,753,937.86 |
| 2. Increase in this period | 7,466,771.47 | 3,651,740.16 | 11,118,511.63 |
| 3. Decrease in this period | |||
| 4. Closing balance | 47,261,260.50 | 5,611,188.99 | 52,872,449.49 |
| II. Accumulative depreciation | |||
| 1. Opening balance | 19,803,178.07 | 1,173,930.21 | 20,977,108.28 |
| 2. Increase in this period | 7,571,066.03 | 337,017.36 | 7,908,083.39 |
| (1) Provision | 7,571,066.03 | 337,017.36 | 7,908,083.39 |
| 3. Decrease in this period | |||
| 4. Closing balance | 27,374,244.10 | 1,510,947.57 | 28,885,191.67 |
| III. Impairment provision | |||
| 1. Opening balance | |||
| 2. Increase in this period | |||
| 3. Decrease in this period | |||
| 4. Closing balance | |||
| IV. Book value | |||
| 1. Closing book value | 19,887,016.40 | 4,100,241.42 | 23,987,257.81 |
| 2. Opening book value | 19,991,310.96 | 785,518.62 | 20,776,829.58 |
(2) Impairment testing of right-of-use assets
□ Applicable ? Inapplicable
As of June 30, 2024, there are no signs of impairment in the right-of-use assets of the Company.
18. Intangible assets
(1) Intangible assets
In RMB
| Item | Land using right | Trademarks, patents and know-how | Software | Total |
| I. Book value | ||||
| 1. Opening balance | 152,914,836.88 | 9,017,372.69 | 23,236,225.88 | 185,168,435.45 |
| 2. Increase in this period | 41,149.68 | 324,388.19 | 365,537.87 | |
| (1) Purchase | 41,149.68 | 324,388.19 | 365,537.87 | |
| 3. Decrease in this period | ||||
| 4. Closing balance | 152,914,836.88 | 9,058,522.37 | 23,560,614.07 | 185,533,973.32 |
| II. Accumulative amortization | ||||
| 1. Opening balance | 23,080,721.81 | 8,919,025.53 | 13,095,478.23 | 45,095,225.57 |
| 2. Increase in this period | 2,661,285.46 | 14,882.16 | 1,012,456.30 | 3,688,623.92 |
| (1) Provision | 2,661,285.46 | 14,882.16 | 1,011,540.76 | 3,687,708.38 |
| 3. Decrease in this period | ||||
| 4. Closing balance | 25,742,007.27 | 8,933,907.69 | 14,107,934.53 | 48,783,849.49 |
| III. Impairment provision | ||||
| 1. Opening balance | ||||
| 2. Increase in this period | ||||
| 3. Decrease in this period | ||||
| 4. Closing balance | ||||
| IV. Book value | ||||
| 1. Closing book value | 127,172,829.61 | 124,614.68 | 9,452,679.54 | 136,750,123.83 |
| 2. Opening book value | 129,834,115.07 | 98,347.16 | 10,140,747.65 | 140,073,209.88 |
(2) Failure to obtain the land use right certificates
In RMBAt the end of the period, the Company had no land use right without the property right certificate.
(3) Impairment test of intangible assets
□ Applicable ? Inapplicable
19. Long-term amortizable expenses
In RMB
| Item | Opening balance | Increase in this period | Amortized amount in this period | Other decrease | Closing balance |
| Xuanfeng Chayuan village and Zhuyuan village land transfer compensation | 916,323.98 | 28,050.78 | 888,273.20 | ||
| Membership fee | 514,999.92 | 167,833.34 | 347,166.58 | ||
| Plant ground reconstruction project | 145,269.71 | 43,581.00 | 101,688.71 | ||
| High voltage network access fee of East China base | 179,459.59 | 153,822.66 | 25,636.93 | ||
| Sporadic decoration and renovation costs of Fangda Town | 3,015,993.78 | 936,879.28 | 2,079,114.50 | ||
| Sporadic decoration and renovation costs of Fangda Center | 684,013.47 | 194,381.64 | 489,631.83 | ||
| Renovation of the exhibition hall on the 2nd floor of the East China Base | 310,724.95 | 34,525.00 | 276,199.95 | ||
| Others | 1,293,253.59 | 426,189.74 | 602.59 | 866,461.26 | |
| Total | 6,749,314.04 | 310,724.95 | 1,985,263.44 | 602.59 | 5,074,172.96 |
20. Differed income tax assets and differed income tax liabilities
(1) Non-deducted deferred income tax assets
In RMB
| Item | Closing balance | Opening balance | ||
| Deductible temporary difference | Deferred income tax assets | Deductible temporary difference | Deferred income tax assets | |
| Assets impairment provision | 318,885,422.68 | 59,216,319.69 | 301,423,517.61 | 56,628,793.35 |
| Unrealized profit of internal transactions | 429,990,392.84 | 88,425,089.98 | 393,622,330.41 | 82,987,001.02 |
| Deductible loss | 138,889,234.90 | 32,973,293.23 | 130,536,168.91 | 31,566,961.10 |
| Credit impairment provision | 285,793,380.44 | 43,985,563.69 | 273,785,349.40 | 42,172,039.47 |
| Anticipated liabilities | 4,216,060.76 | 632,409.11 | 4,842,411.47 | 726,361.72 |
| Deferred earning | 3,775,568.10 | 719,053.28 | 3,922,402.14 | 744,121.83 |
| Change in fair value | 9,277,014.48 | 1,399,219.85 | 9,127,633.52 | 1,369,145.03 |
| Lease liabilities | 9,511,018.88 | 2,457,322.18 | 20,573,028.70 | 4,335,420.74 |
| Accrued and unpaid land tax | 16,543,205.26 | 4,135,801.31 | 16,543,205.26 | 4,135,801.32 |
| Reserved expense | 9,427,003.06 | 2,801,828.70 | 36,216,407.02 | 5,434,461.06 |
| Total | 1,226,308,301.40 | 236,745,901.02 | 1,190,592,454.44 | 230,100,106.64 |
(2) Non-deducted deferred income tax liabilities
In RMB
| Item | Closing balance | Opening balance |
| Taxable temporary difference | Deferred income tax liabilities | Taxable temporary difference | Deferred income tax liabilities | |
| Change in fair value | 4,200,176,971.36 | 1,050,044,242.85 | 4,161,500,052.20 | 1,040,357,639.32 |
| Acquire premium to form inventory | 1,535,605.47 | 383,901.37 | 1,535,605.47 | 383,901.37 |
| Use right assets | 10,355,437.60 | 2,588,859.40 | 20,776,829.58 | 4,110,042.13 |
| Estimated gross profit for recognized revenue that has not reached the tax liability point. | 27,833,078.25 | 6,958,269.56 | 29,608,338.87 | 7,402,084.72 |
| Rental income | 25,570,358.86 | 6,392,589.70 | 28,537,396.58 | 7,134,349.15 |
| Total | 4,265,471,451.54 | 1,066,367,862.88 | 4,241,958,222.70 | 1,059,388,016.69 |
(3) Net deferred income tax assets or liabilities listed
In RMB
| Item | Deferred income tax assets and liabilities at the end of the period | Offset balance of deferred income tax assets or liabilities after offsetting | Deferred income tax assets and liabilities at the beginning of the period | Offset balance of deferred income tax assets or liabilities after offsetting |
| Deferred income tax assets | 47,116,907.11 | 189,628,993.91 | 47,241,557.57 | 182,858,549.07 |
| Deferred income tax liabilities | 47,116,907.11 | 1,019,250,955.77 | 47,241,557.57 | 1,012,146,459.12 |
(4) Details of unrecognized deferred income tax assets
In RMB
| Item | Closing balance | Opening balance |
| Deductible temporary difference | 215,559.63 | 462,778.59 |
| Deductible loss | 12,375,300.84 | 17,530,215.40 |
| Total | 12,590,860.47 | 17,992,993.99 |
(5) Deductible losses of the un-recognized deferred income tax asset will expire in the following years
In RMB
| Year | Closing amount | Opening amount | Remarks |
| 2024 | 851,893.17 | 1,276,235.76 | |
| 2025 | 873,293.27 | 213,129.83 | |
| 2026 | 1,654,924.97 | 2,355,213.17 | |
| 2027 | 1,234,520.34 | 3,698,098.44 | |
| 2028 | 139,385.94 | 9,987,538.20 | |
| 2029 and later | 7,621,283.15 | The deductible losses are mainly from Hong Kong companies, and according to Hong Kong tax policy, the deductible losses can be used in perpetuity. | |
| Total | 12,375,300.84 | 17,530,215.40 |
21. Other non-current assets
In RMB
| Item | Closing balance | Opening balance | ||||
| Remaining book value | Impairment provision | Book value | Remaining book value | Impairment provision | Book value | |
| Contract assets | 65,754,345.90 | 5,632,433.41 | 60,121,912.49 | 69,887,873.01 | 5,127,003.43 | 64,760,869.58 |
| Prepaid house and equipment amount | 37,323,701.55 | 37,323,701.55 | 20,034,901.32 | 20,034,901.32 | ||
| Others | 2,004,000.00 | 2,004,000.00 | 2,004,000.00 | 2,004,000.00 | ||
| Total | 105,082,047.45 | 5,632,433.41 | 99,449,614.04 | 91,926,774.33 | 5,127,003.43 | 86,799,770.90 |
22. Assets with restricted ownership or use rights
In RMB
| Item | Closing balance | Beginning of the period | ||||||
| Remaining book value | Book value | Type of restriction | Restricted situation | Remaining book value | Book value | Type of restriction | Restricted situation | |
| Monetary capital | 776,544,406.75 | 776,544,406.75 | For pledge or restricted use | Various deposits | 645,489,997.82 | 645,489,997.82 | For pledge or restricted use | Various deposits |
| Notes receivable | 21,162,837.86 | 21,096,517.86 | For endorsement or discounting | Bills endorsed or discounted but not yet due | 27,937,899.17 | 27,843,496.17 | For endorsement or discounting | Bills endorsed or discounted but not yet due |
| Account receivable | 35,195,428.88 | 34,843,474.59 | For pledge | Loan by pledge | 39,392,140.71 | 38,094,032.45 | For pledge | Loan by pledge |
| in fixed assets | 145,934,582.39 | 141,500,759.61 | Used as collateral | Loan by pledge | 45,915,995.84 | 43,108,073.24 | Used as collateral | Loan by pledge |
| Investment real estate | 1,827,299,718.88 | 1,827,299,718.88 | Used as collateral | Loan by pledge | 1,943,287,098.56 | 1,943,287,098.56 | Used as collateral | Loan by pledge |
| Equity pledge | 200,000,000.00 | 200,000,000.00 | For pledge | 100% stake in Fangda Property Development held by the Company | 200,000,000.00 | 200,000,000.00 | For pledge | 100% stake in Fangda Property Development held by the Company |
| Construction in process | 228,077,468.49 | 228,077,468.49 | Used as collateral | Loan by pledge | ||||
| Intangible assets | 24,179,649.75 | 23,454,260.19 | Used as collateral | Loan by pledge | ||||
| Non-current assets due in 1 year | 327,120,273.54 | 327,120,273.54 | For pledge | Loan by pledge | ||||
| Total | 3,258,394,093.00 | 3,252,816,606.37 | 3,229,143,405.64 | 3,224,942,971.78 | ||||
23. Short-term borrowings
(1) Classification of short-term borrowings
In RMB
| Item | Closing balance | Opening balance |
| Guarantee loan | 1,114,026,708.98 | 711,492,580.56 |
| Credit borrow | 300,270,416.67 | |
| Guarantee and pledge loan | 1,310,714,488.01 | 1,184,641,572.44 |
| Other loans | 4,000,000.00 | 11,650,469.54 |
| Total | 2,428,741,196.99 | 2,208,055,039.21 |
Explanation of the classification of short-term borrowings: Guaranteed borrowings are borrowings with credit guarantee provided;guaranteed and pledged borrowings are borrowings with credit guarantee provided and using intellectual property or margin forpledge guarantee; other borrowings are discounted borrowings received from customers' acceptance bills or financing letters.
24. Derivative financial liabilities
In RMB
| Item | Closing balance | Opening balance |
| Forward foreign exchange contract | 628,367.00 | |
| Total | 628,367.00 |
25. Notes payable
In RMB
| Type | Closing balance | Opening balance |
| Commercial acceptance | 3,443,563.69 | 8,781,696.46 |
| Bank acceptance | 926,879,613.50 | 860,105,250.33 |
| Total | 930,323,177.19 | 868,886,946.79 |
The total amount of outstanding and unpaid notes payable at the end of this period is RMB8,936,602.56. The reasons for the non-payment upon maturity are as follows: Among them, RMB8,584,133.56 for bank acceptance bills, because the due date of June 29,2024 is Saturday, the bank system postpones the deduction to the next working day, that is, the bank has already made the paymenton Monday, July 1, 2024; RMB352,469.00 for commercial acceptance bills, because the supplier did not apply to the bank forpayment in time.
26. Account payable
(1) Account payable
In RMB
| Item | Closing balance | Opening balance |
| Account repayable and engineering repayable | 1,332,820,925.05 | 1,374,752,105.25 |
| Payable installation and implementation fees | 454,031,510.99 | 481,683,031.93 |
| Construction payable | 57,670,168.19 | 86,851,302.81 |
| Others | 26,772,708.97 | 29,007,342.28 |
| Total | 1,871,295,313.20 | 1,972,293,782.27 |
(2) Significant accounts payable older than one year or past due
There are no important accounts payable with an age of more than 1 year or overdue at the end of this period.
27. Other payables
In RMB
| Item | Closing balance | Opening balance |
| Dividend payable | 6,962,732.02 | |
| Other payables | 110,240,797.47 | 117,581,764.15 |
| Total | 117,203,529.49 | 117,581,764.15 |
(1) Dividend payable
In RMB
| Item | Closing balance | Opening balance |
| Shareholding of minority shareholders | 6,962,732.02 | |
| Total | 6,962,732.02 |
(2) Other payables
1) Other payables presented by nature
In RMB
| Item | Closing balance | Opening balance |
| Performance and quality deposit | 36,615,081.07 | 40,096,446.17 |
| Deposit | 40,402,857.87 | 24,659,670.94 |
| Reserved expense | 2,197,754.18 | 4,785,143.40 |
| Others | 31,025,104.35 | 48,040,503.64 |
| Total | 110,240,797.47 | 117,581,764.15 |
(2) Significant other accounts payable older than 1 year or past due
In RMB
| Item | Closing balance | Reason |
| Shenzhen Yikang Real Estate Co. Ltd. | 26,149,417.56 | Payment paid as agreed in the contract |
| Total | 26,149,417.56 |
28. Prepayment received
(1) Prepayment received
In RMB
| Item | Closing balance | Opening balance |
| Rental | 1,799,054.73 | 1,432,885.03 |
| Total | 1,799,054.73 | 1,432,885.03 |
29. Contract liabilities
In RMB
| Item | Closing balance | Opening balance |
| Project funds collected in advance | 211,877,979.62 | 175,345,246.29 |
| Material payment and house sale payment. | 5,020,265.66 | 22,694,108.20 |
| Others | 484,361.02 | 124,854.98 |
| Total | 217,382,606.30 | 198,164,209.47 |
The amount and reason for the significant change in the book value during the reporting period
In RMB
| Item | Change | Reason |
| Project funds collected in advance | 36,532,733.33 | Increased due to the advance payment for engineering contracting contracts. |
| Material payment and house sale payment. | -17,673,842.54 | Decreased due to the reduction of advance payment for material purchase |
| Total | 18,858,890.79 |
30. Employees' wage payable
(1) Employees' wage payable
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance |
| 1. Short-term remuneration | 73,557,667.19 | 242,537,025.41 | 282,944,218.70 | 33,150,473.90 |
| 2. Retirement pension program-defined contribution plan | 381,396.01 | 13,522,893.81 | 13,554,927.38 | 349,362.44 |
| 3. Dismiss compensation | 124,049.06 | 1,089,811.46 | 1,213,860.52 | |
| Total | 74,063,112.26 | 257,149,730.68 | 297,713,006.60 | 33,499,836.34 |
(2) Short-term remuneration
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance |
| 1. Wage, bonus, allowance and subsidies | 72,008,514.84 | 225,356,213.47 | 265,515,847.20 | 31,848,881.11 |
| 2. Employee welfare | 321,678.16 | 6,078,465.91 | 6,371,254.56 | 28,889.51 |
| 3. Social insurance | 142,502.10 | 5,217,044.01 | 5,227,487.22 | 132,058.89 |
| Including: medical insurance | 118,083.98 | 4,272,397.97 | 4,268,021.66 | 122,460.29 |
| Labor injury insurance | 5,534.39 | 478,879.08 | 481,373.67 | 3,039.80 |
| Breeding insurance | 18,883.73 | 465,766.96 | 478,091.89 | 6,558.80 |
| 4. Housing fund | 143,003.33 | 5,451,234.97 | 5,378,277.05 | 215,961.25 |
| 5. Labor union budget and staff education | 542,240.97 | 434,067.05 | 433,249.16 | 543,058.86 |
| fund | ||||
| 6. Short-term paid leave | 399,727.79 | 18,103.51 | 381,624.28 | |
| Total | 73,557,667.19 | 242,537,025.41 | 282,944,218.70 | 33,150,473.90 |
(3) Defined contribution plan
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance |
| 1. Basic pension | 373,813.17 | 12,970,379.77 | 13,002,045.47 | 342,147.47 |
| 2. Unemployment insurance | 7,582.84 | 552,514.04 | 552,881.91 | 7,214.97 |
| Total | 381,396.01 | 13,522,893.81 | 13,554,927.38 | 349,362.44 |
31. Taxes payable
In RMB
| Item | Closing balance | Opening balance |
| VAT | 4,788,021.30 | 5,063,851.12 |
| Enterprise income tax | 14,036,438.04 | 13,798,160.21 |
| Personal income tax | 1,036,373.92 | 1,750,380.58 |
| City maintenance and construction tax | 576,138.95 | 636,181.87 |
| Land using tax | 494,915.92 | 608,959.21 |
| Property tax | 8,304,804.34 | 2,656,539.62 |
| Education surtax | 251,080.62 | 273,885.15 |
| Local education surtax | 167,387.13 | 182,589.47 |
| Consumption service tax | 10,359.29 | |
| Land VAT | 19,663,675.05 | 16,543,205.26 |
| Others | 1,280,009.65 | 850,956.77 |
| Total | 50,598,844.92 | 42,375,068.55 |
32. Non-current liabilities due within 1 year
In RMB
| Item | Closing balance | Opening balance |
| Long-term loans due within 1 year | 30,942,037.67 | 914,958.90 |
| Long-term payables due within 1 year | 49,323,018.90 | |
| Lease liabilities due within one year | 13,070,051.28 | 13,897,158.66 |
| Total | 44,012,088.95 | 64,135,136.46 |
33. Other current liabilities
In RMB
| Item | Closing balance | Opening balance |
| Unterminated notes receivable | 21,162,837.86 | 27,937,899.17 |
| Substituted money on VAT | 26,043,891.43 | 25,586,755.88 |
| Total | 47,206,729.29 | 53,524,655.05 |
34. Long-term borrowings
(1) Classification of long-term borrowings
In RMB
| Item | Closing balance | Opening balance |
| Guaranteed and mortgage loans | 250,218,750.00 | |
| Guarantee, mortgage and pledge loan | 660,723,287.67 | 660,914,958.90 |
| Less: Long-term loans due within 1 year | 30,942,037.67 | 914,958.90 |
| Total | 880,000,000.00 | 660,000,000.00 |
Notes to classification of long-term borrowings:
(1) The pledges in the above guarantees, mortgages and pledges of borrowings are pledges of the Company's 100% equity interestin its subsidiary, Fangda Real Estate, which is directly and indirectly held by the Company, and the rent receivables from its self-owned rental properties in Fangda Town.
(2) The interest rate range for long-term borrowings is 3% to 6%.
35. Lease liabilities
In RMB
| Item | Closing balance | Opening balance |
| Lease payments | 26,684,228.98 | 23,255,219.85 |
| Less: unrecognized financing expenses | 1,491,589.81 | 2,682,191.15 |
| Less: lease liabilities due within one year | 13,070,051.28 | 13,897,158.66 |
| Total | 12,122,587.89 | 6,675,870.04 |
36. Long-term payables
In RMB
| Item | Closing balance | Opening balance |
| Long-term payable | 48,400,000.00 | |
| Total | 48,400,000.00 |
(1) Long term accounts payable listed by nature
In RMB
| Item | Closing balance | Opening balance |
| Equity repurchase payment | 0.00 | 48,400,000.00 |
37. Anticipated liabilities
In RMB
| Item | Closing balance | Opening balance | Reason |
| Loss contract to be executed | 341,507.92 | 193,502.52 | |
| Maintenance fee | 3,984,129.49 | 4,648,908.95 | Product quality warranty |
| Total | 4,325,637.41 | 4,842,411.47 |
38. Deferred earning
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance | Reason |
| Government subsidy | 8,978,678.72 | 2,321,892.00 | 313,198.25 | 10,987,372.47 | See the following table |
| Total | 8,978,678.72 | 2,321,892.00 | 313,198.25 | 10,987,372.47 |
Items involving government subsidies:
| Item | Balance as of December 31, 2023 | Amount of new subsidy | Other misc. gains recorded in this period | Balance as of June 30, 2024 | Related to assets/earning |
| Railway transport screen door controlling system and information transmission technology | 3,458.27 | 3,458.27 | Assets-related | ||
| Major investment project prize from Industry and Trade Development Division of Dongguan Finance Bureau | 1,395,238.70 | 28,571.40 | 1,366,667.30 | Assets-related | |
| Distributed PV power generation project subsidy sponsored by Dongguan Reform and Development Commission | 293,750.33 | 12,499.98 | 281,250.35 | Assets-related | |
| Subsidized land transfer | 162,376.31 | 1,862.82 | 160,513.49 | Assets-related | |
| Special subsidy for industrial transformation, upgrading and development | 1,150,688.31 | 75,869.58 | 1,074,818.73 | Assets-related | |
| Enterprise informationization subsidy project of Shenzhen Small and Medium Enterprise Service Agency | 276,000.00 | 24,000.00 | 252,000.00 | Assets-related | |
| National Industry Revitalization and Technology Renovation Project fund | 4,762,526.30 | 153,864.30 | 4,608,662.00 | Assets-related | |
| Subsidy for new plant | 934,640.50 | 13,071.90 | 921,568.60 | Assets-related | |
| Land construction subsidy | 2,321,892.00 | 2,321,892.00 | Assets-related | ||
| Total | 8,978,678.72 | 2,321,892.00 | 313,198.25 | 10,987,372.47 |
39. Capital share
In RMB
| Opening balance | Change (+,-) | Closing balance | |||||
| Issued new shares | Bonus shares | Transferred from reserves | Others | Subtotal | |||
| Total of capital shares | 1,073,874,227.00 | 1,073,874,227.00 | |||||
40. Capital reserve
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance |
| Capital premium (share capital premium) | 10,005,491.05 | 61,979.15 | 9,943,511.90 | |
| Other capital reserves | 1,454,097.35 | 1,454,097.35 | ||
| Total | 11,459,588.40 | 61,979.15 | 11,397,609.25 |
Other explanations, including the changes in this period and the reasons for the changes: The reduction in this period is thedifference between the cost of long-term equity investment obtained by acquiring minority equity and the corresponding net assetbook value.
41. Other miscellaneous income
In RMB
| Item | Opening balance | Amount occurred in the current period | Closing balance | |||||
| Amount before income tax | Less: amount written into other gains and transferred into gain/loss in previous terms | Less: amount written into other gains and transferred into gain/loss in previous terms | Less: Income tax expenses | After-tax amount attributed to the parent | After-tax amount attributed to minority shareholders | |||
| I. Other comprehensive income that will not be subsequently reclassified into profit and loss | -25,201,209.27 | -25,201,209.27 | ||||||
| Fair value change of investment in other equity tools | -25,201,209.27 | -25,201,209.27 | ||||||
| 2. Other misc. incomes that will be re-classified into gain and loss | 48,323,080.06 | 38,331,442.45 | 9,742,967.05 | 28,592,893.06 | -4,417.66 | 76,915,973.12 | ||
| Cash flow hedge reserve | 170,878.62 | -802,104.06 | -120,315.61 | -676,913.84 | -4,874.61 | -506,035.22 | ||
| Translation difference of foreign exchange statement | 236,706.94 | -319,584.11 | -320,041.06 | 456.95 | -83,334.12 | |||
| Investment real estate measured at fair value | 47,915,494.50 | 39,453,130.62 | 9,863,282.66 | 29,589,847.96 | 77,505,342.46 | |||
| Other miscellaneous income | 23,121,870.79 | 38,331,442.45 | 9,742,967.05 | 28,592,893.06 | -4,417.66 | 51,714,763.85 |
42. Surplus reserves
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance |
| Statutory surplus reserves | 79,324,940.43 | 79,324,940.43 | ||
| Total | 79,324,940.43 | 79,324,940.43 |
43. Retained profit
In RMB
| Item | Current period | Last period |
| Adjustment on retained profit of previous period | 4,772,359,940.45 | 4,553,295,402.30 |
| Retained profit adjusted at beginning of year | 4,772,359,940.45 | 4,553,295,402.30 |
| Plus: Net profit attributable to owners of the parent | 116,795,117.62 | 182,155,268.18 |
| Common share dividend payable | 85,909,938.16 | 53,693,711.35 |
| Closing retained profit | 4,803,245,119.91 | 4,681,756,959.13 |
44. Operational revenue and costs
In RMB
| Item | Amount occurred in the current period | Occurred in previous period | ||
| Income | Cost | Income | Cost | |
| Main business | 2,115,537,007.16 | 1,724,711,866.23 | 1,994,095,251.72 | 1,613,648,910.68 |
| Other businesses | 18,308,580.60 | 12,887,318.75 | 84,751,625.60 | 10,581,557.95 |
| Total | 2,133,845,587.76 | 1,737,599,184.98 | 2,078,846,877.32 | 1,624,230,468.63 |
Note: The decrease in other operating income in this period is mainly due to the adjustment of the rental income of the subsidiarywhose main business is real estate leasing from other operating income to main operating income in this period. The rental incomein this period is RMB69,095,799.23, and the rental income in the previous period is RMB73,425,170.71.
Breakdown of operating revenues and operating costs:
In RMB
| Contract classification | Segment 1 - Curtain wall and new materials | Segment 2 - Rail transport screen door business | Segment 3 - Commercial real estate | Segment 4 - New energy | Segment 5 - Others | Total | ||||||
| Turnover | Operating cost | Turnover | Operating cost | Turnover | Operating cost | Turnover | Operating cost | Turnover | Operating cost | Turnover | Operating cost | |
| Business type | 1,737,754,739.77 | 1,498,853,634.92 | 263,455,042.38 | 204,334,717.47 | 118,828,634.36 | 30,419,966.05 | 7,061,695.63 | 3,952,479.21 | 6,745,475.62 | 38,387.33 | 2,133,845,587.76 | 1,737,599,184.98 |
| Including: | ||||||||||||
| Curtain wall system and new materials | 1,737,754,739.77 | 1,498,853,634.92 | 1,737,754,739.77 | 1,498,853,634.92 | ||||||||
| Subway screen door and service | 263,455,042.38 | 204,334,717.47 | 263,455,042.38 | 204,334,717.47 | ||||||||
| Commercial real estate leasing and property services | 118,828,634.36 | 30,419,966.05 | 118,828,634.36 | 30,419,966.05 | ||||||||
| PV power generation products | 7,061,695.63 | 3,952,479.21 | 7,061,695.63 | 3,952,479.21 | ||||||||
| Others | 6,745,475.62 | 38,387.33 | 6,745,475.62 | 38,387.33 | ||||||||
| By operating region | 1,737,754,739.77 | 1,498,853,634.92 | 263,455,042.38 | 204,334,717.47 | 118,828,634.36 | 30,419,966.05 | 7,061,695.63 | 3,952,479.21 | 6,745,475.62 | 38,387.33 | 2,133,845,587.76 | 1,737,599,184.98 |
| Including: | ||||||||||||
| In China | 1,672,512,452.59 | 1,448,049,207.46 | 150,308,848.24 | 124,723,170.68 | 118,828,634.36 | 30,419,966.05 | 7,061,695.63 | 3,952,479.21 | 6,745,475.62 | 38,387.33 | 1,955,457,106.44 | 1,607,183,210.73 |
| Out of China | 65,242,287.18 | 50,804,427.46 | 113,146,194.14 | 79,611,546.79 | 178,388,481.32 | 130,415,974.25 |
(1) The information of operating revenue broken down by revenue recognition time is as follows:
| Item | January to June 2024 (yuan) | January to June 2023 (yuan) |
| Revenue recognized at a certain point in time | 231,875,066.13 | 284,640,620.34 |
| Revenue recognized over a period of time | 1,901,970,521.63 | 1,794,206,256.98 |
| Total | 2,133,845,587.76 | 2,078,846,877.32 |
For curtain wall materials, real estate and other commodity sales transactions, the Company completes theperformance obligations when the customer obtains the control of the relevant commodities; for providingbuilding curtain wall, Metro screen door design, production and installation and other service transactions, theCompany confirms the completed performance obligations according to the performance progress during thewhole service period. The contract price of the Company is usually due within one year, and there is nosignificant financing component.
(2) Information related to remaining performance obligations
As of June 30, 2024, the Company's remaining contractual obligations are mainly related to theCompany's engineering contracts, and the remaining contractual obligations are expected to be recognized asrevenue according to the performance progress in the future performance period of the correspondingengineering contracts.
The amount of revenue corresponding to the performance obligations that have been signed, but not yetperformed or not yet performed at the end of the reporting period is RMB8,900,311,936.77, of whichRMB2,238,894,511.23 is expected to be recognized in the second half of 2024, and RMB3,899,420,951.80 isexpected to be recognized in 2025, RMB2,761,996,473.74 is expected to be recognized in 2026 and beyond.
45. Taxes and surcharges
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| City maintenance and construction tax | 3,231,945.08 | 4,446,267.60 |
| Education surtax | 2,248,674.08 | 2,918,968.56 |
| Property tax | 9,979,214.78 | 9,523,215.93 |
| Land using tax | 952,023.94 | 888,300.59 |
| Vehicle usage tax | 8,760.00 | 10,290.00 |
| Stamp tax | 2,082,243.80 | 1,554,773.97 |
| Land VAT | 3,489,085.76 | 2,802,673.55 |
| Others | 168,005.35 | 359,251.36 |
| Total | 22,159,952.79 | 22,503,741.56 |
46. Management expense
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Labor costs | 57,329,867.92 | 51,557,093.96 |
| Agencies | 2,839,264.19 | 3,942,772.45 |
| Depreciation and amortization | 7,207,803.35 | 7,282,563.56 |
| Office expense | 4,020,332.41 | 5,141,931.61 |
| Entertainment expense | 5,332,709.90 | 2,551,085.91 |
| Amortization of right of use assets and lease fees | 2,246,218.58 | 1,904,893.13 |
| Lawsuit | 38,842.74 | 2,954,790.97 |
| Travel expense | 2,010,823.16 | 1,575,151.34 |
| Others | 3,815,696.70 | 2,680,658.53 |
| Total | 84,841,558.95 | 79,590,941.46 |
47. Sales expense
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Labor costs | 12,788,956.33 | 13,183,424.46 |
| Sales agency fee | 982,162.22 | 1,773,126.99 |
| Entertainment expense | 2,417,855.86 | 2,554,127.30 |
| Travel expense | 1,410,466.32 | 1,390,759.29 |
| Advertisement and promotion fee | 1,313,336.10 | 830,068.74 |
| Amortization of right of use assets and lease fees | 684,175.82 | 83,983.81 |
| Others | 3,961,319.31 | 8,328,066.20 |
| Total | 23,558,271.96 | 28,143,556.79 |
48. R&D cost
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Labor costs | 50,364,726.96 | 48,716,037.44 |
| Material costs | 26,975,019.70 | 29,157,592.26 |
| Agencies | 4,956,566.33 | 4,191,108.26 |
| Depreciation costs | 840,171.99 | 999,888.33 |
| Amortization of intangible assets | 509,458.78 | 497,817.82 |
| Others | 1,993,659.12 | 5,427,066.55 |
| Total | 85,639,602.88 | 88,989,510.66 |
49. Financial expense
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Interest expense | 29,211,652.87 | 48,188,161.19 |
| Less: discount government subsidies | 308,700.00 | |
| Less: Interest income | 11,466,633.99 | 12,097,319.82 |
| Acceptant discount | 12,789,518.90 | 7,888,113.87 |
| Exchange gain/loss | -1,419,923.57 | -11,140,562.06 |
| Commission charges and others | 2,375,368.88 | 1,214,164.61 |
| Total | 31,489,983.09 | 33,743,857.79 |
50. Other gains
In RMB
| Source | Amount occurred in the current period | Occurred in previous period |
| Government subsidies related to deferred income (related to assets) | 313,198.25 | 283,322.58 |
| Government subsidies directly included in current profits and losses (related to income) | 8,287,811.03 | 7,695,968.32 |
| Other items related to daily activities and included in other income | 2,861,328.23 | 584,491.42 |
| Total | 11,462,337.51 | 8,563,782.32 |
51. Income from fair value fluctuation
In RMB
| Source of income from fluctuation of fair value | Amount occurred in the current period | Occurred in previous period |
| Investment real estate measured at fair value | 555,662.75 | 122,109.40 |
| Other non-current financial assets | 2,702.12 | 7,782.60 |
| Total | 558,364.87 | 129,892.00 |
52. Investment income
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Gains from long-term equity investment measured by equity | -34,959.52 | 294.42 |
| Investment income from disposal of trading financial assets | -890,803.00 | |
| Financial assets de-recognized as a result of amortized cost | -1,123,208.42 | -2,362,127.61 |
| Income from derecognition of other financial assets measured at fair value | -33,150.26 | |
| Total | -2,082,121.20 | -2,361,833.19 |
53. Credit impairment loss
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Bad debt loss of other receivables | -781,873.49 | -716,812.51 |
| Bad debt loss of accounts receivable and notes receivable | -7,092,925.51 | 20,991,390.10 |
| Total | -7,874,799.00 | 20,274,577.59 |
54. Assets impairment loss
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Contract asset impairment loss | -15,876,085.85 | -14,673,904.92 |
| Total | -15,876,085.85 | -14,673,904.92 |
55. Assets disposal gains
In RMB
| Source | Amount occurred in the current period | Occurred in previous period |
| Disposition not classified as possession of fixed assets to be sold, construction in progress, productive biological assets and intangible assets | 3,289.78 | 50,072.23 |
| Including: Fixed assets | 3,289.78 | 50,072.23 |
| Disposal of use right assets | -4,780.00 | 323,279.85 |
| Total | -1,490.22 | 373,352.08 |
56. Non-business income
In RMB
| Item | Amount occurred in the current period | Occurred in previous period | Amount accounted into the current accidental gain/loss |
| Penalty income | 58,348.90 | 106,311.57 | 58,348.90 |
| Compensation received | 46,335.00 | 39,036.80 | 46,335.00 |
| Others | 74,076.65 | 58,698.17 | 74,076.65 |
| Total | 178,760.55 | 204,046.54 | 178,760.55 |
57. Non-business expenses
In RMB
| Item | Amount occurred in the current period | Occurred in previous period | Amount accounted into the current accidental gain/loss |
| Donation | 50,000.00 | 217,861.40 | 50,000.00 |
| Loss from retirement os damaged non-current assets | 136,535.83 | 23,473.88 | 136,535.83 |
| Penalty and overdue fine | 84,167.14 | 43,356.01 | 84,167.14 |
| Lawsuit indemnity | 53,158.01 | ||
| Others | 265,000.51 | 232,013.29 | 265,000.51 |
| Total | 535,703.48 | 569,862.59 | 535,703.48 |
58. Income tax expenses
(1) Details about income tax expense
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Income tax expenses in this period | 25,927,934.50 | 33,781,299.25 |
| Deferred income tax expenses | -9,408,915.24 | -5,591,393.81 |
| Total | 16,519,019.26 | 28,189,905.44 |
(2) Adjustment process of accounting profit and income tax expense
In RMB
| Item | Amount occurred in the current period |
| Total profit | 134,386,296.29 |
| Income tax expenses calculated based on the legal (or applicable) tax rates | 33,596,574.07 |
| Impacts of different tax rates applicable for some subsidiaries | -7,756,825.23 |
| Impacts of income tax before adjustment | 2,538,283.55 |
| Impacts of non-deductible cost, expense and loss | 1,332,361.35 |
| Profit and loss of associates and joint ventures calculated using the equity method | 8,739.88 |
| Impact of tax rate change on the opening balance of deferred income tax | -25,453.99 |
| Taxation impact of R&D expense and (presented with "-”) | -13,174,660.37 |
| Income tax expenses | 16,519,019.26 |
59. Other miscellaneous income
See Note 41 Other comprehensive income in this section for details.
60. Notes to the cash flow statement
(1) Cash inflow related to operation
Other cash received from business operations
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Interest income | 6,489,453.44 | 4,863,151.74 |
| Subsidy income | 9,451,485.75 | 6,530,882.67 |
| Retrieving of bidding deposits | 22,816,388.75 | 20,253,140.27 |
| Other operating accounts | 5,152,936.76 | 11,800,747.12 |
| Total | 43,910,264.70 | 43,447,921.80 |
Other cash paid for business operations
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Pocket expenses | 27,505,053.77 | 25,234,094.43 |
| Bidding deposit paid | 18,891,370.53 | 17,035,960.19 |
| Net draft deposit net paid | 261,383,332.31 | 199,180,751.42 |
| Other trades | 4,256,435.20 | 23,008,888.00 |
| Total | 312,036,191.81 | 264,459,694.04 |
(2) Cash related to investment activities
Other cash paid for investment
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Loss on forward foreign exchange contract delivery | 890,803.00 | |
| Total | 890,803.00 |
(3) Cash related to financing
Other cash received from financing activities
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Maturity principal and interest of pledged large-scale time deposit | 330,600,944.44 | |
| Total | 330,600,944.44 |
Other cash paid related to financing activities
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Bill discount financing deposit | 115,912,636.08 | 60,589,831.95 |
| Principal and interest of lease liabilities | 10,536,884.00 | 8,096,984.15 |
| Payment for repurchase of equity interest in Fangda Zhiyuan | 98,116,151.32 | |
| Total | 224,565,671.40 | 68,686,816.10 |
Changes in liabilities arising from financing activities? Applicable □ Inapplicable
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance | ||
| Change in cash | Non-cash change | Change in cash | Non-cash change | |||
| Short-term loans | 2,208,055,039.21 | 2,253,971,200.00 | 1,807,897,897.17 | 225,387,145.05 | 2,428,741,196.99 | |
| Long-term borrowings (including portion due within one year) | 660,914,958.90 | 250,000,000.00 | 16,767,578.76 | 16,740,499.99 | 910,942,037.67 | |
| Lease liabilities | 20,573,028.70 | 15,156,494.47 | 10,536,884.00 | 25,192,639.17 | ||
| (including portion due within one year) | ||||||
| Long-term accounts payable (including portion due within one year) | 97,723,018.90 | 393,132.42 | 98,116,151.32 | |||
| Total | 2,987,266,045.71 | 2,503,971,200.00 | 32,317,205.65 | 1,933,291,432.48 | 225,387,145.05 | 3,364,875,873.83 |
(4) Explanation of cash flows presented on a net basis
| Item | Relevant factual information | Basis for adopting net presentation | Financial impact |
| Net margin paid on bills of exchange, etc. | Corresponding deposits for bills of exchange are presented on a net basis according to changes in their balances | Quick turnaround and short maturity | None |
| Net deposits received such as bills of exchange |
(5) Significant activities and financial effects that do not involve current cash receipts and disbursementsbut affect the enterprise's financial position or may affect the enterprise's cash flows in the futureNo
61. Supplementary data of cash flow statement
(1) Supplementary data of cash flow statement
In RMB
| Supplementary information | Amount of the Current Term | Amount of the Previous Term |
| 1. Net profit adjusted to cash flow related to business operations: | ||
| Net profit | 117,867,277.03 | 185,394,944.82 |
| Plus: Asset impairment provision | 23,750,884.85 | -5,600,672.67 |
| Fixed asset depreciation, gas and petrol depreciation, production goods depreciation | 15,141,781.37 | 14,896,760.41 |
| Depreciation of right to use assets | 7,908,083.39 | 7,370,647.68 |
| Amortization of intangible assets | 3,687,708.38 | 2,451,985.26 |
| Amortization of long-term amortizable expenses | 1,985,263.44 | 2,107,067.00 |
| Loss from disposal of fixed assets, intangible assets, and other long-term assets ("-" for gains) | 1,490.22 | -373,352.08 |
| Loss from fixed asset discard ("-" for gains) | 136,535.83 | 23,473.88 |
| Loss from fair value fluctuation ("-" for gains) | -558,364.87 | -129,892.00 |
| Financial expenses ("-" for gains) | 42,001,171.77 | 56,076,275.06 |
| Investment losses ("-" for gains) | 958,912.78 | -294.42 |
| Decrease of deferred income tax asset ("-" for increase) | -6,770,444.84 | -4,214,889.76 |
| Increase of deferred income tax asset ("-" for increase) | 7,104,496.65 | -4,647,431.65 |
| Decrease of inventory ("-" for increase) | 2,846,757.44 | 34,523,652.33 |
| Decrease of operational receivable items ("-" for increase) | -307,138,399.56 | -149,791,569.44 |
| Increase of operational receivable items ("-" for decrease) | -56,399,743.16 | -154,844,906.67 |
| Others | -24,054,408.93 | -20,555,508.88 |
| Cash flow generated by business operations, net | -171,530,998.21 | -37,313,711.13 |
| 2. Major investment and financing activities with no cash involved: | ||
| Debt transferred to assets | ||
| Convertible corporate bonds due within one year | ||
| Fixed assets under finance leases | ||
| 3. Net change in cash and cash equivalents: | ||
| Balance of cash at period end | 908,462,270.84 | 748,672,706.05 |
| Less: Initial balance of cash | 779,661,118.42 | 783,677,929.06 |
| Add: Ending balance of cash equivalents | ||
| Less: Ending balance of cash equivalents | ||
| Net increase in cash and cash equivalents | 128,801,152.42 | -35,005,223.01 |
(2) Composition of cash and cash equivalents
In RMB
| Item | Closing balance | Opening balance |
| I. Cash | 908,462,270.84 | 779,661,118.42 |
| Including: Cash in stock | 28,569.08 | 5,350.98 |
| Bank savings can be used at any time | 894,082,425.59 | 742,322,526.29 |
| Other monetary capital can be used at any time | 14,351,276.17 | 6,344,828.78 |
| III. Balance of cash and cash equivalents at end of term | 908,462,270.84 | 779,661,118.42 |
(3) Monetary funds other than cash and cash equivalents
In RMB
| Item | Amount of the Current Term | Amount of the Previous Term | Reasons for not being cash and cash equivalents |
| Various deposits | 776,544,406.75 | 537,833,587.91 | Use restricted |
| Total | 776,544,406.75 | 537,833,587.91 |
62. Foreign currency monetary items
(1) Foreign currency monetary items
In RMB
| Item | Closing foreign currency balance | Exchange rate | Closing RMB balance |
| Monetary capital | 60,525,119.37 | ||
| Including: USD | 4,921,776.90 | 7.1268 | 35,076,519.26 |
| Euro | 0.01 | 7.6617 | 0.08 |
| HK Dollar | 10,186,412.49 | 0.9127 | 9,296,934.97 |
| Vietnamese currency | 1,676,745,450.00 | 0.0003 | 469,403.04 |
| SGD | 1,486,881.68 | 5.2790 | 7,849,248.39 |
| AUD | 1,643,864.35 | 4.7650 | 7,833,013.63 |
| Account receivable | 4,126,819.39 | ||
| Including: USD | 4,560.00 | 7.1268 | 32,498.21 |
| HK Dollar | 172,200.00 | 0.9127 | 157,163.50 |
| AUD | 826,266.04 | 4.7650 | 3,937,157.68 |
| Contract assets | 128,499,944.91 | ||
| Including: USD | 12,246,126.13 | 7.1268 | 87,275,691.72 |
| INR | 64,687,475.47 | 0.0854 | 5,522,951.97 |
| Euro | 2,799,793.70 | 7.6617 | 21,451,179.38 |
| AUD | 2,990,581.71 | 4.7650 | 14,250,121.84 |
| Other receivables | 2,462,223.56 | ||
| Including: USD | 208,645.94 | 7.1268 | 1,486,977.89 |
| HK Dollar | 756,602.35 | 0.9127 | 690,535.83 |
| SGD | 25,075.00 | 5.2790 | 132,370.93 |
| AUD | 31,970.39 | 4.7650 | 152,338.91 |
| Account payable | 17,660,445.20 | ||
| Including: USD | 1,157,913.82 | 7.1268 | 8,252,220.21 |
| HK Dollar | 2,742,472.43 | 0.9127 | 2,502,999.74 |
| INR | 193,375.00 | 0.0854 | 16,510.16 |
| AUD | 1,443,537.98 | 4.7650 | 6,878,458.47 |
| SGD | 1,942.91 | 5.2790 | 10,256.62 |
| Other payables | 425,278.22 | ||
| Including: USD | 36,973.55 | 7.1268 | 263,503.09 |
| AUD | 33,950.71 | 4.7650 | 161,775.13 |
(2) The note of overseas operating entities should include the main operation places, book keepingcurrencies and selection basis. Where the book keeping currency is changed, the reason should also beexplained.
□ Applicable ? Inapplicable
63. Leasing
(1) The Company is the leasee
? Applicable □ InapplicableVariable lease payments not included in the measurement of the lease liability
□ Applicable ? Inapplicable
Lease costs for short-term leases or low-value assets with simplified treatment? Applicable □ Inapplicable
| Item | January-June 2024 |
| Short term lease expenses with simplified treatment included in current profit and loss | 25,437,567.00 |
| Lease expenses of low value assets with simplified treatment included in current profit and loss (except short-term lease) | 202,015.49 |
| Interest expense on lease liabilities | 526,573.34 |
Total cash outflow related to leasing
| Total cash outflow related to leasing | 31,632,243.77 |
Involvement in sale-and-leaseback transactions: None.
(2) The Company as lessor
Operating leases as lessor? Applicable □ Inapplicable
In RMB
| Item | Rental income | Including: Income related to variable lease payments not included in lease receipts |
| Rental income | 69,095,799.23 | 168,411.76 |
| Total | 69,095,799.23 | 168,411.76 |
Financing leases as lessor
□ Applicable ? Inapplicable
Undiscounted lease receipts for each of the next five years? Applicable □ Inapplicable
In RMB
| Item | Annual undiscounted lease receipts | |
| Closing amount | Opening amount | |
| First year | 138,087,637.15 | 132,605,879.94 |
| Second year | 117,339,492.09 | 115,552,250.91 |
| Third year | 82,815,740.12 | 94,134,268.43 |
| Fourth year | 59,828,831.71 | 59,112,763.63 |
| Fifth year | 37,263,612.05 | 39,342,690.51 |
| Total undiscounted lease receipts after five years | 103,540,429.38 | 90,429,704.69 |
VIII. R&D expenses
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Labor costs | 50,364,726.96 | 48,716,037.44 |
| Material costs | 26,975,019.70 | 29,157,592.26 |
| Agencies | 4,956,566.33 | 4,191,108.26 |
| Depreciation costs | 840,171.99 | 999,888.33 |
| Amortization of intangible assets | 509,458.78 | 497,817.82 |
| Others | 1,993,659.12 | 5,427,066.55 |
| Total | 85,639,602.88 | 88,989,510.66 |
| Including: Expensed R&D expenditure | 85,639,602.88 | 88,989,510.66 |
IX. Change to Consolidation Scope
1. Change to the consolidation scope for other reasons
During this period, the Company added one wholly-owned subsidiary, Fangda Curtain Wall Singapore Co.,Ltd., through establishment; and reduced one subsidiary, Shenzhen Fangda Investment Partnership (LimitedPartnership), through liquidation and cancellation.X. Equity in Other Entities
1. Interests in subsidiaries
(1) Group Composition
In RMB
| Company | Registered capital | Place of business | Registered address | Business | Shareholding percentage | Obtaining method | |
| Direct | Indirect | ||||||
| Shihui International Holding Co., Ltd. | 21,380,400.00 | Virgin Islands | Virgin Islands | Investment | 100.00% | Incorporation | |
| Shenzhen Hongjun Investment Co., Ltd. | 100,000,000.00 | Shenzhen | Shenzhen | Investment | 98.00% | 2.00% | Incorporation |
| Fangda Curtain Wall Singapore Co., Ltd. | 1,583,700.00 | Singapore | Singapore | Designing, manufacturing, and installation of curtain walls | 100.00% | Incorporation | |
| Jiangxi Fangda Intelligent Manufacturing Technology Co., Ltd. | 200,000,000.00 | Ganzhou | Ganzhou | Production and sales of new-type materials and composite materials | 99.00% | 1.00% | Incorporation |
| Shenzhen Fangda Jianke Group Co., Ltd. | 600,000,000.00 | Shenzhen | Shenzhen | Designing, manufacturing, and installation of curtain walls | 98.66% | 1.34% | Incorporation |
| Dongguan Fangda New Material Co., Ltd. | 272,800,000.00 | Dongguan | Dongguan | Installation and sales of building curtain walls | 100.00% | Incorporation | |
| Chengdu Fangda Construction Technology Co., Ltd. | 50,000,000.00 | Chengdu | Chengdu | Trusted processing of building curtain wall materials | 100.00% | Incorporation | |
| Fangda | 14,295,000.0 | Australia | Australia | Designing, | 100.00% | Incorporation | |
| Australia Co., Ltd. | 0 | manufacturing, and installation of curtain walls | |||||
| Fangda Southeast Asia Co., Ltd. | 3,000,000.00 | Vietnam | Vietnam | Designing, manufacturing, and installation of curtain walls | 100.00% | Incorporation | |
| Shanghai Fangda Zhijian Technology Co., Ltd | 100,000,000.00 | Shanghai | Shanghai | Intelligent technology, new energy, automated technology | 30.00% | 70.00% | Incorporation |
| Fangda Jianke Hong Kong Co., Ltd. | 36,594.00 | Hong Kong | Hong Kong | Design, sale and installation of building curtain wall | 100.00% | Incorporation | |
| Shanghai Fangda Jianzhi Technology Co., Ltd. | 50,000,000.00 | Shanghai | Shanghai | Construction technology, intelligent technology, automation technology, design, production and installation of building curtain walls | 100.00% | Incorporation | |
| Chengdu Fangda Curtain Wall Technology Co., Ltd. | 50,000,000.00 | Chengdu | Chengdu | Building decoration and other construction industry | 100.00% | Incorporation | |
| Shenzhen Fangda Jianchuang Technology Co., Ltd. | 50,000,000.00 | Shenzhen | Shenzhen | Production and sales of building curtain walls | 100.00% | Incorporation | |
| Shenzhen Fangda New Energy Co., Ltd. | 100,000,000.00 | Shenzhen | Shenzhen | Design and construction of PV power plants | 99.00% | 1.00% | Incorporation |
| Pingxiang Fangda Luxin New Energy Co., Ltd. | 10,000,000.00 | Pingxiang | Pingxiang | Design and construction of PV power plants | 100.00% | Incorporation | |
| Nanchang Xinjian Fangda New Energy Co., Ltd. | 10,000,000.00 | Nanchang | Nanchang | Design and construction of PV power plants | 100.00% | Incorporation |
| Dongguan Fangda New Energy Co., Ltd. | 10,000,000.00 | Dongguan | Dongguan | Design and construction of PV power plants | 100.00% | Incorporation | |
| Shenzhen Xunfu Investment Co., Ltd | 100,000.00 | Shenzhen | Shenzhen | Project investment and investment consultancy | 100.00% | Incorporation | |
| Shenzhen Lifu Investment Co., Ltd | 1,000,000.00 | Shenzhen | Shenzhen | Project investment and investment consultancy | 52.00% | Incorporation | |
| Fangda Zhichuang Technology Co., Ltd. | 105,000,000.00 | Shenzhen | Shenzhen | Production, processing and installation of subway screen doors | 51.00% | 43.29% | Incorporation |
| Shenzhen Qianhai Kechuangyuan Software Co., Ltd. | 5,000,000.00 | Shenzhen | Shenzhen | Software development | 94.29% | Incorporation | |
| Fangda Zhiyuan Technology (Hong Kong) Co., Ltd. | 8,435.80 | Hong Kong | Hong Kong | Metro screen door | 94.29% | Incorporation | |
| Fangda Zhiyuan Technology (Wuhan) Co., Ltd. | 10,000,000.00 | Wuhan | Wuhan | Production, processing and installation of subway screen doors | 94.29% | Incorporation | |
| Fangda Zhiyuan Railway Transportation Equipment (Dongguan) Co. | 1,000,000.00 | Dongguan | Dongguan | Production, processing and installation of subway screen doors | 94.29% | Incorporation | |
| Fangda Zhiyuan Technology (Nanchang) Co., Ltd. | 1,000,000.00 | Nanchang | Nanchang | Production, processing and installation of subway screen doors | 94.29% | Incorporation | |
| General Railway Technology Ltd. | 47,880.30 | Singapore | Singapore | Production, processing and installation of subway screen doors | 94.29% | Incorporation | |
| Shenzhen Fangda | 200,000,000.00 | Shenzhen | Shenzhen | Real estate development | 99.00% | 1.00% | Incorporation |
| Property Development Co., Ltd. | and operation | ||||||
| Shenzhen Fangda Property Management Co., Ltd. | 10,000,000.00 | Shenzhen | Shenzhen | Property management | 100.00% | Incorporation | |
| Fangda (Jiangxi) Property Development Co., Ltd. | 100,000,000.00 | Nanchang | Nanchang | Real estate development and operation | 100.00% | Incorporation | |
| Shenzhen Fangda Yunzhi Technology Co., Ltd. | 50,000,000.00 | Shenzhen | Shenzhen | Technology development and sales; Invest in industry; Operation management of science and technology park | 100.00% | Incorporation | |
| Shenzhen Zhongrong Litai Investment Co., Ltd. | 121,000,000.00 | Shenzhen | Shenzhen | Business service | 55.00% | Purchase | |
| Fangda New Materials (Jiangxi) Co., Ltd. | 99,328,800.00 | Nanchang | Nanchang | Production and sales of new-type materials and composite materials | 75.00% | 25.00% | Incorporation |
| Shenzhen Fangda Yunzhu Technology Co., Ltd. | 10,000,000.00 | Shenzhen | Shenzhen | Inspection, technical service and consultation of building safety and building energy saving system | 100.00% | Consolidation of entities under common control | |
| Shenzhen Yunzhu Testing Technology Co., Ltd. | 5,000,000.00 | Shenzhen | Shenzhen | Inspection, technical service and consultation of building safety and building energy saving system | 100.00% | Consolidation of entities under common control |
(2) Major non wholly-owned subsidiaries
In RMB
| Company | Shareholding of minority shareholders | Profit and loss attributed to minority shareholders | Dividend to be distributed to minority shareholders | Interest balance of minority shareholders in the end of the period |
| Fangda Zhiyuan Technology | 5.71% | 1,074,521.80 | 6,962,732.02 | 18,155,735.00 |
| Zhongrong Litai | 45.00% | -2,277.15 | 48,297,150.41 |
(3) Financial highlights of major non wholly owned subsidiaries
In RMB
| Company | Closing balance | Opening balance | ||||||||||
| Current assets | Non-current assets | Total of assets | Current liabilities | Non-current liabilities | Total liabilities | Current assets | Non-current assets | Total of assets | Current liabilities | Non-current liabilities | Total liabilities | |
| Zhongrong Litai | 209,698,594.92 | 242,160.39 | 209,940,755.31 | 102,365,964.40 | 247,789.99 | 102,613,754.39 | 209,637,980.81 | 285,106.81 | 209,923,087.62 | 102,400,696.16 | 190,330.21 | 102,591,026.37 |
| Fangda Zhiyuan Technology | 876,971,774.41 | 144,552,506.72 | 1,021,524,281.13 | 681,946,798.41 | 21,852,914.59 | 703,799,713.00 | 772,725,686.09 | 147,607,926.78 | 920,333,612.87 | 484,982,075.34 | 13,696,876.21 | 498,678,951.55 |
In RMB
| Company | Amount occurred in the current period | Occurred in previous period | ||||||
| Turnover | Net profit | Total of misc. incomes | Business operation cash flows | Turnover | Net profit | Total of misc. incomes | Business operation cash flows | |
| Zhongrong Litai | 55,045.86 | -5,060.33 | -5,060.33 | 3,614.11 | 55,045.86 | -76,530.05 | -76,530.05 | 101,149.87 |
| Fangda Zhiyuan Technology | 263,455,042.38 | 17,975,469.57 | 17,917,717.09 | -40,109,210.54 | 291,615,462.85 | 54,940,579.16 | 55,117,691.94 | -34,107,845.79 |
2. Change in the ownership share of the subsidiary and control of the transaction of the subsidiary
(1) Description of changes in owner's equity shares of subsidiaries:
On May 30, 2024, the subsidiary of the Company, Fangda Partnership, transferred 51% of its equity in Zhiyuan TechnologyCompany to the Company. Shenzhen Zhuoshun Investment Co., Ltd. indirectly held 0.2448% of the equity in Zhiyuan TechnologyCompany through its indirect holding of Fangda Partnership, and this part of the equity was also transferred. The correspondingtransfer amount for this part of the equity is RMB 1,140,260.53.
(2) Impact of transaction on minority shareholders' equity and owner's equity attributable to parent company
In RMB
| Item | Amount |
| Disposal consideration - cash | 1,140,260.53 |
| Less: Share of net assets of subsidiaries calculated according to the proportion of equity disposed | 1,078,281.38 |
| Difference | 61,979.15 |
| Including: adjustment of capital reserve | 61,979.15 |
3. Interests in joint ventures or associates
(1) Financial summary of insignificant joint ventures and associates
In RMB
| Closing balance/amount occurred in this period | Opening balance/amount occurred in previous period | |
| Associate: | ||
| Total book value of investment | 54,722,057.88 | 54,757,017.40 |
| Total shareholding | ||
| Net profit | -34,959.52 | 294.42 |
| --Total of misc. incomes | -34,959.52 | 294.42 |
XI. Government Subsidies
1. Governmental subsidy recognized as receivable at the end of the report period? Applicable □ InapplicableClosing balance of accounts receivable: RMB852,854.43.Reasons for not receiving the estimated amount of government grants at the expected point in time
□ Applicable ? Inapplicable
2. Liabilities involving government subsidies
? Applicable □ Inapplicable
In RMB
| Accounting item | Opening balance | Amount of new subsidy | Amount included in non-operating revenue | Other misc. gains recorded in this period | Other change in the current period | Closing balance | Assets/earning-related |
| Deferred earning | 8,978,678.72 | 2,321,892.00 | 313,198.25 | 10,987,372.47 | Assets-related | ||
| Total | 8,978,678.72 | 2,321,892.00 | 313,198.25 | 10,987,372.47 |
3. Government subsidies accounted into current profit or loss.
? Applicable □ Inapplicable
In RMB
| Accounting item | Amount occurred in the current period | Occurred in previous period |
| Other gains | 8,601,009.28 | 7,979,290.90 |
| Financial expenses | 308,700.00 | |
| Total | 8,601,009.28 | 8,287,990.90 |
XII. Risks of Financial Tools
1. Types of risks arising from financial instruments
The risks associated with the financial instruments of the Company arise from the various financial assets and liabilitiesrecognized by the Company in the course of its operations, including credit risks, liquidity risks and market risks.The management objectives and policies of various risks related to financial instruments are governed by the managementof the Company. The operating management is responsible for daily risk management through functional departments (forexample, the Company's credit management department reviews the Company's credit sales on a case-by-case basis). The internalaudit department of the Company conducts daily supervision of the implementation of the Company's risk management policiesand procedures, and reports relevant findings to the Company's audit committee in a timely manner.
The overall goal of the Company's risk management is to formulate risk management policies that minimize the risksassociated with various financial instruments without excessively affecting the Company's competitiveness and resilience.
(1) Credit risk
Credit risk is caused by the failure of one party of a financial instrument in performing its obligations, causing the risk offinancial loss for the other party. The credit risk of the Company mainly comes from monetary capital, notes receivable, accountsreceivable, other receivables, receivables financing, contract assets, etc. The credit risk of these financial assets comes from thedefault of the counterparties, and the maximum risk exposure is equal to the book amount of these instruments.
The Company's money and funds are mainly deposited in the commercial banks and other financial institutions. TheCompany believes that these commercial banks have higher reputation and asset status and have lower credit risk.
For notes receivable, accounts receivable, other receivables, receivables financing and contract assets, the Company setsrelevant policies to control credit risk exposure. The Group set the credit line and term for debtors according to their financialstatus, external rating, and possibility of getting third-party guarantee, credit record and other factors. The Group regularlymonitors debtors' credit record. For those with poor credit record, the Group will send written payment reminders, shorten orcancel credit term to lower the general credit risk.
① Significant increases in credit risk
The credit risk of the financial instrument has not increased significantly since the initial confirmation. In determiningwhether the credit risk has increased significantly since the initial recognition, the Company considers reasonable and evidencedinformation, including forward-looking information, that can be obtained without unnecessary additional costs or effort. TheCompany determines the relative risk of default risk of the financial instrument by comparing the risk of default of the financialinstrument on the balance sheet date with the risk of default on the initial recognition date to assess the credit risk of the financialinstrument from initial recognition.
When one or more of the following quantitative and qualitative criteria are triggered, the Company believes that the creditrisk of financial instruments has increased significantly: the quantitative criteria are mainly the probability of default in theremaining life of the reporting date increased by more than a certain proportion compared with the initial recognition; thequalitative criteria are the major adverse changes in the operation or financial situation of the major debtors, the early warning ofcustomer list, etc.
② Definition of assets where credit impairment has occurred
In order to determine whether or not credit impairment occurs, the standard adopted by our company is consistent with thecredit risk management target for related financial instruments, and quantitative and qualitative indicators are considered.
Major financial difficulties have occurred to the issuer or the debtor; Breach of contract by the debtor, such as payment ofinterest or default or overdue of principal; (B) The concession that the debtor would not make under any other circumstances foreconomic or contractual considerations relating to the financial difficulties of the debtor; The debtor is likely to be bankrupt orundertake other financial restructuring; The financial difficulties of the issuer or debtor lead to the disappearance of the activemarket for the financial asset; To purchase or generate a financial asset at a substantial discount, which reflects the fact that acredit loss has occurred.
Credit impairment in financial assets may be caused by a combination of multiple events, not necessarily by events that canbe identified separately.
③ Expected credit loss measurement
Depending on whether there is a significant increase in credit risk and whether a credit impairment has occurred, theCompany prepares different assets for a 12-month or full expected credit loss. The key parameters of expected credit lossmeasurement include default probability, default loss rate and default risk exposure. Taking into account the quantitative analysisand forward-looking information of historical statistics (such as counterparty ratings, guaranty methods, collateral categories,repayment methods, etc.), the Company establishes the default probability, default loss rate and default risk exposure model.
Definition:
The probability of default refers to the possibility that the debtor will not be able to fulfill its obligation to pay in the next 12months or throughout the remaining period.
Breach Loss Rate means the extent of loss expected by the Company for breach risk exposure. Depending on the type ofcounterparty, the manner and priority of recourse, and the different collateral, the default loss rate is also different. The default lossrate is the percentage of the risk exposure loss at the time of the default, calculated on the basis of the next 12 months or the entirelifetime.
Exposure to default is the amount payable to the Company at the time of default in the next 12 months or throughout theremaining life. Prospective information credit risks significantly increased and expected credit losses were calculated. Through theanalysis of historical data, the Company has identified the key economic indexes that affect the credit risk of each business typeand the expected credit loss.
The largest credit risk facing the Group is the book value of each financial asset on the balance sheet. The Group makes noguarantee that may cause the Group credit risks.
Among the accounts receivable and contract assets of the Company, the accounts receivable and contract assets of the topfive customers accounted for 10.83% of the total accounts receivable and contract assets of the Company (beginning of the period:
11.45%); among the other receivables of the Company, the other receivables of the top five companies with the largest amount ofdebts accounted for 68.87% of the total other receivables of the Company (beginning of the period: 72.01%).
(2) Liquidity risk
Liquidity risk is the risk of capital shortage when the Group needs to pay cash or settled with other financial assets. TheCompany is responsible for the cash management of its subsidiaries, including short-term investments in cash surpluses and loansto meet projected cash requirements. The Company's policy is to regularly monitor short and long-term liquidity requirements andcompliance with borrowing agreements to ensure adequate cash reserves and readily available securities.As of June 31, 2024, the maturity of the Company's financial liabilities is as follows:
In RMB10,000
| Item | June 30, 2024 | |||
| Less than 1 year | Within 1-3 years | Over 3 years | Total | |
| Short-term loans | 242,874.12 | 242,874.12 | ||
| Derivative financial liabilities | 62.84 | 62.84 | ||
| Notes payable | 93,032.32 | 93,032.32 | ||
| Account payable | 184,930.52 | 747.59 | 1,451.42 | 187,129.53 |
| Other payables | 4,292.75 | 1,598.28 | 5,829.32 | 11,720.35 |
| Non-current liabilities due in 1 year | 4,401.21 | 4,401.21 | ||
| Other current liabilities | 4,720.67 | 4,720.67 | ||
| Long-term loans | 39,500.00 | 48,500.00 | 88,000.00 | |
| Lease liabilities | 939.79 | 272.47 | 1,212.26 | |
| Total liabilities | 534,314.43 | 42,785.66 | 56,053.21 | 633,153.30 |
(Continued)
| Item | December 31, 2023 | |||
| Less than 1 year | Within 1-3 years | Over 3 years | Total | |
| Short-term loans | 220,805.50 | 220,805.50 | ||
| Notes payable | 86,888.69 | 86,888.69 | ||
| Account payable | 195,524.32 | 1,415.80 | 289.26 | 197,229.38 |
| Other payables | 5,168.51 | 1,010.36 | 5,579.31 | 11,758.18 |
| Non-current liabilities due in 1 year | 6,413.51 | 6,413.51 | ||
| Other current liabilities | 5,352.47 | 5,352.47 | ||
| Long-term loans | 30,000.00 | 36,000.00 | 66,000.00 | |
| Lease liabilities | 578.6 | 88.99 | 667.59 | |
| Long-term payable | 4,840.00 | 4,840.00 | ||
| Total | 520,153.00 | 37,844.76 | 41,957.56 | 599,955.32 |
(3) Market risk
① Credit risks
The exchange rate risk of the Company mainly comes from the assets and liabilities of the Company and its subsidiaries inforeign currency not denominated in its functional currency. Except for the use of Hong Kong dollars, United States dollars,Australian dollars, Vietnamese dong, euro, Indian rupees or Singapore currencies by its subsidiaries established in and outside theHong Kong Special Administrative Region, other major businesses of the Company shall be denominated in Renminbi.
As of June 30, 2024, the foreign currency financial assets and foreign currency financial liabilities of the Company at theend of the period are listed in the description of foreign currency monetary items in Note 62.The Company pays close attention to the impact of exchange rate changes on the Company's exchange rate risk. TheCompany continuously monitors the scale of foreign currency transactions and foreign currency assets and liabilities to minimizeforeign exchange risks. To this end, the Company may avoid foreign exchange risks by signing forward foreign exchangecontracts or currency swap contracts.
② Exchange rate risk
The Group's interest rate risk mainly arises from long-term interest-bearing debts such as long-term bank loans. Financialliabilities with floating interest rate cause cash flow interest rate risk for the Group. Financial liabilities with fixed interest ratecause fair value interest rate risk for the Group. The Group decides the proportion between fixed interest rate and floating interestrate according to the market environment and regularly reviews and monitors the combination of fixed and floating interest rateinstruments.
The Finance Department at the Company's head office monitors the level of the Group's interest rates on an ongoing basis.The rising interest rate will increase the cost of the new interest-bearing debt and the interest expenditure on interest-bearing debtwhich has not yet been paid by the Company at the floating rate, and will have a significant adverse effect on the Company'sfinancial performance. Management will make adjustments in time according to the latest market conditions.
During the period ended June 30, 2024, if the borrowing interest rate calculated at a floating rate increases or decreases by50 basis points while other risk variables remain unchanged, the Company's net profit for one year will decrease or increase by
4.8125 million (December 31, 2023: RMB3.60 million).
2. Hedging
(1) The Company conducts hedging business for risk management.
? Applicable □ Inapplicable
| Item | Corresponding risk management strategies and objectives | Qualitative and quantitative information about the hedged risk | Economic relationships between hedged items and related hedging instruments | Effective achievement of expected risk management objectives | The impact of the corresponding hedging activities on the risk exposure |
| Forward foreign exchange contract value preservation | Utilizing the hedging and protection function of forward foreign exchange contracts, the Company carries out the business of hedging foreign currency receivables in order to reasonably avoid the risks brought by exchange rate fluctuations to its | The Company uses forward foreign exchange contracts to hedge expected receivables. The Company adopts the strategy of dynamic hedging of exchange rate risk exposure and adjusts the position of foreign exchange contracts according to the expected foreign currency | The underlying variables are all foreign currency exchange rates. The exchange rates of the hedged item and the hedging instrument change in opposite directions due to exposure to the same hedged risk, and there is a relationship of risk hedging. | The Company has formulated relevant internal management systems for its aluminum futures hedging and forward foreign exchange trading business, and continuously evaluates the effectiveness of hedging to ensure that the hedging relationship is | Buy or sell corresponding forward foreign exchange contracts to hedge the risk exposure of foreign currency receivables. |
| operations, enhance the Company's overall ability to withstand risks, and strengthen the soundness of its operating activities. | receivables exposure. | effective in the designated accounting period, and that the risks of fluctuations in raw material purchasing prices and exchange rate fluctuations of foreign-currency receivables are controlled within a reasonable range, so as to enhance the Company's risk-resistance ability and increase the robustness of its operating activities. |
(2) The Company conducts eligible hedging operations and applies hedge accounting.
In RMB
| Item | Carrying value associated with hedged items and hedging instruments | Cumulative fair value hedge adjustments to hedged items included in the carrying value of the hedged item recognized | Hedge effectiveness and sources of hedge ineffectiveness | Impact of hedge accounting related to the Company's financial statements |
| Types of hedge risk | ||||
| Exchange rate risk | -628,367.00 | Inapplicable | Relevance of hedged items to hedging instruments | Derivative financial liabilities: RMB628,367.00, other comprehensive income: RMB-506,035.22, investment income: RMB-890,803.00, financial expenses: RMB-419,124.00. |
| Type | ||||
| Cash flow hedging | -628,367.00 | Inapplicable | Relevance of hedged items to hedging instruments | Derivative financial liabilities: RMB628,367.00, other comprehensive income: RMB-506,035.22, investment income: RMB-890,803.00, financial expenses: RMB-419,124.00. |
(3) The Company conducts hedging business for risk management and expects to achieve its risk management objectivesbut does not apply hedge accounting.
□ Applicable ? Inapplicable
3. Financial Assets
(1) Classification of transfer methods
? Applicable □ Inapplicable
In RMB
| Way of transfer | Nature of financial assets transferred | Amount of financial assets transferred | Derecognition | Basis for judging derecognition |
| Endorsement or discounting | Outstanding promissory notes in notes receivable | 21,162,837.86 | Not derecognized | Promissory notes used for discounting or endorsement are accepted by banks or enterprises with low credit ratings, discounting or endorsement does not affect recourse, and the credit risk and deferred payment risk associated with the notes remain untransferred |
| Endorsement or discounting | Outstanding bankers' acceptances in receivables financing | 44,709,465.46 | Derecognition | Bankers' acceptances used for discounting or endorsement are accepted by banks with high credit ratings and the credit risk and deferred payment risk associated with the instruments are low |
| Factoring | Outstanding receivables in receivables financing | 41,318,451.21 | Derecognition | Non-recourse factoring |
| Total | 107,190,754.53 |
(2) Financial assets derecognized due to transfers
? Applicable □ Inapplicable
In RMB
| Item | Transfer method of financial assets | Amount of financial assets derecognized | Gain or loss related to the de-recognition |
| Outstanding bankers' acceptances in receivables financing | Endorsement or discounting | 44,709,465.46 | -33,150.26 |
| Account receivable | Factoring | 41,318,451.21 | -1,123,208.42 |
| Total | 86,027,916.67 | -1,156,358.68 |
(3) Transfer of financial assets with continuing involvement in assets
□ Applicable ? Inapplicable
XIII. Fair Value
1. Closing fair value of assets and liabilities measured at fair value
In RMB
| Item | Closing fair value | |||
| First level fair value | Second level fair value | Third level fair value | Total | |
| 1. Continuous fair value measurement | -- | -- | -- | -- |
| (1) Receivable financing | 4,668,854.47 | 4,668,854.47 | ||
| (2) Investment real estate | 5,675,245,990.63 | 5,675,245,990.63 | ||
| 1. Leased building | 5,675,245,990.63 | 5,675,245,990.63 | ||
| (3) Other non-current financial assets | 6,371,282.04 | 6,371,282.04 | ||
| Total assets measured at fair value continuously | 4,668,854.47 | 5,681,617,272.67 | 5,686,286,127.14 | |
| (4) Transactional financial liabilities | 628,367.00 | 628,367.00 | ||
| Including: Derivative financial liabilities | 628,367.00 | 628,367.00 | ||
| Total assets measured at fair value continuously | 628,367.00 | 628,367.00 | ||
| 2. Discontinuous fair value measurement | -- | -- | -- | -- |
2. Recognition basis of market value of continuous and discontinuous items measured at first level fairvalue
The Group determines the fair value using quotation in an active market for financial instruments traded inan active market;
3. Valuation technique and qualitative and quantitative information for key parameters of continuousand discontinuous second level fair value items
For derivative financial assets and derivative financial liabilities with fair value of forward exchangecontracts, the fair value is determined based on the market value of expected earnings at the balance sheet date.
Receivables financed at fair value through other comprehensive income are notes receivable, for whichthe fair value is determined based on the book value due to the short remaining maturity.
4. Valuation technique and qualitative and quantitative information for key parameters of continuousand discontinuous third level fair value itemsInvestment properties measured at fair value are appraised using the comparative and income approaches.Comparison method: It selects a certain number of comparable examples, compares them with the valuationobject and processes the comparable instance transaction prices according to the difference to obtain the valueor price of the valuation object. The income approach is a method of predicting the future earnings of the objectof valuation, and using the rate of compensation or capitalization rate, income multiplier to convert the futureearnings into value to get the value or price of the object of valuation.
5、. Switch between different levels, switch reason and switching time policyThe Company takes the occurrence date of the events leading to the transition between levels as the timepoint to confirm the transition between levels. In the period, there is no switch in the financial assets measuredat fair value between the first and second level or transfer in or out of the third level.
6. Fair value of financial assets and liabilities not measured at fair value
Financial assets and liabilities measured at amortized cost include: monetary capital, bills receivable,accounts receivable, contractual assets, other receivables, short-term borrowings, notes payable, accountspayables, other payables, and long-term payables.
XIV. Related Parties and Transactions
1. Parent of the Company
| Parent | Registered address | Business | Registered capital | Share of the parent co. in the Company | Voting power of the parent company |
| Shenzhen Banglin Technologies Development Co., Ltd. | Shenzhen | Industrial investment | RMB30 million | 11.11% | 11.11% |
| Shengjiu Investment Ltd. | Hong Kong | Industrial investment | HKD1 million | 10.25% | 10.25% |
Particulars about the parent of the Company
① All of the investors of Shenzhen Banglin Technology Development Co., Ltd., the holding shareholder of the Company, arenatural persons. Among them, Chairman Xiong Jianming is holding 85％ shares, and Mr. Xiong Xi is holding 15% of the shares.
② Among the top 10 shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu Investment Co., Ltd. areacting in concert.The final controller of the Company is Xiong Jianming.
2. Subsidiaries of the Company
For details of subsidiaries of the enterprise, please refer to Note X, rights and interests in other entities.
3. Joint ventures and associates
There are no important joint ventures or associates in this year.Information about other joint ventures or associates with related transactions in this period or with balance generated by relatedtransactions in previous period:
| Joint venture or associate | Relationship with the Company |
| Ganshang Joint Investment | Affiliates of the Company |
4. Other associates
| Other related parties | Relationship with the Company |
| Jiangxi Business Innovative Property Joint Stock Co., Ltd. | Affiliates of the Company |
| Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise (limited partner) | Affiliated relationship with Shenzhen Banglin Technology Development Co., Ltd. |
| Shenyang Fangda | Subsidiary in liquidation |
| Shenzhen Yikang Real Estate Co. Ltd. | Controlled subsidiaries |
| Shenzhen Qijian Technology Co., Ltd. (Qijian Technology) | Common actual controller |
| Director, manager and secretary of the Board | Key management |
5. Related transactions
(1) Related transactions for purchase and sale of goods, provision and acceptance of services
Sales of goods and services
In RMB
| Affiliated party | Related transaction | Amount occurred in the current period | Occurred in previous period |
| Qijian Technology | Property service and sales of goods | 0.00 | 124,524.04 |
(2) Related leasing
The Company is the leasor:
In RMB
| Name of the leasee | Category of asset for lease | Rental recognized in the period | Rental recognized in the period |
| Qijian Technology | Houses & buildings | 0.00 | 434,285.70 |
(3) Related guarantees
The Company is the guarantor:
In RMB10,000
| Beneficiary party | Amount guaranteed | Start date | Due date | Completed or not |
| Fangda Jianke | 24,000.00 | May 5, 2023 | Three years after the expiration date of debt performance | Yes |
| Fangda Jianke | 4,000.00 | May 15, 2023 | Three years after the expiration date of debt performance | Yes |
| Fangda Jianke | 60,000.00 | January 21, 2023 | Three years after the expiration date of debt performance | Yes |
| Fangda Jianke | 15,000.00 | May 25, 2022 | Three years after the expiration date of debt performance | Yes |
| Fangda Zhiyuan | 10,000.00 | May 25, 2022 | Three years after the expiration date of debt performance | Yes |
| Fangda Jianke | 39,000.00 | December 9, 2022 | Three years after the expiration date of debt performance | Yes |
| Fangda Yunzhu | 1,000.00 | March 30, 2023 | Three years after the expiration date of debt performance | Yes |
| Fangda Zhiyuan | 36,000.00 | June 20, 2023 | Three years after the expiration date of debt performance | Yes |
| Fangda Zhijian | 7,000.00 | May 15, 2023 | Three years after the expiration date of debt performance | Yes |
| Fangda Zhiyuan | 15,000.00 | May 5, 2023 | Three years after the expiration date of debt performance | Yes |
| Fangda Yunzhu | 600.00 | May 11, 2023 | Three years after the expiration date of debt performance | Yes |
| Total amount of guarantee fulfilled | 211,600.00 |
| Fangda Jianke | 93,000.00 | December 28, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 39,000.00 | January 24, 2024 | Three years after the expiration date of debt performance | No |
| Fangda New Material | 10,000.00 | April 18, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Yunzhu | 1,000.00 | June 28, 2024 | Three years after the expiration date of debt performance | No |
| Fangda Yunzhu | 1,000.00 | May 7, 2024 | Three years after the expiration date of debt performance | No |
| Fangda New Material | 8,500.00 | November 2, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Zhiyuan | 10,000.00 | September 25, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 15,000.00 | May 11, 2024 | Three years after the expiration date of debt performance | No |
| Fangda Zhijian | 7,000.00 | May 8, 2024 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 48,000.00 | December 15, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Zhiyuan | 10,000.00 | December 21, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Zhiyuan | 18,000.00 | December 15, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 11,400.00 | August 16, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 50,000.00 | September 28, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 30,000.00 | September 25, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 30,000.00 | October 20, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 4,000.00 | June 20, 2024 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 20,000.00 | October 9, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 60,000.00 | June 27, 2024 | Three years after the expiration date of debt performance | No |
| Fangda Zhiyuan | 36,000.00 | June 27, 2024 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 24,000.00 | May 27, 2024 | Three years after the expiration date of debt performance | No |
| Fangda Zhiyuan | 15,000.00 | May 30, 2024 | Three years after the expiration date of debt performance | No |
| Fangda Zhiyuan | 20,000.00 | October 7, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Zhiyuan | 15,000.00 | September 25, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Zhiyuan | 10,000.00 | May 11, 2024 | Three years after the expiration date of debt performance | No |
| Fangda Zhiyuan | 15,550.00 | November 21, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Yunzhu | 600.00 | June 3, 2024 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 50,000.00 | October 23, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Property | 135,000.00 | February 25, 2020 | Three years after the expiration date | No |
| of debt performance | ||||
| Fangda Intelligent Manufacturing | 30,000.00 | February 22, 2024 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 30,000.00 | December 21, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Jianke | 20,000.00 | November 2, 2023 | Three years after the expiration date of debt performance | No |
| Fangda Zhiyuan | 31,896.02 | February 17, 2024 | The date of completion of the project contract. | No |
| Fangda Zhiyuan | 24,885.16 | February 17, 2024 | The date of completion of the project contract. | No |
| Total amount of guarantee being performed | 923,831.18 |
Note to related guaranteesThe above-mentioned guarantees are all associated guarantees within interested entities of the Company.
(4) Remuneration of key management
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Remuneration of directors, supervisors and senior management | 5,313,183.00 | 4,799,048.45 |
6. Receivable and payables due with related parties
(1) Receivable interest
In RMB
| Project name | Affiliated party | Closing balance | Opening balance | ||
| Remaining book value | Bad debt provision | Remaining book value | Bad debt provision | ||
| Account receivable | Qijian Technology | 4,763.36 | 47.63 | ||
| Other receivables | Ganshang Joint Investment | 3,791,089.25 | 56,487.23 | 3,791,089.25 | 56,487.23 |
| Other receivables | Shenzhen Yikang Real Estate Co. Ltd. | 76,062,675.83 | 1,133,333.87 | 76,062,675.83 | 1,133,333.87 |
(2) Receivable interest
In RMB
| Project name | Affiliated party | Closing balance of book value | Opening balance of book value |
| Other payables | Shenzhen Yikang Real Estate Co. Ltd. | 26,149,417.56 | 26,102,009.60 |
| Other payables | Qijian Technology | 400.00 |
XV. Commitment and Contingent Events
1. Major commitments
On November 6, 2017, Fangda Real Estate Co., Ltd., a subsidiary of the Company, and BangshenElectronics (Shenzhen) Co., Ltd. signed the "Joint Development Agreement on Fangda Bangshen IndustrialPark (Temporary Name) Urban Renewal Project", and the two parties agreed to develop cooperatively. In orderto develop urban renewing projects such as a "renovation project", Fangda Real Estate provided Party A withproperty compensation through renovating and renovating the property allocation terms agreed upon by bothparties, and obtained independent development rights of the project. As of June 30, 2024, Fangda Real Estatehas paid a deposit of RMB20 million and a transitional compensation of RMB4.5 million.
(2) In July 2018 ,the Company's subsidiary Fangda Real Estate Co. Ltd. (Party A) signed a contract withShenzhen Yikang Real Estate Co. Ltd. (Party B1) and Shenzhen Qianhai Zhongzheng Dingfeng No. 6Investment Enterprise (Limited Partnership) (Party B2), "Shenzhen Henggang Dakang Village ProjectCooperation Agreement". Party B agrees to transfer the entire equity of the project company it holds and theentire development interest of the project to Party A. Party A shall pay Party B a total of RMB600 million forthe cooperation price. As of June 30, 2024, Fangda Property has paid Party B and the project company RMB50million of security deposit, RMB20 million of service fee, RMB61,937,200 of equity transfer andRMB79,362,900 of other related payments.
The Company has no other commitments that should be disclosed by June 30, 2024.
2. Contingencies
Significant contingencies on the balance sheet date:
(1) Contingent liabilities formed by material lawsuit or arbitration, and their influences on the financialposition
① On June 19, 2019, Langfang Aomei Jiye Real Estate Development Co., Ltd. filed a lawsuit againstFangda Jianke in the People's Court of Langfang Development Zone, demanding compensation ofRMB19,721,315.00, and filed an application for appraisal of quality, repair cost and uncompleted project cost;Fangda Jianke filed a counterclaim on September 11, 2019, demanding payment of RMB13,939,863.27, and putforward the application for completed project cost appraisal. As of the disclosure date of this report, the case isstill under trial.
② In March 2022, Xiangheng Real Estate (Jinan) Co., Ltd. filed an arbitration with the Jinan ArbitrationCommission, requesting Fangda Jianke to bear the deduction, maintenance, rectification and rework costs ofRMB8,956,563.81 and lawyer's fees of RMB350,000.00 caused by the quality problems of the supply andinstallation of aluminum alloy doors and windows, louvers and curtain walls of Jinan Kerry comprehensivedevelopment project (phase I and II); In April 2022, Fangda Construction Technology Co., Ltd. filed an antiarbitration application, requiring Xiangheng Real Estate (Jinan) Co., Ltd. to pay a total of RMB18,062,462.28for the project funds and project expenses. As of the disclosure date of this report, the two cases are under jointtrial.
③ In September 2022, Fangda Jianke Co., Ltd. filed a lawsuit to the People's Court of Longhua District,requiring Longguang Engineering Construction Co., Ltd. to pay the total principal and interest of the project
funds of Longguang Jiuzuan Project Plot 05 and Plot 09 to Fangda Construction Technology Co., Ltd., totalingRMB33,197,543.00. As of the date of this report's disclosure, the Jiuzuan 05 Plot project case has issued firstand second instance judgments: The first instance judgment ordered Longguang Company to pay Fangda JiankeRMB7,709,679.55 for the project payment, RMB6,033,911.38 for the quality guarantee deposit, and thecorresponding interest, and to have the priority to be compensated for the proceeds from the sale and auction ofthe curtain wall production and installation project of this project; the second instance judgment upheld thejudgment items of the first instance project payment, quality guarantee deposit, corresponding interest, andpriority to be compensated, and modified the judgment that the owner of Longguang Jiuzuan Project 05 Plot,Shenzhen Longguang Junjing Real Estate Development Co., Ltd., shall bear joint and several liability forFangda Jianke. Fangda Jianke has applied for compulsory execution. As of the date of this report, the case ofthe Jiuzhuan 09 plot project has been adjudicated in first instance, with Longguang Company being sentencedto pay the engineering fee of RMB7,709,679.55, the quality assurance deposit of RMB6,033,911.38, andcorresponding interest to Fangda Jianke. Longguang Company has the priority right to be compensated for thesale and auction price of the curtain wall production and installation project of the project; Due to both partiesfiling appeals, it is currently in the second instance.
④ In August 2023, Fangda Jianke filed a lawsuit with the Chengguan District People's Court of LanzhouCity, requesting Lanzhou Xinhe Real Estate Co., Ltd. to pay Fangda Jianke the principal and interest of theproject payment for the Lanzhou East Lake project, totaling RMB5,374,850.03, and claiming the priority ofcompensation for the construction project price. In January 2024, after the warranty period of the project inquestion expired, an additional warranty deposit of RMB1,788,589.6 was added. In September 2023, LanzhouXinhe Real Estate Co., Ltd. filed a counterclaim, requesting Fangda Jianke to pay a liquidated damages fordelay in completion of RMB5,670,000.00. As of the date of this report's disclosure, the first instance court hasmade a judgment, ruling that Lanzhou Xinhe Real Estate Co., Ltd. shall pay Fangda Jianke RMB6,477,148.2for the project payment and interest, and dismissing all counterclaims of Lanzhou Xinhe Real Estate Co., Ltd.Currently, both parties have appealed and the case is in the second instance.
⑤ In November 2023, Fangda Jianke filed a lawsuit with the Bao'an District People's Court of ShenzhenCity, requesting Shenzhen Zhongyi Fuhua Co., Ltd. to pay the principal and interest of the project payment forthe Zhongyi Smart Building project, totaling RMB8,657,880.49, and claiming the priority of compensation forthe project price. The first instance judgment ordered Shenzhen Zhongyi Fuhua Co., Ltd. to pay Fangda JiankeRMB8,507,859.49 for the project payment and interest, and supported the priority of compensation for theproject payment. Shenzhen Zhongyi Fuhua Co., Ltd. refused to accept the first instance judgment and appealed.As of the date of this report's disclosure, the two parties have reached a civil mediation agreement on the secondinstance and are in the process of fulfilling it.
⑥ In November 2023, Fangda Jianke filed a lawsuit with the People's Court of Honggutan District,Nanchang City, demanding that Jiangxi Huilian Real Estate Co., Ltd. and Jiangxi Boneng Industrial Group Co.,Ltd. pay the project payment and interest of the Nanchang Shanglian Center project, totalingRMB45,309,399.07, and claiming the priority of compensation for the project price. The first instance judgmentordered Jiangxi Huilian Real Estate Co., Ltd. to pay Fangda Jianke RMB38,800,206.53 and interest, and ruledthat Jiangxi Boneng Industrial Group Co., Ltd. shall bear joint and several liability for RMB37,563,144.42 ofthe project payment and interest. The request for accelerated maturity of the quality guarantee deposit and thepriority of compensation for the project payment was not supported. Fangda Jianke appealed, and the secondinstance judgment supported the priority of compensation. As of the date of this report's disclosure, FangdaJianke has applied to the court for compulsory execution.
⑦ In December 2023, Fangda Jianke filed a lawsuit with the People's Court of Yantian District,Shenzhen, demanding that Shenzhen Chuangshihe Industrial Co., Ltd. pay Fangda Jianke the principal amountof the Hejing Tongchuang project project payment of RMB12,018,518.24 and overdue interest, and claim thepriority right to recover the construction project price. As of the date of this report's disclosure, the court hasissued a first-instance judgment, ruling that Shenzhen Chuangshihe Industrial Co., Ltd. shall pay Fangda JiankeRMB7,961,110.76 for the principal of the project payment and overdue interest, and not supporting the requestfor the priority of compensation for the project payment. Currently, both parties have appealed and the case is inthe second instance.
⑧ In April 2024, Fangda Jianke filed a lawsuit with the People's Court of Panyu District, Guangzhou City,demanding that Guangzhou Wanya Real Estate Co., Ltd. pay Fangda Jianke the principal of the curtain wallproject payment of RMB15,015,731.53 for Plot 6 of Guangzhou Vanke Expo Center and overdue interest, andclaiming the priority of compensation for the construction project price. As of the date of this report's disclosure,the case has been filed and is awaiting trial.
⑨ In March 2024, Fangda Jianke filed a lawsuit with the People's Court of Nanshan District, ShenzhenCity, demanding that Shenzhen Hairunde Petrochemical Technology Co., Ltd., Shenzhen Hanjing Group Co.,Ltd., Huang Jianwen, and Wu Shaojie pay Fangda Jianke the principal and interest of the project payment forthe Hanjing Times project, totaling RMB21,989,562.71, and claiming the priority of compensation for theconstruction project price. As of the disclosure date of this report, the court has filed and accepted the case, andis awaiting a hearing.
⑩ In March 2024, Fangda Jianke filed a lawsuit with the People's Court of Nanshan District, ShenzhenCity, demanding that Shenzhen Luolansibao Property Development Co., Ltd., Shenzhen Hanjing Group Co.,Ltd., Huang Jianwen, and Wu Shaojie pay Fangda Jianke the principal and interest of the project payment forthe Hanjing Finance project, totaling RMB37,136,765.50, and claiming the priority of compensation for theconstruction project price. As of the disclosure date of this report, the court has filed and accepted the case, andis awaiting a hearing.
? In May 2024, Fangda Jianke filed a lawsuit with the People's Court of GuangmingDistrict, Shenzhen City, demanding that Shenzhen CIMC Low-Orbit Satellite Internet of ThingsIndustrial Park Development Co., Ltd. pay Fangda Jianke the principal and interest of the projectpayment for the curtain wall project of the Satellite Internet of Things Industrial Building, totalingRMB10,130,636.22, and claiming the priority of compensation for the construction project price.
As of the disclosure date of this report, the court has filed and accepted the case, and is awaiting a hearing.
? In February 2024, Shenzhen Rijiasheng Trading Co., Ltd. (hereinafter referred to asRijiasheng Company) filed a lawsuit with the People's Court of Nanshan District, Shenzhen City,demanding that Fangda Real Estate Company return the purchase price and liquidated damages ofBuilding 4 of Fangda City to Rijiasheng Company, and compensate for the losses totalingRMB21,627,925.22. As of the date of this report's disclosure, the court has accepted the case and is waitingfor the trial, and Fangda Real Estate Company has filed a counterclaim application.
(2) Pending major lawsuits
① In September 2022, Fangda Real Estate Co., Ltd. filed a lawsuit to the People's Court of NanshanDistrict, Shenzhen, requiring Shenzhen Hongtao Group Co., Ltd. to pay the total principal and interest ofFangda Real Estate Co., Ltd. to Fangda Real Estate Co., Ltd. for the purchase of building 3 # in Fangda City,amounting to RMB56,527,427.01, and Hongtao Company's counterclaim party, Dada Real Estate Co., Ltd.,
requested to cancel the signed Supplementary Agreement on Real Estate Sales and pay the liquidated damagesof RMB44,046,859.04 for overdue certificate processing. The court has issued a first instance judgment, rulingthat Hongtao Company shall pay Fangda Real Estate Company the purchase price of RMB40,127,678.19 andoverdue payment interest (temporarily calculated as RMB8,418,135.54 until June 30, 2022). The subsequentinterest shall be calculated based on RMB40,127,678.19 and continue to be calculated until the actual paymentdate according to the loan market quotation interest rate standard published by the National Interbank FundingCenter. Reject all counterclaim requests from Hongtao Company. Both parties later filed an appeal. As of thedisclosure date of this report, the second instance judgment has been issued and the original judgment has beenupheld. Currently, the case has entered the execution stage.
② In April 2023, Fangda Jianke filed a lawsuit with the Guangzhou Intermediate People's Court,demanding the termination of the construction contract signed with Guangzhou Kaidar Investment Co., Ltd. forthe Kaidar Hub International Plaza project, and requiring Guangzhou Kaidar Investment Co., Ltd. to pay theprincipal amount of the project payment of RMB113,529,244.60 and interest to Fangda Jianke, and claiming thepriority right to receive compensation for the construction project price. As of the disclosure date of this report,the court has issued a first instance judgment, stating that Kedar is required to pay the principal amount of theproject payment of RMB113，529，244.60 and corresponding interest to Fangda Jianke, and has the priorityright to be compensated for the discount or auction price of the project curtain wall. Currently, the case hasentered the execution stage.
(3) Contingent liabilities formed by providing of guarantee to other companies' debts and their influenceson financial situation
By June 30, 2024, the Company has provided loan guarantees for the following entities:
| Name of guaranteed entity | Guarantee | Amount (in RMB10,000) | Term |
| Fangda Property | Guarantee and mortgage guarantee | 66,000.00 | 2020.03.13-2030.03.12 |
| Fangda Intelligent Manufacturing | Guarantee | 25,000.00 | 2024.03.15-2030.03.14 |
| Fangda Jianke | Guarantee | 30,000.00 | 2024.06.26-2026.06.25 |
| Fangda Jianke | Guarantee | 4,000.00 | 2024.03.14-2025.03.14 |
| Fangda Jianke | Guarantee | 5,000.00 | 2024.03.28-2025.03.28 |
| Fangda Jianke | Guarantee | 4,000.00 | 2024.06.20-2025.06.15 |
| Fangda Jianke | Guarantee | 20,000.00 | 2023.08.04-2024.08.04 |
| Fangda Jianke | Guarantee | 10,500.00 | 2024.06.05-2025.03.05 |
| Fangda Yunzhu | Guarantee | 1,000.00 | 2024.06.28-2025.06.23 |
| Fangda Jianke | Guarantee | 5,000.00 | 2024.05.17-2025.05.16 |
| Fangda Zhiyuan Technology | Guarantee | 1,000.00 | 2023.09.20-2024.09.19 |
| Fangda Zhiyuan Technology | Guarantee | 2,000.00 | 2023.10.16-2024.10.16 |
| Fangda Zhiyuan Technology | Guarantee | 2,000.00 | 2024.06.21-2025.06.21 |
| Fangda Zhiyuan Technology | Guarantee | 4,000.00 | 2024.06.24-2025.06.24 |
| Total | 179,500.00 |
Notes:
(1) All the above loan guarantees are related guarantees between internal equity entities of the Company.
(2) The Company’s property business provides periodic mortgage guarantee for property purchasers. Theterm of the periodic guarantee lasts from the effectiveness of guarantee contracts to the completion of mortgageregistration and transfer of housing ownership certificates to banks. As of June 30, 2024, the Company hasundertaken the above phased guarantee amount of RMB3.06 million.
3. Others
Status of non-revocation of company as at June 30, 2024:
| Currency | Guarantee balance (original currency) | Deposit (RMB) | Credit line used (RMB) |
| CNY | 904,860,392.54 | 5,803,897.96 | 899,056,494.58 |
| INR | 38,164,259.78 | 46,099.32 | 3,212,327.02 |
| HKD | 22,259,665.45 | 15,000,000.00 | 6,306,329.89 |
| USD | 2,628,036.33 | 1,463,768.39 | 17,265,720.93 |
| SGD | 15,697,838.00 | 82,868,886.80 | |
| AUD | 975,000.00 | 4,645,875.00 | |
| EUR | 4,074,964.01 | 31,221,151.76 | |
| Total | 22,313,765.67 | 1,044,576,785.98 |
XVI. Other material events
1. Segment information
(1) Recognition basis and accounting policy for segment report
The Group divides its businesses into five reporting segments. The reporting segments aredetermined based on financial information required by routine internal management. The Group'smanagement regularly review the operating results of the reporting segments to determineresource distribution and evaluate their performance.
The reporting segments are:
① Curtain wall division: production and sales of curtain wall materials, design, productionand installation of building curtain walls, curtain wall testing and maintenance services;
② Rail transit branch: assembly and processing of subway screen doors, screen doordetection and maintenance services;
③ Commercial real estate segment: development and operating of real estate on land ofwhich land use right is legally obtained by the Company; property management;
(4) New energy segment: photovoltaic power generation, photovoltaic power plant sales,photovoltaic equipment R & D, installation, and sales, and photovoltaic power plant engineeringdesign and installation
(5) Others
The segment report information is disclosed based on the accounting policies andmeasurement standards used by the segments when reporting to the management. The policiesand standards should be consistent with those used in preparing the financial statement.
(2) Financial information
In RMB
| Item | Curtain wall | Rail transport | Commercial real estate | New energy | Others | Offset between segments | Total |
| Turnover | 1,739,882,078.11 | 263,455,042.38 | 122,693,103.92 | 7,393,708.51 | 10,903,608.21 | 10,481,953.36 | 2,133,845,587.76 |
| Including: external transaction income | 1,737,754,739.77 | 263,455,042.38 | 118,828,634.36 | 7,061,695.63 | 6,745,475.62 | 2,133,845,587.76 | |
| Inter-segment transaction income | 2,127,338.34 | 0.00 | 3,864,469.57 | 332,012.88 | 4,158,132.59 | 10,481,953.36 | 0.00 |
| Including: major business turnover | 1,720,386,343.43 | 263,135,057.05 | 122,227,950.87 | 7,393,708.51 | 10,903,608.21 | 8,509,660.91 | 2,115,537,007.16 |
| Operating cost | 1,499,203,666.24 | 205,971,111.45 | 30,848,836.60 | 3,952,479.21 | 38,387.33 | 2,415,295.85 | 1,737,599,184.98 |
| Including: major business cost | 1,486,516,981.20 | 205,770,477.73 | 30,848,836.60 | 3,952,479.21 | 38,387.33 | 2,415,295.85 | 1,724,711,866.23 |
| Operation cost | 162,677,592.52 | 36,949,430.37 | 40,539,994.42 | 330,025.61 | -43,229,863.45 | -64,235,984.09 | 261,503,163.56 |
| Operating profit/(loss) | 78,538,412.89 | 20,534,500.56 | 51,304,272.91 | 3,111,203.69 | 54,095,084.33 | 72,840,235.15 | 134,743,239.22 |
| Total assets | 7,761,330,489.38 | 1,021,524,281.13 | 6,175,673,459.99 | 180,978,061.92 | 3,828,380,477.88 | 5,211,270,812.37 | 13,756,615,957.93 |
| Total liabilities | 5,306,095,271.92 | 703,799,713.00 | 3,346,409,377.11 | 54,068,848.83 | 1,624,007,073.03 | 3,365,002,985.95 | 7,669,377,297.94 |
(3) Others
Regional information on operating revenues:
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| In China | 1,955,457,106.44 | 1,831,339,689.35 |
| Out of China | 178,388,481.32 | 247,507,187.97 |
| Total | 2,133,845,587.76 | 2,078,846,877.32 |
XVII. Notes to Financial Statements of the Parent
1. Account receivable
(1) Account age
In RMB
| Age | Closing balance of book value | Opening balance of book value |
| Within 1 year (inclusive) | 1,084,683.01 | 416,495.45 |
| Over 3 years | 359,129.89 | 359,129.89 |
| 3-4 years | 222,666.00 | 359,129.89 |
| 4-5 years | 136,463.89 | |
| Total | 1,443,812.90 | 775,625.34 |
(2) Disclosure by bad debt accrual method
In RMB
| Type | Closing balance | Opening balance | ||||||||
| Remaining book value | Bad debt provision | Book value | Remaining book value | Bad debt provision | Book value | |||||
| Amount | Proportion | Amount | Provision rate | Amount | Proportion | Amount | Provision rate | |||
| Account receivable for which bad debt provision is made by group | 1,443,812.90 | 100.00% | 181,095.15 | 12.54% | 1,262,717.75 | 775,625.34 | 100.00% | 92,032.81 | 11.87% | 683,592.53 |
| Including: | ||||||||||
| Portfolio 3. Others | 1,443,812.90 | 100.00% | 181,095.15 | 12.54% | 1,262,717.75 | 775,625.34 | 100.00% | 92,032.81 | 11.87% | 683,592.53 |
| Total | 1,443,812.90 | 100.00% | 181,095.15 | 12.54% | 1,262,717.75 | 775,625.34 | 100.00% | 92,032.81 | 11.87% | 683,592.53 |
Category name for bad debt provision by combination: Others
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Portfolio 3. Others | 1,443,812.90 | 181,095.15 | 12.54% |
| Total | 1,443,812.90 | 181,095.15 | |
Group recognition basis:
See 10. Financial Tools in Chapter X, V, Important Accounting Policies and Accounting Estimates for the recognition criteria andinstructions for withdrawing bad debt reserves by portfolioIf the provision for bad debts on accounts receivable is being made based on the expected credit loss general model:
□ Applicable ? Inapplicable
(3) Bad debt provision made, returned or recovered in the period
Bad debt provision made in the period:
In RMB
| Type | Opening balance | Change in the period | Closing balance | |||
| Provision | Written-back or recovered | Canceled | Others | |||
| Portfolio 3. Others | 92,032.81 | 89,062.34 | 181,095.15 | |||
| Total | 92,032.81 | 89,062.34 | 181,095.15 | |||
(5) Accounts receivable and contract assets with the top-5 ending balances, grouped by party owed
In RMB
| Entity | Closing balance of accounts receivable | Closing balance of contract assets | Closing balance of accounts receivable and contract assets | Percentage of total ending balance of accounts receivable and contract assets | Closing balance of provision for bad debts on accounts receivable and impairment of contract assets |
| Top five summary | 1,378,509.66 | 0.00 | 1,378,509.66 | 95.48% | 180,618.44 |
| Total | 1,378,509.66 | 0.00 | 1,378,509.66 | 95.48% | 180,618.44 |
2. Other receivables
In RMB
| Item | Closing balance | Opening balance |
| Dividend receivable | 62,142,383.24 | |
| Other receivables | 1,637,032,979.44 | 1,684,718,397.92 |
| Total | 1,699,175,362.68 | 1,684,718,397.92 |
(1) Receivable dividend
1) Receivable dividend
In RMB
| Item (or invested entity) | Closing balance | Opening balance |
| Fangda Zhiyuan | 62,142,383.24 | 0.00 |
| Total | 62,142,383.24 | 0.00 |
(2) Other receivables
1) Other receivables are disclosed by nature
In RMB
| By nature | Closing balance of book value | Opening balance of book value |
| Deposit | 80,000.00 | |
| Others | 65,679.85 | 57,199.41 |
| Accounts between related parties within the scope of consolidation | 1,636,968,278.22 | 1,684,583,242.78 |
| Total | 1,637,033,958.07 | 1,684,720,442.19 |
(2) Account age
In RMB
| Age | Closing balance of book value | Opening balance of book value |
| Within 1 year (inclusive) | 300,657,920.73 | 692,784,064.86 |
| 1-2 years | 390,808,980.00 | 92,578,310.00 |
| 2-3 years | 393,487,692.40 | 694,397,404.79 |
| Over 3 years | 552,079,364.94 | 204,960,662.54 |
| 3-4 years | 449,639,033.67 | 204,960,662.54 |
| 4-5 years | 102,440,331.27 | |
| Over 5 years | ||
| Total | 1,637,033,958.07 | 1,684,720,442.19 |
(3) Disclosure by bad debt accrual method
In RMB
| Type | Closing balance | Opening balance | ||||||||
| Remaining book value | Bad debt provision | Book value | Remaining book value | Bad debt provision | Book value | |||||
| Amount | Proportion | Amount | Provision rate | Amount | Proportion | Amount | Provision rate | |||
| Provision for bad debts by combination | 1,637,033,958.07 | 100.00% | 978.63 | 0.00% | 1,637,032,979.44 | 1,684,720,442.19 | 100.00% | 2,044.27 | 0.00% | 1,684,718,397.92 |
| Including: | ||||||||||
| Portfolio 1: First stage | 65,679.85 | 0.00% | 978.63 | 1.49% | 64,701.22 | 137,199.41 | 0.01% | 2,044.27 | 1.49% | 135,155.14 |
| Portfolio | 1,636,96 | 100.00% | 0.00 | 0.00% | 1,636,96 | 1,684,58 | 99.99% | 0.00 | 0.00% | 1,684,58 |
| 4: related party funds within the scope of consolidation | 8,278.22 | 8,278.22 | 3,242.78 | 3,242.78 | ||||||
| Total | 1,637,033,958.07 | 100.00% | 978.63 | 0.00% | 1,637,032,979.44 | 1,684,720,442.19 | 100.00% | 2,044.27 | 0.00% | 1,684,718,397.92 |
Category name for bad debt provision by combination: combination 1: First stage
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Portfolio 1: First stage | 65,679.85 | 978.63 | 1.49% |
| Total | 65,679.85 | 978.63 | |
Group recognition basis:
Provision for bad debts based on general model of expected credit lossesProvision type for bad debts by portfolio: Portfolio 4: Amounts from related parties within the scope of consolidation
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Portfolio 4: related party funds within the scope of consolidation | 1,636,968,278.22 | 0.00 | 0.00% |
| Total | 1,636,968,278.22 | 0.00 | |
Group recognition basis:
A description of the basis for determining this combination is provided in Section X, V. Significant Accounting Policies andAccounting Estimates in 10, Financial Instruments.Provision for bad debts based on general model of expected credit losses
In RMB
| Bad debt provision | First stage | Second stage | Third stage | Total |
| Expected credit losses in 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 1, 2024 | 2,044.27 | 2,044.27 | ||
| Balance on January 1, 2024 in the current period | ||||
| Provision | -1,065.64 | -1,065.64 | ||
| Balance on June 30, 2024 | 978.63 | 978.63 |
Changes in book balances with significant changes in the current period
□ Applicable ? Inapplicable
4) Bad debt provision made, returned or recovered in the period
Bad debt provision made in the period:
In RMB
| Type | Opening balance | Change in the period | Closing balance | |||
| Provision | Written-back or recovered | Write-off | Others | |||
| Other receivables and bad debt provision | 2,044.27 | -1,065.64 | 978.63 | |||
| Total | 2,044.27 | -1,065.64 | 978.63 | |||
5) Balance of top 5 other receivables at the end of the period
In RMB
| Entity | By nature | Closing balance | Age | Percentage (%) | Balance of bad debt provision at the end of the period |
| Shenzhen Fangda Property Development Co., Ltd. | Related party funds within the scope of consolidation | 300,592,240.88 | Less than 1 year | 86.93% | 0.00 |
| 373,808,980.00 | 1-2 years | ||||
| 305,288,990.00 | 2-3 years | ||||
| 356,210,434.73 | 3-4 years | ||||
| 87,210,434.73 | 4-5 years | ||||
| Fangda (Jiangxi) Property Development Co., Ltd. | Related party funds within the scope of consolidation | 17,000,000.00 | 1-2 years | 11.20% | 0.00 |
| 88,198,702.40 | 2-3 years | ||||
| 78,198,702.39 | 3-4 years | ||||
| Shihui International Holding Co., Ltd. | Related party funds within the scope of consolidation | 15,229,896.55 | 3-4 years | 1.86% | 0.00 |
| 15,229,896.54 | 4-5 years | ||||
| Others | Others | 65,679.85 | Less than 1 year | 0.01% | 978.63 |
| Total | 1,637,033,958.07 | 100.00% | 978.63 |
3. Long-term share equity investment
In RMB
| Item | Closing balance | Opening balance | ||||
| Remaining book value | Impairment provision | Book value | Remaining book value | Impairment provision | Book value | |
| Investment in subsidiaries | 1,657,062,530.00 | 1,657,062,530.00 | 1,526,831,253.00 | 1,526,831,253.00 | ||
| Total | 1,657,062,530.00 | 1,657,062,530.00 | 1,526,831,253.00 | 1,526,831,253.00 | ||
(1) Investment in subsidiaries
In RMB
| Invested entity | Opening book value | Beginning balance of impairment provisions | Change (+,-) | Closing book value | Balance of impairment provision at the end of the period | |||
| Increased investment | Decreased investment | Impairment provision | Others | |||||
| Fangda Jianke | 751,950,000.00 | 751,950,000.00 | ||||||
| Fangda Jiangxi New Material | 74,496,600.00 | 74,496,600.00 | ||||||
| Fangda Property | 198,000,000.00 | 198,000,000.00 | ||||||
| Shihui International | 61,653.00 | 61,653.00 | ||||||
| Fangda New Energy | 99,000,000.00 | 99,000,000.00 | ||||||
| Fangda Hongjun Investment | 98,000,000.00 | 98,000,000.00 | ||||||
| Fangda Partnership | 235,323,000.00 | 235,323,000.00 | 0.00 | |||||
| Fangda Intelligent Manufacturing | 70,000,000.00 | 128,000,000.00 | 198,000,000.00 | |||||
| Fangda Zhiyuan | 0.00 | 237,554,277.00 | 237,554,277.00 | |||||
| Total | 1,526,831,253.00 | 365,554,277.00 | 235,323,000.00 | 1,657,062,530.00 | ||||
4. Operational revenue and costs
In RMB
| Item | Amount occurred in the current period | Occurred in previous period | ||
| Income | Cost | Income | Cost | |
| Main business | 10,908,179.61 | 38,387.33 | ||
| Other businesses | 12,358,317.34 | |||
| Total | 10,908,179.61 | 38,387.33 | 12,358,317.34 | |
Note: The operating income of the parent company all comes from the rental income of self-built and self-owned properties. Thisperiod, the rental income of its properties is adjusted to the main business income.
Breakdown of operating revenues and operating costs:
In RMB
| Contract classification | Others | Total | ||
| Turnover | Operating cost | Turnover | Operating cost | |
| Business type | ||||
| Including: Other businesses | 10,908,179.61 | 38,387.33 | 10,908,179.61 | 38,387.33 |
| Total | 10,908,179.61 | 38,387.33 | 10,908,179.61 | 38,387.33 |
Information related to the transaction price allocated to the remaining performance obligations:
The amount of revenue corresponding to the performance obligations that have been signed, but not yet performed or not yetperformed at the end of the reporting period is RMB82,113,615.12, of which RMB11,043,003.43 is expected to be recognized inthe second half of 2024, and RMB19,501,650.81 is expected to be recognized in 2025, RMB51,568,960.88 is expected to berecognized in 2026 and beyond.
5. Investment income
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Gains from long-term equity investment measured by costs | 62,142,383.24 | |
| Investment gain obtained from disposal of long-term equity investment | 47,167.38 | |
| Total | 62,189,550.62 |
XVIII. Supplementary Materials
1. Detailed accidental gain/loss
? Applicable □ Inapplicable
In RMB
| Item | Amount | Notes |
| Gain/loss of non-current assets | -1,490.22 | |
| Government grants recognized in the current period's profit or loss (except for government grants that are closely related to the Company's normal business operations, in line with national policies and in accordance with defined criteria, and have a continuous impact on the Company's profit or loss) | 7,230,976.70 | |
| Gains and losses from changes in the fair value of financial assets and liabilities held by non-financial corporations and gains and losses from the disposal of financial assets and liabilities, except for effective hedging operations related to the Company's normal business operations | -888,100.88 | |
| Gain/loss from change of fair value of investment property measured at fair value in follow-up measurement | 555,662.75 | |
| Other non-business income and expenditures other than the above | -356,942.93 | |
| Less: Influenced amount of income tax | 1,469,609.41 | |
| Influenced amount of minority shareholders' equity (after-tax) | -35,516.22 | |
| Total | 5,106,012.23 | -- |
Other gain/loss items satisfying the definition of non-recurring gain/loss account:
□ Applicable ? Inapplicable
The Company has no other gain/loss items satisfying the definition of non-recurring gain/loss accountCircumstance that should be defined as recurrent profit and loss to Explanation Announcement of Information Disclosure No. 1 -Non-recurring gain/loss
□ Applicable ? Inapplicable
2. Net income on asset ratio and earning per share
| Profit of the report period | Weighted average net income/asset ratio | Earning per share | |
| Basic earnings per share (yuan/share) | Diluted Earnings per share (yuan/share) | ||
| Net profit attributable to common shareholders of the Company | 1.95% | 0.11 | 0.11 |
| Net profit attributable to the common owners of the PLC after deducting of non-recurring gains/losses | 1.86% | 0.10 | 0.10 |
3. Differences in accounting data under domestic and foreign accounting standards
(1) Differences in net profits and assets in financial statements disclosed according to the internationaland Chinese account standards
□ Applicable ? Inapplicable
(2) Differences in net profits and assets in financial statements disclosed according to the internationaland Chinese account standards
□ Applicable ? Inapplicable
(3) Differences in financial data using domestic and foreign accounting standards, the overseas institutionname should be specified if the difference in data audited by an overseas auditor is adjustedNo