Stock Code: 600519 Stock Abbr.: Kweichow Moutai
KWEICHOW MOUTAI CO., LTD.
ANNUAL REPORT 2021
Important StatementsThe Board of Directors, Board of Supervisors, directors, supervisors and the senior managementof the Company guarantee that the information presented in this report is free of any falserecords, misleading statements or material omissions, and shall bear individual and joint legalliabilities for the truthfulness, accuracy and completeness of its contents.
The situation of directors who did not attend the board meeting in person
| Position | Name | Reason | Proxy |
| Independent director | Lu Jinhai | Pandemic prevention | Zhang Jingzhong |
Baker Tilly China CPAs has issued a standard unqualified audit report for the Company.
Ding Xiongjun, responsible person for the Company, Jiang Yan, responsible person foraccounting work, and Cai Congying, responsible person for the Company’s financial affairs(Accounting Supervisor), have warranted that the financial statements in this report are true,accurate and complete.
The proposed profit distribution plan or the proposed plan of capitalization of capital reserves inthe reporting period approved by the resolution of the Board of DirectorsOn the basis of a total capital of 1,256,197,800 shares by the end of 2021, all shareholders will bedistributed a cash dividend of CNY 216.75 (before tax) for every 10 shares, with a total profitdistribution of CNY 27,228,087,315.00, and the remaining CNY 133,488,774,605.19 will be reservedfor future annual distribution. The above profit distribution proposal shall be submitted to the generalassembly of shareholders of the Company for deliberation and approval before implementation.
Risk disclosure statement for forward-looking statements
Forward-looking statements in this report concerning future plans or development strategies do notconstitute substantial promises to investors, due to the related uncertainty. Investors are advised to beaware of their own investment risks.
Existence of non-operational embezzlement of funds by controlling shareholders or theirassociated partiesNo
Existence of Financial Guarantees to External Parties in Violation of the Regulated DecisionProceduresNo
Over half of the directors’ failure to guarantee the truthfulness, accuracy and completeness of theCompany’s disclosed annual reportNo
Significant risk statementsThe Company has elaborated the potential risks in the chapter of “The Company Discussion andAnalysis on its Future Development”. Investors are advised to pay their due attention.
Information StatementAll information and data cited in this Report are objective and authentic. Financial figures herein are recorded in CNY, unless otherwise specified. This Report is prepared in Chinese and English, respectively.In case of any ambiguity in the Chinese and English texts, the Chinese text shall prevail.
Contents
Section I Definitions ...... 5
Section II Company Profile and Key Financial Results ...... 5
Section III Management’s Discussion and Analysis ...... 8
Section IV Corporate Governance ...... 23
Section V Environment and Social Responsibility ...... 41
Section VI Significant Events ...... 46
Section VII Changes in Shares and Information about Shareholders ...... 59
Section VIII Preferred Shares ...... 63
Section IX Information about Bond ...... 63
Section X Financial Report ...... 64
| Documents Available for Reference | References include the accounting statements signed and stamped by the respective individuals in charge of the company, the company accounting work, and the accounting department (their accounting supervisor). |
| References include the audit report original signed and stamped by the certified public accountant and stamped by the accounting firm. | |
| The originals of company documents and announcements that are publicly disclosed in China Securities Journal and Shanghai Securities News during the reporting period. |
Section I Definitions
1. Definitions
Unless it is otherwise referred in the context, the terms in this report have the following meanings:
| Terms and Definitions | ||
| CSRC | refers to | China Securities Regulatory Commission |
| SSE | refers to | Shanghai Stock Exchange |
| Company, the company | refers to | Kweichow Moutai Co., Ltd. |
| Controlling shareholder, group company | refers to | China Kweichow Moutai Distillery (Group) Co., Ltd. |
| Reporting period | refers to | Fiscal Year of 2021 |
| This report, the report | refers to | Annual Report 2021 |
Section II Company Profile and Key Financial Results
1. Corporate Information of “the Company”
| Name of the Company in Chinese | 贵州茅台酒股份有限公司 |
| Abbr. of the Company name in Chinese (if any) | 贵州茅台 |
| Name of the Company in English | Kweichow Moutai Co., Ltd. |
| Legal Representative | Ding Xiongjun |
2. Contact Information
3. Company profile
| Registered address | Maotai Town, Renhuai City, Guizhou Province |
| Office address | Maotai Town, Renhuai City, Guizhou Province |
| Zip code of office address | 564501 |
| Website address | http://www.moutaichina.com/ |
| E-mail address | mtdm@moutaichina.com |
4. Information disclosure and the place where the report is available
| Media name and its website address where the report is disclosed | China Securities Journal and Shanghai Securities News |
| Website address of the stock exchange where the report is disclosed | http://www.sse.com.cn/ |
| Place where the report is available | The office of the Board of Directors |
| Secretary of the board | Representative for securities affairs | |
| Name | Jiang Yan | Cai Congying |
| Address | Maotai Town, Renhuai City, Guizhou Province | Maotai Town, Renhuai City, Guizhou Province |
| Tel. | 0851-22386002 | 0851-22386002 |
| Fax | 0851-22386193 | 0851-22386193 |
| mtdm@moutaichina.com | mtdm@moutaichina.com |
5. Stock information
| Stock information | ||||
| Stock type | Stock exchange where the shares are listed | Stock abbreviation | Stock code | Previous stock Abbreviation (if any) |
| A shares | Shanghai Stock Exchange | Kweichow Moutai | 600519 | |
6. Other information
| Appointed accounting firm (domestic) | Name | Baker Tilly China CPAs |
| Office address | Building 12, Foreign Language Culture and Creativity Park, 19 Chegongzhuang West Road, Haidian District, Beijing | |
| Name of the signing accountant | Tong Wenguang, Liu Zonglei, Yang Shu |
7. Last Years’ Key Accounting Data and Financial Indicators
7.1 Key accounting data
Unit: CNY
| Key accounting date | 2021 | 2020 | Change (%) | 2019 |
| Operating proceeds | 106,190,154,843.76 | 94,915,380,916.72 | 11.88 | 85,429,573,467.25 |
| Net profits attributable to shareholders of the Public Company | 52,460,144,378.16 | 46,697,285,429.81 | 12.34 | 41,206,471,014.43 |
| Net profits attributable to shareholders of the Public Company after deducting non-recurring gains and losses | 52,581,102,656.24 | 47,016,420,742.73 | 11.84 | 41,406,909,012.08 |
| Net cash flows from operating activities | 64,028,676,147.37 | 51,669,068,693.03 | 23.92 | 45,210,612,632.56 |
| 31 December 2021 | 31 December 2020 | Changes of the Same Period(%) | 31 December 2019 | |
| Net assets attributable to shareholders of the Company | 189,539,368,797.29 | 161,322,735,087.56 | 17.49 | 136,010,349,875.11 |
| Total assets | 255,168,195,159.90 | 213,395,810,527.46 | 19.58 | 183,042,372,042.50 |
| Share capital | 1,256,197,800.00 | 1,256,197,800.00 | 1,256,197,800.00 |
7.2 Key financial indicators
| Key financial indicators | 2021 | 2020 | Change (%) | 2019 |
| Basic earnings per share (CNY/share) | 41.76 | 37.17 | 12.34 | 32.80 |
| Diluted earnings per share (CNY/share) | 41.76 | 37.17 | 12.34 | 32.80 |
| Basic earnings per share after non-recurring gains and losses (CNY/share) | 41.86 | 37.43 | 11.84 | 32.96 |
| Weighted average ROE (%) | 29.90 | 31.41 | -1.51 | 33.09 |
| Weighted average ROE after non-recurring | 29.97 | 31.63 | -1.66 | 33.25 |
8. Differences in accounting data by domestic and overseas accounting standards
8.1 Differences in the net profits and net assets attributable to shareholders of the companydisclosed in the financial reports prepared under the international accounting standards andChina accounting standards
□Applicable √N/A
8.2 Differences in the net profits and net assets attributable to shareholders of the Companydisclosed in the financial reports prepared under the overseas accounting standards and Chinaaccounting standards
□Applicable √N/A
8.3 Explanations for above accounting data differences
□Applicable √N/A
9. Quarterly key financial data in 2021
Unit: CNY
gains and losses (%)
| (Jan.-Mar.) | (Apr.-Jun.) | (Jul.-Sept.) | (Oct.-Dec.) | |
| Operating proceeds | 27,270,884,813.14 | 21,816,392,982.87 | 25,554,926,006.54 | 31,547,951,041.21 |
| Net profits attributable to shareholders of the Company | 13,954,462,085.61 | 10,699,523,465.97 | 12,612,188,608.39 | 15,193,970,218.19 |
| Net profit attributable to ordinary shareholders of the company after deducting non-recurring profit and loss | 13,969,463,370.71 | 10,679,654,343.72 | 12,707,913,515.40 | 15,224,071,426.41 |
| Net cash flows from operating activities | -1,484,892,858.66 | 23,204,363,591.63 | 15,032,826,622.95 | 27,276,378,791.45 |
Explanations for the differences between quarterly data and those disclosed in previous periodicalreports
□Applicable √N/A
10. Non-recurring Items and Their Gains/Losses
√Applicable □N/A
Unit: CNY
| Non-recurring gains and losses | Amount in 2021 | Note (if applicable) | Amount in 2020 | Amount in 2019 |
| Gain or loss from disposal of non-current assets | -11,920,829.77 | -100,113.92 | -510,515.56 | |
| Government grants accounted for, in the profit or loss for the current period (except for the government grants closely related to the business of the Company and continuously given at a fixed amount or quantity in accordance with certain standards) | 4,616,000.00 | 2,028,500.00 | ||
| Gains and losses from changes in fair value arising from holding trading financial assets, derivative financial assets, trading financial | -3,750,122.23 | 4,966,170.34 | -14,018,472.46 |
| liabilities and derivative financial liabilities, as well as investment income from disposal of trading financial assets, derivative financial assets, trading financial liabilities, derivative financial liabilities and other debt investments, except for the effective hedging business associated with the company’s regular business operations. | ||||
| Other non-operational income and expenditure in addition to the items listed above. | -210,928,052.99 | -438,037,777.35 | -258,459,086.43 | |
| Other items of gains and losses that fall into the category of non-recurring gains and losses | 61,031,069.26 | 237,455.55 | ||
| Less: Income tax impact | -40,237,983.93 | -107,726,441.35 | -68,247,018.61 | |
| Minority shareholder equity impact (after tax) | 244,326.28 | -4,044,011.11 | -4,303,058.19 | |
| Total | -120,958,278.08 | -319,135,312.92 | -200,437,997.65 |
11. Items evaluated at fair values
√Applicable □N/A
Unit: CNY
| Item | Opening balance | Closing balance | Change | Amount of impact on current profit |
| Other non-current financial assets | 9,830,052.91 | -9,830,052.91 | -3,750,122.23 | |
| Total | 9,830,052.91 | -9,830,052.91 | -3,750,122.23 |
Section III Management’s Discussion and Analysis
1. Discussion and analysis of business situation
In 2021, Adhering to be guided by Xi Jinping’s Thought of Socialism with Chinese Characteristics fora New Era, the company comprehensively carried out the spirit of the important speech of PresidentXi’s inspection of Guizhou, fully implemented the strategic plan of the provincial party committeeand the provincial government, followed the requirements of “high-quality development, big-strideforward”, focused on “dual-doubling, dual-consolidating and dual-construction” target demanded bythe group company, and coordinated the work of epidemic prevention and control, production andoperation, reform and development in an integrated manner. In all, the Company has maderemarkable and excellent achievements, painted the picture of the era of “five lines” development,stepped onto the new path of development of a high quality and strong industry, and realized a grandstart in the “14th Five Year Plan” development.
2. Industry sector situation in the reporting period
See “Industry profile” and “Industry pattern and trend” in this report.
3. Business scope in the reporting period
The Company’s main business is the production and sales of Moutai and a series of liquors. Theleading product “Kweichow Moutai” is one of the three most famous distilled liquors in the world,
and is also a brand of Chinese Baijiu that embodies national geographical hallmark products, organicfoods and national intangible cultural heritages.The Company’s business model is: raw materials acquisition – merchandise production – sales. Theacquisition of raw materials is carried out according to the Company's production and sales plan; theproduction process of products is as follows: yeast making - Chinese Baijiu making – cellaring -blending - packaging; the sales model is as follows: the Company's products are sold through directsales and distributor channels. Direct sales channels refer to self-operated channels, while distributorchannels refer to social distributors, supermarkets, e-commerce and other channels.
4. Analysis of core competitiveness
√Applicable □N/A
The Company possesses “four core potentials”, i.e, unique territorial protection of product origin,irreplicable microbial colonies, unique brewing techniques inherited for generations over a thousandyears and long-term cellaring base of high-quality Chinese Baijiu resources. In addition, thecompany also owns famous brands, outstanding quality, long-standing culture and long history. Nosignificant changes in the core competitiveness of the Company has ever taken place during thereporting period.
5. Business operation briefing for the reporting period
Firstly, the new blueprint has been inspiring. The Company pursued high-quality development for theall situations, formulated the “14th Five Year Plan” development program, confirmed the“five-color-lines” development path, affirmed the “one base and one benchmark” target,comprehensively carried out top-level designs, built a new system of corporate governance, drew a“concentric circle” of dream building for thousands of people, and opened a new chapter of buildinga high-quality and strong industry.
Secondly, new achievements have accumulated into powerful potentials. The Company has beenadhering to the motto of “quality is the soul of lifeline”, and established the quality concept of fivecraftsmanships of the new era, built a “365 quality management system”, deeply delved into the “nineseries” of Moutai culture. Major projects such as packaging logistics park and Tongminba liquor basein Xishui County were orderly carried forward. Safety and environmental protection managementwere taken to a new level. The Moutai culture and sports center was brought into use. All these havebeen building a more solid foundation for a high-quality and strong industry.
Thirdly, the new business performance is remarkable. The Company has achieved a total operatingproceeds of CNY 109.46 billion, an increase of 11.71% year-on-year; the total profit is CNY 74.53billion, a year-on-year increase of 12.59%; the net profit attributable to the owner of the parentcompany is CNY 52.46 billion, with a year-on-year increase of 12.34%. All indicators havemaintained double-digit growth, and the comprehensive strength of the Company has once againreached a new level.
5.1Main business analysis
A.Analysis of accounting item changes related to the income statement and the cash flowstatement
Unit: CNY
| Item | Amount in the reporting period | Amount in the same reporting period of last year | YoY Change (%) |
| Operating proceeds | 106,190,154,843.76 | 94,915,380,916.72 | 11.88 |
| Operating costs | 8,983,377,809.96 | 8,154,001,476.28 | 10.17 |
| Sales expenses | 2,737,369,434.78 | 2,547,745,650.95 | 7.44 |
| General and administrative expenses | 8,450,274,065.03 | 6,789,844,289.39 | 24.45 |
| Financial expenses | -934,523,406.02 | -234,610,582.44 | N/A |
| R&D expenses | 61,923,213.59 | 50,398,036.33 | 22.87 |
| Net cash flows from operating activities | 64,028,676,147.37 | 51,669,068,693.03 | 23.92 |
| Net cash flows from investment activities | -5,562,445,704.34 | -1,805,227,155.72 | N/A |
| Net cash flows from financing activities | -26,564,141,388.96 | -24,127,536,908.26 | N/A |
Causes for the operating proceeds change: mainly due to the increase of sales and the productstructure change in the reporting period.
Causes for the operating expense change: majorly due to the sales increase, the production costincrease, and the product structure change in the reporting period.
Causes for the sales expense change: mainly due to the advertising and marketing expense increasesfor the the Moutai-flavor series liquor in the reporting period.
Causes for the general and administrative expense change: mainly due to employee compensationincrease and maintenance cost increase in the reporting period.
Causes for the financial expense change: mainly due to the increase of commercial bank interestincome increase in the reporting period.
Causes for the R&D expense change: majorly due to the increase of R&D project increases in thereporting period.
Causes for the Net cash flow change from operating activities: mainly due to the increase of cashreceived from sales of goods and rendering of services in the reporting period.
Causes for the Net cash flow change from investment activities: mainly due to the increase of cashpayment used to buy certificates of deposit in the reporting period.
Causes for Net cash flow change from financing activities: mainly caused by the increase of cashdividend distribution in the reporting period.
Detailed reasons for any significant changes to the business type, profit structure or profit sources ofthe Company in the reporting period.
□Applicable √N/A
B. Income and cost analysis
√Applicable □N/A
a. Main business grouped by business segment, by product, by geographical zoning and by salesmodel.
Unit: CNY
| Main business grouped by business segment | ||||||
| Business segment | Operating proceeds | Operating costs | Gross profit margin | YoY Change of operating proceeds (%) | YoY change of operating costs (%) | YoY change of gross profit margin (%) |
| Liquor | 106,059,290,342.18 | 8,890,990,510.72 | 91.62 | 11.85 | 9.99 | 0.14 |
| Main business grouped by product | ||||||
| Product | Operating proceeds | Operating costs | Gross profit margin | YoY Change of operating proceeds (%) | YoY change of operating costs (%) | YoY change of gross profit margin (%) |
| Moutai | 93,464,512,115.94 | 5,577,910,539.00 | 94.03 | 10.18 | 9.36 | 0.04 |
| Other liquor | 12,594,778,226.24 | 3,313,079,971.72 | 73.69 | 26.06 | 11.06 | 3.55 |
| Main business grouped by geographical zoning | ||||||
| Geographical zonging | Operating proceeds | Operating costs | Gross profit margin | YoY Change of operating proceeds (%) | YoY change of operating costs (%) | YoY change of gross profit margin (%) |
| Domestic | 103,440,817,492.55 | 8,649,283,176.18 | 91.64 | 11.96 | 9.83 | 0.16 |
| Overseas | 2,618,472,849.63 | 241,707,334.54 | 90.77 | 7.66 | 15.96 | -0.66 |
| Main business condition by sales model | ||||||
| Sales model | Operating proceeds | Operating costs | Gross profit margin | YoY Change of Operating proceeds (%) | YoY change of operating costs (%) | YoY change of gross profit margin (%) |
| Wholesale agency | 82,029,927,984.26 | 7,958,382,622.48 | 90.30 | 0.55 | 6.06 | -0.50 |
| Direct sales | 24,029,362,357.92 | 932,607,888.24 | 96.12 | 81.49 | 60.89 | 0.50 |
b. Analysis of production volume, sales volume and inventory
√Applicable □N/A
| Main product | Unit | Production volume | Sales volume | Inventory | YoY change of production volume (%) | YoY change of sales volume (%) | YoY change of inventory (%) |
| Liquor | Ton | 84,721.17 | 66,438.69 | 260,746.17 | 12.72 | 3.72 | 4.62 |
c. Execution situation of major acquisition contracts and major sales contracts
□Applicable √N/A
d. Coast Analysis Table
Unit: CNY
| Condition by business segment | |||||||
| By business segment | Main breakdown items of cost | Amount in the reporting period | As % of total cost (%) | Amount in the same reporting period of previous year | As % of total cost in previous year (%) | YoY change (%) | Description of reasons |
| Liquor | 8,890,990,510.72 | 100 | 8,083,371,418.24 | 100 | 9.99 | ||
| Condition by product | |||||||
| By product | Main breakdown items of cost | Amount in the reporting period | As % of total | Amount in the same reporting | in | YoY change (%) | Description of reasons |
| cost (%) | period of previous year | previous year (%) | |||||
| Liquor | Direct materials costs | 5,006,828,759.74 | 56.32 | 4,426,309,798.99 | 54.76 | 13.12 | |
| Direct labor costs | 2,776,100,778.17 | 31.22 | 2,626,407,879.93 | 32.49 | 5.70 | ||
| Manufacturing costs | 592,850,869.35 | 6.67 | 553,108,867.79 | 6.84 | 7.19 | ||
| Fuels and energies | 271,547,032.80 | 3.05 | 244,593,638.55 | 3.03 | 11.02 | ||
| Transportation costs | 243,663,070.66 | 2.74 | 232,951,232.98 | 2.88 | 4.60 | ||
| Total | 8,890,990,510.72 | 100.00 | 8,083,371,418.24 | 100.00 | 9.99 |
e. Any share changes of subsidiaries merger scope changes in the reporting period
□Applicable √N/A
f. Information about significant changes or adjustments of the Company’s businesses, products orservices
□Applicable √N/A
g. Major customers and suppliers
(1)Major customers
The top five customers constitute a total proceeds of CNY 14,982.74 million, accounting for 14.13%of annual total proceeds, among which the proceeds by the affiliated parties totaled CNY 5,240.25million, accounting for 4.94% of the total annual proceeds.
(2)Major suppliers
The total acquisition cost paid to the five suppliers is CNY 2,917.35 million, accounting for 43.33%of annual total acquisition cost, among which the total to the affiliated parties is CNY 842.89 million,accounting for 12.52% of annual total acquisition cost.
C. Expenses
√Applicable □N/A
Financial expenses in the reporting period was CNY -934,523,406.02, comparing with that in the lastperiod of CNY -234,610,582.44, the cost reduction was mainly due to the increase of interest incomefrom commercial bank deposits.
D.R&D expensesa. Statement of R&D expenses
√Applicable □N/A
Unit: CNY
| R&D expenses in this period | 190,053,124.36 |
| Total R&D expenses | 190,053,124.36 |
| as（%）in operating proceeds | 0.18 |
Note: The R&D expenses in this period include the R&D expenses listed in the operating costs andthe compensation of scientific researchers.b. Statement of R&D employee
√Applicable □N/A
| Number of R&D employees | 659 |
| as (%) in the total number of the Company’s employees | 2.20 |
| Educational background structure of R&D employees | |
| Educational background structure type | Number in each educational background structure |
| Doctorate | 53 |
| Master’s degree | 153 |
| Undergraduate | 405 |
| Junior college | 42 |
| High school and below | 6 |
| Age structure of R&D employee | |
| Age structure type | Number in each age structure |
| under 30 (excluding 30) | 134 |
| 30-40 (including 30 but excluding 40) | 371 |
| 40-50 (including 40 but excluding 50) | 113 |
| 50-60 (including 50 but excluding 60) | 34 |
| over 60 | 7 |
c. Explanation
□Applicable√ N/A
d. Reasons for the significant changes in R&D employees and their impacts on the Company’s futuredevelopment
□Applicable√ N/A
E. Cash flows
√ Applicable □N/A
Unit: CNY
| Item | Amount in this period | Amount in last period | Change (%) |
| Net increase customer and interbank deposits | 7,511,166,145.93 | 3,189,100,199.87 | 135.53 |
| Receipt of other cash related to business activities | 1,643,536,862.48 | 221,421,226.63 | 642.27 |
| Net increase in loans and advances to customers | 484,244,272.00 | 2,978,755,728.00 | -83.74 |
| Net increase in lending funds | -400,000,000.00 | 200,000,000.00 | N/A |
| Net increase in central and interbank deposits | 559,089,326.28 | -2,506,406,682.56 | N/A |
| Cash paid for interests, fees, and commissions | 163,462,728.48 | 107,241,768.26 | 52.42 |
| Cash received from investment recoveries | 6,079,930.68 | 314,906,521.48 | -98.07 |
| Cash received from investment returns | 860,000.00 | N/A | |
| Net cash received from disposal of fixed assets, intangible assets and other long-term assets | 2,463,474.29 | 495,904.85 | 396.76 |
| Cash received from other investment relate activities | 9,983,452.63 | 6,675,319.03 | 49.56 |
| Cash paid to acquire or construct fixed assets, intangible assets and other long-term assets | 3,408,784,532.01 | 2,089,769,498.78 | 63.12 |
| Cash paid for investments | 2,150,000,000.00 | 20,000,000.00 | 10,650.00 |
| Cash paid for other investment related activities | 23,048,029.93 | 17,535,402.30 | 31.44 |
| Net cash flow from investment activities | -5,562,445,704.34 | -1,805,227,155.72 | N/A |
| Cash paid for other financing related activities | 88,121,549.59 | 36,507,157.75 | 141.38 |
| Impact of fluctuation in exchange rate on cash and cash equivalents | -2,026,542.60 | 380,639.36 | N/A |
(1) The net increase in customer and interbank deposits is mainly due to the Company’s holdingsubsidiary, Kweichow Moutai Group Finance Co., Ltd. gathered more funds from other membercompanies of the group company than the previous reporting period.
(2) The increase in the cash received from other business related activities, is mainly due to theinterest income increases from commercial bank deposits in the reporting period.
(3) The decrease in the net increase in loans and advances to customers, is mainly due to less loanincrease was issued by the Company’s holding subsidiary, Kweichow Moutai Group Finance Co., Ltd.to the member companies of the group company in the reporting period.
(4) The decrease in the net increase in lending funds, is mainly due to the due recovery of interbankloans by the Company’s holding subsidiary, Kweichow Moutai Group Finance Co., Ltd.
(5) The increase in the central and interbank deposits is mainly due to the maturity of the fixed termbank deposits deposited by the Company’s holding subsidiary, Kweichow Moutai Group Finance Co.,Ltd. in the previous reporting period.
(6) The increase in the cash paid for interests, fees and commissions, is mainly due to the increase ofinterest payments by the Company’s holding subsidiary, Kweichow Moutai Group Finance Co., Ltd.in the reporting period.
(7) The decrease in the cash received from investment recoveries, is mainly due to the decrease in thecash received from disposal of non-current financial assets in this period.
(8) The increase in the cash received from investment returns, is mainly due to bond interests receiveby the Company’s holding subsidiary, Kweichow Moutai Group Finance Co., Ltd.
(9) The increase in the net cash received from disposal of fixed assets, intangible assets and otherlong-term assets, is majorly caused by the increase in the cash received from disposal of fixed assetsin this period.
(10) The increase in the cash received from other investing activities, is caused by the increase in theperformance bond for basic construction in this period.
(11) The increase in the cash paid to acquire and construct fixed assets, intangible assets and otherlong-term assets, is majorly caused by the increase in the land transferring fees in this period.
(12) The increase in the cash paid for investments, is majorly caused by the purchase of the certificateof deposit in this period.
(13) The increase in the cash paid for other investing activities, is caused by the increase in the returnof the performance bond for basic construction in this period.
(14) The decrease in the cash paid for other financing activities, is majorly caused by the increase inthe cash for purchasing certificate of deposit.
(15) The increase in the cash paid for other financing activities, is majorly caused by the adjustmentregarding the accounting affairs in leasing according to the new leasing principles.
(16) The decrease in the effect of fluctuation in exchange rate on cash and cash equivalents, is causedby the Company’s wholly-owned subsidiary, Kweichow Moutai Paris Trading, whose financialstatement of overseas operation has been converted as the foreign currency translation differences inthe statement of recording currency.
5.2 Reasons for significant changes of profit caused by non-core business
□Applicable√ N/A
5.3 Analysis of assets and liabilities
√Applicable □N/A
A. Assets and liabilities
Unit: CNY
| Item | Amount by the end of this period | As % of total assets (%) | Amount by the end of last period | As % of total assets (%) | Change in percentage (%) | Explanation about any material change |
| Cash and cash equivalents | 51,810,243,607.11 | 20.30 | 36,091,090,060.90 | 16.91 | 43.55 | Majorly caused by the increase in commercial bank deposit |
| Notes receivables | 1,532,728,979.67 | 0.72 | N/A | |||
| Prepayment | 389,109,841.28 | 0.15 | 898,436,259.15 | 0.42 | -56.69 | Mainly the intangible assets converted from the pre-paid real-estate funds. |
| Inventories | 33,394,365,084.83 | 13.09 | 28,869,087,678.06 | 13.53 | 15.68 | |
| Other current assets | 71,527,560.74 | 0.03 | 26,736,855.91 | 0.01 | 167.52 | Mainly the VAT credit increases |
| Debt investment | 170,468,623.71 | 0.07 | 20,143,397.78 | 0.01 | 746.28 | |
| Investment real estate property | 5,242,431.75 | 0.002 | N/A | The Company’s holding subsidiary, Moutai Custom Marketing (Guizhou) Co., Ltd., leased real estate properties. | ||
| Fixed assets | 17,472,173,182.85 | 6.85 | 16,225,082,847.29 | 7.60 | 7.69 | |
| Right-to-use assets | 362,785,970.23 | 0.14 | N/A | Impacted by the newly-implemented leasing regulations | ||
| Other non-current assets | 2,059,761,333.33 | 0.81 | N/A | Purchased of certificates of deposit | ||
| Other non-current financial assets | 9,830,052.91 | 0.005 | N/A | Disposal of the equities of shareholding company, Kweichow Moutai Distillery |
| Deferred income tax assets | 2,237,206,443.84 | 0.88 | 1,123,225,086.37 | 0.53 | 99.18 | Mainly caused by the increase of deferred tax assets due to the confirmation of internal transactions with unrealized profits. |
| Accounts payable | 2,009,832,495.56 | 0.79 | 1,342,267,668.12 | 0.63 | 49.73 | Mainly due to the account payable increase for raw materials. |
| Taxes payable | 11,979,802,144.01 | 4.69 | 8,919,821,015.58 | 4.18 | 34.31 | Mainly because the taxes realized in this period increased over the previous period. |
| Deposits from customers and inter-bank | 21,763,575,647.32 | 8.53 | 14,241,859,949.77 | 6.67 | 52.81 | Mainly because the Kweichow Moutai Group Finance Co., Ltd. absorbed more deposits from other member companies of the group company. |
| Non-current liabilities due within one year | 104,319,886.87 | 0.04 | N/A | Impacted by the newly-implemented leasing regulations. | ||
| Leasing liabilities | 296,466,199.74 | 0.12 | N/A | Impacted by the newly-implemented leasing regulations. | ||
| Deferred income tax liabilities | 1,457,513.23 | 0.001 | N/A | Disposal of the equities of shareholding company, Kweichow Moutai Distillery (Group) Foreign Investment Cooperation Management CO., Ltd. | ||
| Other comprehensive income | -13,017,880.78 | -5,331,367.75 | N/A | The financial reports for the overseas operation of the Company’s wholly-owned subsidiary, Kweichow Moutai Paris Trading Co., Ltd., were converted into its bookkeeping base currency. |
Other explanation: According to the relevant provisions of the accounting standards for BusinessEnterprises No. 21 - leasing (CK [2018] No. 35) revised and issued by the Ministry of Finance in2018, the Company implemented the new leasing regulations from January 1, 2021, and theaccounting treatment of leasing business was listed in the items of right-to-use assets, lease liabilitiesand non-current liabilities due within one year.
B. Main assets overseas
□Applicable √N/A
C. Restricted assets rights as of the end of this reporting period
□Applicable √N/A
5.4 Analysis of operating information in the industry
√Applicable □N/A
Analysis of operating information in the liquor production industryA. Industry profile
√Applicable □N/A
According to the National Bureau of statistics, the total output of Chinese Baijiu productionenterprises in Chinese Baijiu above designated size has reached 7,156.30 million liters in 2021, aslight decrease of 0.59% compared with the same period last year. The sales revenue has reachedCNY 603.35 billion, a year-on-year increase of 18.6%; the total profit was CNY 170.19 billion, ayear-on-year increase of 32.95%.
B. Production CapacityCurrent capacity
√Applicable □N/A
| Main Factories | Designed Capacity | Actual Capacity |
| Chinese Baijiu production workshop of Moutai | 42,742.50 | 56,472.25 |
| Series liquor production workshop | 31,660.00 | 28,248.92 |
Notes: (1) In the design capacity of 31,660.00 tons of series base liquor, due to the production processcharacteristics of the series liquor, the design capacity of 6,400.00 tons of series base liquor wasplaced into operation in November 2021, and the actual capacity would be released in 2022. (2) Thecompany uses the weight unit to measure according to the usual practice. The units of measurementused for production, sales, inventory, and production capacity in this report are all in "tons".
Capacity under Construction
√Applicable □N/A
Unit: CNY 10,000
| Name of the Capacity under Construction | Planned investment amount | Amount invested in this reporting period | Accumulated investment amount |
| 30000 ton Moutai-flavored series liquor technical renovation project and its supporting facilities | 838,400.00 | 205,273.00 | 371,273.00 |
Production capacity calculation standards
√Applicable □N/A
In the above “existing capacity” table, the design capacity is calculated according to the productionprocess requirements, combined with the plant specifications and the number of cellars, and the actualcapacity is calculated according to the actual base liquor production yield in the reporting period.
C. Inventory at the end of the reporting period
√Applicable □N/A
Unit: Ton
| Finished liquor | Semi-finished liquor (including base liquor) |
| 10,282.35 | 250,463.82 |
Note: The finished liquor is the Company’s packaged inventory stock (including Moutai-flavor seriesliquor).
Inventory Impairment Risk Warning
□Applicable √N/A
Product profile
√Applicable □N/A
Unit: CNY 10,000
| Product grade | Production (ton) | Change（%）Same Period | Sales (tons) | Change（%）Same period | Production/sales rate (%) | Sales revenue | Change（%）same period | Main representing brand |
| Moutai | 56,472.25 | 12.42 | 36,261.31 | 5.68 | 9,346,451.21 | 10.18 | Moutai | |
| Other series liquor | 28,248.92 | 13.33 | 30,177.38 | 1.46 | 1,259,477.82 | 26.06 | Moutai Wangzi liquor, Han Moutai-flavored liquor, Lai Mao liquor |
Note: (1) In order to ensure the sustainable development of the Company, a certain amount of baseliquor needs to be retained every year. According to the production process, it takes Maotai liquor atleast 5 years of cellaring since its production before in can be released from the factory. (2) Moutai isa blend of base liquor of different years, different rounds and different concentrations. It is a perfectcombination of technology and art. Therefore, the base liquor of a certain year may appear as aproduct in the next several years. (3) The Company regards quality as its life, adheres to quality first,adheres to the spirit of craftsmanship, and adheres to the principle of “honoring the principles, abidingby the rules, sticking to the craftsmanship, cellaring enough liquor to age, and not selling youngliquor”. The production of Moutai is of natural solid-state fermentation, brewed with traditionalcraftsmanship, and therefore the production yield has certain volatility. (4) Based on the abovereasons, the production and sales rate of Moutai base liquor cannot be accurately calculated. Theproduct formation process of series liquor is similar to that of Moutai.
Product grading standards
√Applicable ?N/A
Graded by the quality of the product.
Changes in the product structure and business strategy
□Applicable √N/A
E. Raw material purchasea. purchase model
√Applicable ?N/A
Raw materials are mainly purchased from the market through centralized procurement accordingto the Company’s production and sales plan.
b. purchase amount
√Applicable ?N/A
Unit: CNY 10,000
| Raw materials type | Purchase amount in this period | Purchase amount in last period | as % in total purchase amount |
| Liquor brewing raw materials | 310,081.75 | 295,279.42 | 48.90 |
| Packaging materials | 282,811.20 | 239,037.16 | 44.59 |
| Energies | 35,258.15 | 26,730.70 | 5.56 |
| Workshop auxiliary materials | 6,042.04 | 4,690.69 | 0.95 |
F. Salesa. Sales model
√Applicable?N/A
The Company’s products are sold through direct selling and distributor channels. Direct saleschannels refer to self-operated channels, while wholesale agency channels refer to social distributors,supermarkets, e-commerce and other channels.
b. Sales channel
√Applicable?N/A
Unit: CNY 10,000
| Channel type | Sales amount in this period | Sales amount in last period | Sales volume in this period (ton) | Sales volume in last period (ton) |
| Direct selling | 2,402,936.23 | 1,324,035.65 | 5,735.70 | 3,932.08 |
| Wholesale agency | 8,202,992.80 | 8,158,164.26 | 60,702.99 | 60,123.80 |
c. Regional situation
√Applicable?N/A
Unit: CNY 10,000
| Region Name | Sales revenue in this period | Sales revenue in last period | as % in the total amount | Sales volume in this period (ton) | Sales volume in last period (ton) | as % in the total volume |
| Domestic | 10,344,081.75 | 9,238,973.51 | 97.53 | 64,877.80 | 62,529.32 | 97.65 |
| Overseas | 261,847.28 | 243,226.40 | 2.47 | 1,560.89 | 1,526.56 | 2.35 |
Regional division standards?Applicable √N/A
d. Distributor Situation
√Applicable?N/A
| Region Name | Number of distributors by the end of the reporting period | Number increased in the reporting period | Number decreased in the reporting period |
| Domestic | 2,089 | 63 | 20 |
| Overseas | 104 |
Facts:
√Applicable?N/A
The increase is mainly the distributors of Moutai-flavor series liquor, and the decrease is mainly thedistributors of Moutai liquor.
Management of distributors?Applicable √N/A
e. Online-sales situation?Applicable √N/A
Future online business strategy?Applicable √N/A
G. Analysis of the Company’s revenue and costa. disclose the composition of the company’s main business by different types
√Applicable?N/A
Unit: CNY
| Type | Operating proceeds | Change（%） | Operating costs | Change（%） | Gross profit rate（%） | Change（%） |
| By class of product | ||||||
| Moutai | 93,464,512,115.94 | 10.18 | 5,577,910,539.00 | 9.36 | 94.03 | 0.04 |
| Other series liquor | 12,594,778,226.24 | 26.06 | 3,313,079,971.72 | 11.06 | 73.69 | 3.55 |
| Subtotal | 106,059,290,342.18 | 11.85 | 8,890,990,510.72 | 9.99 | 91.62 | 0.14 |
| by sales channel | ||||||
| Direct selling | 24,029,362,357.92 | 81.49 | 932,607,888.24 | 60.89 | 96.12 | 0.50 |
| Wholesale agency | 82,029,927,984.26 | 0.55 | 7,958,382,622.48 | 6.06 | 90.30 | -0.50 |
| Subtotal | 106,059,290,342.18 | 11.85 | 8,890,990,510.72 | 9.99 | 91.62 | 0.14 |
| By regional segment | ||||||
| Domestic | 103,440,817,492.55 | 11.96 | 8,649,283,176.18 | 9.83 | 91.64 | 0.16 |
| Overseas | 2,618,472,849.63 | 7.66 | 241,707,334.54 | 15.96 | 90.77 | -0.66 |
| Subtotal | 106,059,290,342.18 | 11.85 | 8,890,990,510.72 | 9.99 | 91.62 | 0.14 |
Fact Sheet?Applicable √N/A
Cost
√Applicable?N/A
Fact Sheet
√Applicable?N/A
See Statement of Cost, Analysis of main business, Section III Management Discussion and Analysis.
5.5Analysis of investment situation
Total investment?Applicable √N/A
A. Significant equity investment?Applicable √N/A
B. Important non-equity investment
√Applicable?N/A
Non raised fund projects (projects with total investment exceeding 10% of the Company’s audited netassets at the end of last year)
a. According to the resolution of the Company’s 2011 annual shareholders’ meeting, the Company hasplanned to invest CNY 3,583.16 million in the construction of Moutai-flavor series liquor makingtechnical transformation project and supporting facilities project. By the end of the reporting period, atotal of CNY 1,994.84 million had been invested.
b. According to the resolution of the Company’s first extraordinary general meeting in 2012, theCompany has planned to invest CNY 4,139.00 million in the construction of phase I of the Moutailiquor technical transformation project and supporting facilities project in Zhonghua Area. By the endof the reporting period, a total of CNY 4,281.51 million has been invested.
C. Financial assets measured at fair value?Applicable √N/A
5.6Analysis of major holding companies
√Applicable?N/A
Unit: CNY 10,000
| Company name | Industry | Registered capital | Total assets | Net assets | Operating proceeds | Operating profit | Net profit |
| Kweichow Moutai Sales Co., Ltd. | Liquor, beverages and tea wholesale | 1,000.00 | 7,651,886.93 | 5,678,012.95 | 9,061,083.73 | 6,405,840.18 | 4,803,918.40 |
5.7Structured entities controlled by the Company
?Applicable √N/A
6. Discussion and analysis of the Company’s future development
6.1Pattern and trend in the industry
√Applicable ?N/A
Pattern and trend. In 2021, the ever-changing situation and the century epidemic situation areintertwined, and the external environment becomes more complex, severe and uncertain. However,the fundamentals of China’s long-term economic improvement will not change. The total volume ofliquor production and sales has stabilized, and quality and efficiency have been steadily improved.The main trends are as follows: first, the industry will further improve quality and efficiency. In 2021,the Chinese Baijiu enterprises have completed their business income of CNY 603.35 billion, anincrease of 18.6% over the same period last year. The total profit was CNY 170.19 billion, ayear-on-year increase of 32.95%. The high-quality development of the industry has achievedremarkable results; second, the industrial concentration was further improved. The market share of theindustry will continue to concentrate on advantageous brands, advantageous production capacity andadvantageous production areas, and the structural growth pattern will exist for a long time; third, theconsumption structure was further upgraded. Under the background of common prosperity, disposableincome of residents continues to increase. The demand for Chinese Baijiu with high quality will drivethe development of high-quality and famous Chinese Baijiu.
Competitive advantage of the Company. First, the Company has “four core potentials” composed ofunique geographical protection of origin, non-replicable microbial colony, unique brewing technologyinherited for thousands of years and high-quality base liquor resources stored for a long time; Second,the company has large-scale product production and supporting capacity, strong management,technology and marketing team and craftsman team proficient in Chinese Baijiu making, startermaking, blending and tasting; Third, as a traditional pillar and characteristic advantage industry inGuizhou Province, local governments have successively introduced various policies to support thedevelopment of Chinese Baijiu industry. The external environment of Chinese Baijiu development hasbeen continuously improving, the market competitiveness is outstanding, and brand competitivenesshas been leading continuously.
6.2 Development strategy
√Applicable ?N/A
During the “14th Five Year Plan” period, the Company will take the overall situation withhigh-quality development, closely focus on the development goal of “dual-doubling,dual-consolidation and dual-construction” of the group company, unswervingly follow the “five linedevelopment path”, adhere to the principle that quality is the soul of life, build the two lifelines ofecology and safety, focus on the main business, deeply practice the “five-in-one marketing”, makedecisions according to the situation, take advantage of the situation, gather strength, and continuouslyimprove product quality, brand value, marketing ability, cultural content and management efficiencyto promote high-quality development and make great strides forward.
6.3 Business plan
√Applicable ?N/A
In the new year of 2022, the Company will strictly follow the decisions and arrangements of the CPCCentral Committee, the State Council, Guizhou Provincial Party Committee and the provincialgovernment, put every effort into the production and operation, reform and development, strive topromote the high-quality development of the company.
This year’s business objectives are as follows: first, the total operating proceeds will increase by about15% compared with the previous year; and the second is to complete the capital constructioninvestment of CNY 6.97 billion. The Board of Directors will focus on the annual targets and tasks,take overall consideration and go all out to do the following key tasks:
First, we will make every effort to ensure high-quality and stable production. Further practice theconcept of “quality is the soul of life”, establish the new era of quality concept, build and implementthe “365” quality management system, adhere to the traditional process, scientific innovation,continue to promote the modernization of Moutai quality management; constantly optimize theproduction process analysis and judgment system, pay close attention to production processimplementation and process management, strengthen scientific research and technology, build andimprove the whole industry chain and whole life cycle information platform, support Moutai qualityengineering with modern science and technology, and provide strong technical support for sustainablequality and stable production.
Second, we will continue to do a good job in marketing. We will strengthen market coordination,accelerate the optimization and upgrading of product mix, targeted product delivery, and increasemarket share. We will resolutely crack down on fake and shoddy goods, and maintain market orderand stability. Accelerate the application of new anti-counterfeiting technology to provide technicalguarantee for Moutai’s anti-counterfeiting rights protection. Constantly enrich the brand connotation,enhance the brand characteristics, promote the upgrading of consumption experience, and strive tobuild Moutai Cultural Experience Hall into a cultural display store, brand image store, drinkingexperience store and customer service store, so as to continuously provide consumers with higherquality services.
Third, we will continue to deepen reform and innovation. We will carry out a campaign to improvethe management of world-class enterprises, continue to improve modern enterprise systems, andsystematically improve their governance capacity and level. We will make every effort to reform themarketing system, optimize the distribution of the marketing network, and ensure that the fruits ofreform and development will benefit more consumers. We will promote the integrated development of“industry, university and research”, introduce professional and technical personnel, deepencooperation in scientific research projects, accelerate the transformation of innovation achievements,further enhance the independent innovation capacity of enterprises, and provide strong technical andintellectual support for high-quality development.
Fourth, we will promote project construction in an orderly manner. To manage the quality, cost andprogress of the whole life cycle projects, start the construction of packaging logistics park; acceleratethe construction of 30,000 tons of Moutai-flavor series liquor technical renovation project and 15liquor warehouses in Zhonghua area; strengthen the overall scheduling and supervision, accelerate theeffective disposal of historical “legacy projects”, and lay a solid foundation and enhance thesustainability for the sustainable and steady development of Moutai.
Fifth, we will adhere to the red line of safety and environmental protection. We will continue to carryout a three-year campaign to improve work safety, improve the work safety management mechanism,promote the construction of a safety risk control and hidden danger management system, implementsmart safety and smart fire protection, improve the professional level of safety management, andenhance the ability of prevention and rescue and relief. Adhere to the ecological priority, greendevelopment path, promoting “de-pollution” and “de-carbon” project, strive to build“Mountain-River-Forest-Soil-River-Microbe” life community and green low-carbon circulationindustry system, promote the construction of “xi ecological civilization thought practicedemonstration base” and build “Chinese Baijiu industry ecological benchmarking enterprise”, toprotect Moutai survival and development of natural ecological environment.
Sixth, to enhance the level of cultural development. Focusing on the nine aspects of Moutai culture,“people, culture, material, art, ceremony, festival, harmony, history and tool”, we willcomprehensively excavate, refine, build and enrich Moutai culture. We will plan and hold high-endinternational wine culture activities, hold traditional cultural activities such as the “Dragon BoatFestival” and “Moutai Festival”, launch the compilation of the Chinese Wine Culture Ceremony, andstrive to build a key national cultural project. Coordinate service management, standardize brandmonitoring and supervision, and strive to establish and improve the corporate culture system in linewith their own characteristics.Seventh, we will strengthen the construction of personnel teams. Focusing on the needs ofdevelopment, we will cultivate and introduce national and provincial high-level innovative talents,outstanding professional talents and operation and management talents in key areas. We will deepenthe “Eight-step craftsman” training system, set up the “Moutai Craftsman Day”, and cultivate a groupof post-90s skills through versatile craftsmen, including craftsmen, Moutai craftsmen, skillidentification, teachers, skill competitions, labor competitions, and “five small” activities. We willcontinue to increase staff training, smooth the channels for the evaluation and employment of jobtechnology and professional titles, strive to improve the working vision and professional level oftechnical personnel, establish a talent classification and evaluation system that fits the development ofMoutai, and strive to create a good environment to attract talents, love and use talents.
Eighth, we will continue to strengthen our responsibility. We will actively carry out social publicwelfare activities such as donating money for students and helping the poor, and continue to highlightthe image of Moutai charity brand. Continue to optimize the support methods, steadily improve thebase support standards, and effectively protect the fundamental interests of farmers; continue to helpDaozhen develop advantageous and characteristic industries, drive development by industry, continueto consolidate the achievements of poverty alleviation and rural revitalization, help the economic andsocial development of the province, and make contributions to promoting common prosperity.
6.4Possible confronting risk
?Applicable√ N/AFirst, the risk of macroeconomic uncertainty; second, the epidemic impact on the consumptiondemand of Chinese Baijiu; and third, the risk of ecological environment protection; fourth, the risk ofintellectual property protection.
6.5Micellaneous
?Applicable √N/A
7. The Company’s failure to disclose the information and reasons in accordance with thestandards due to non-application of the standards or special reasons such as state secrets andtrade secrets?Applicable √N/A
Section IV Corporate Governance
1. Description of the related situation of corporate governance
√Applicable □N/A
In strict accordance with the Company Law, Securities Law, “Governance Standards of ListedCompanies” and other laws and regulations and the China Securities Regulatory Commission,Shanghai Stock Exchange, our company issued regulatory documents on corporate governance,combining the actual situation of the company, establish and improve the corporate governancestructure, actively promote the optimization of corporate governance structure, standardize thecompany operation. The company has formulated the relevant rules and regulations, and all the
systems have been effectively implemented. The company has revised and improved the articles ofAssociation, Rules of Procedure of the General Meeting of Shareholders, Rules of Procedure of theBoard of Directors and Rules of Procedure of the Board of Supervisors, with clearer rights andresponsibilities. The general meeting of shareholders, the board of directors, the board of supervisorsand the managers of the company shall perform their own duties and standardize the operation, andthe information disclosure of the company should be true, accurate, complete, timely and fair. Theboard of directors consists of five special committees, including strategy, audit, risk management,nomination, salary and assessment, each of which carries out its work according to its duties. Theindependent directors expressed their independent opinions in accordance with the regulations andplayed a full role.
(1) Situation of the General Meeting of Shareholders. In accordance with the requirements of theArticles of Association and the Rules of Procedure of the General Meeting of Shareholders of theCompany, the Company convene the general meeting of shareholders to ensure that all shareholders,especially minority shareholders, enjoy equal status and can fully exercise their rights, and employslegal counsel to issue legal opinions on the general meeting of shareholders. In 2021, the companyheld two general meetings of shareholders, deliberated and passed 15 motions, and all the resolutionswere carefully implemented.
(2) Situation of the Board of Directors. At present, the board of directors of the company is composedof 6 directors, among which 3 are independent directors and 1 is a staff director. The board ofdirectors should meet the requirements of laws and regulations. The board of directors of the companyhas five special committees: strategy, audit, risk management, nomination, salary and assessment.Each committee has a clear division of labor, clear rights and responsibilities, and effective operation.All the directors of the company can proceed from the interests of the company and all shareholders,perform their duties in good faith, loyalty, diligence, professional and due diligence, and earnestlysafeguard the legitimate rights and interests of the company and all shareholders.
(3) Situation of the Board of Supervisors. At present, the board of Supervisors of the company iscomposed of 3 supervisors, one of whom is an employee supervisor. The composition of the board ofsupervisors meets the requirements of laws and regulations. The Board of Supervisors of theCompany shall be diligent and responsible, exercise the function of supervision and inspection in thespirit of responsibility to shareholders, supervise the company’s financial situation and operation,related transactions and the performance of duties of senior management personnel, and safeguard thelegitimate rights and interests of the Company and all shareholders.
(4) Situation of controlling shareholders and listed companies. The controlling shareholder shallexercise the rights of the investors and assume their obligations in strict accordance with therequirements of the Company Law. The company has independent business and independentoperation ability. The controlling shareholders and the listed company have achieved independentbusiness, personnel, assets, institutions and finance. The board of directors, board of supervisors andinternal institutions of the company all operate independently to ensure that the company’s majordecisions are independently made and implemented by the company.
(5) Company information disclosure. The Company discloses relevant information in strictaccordance with laws, regulations, the Articles of Association and the Information DisclosureManagement Measures of the Company truly, accurately, completely, timely and fairly, and ensuresthat all shareholders and other stakeholders can have equal access to the Company information.During the reporting period, the company disclosed 30 interim announcements and 4 periodic reports.
(6) Related party transactions. Related party transactions between the Company and its controllingshareholder China Kweichow Moutai (Group) Liquor Co., Ltd. and other related parties, these relatedtransactions are to ensure the normal production and operation and business, the specific contentthrough relevant agreement, and perform the legal procedures, follow the principle of openness,fairness and justice, there is no adverse effect on the company operation.
(7) Internal control and construction situation. During the reporting period, the company continued tocarry out internal control related work in accordance with the requirements of the Basic Standards forEnterprise Internal Control, continued to promote the internal control construction, evaluation, auditand other related work, ensure the realization of the company’s internal control objectives, and furtherimprove the level of corporate governance.
(8) The formulation and implementation of the registration and management system of insider. Inaccordance with the relevant provisions of the CSRC and the Shanghai Stock Exchange, the Companyhas formulated the Registration and Management System for Company Insider. The company hasstrictly implemented relevant systems, registered and filed insider information in accordance with theregulations, further standardized the management of insider information, done a good job in theconfidentiality of insider information, safeguarded the principles of openness, fairness and justice ofinformation disclosure, and protected the legitimate rights and interests of the general investors.
Whether there are significant differences between corporate governance and laws, administrativeregulations and the CSRC regulations on the governance of listed companies; if there are any majordifferences, the reasons shall be explained
√Applicable □N/A
2. The specific measures taken by the controlling shareholders and actual controllers of thecompany to ensure the independence of the company's assets, personnel, finance, institutionsand business, as well as the solutions, work progress and follow-up work plans that affect theindependence of the company work progress and follow-up work plans that affect theindependence of the company
√Applicable □N/A
The situation of the controlling shareholders, actual controllers and other units under their controlengaged in the same or similar business as the company, as well as the impact of great changes in theindustry competition or competition on the Company, the solution measures taken, solution progressand subsequent solution plans
√Applicable □N/A
3. Introduction of shareholders’ Meeting
| Session of the meeting | Date of convening | Query index of the designated website published in the resolution | Date of disclosure of the publication of the resolution | Meeting resolution |
| the annual general meeting in 2020 | 2021-06-09 | www.sse.com.cn | 2021-06-10 | For details, please refer to the Announcement of the Resolution of Kweichow Moutai Annual General Meeting of Shareholders in 2020 (Announcement No.: Lin 2021-013). |
| The first extraordinary general meeting of shareholders in 2021 | 2021-09-24 | www.sse.com.cn | 2021-09-25 | For details, please refer to the Announcement of the Resolution of the First Extraordinary General Meeting of Shareholders of Kweichow Moutai in 2021 (Announcement No.: Lin 2021-026). |
Preferred shareholders with restored voting rights request an extraordinary general meeting ofshareholders
√Applicable □N/A
Description of the shareholders’ general meeting
√Applicable □N/A
4. Situation of directors, supervisors and senior officers
4.1 Shareholding changes and remuneration of outgoing directors, supervisors and seniormanagers currently and during the reporting period
√Applicable □N/A
Unit：per share
| Full Name | Position (note) | Gender | Age | Start Date of Term | Termination date of term | Number of shares held at the beginning of the year | The increase or decrease of shares within the year | Cause of The increase or decrease of shares | Total pre-tax remuneration obtained from the Company during the reporting period (ten thousand CNY) | Whether to get paid from the related parties of the company | |
| Ding Xiongjun | Chairman and director | male | 47 | September 24, 2021 | Yes | ||||||
| Li Jingren | director | male | 57 | November 28, 2018 | Yes | ||||||
| Acting general manager responsibilities | July 2,2019 | ||||||||||
| Lu Jinhai | independent director | male | 51 | May 18, 2016 | 7 | No | |||||
| Xu Dingbo | independent director | male | 58 | September 20, 2016 | 7 | No | |||||
| Zhang Jingzhong | independent director | male | 58 | September 20, 2016 | 7 | No | |||||
| Fu Zhigang | worker director | male | 43 | June 10,2020 | Yes | ||||||
| You Yalin | Chairman and supervisor of the Board of Supervisors | male | 52 | March 20, 2020 | 80.56 | No |
| Che xingyu | supervisor | Male | 54 | June 10,2020 | 63.76 | No | |||||
| Liu Chenglong | Staff supervisor | Male | 44 | June 10,2020 | 66.06 | No | |||||
| Zhong Zhengqiang | vice-general manager | Male | 50 | July 13, 2015 | 116.44 | No | |||||
| Tu Huabin | vice-general manager | Male | 46 | February 27, 2020 | 76.38 | No | |||||
| Wang Xiaowei | vice-general manager | Male | 50 | February 27, 2020 | 76.17 | No | |||||
| Jiang Yan | Deputy General Manager and Chief Financial Officer | Female | 44 | November 15, 2021 | 4.18 | No | |||||
| Secretary of the Board | January 25, 2022 | ||||||||||
| Gao Weidong | Chairman and director | Male | 49 | March 20, 2020 | September 24,2021 | Yes | |||||
| Wang Yan | director；trustee | Male | 52 | October 16, 2018 | January 6,2021 | Yes | |||||
| Liu Gang | Deputy General Manager and Chief Financial Officer | Male | 51 | July 2,2019 | October 8,2021 | 89.66 | No | ||||
| Secretary of the Board | January 18, 2020 | ||||||||||
| summation | / | / | / | / | / | / | 594.21 | / |
Note: 1. According to the relevant regulations of Guizhou State-owned Assets Supervision andAdministration Commission, the annual salary of enterprise leaders is composed of basic annual salary,performance-based annual salary and term incentive. In principle, they do not enjoy other salaryexpenses except the three parts, such as subsidies.2. The pre-tax remuneration received by Mr. ZhongZhengqiang and Mr. Liu Gang from the company during the reporting period included reissue of theyear-end performance of previous years
| Full Name | Main work experience |
| Ding Xiongjun | He served as deputy Secretary General of Guizhou Provincial Government and member of the Party Leadership Group of The General Office of Guizhou Provincial Government, Deputy Director of the Office of the Leading Group for Comprehensively Deepening Reform of Guizhou Provincial Party Committee, Standing Committee member and Vice Mayor of Bijie Municipal Committee of Guizhou Province (in charge of the executive work of the municipal Government), and Secretary of the Party Leadership Group and Director of Guizhou Energy Bureau.Currently, he is the Secretary of the Party Committee, Chairman and director of China Kweichow Moutai Distilley (Group) Co., Ltd., and the chairman and director of Kweichow Moutai Co., Ltd. |
| Li Jingren | He served as a member of the Party Group and chief accountant of Guizhou Reservoir and Ecological Immigration Bureau, a member of the Party Group and deputy Director of Guizhou Reservoir and Ecological Immigration Bureau, the chief accountant of China Kweichow Moutai Distillery (Group) Co., Ltd.. Currently, he is deputy Secretary of the Party Committee, Vice Chairman, Director and general Manager of China Kweichow Moutai Distillery (Group) Co., LTD, and director and acting general manager of Kweichow Moutai Co., Ltd. |
| Lu Jinhai | He used to be director of Financial Engineering Department and Director of Information Technology Department of Southern Fund Management Company, general manager of Baoying Fund Management Co., Ltd., and deputy general manager of China Re Asset Management Co., Ltd. He is currently a partner of Shenzhen Qianhai Daoming Investment Management Co., Ltd. and an independent director of Kweichow Moutai Co., Ltd. |
| Xu Dingbo | He was a teaching assistant at the University of Pittsburgh and Minnesota, an assistant professor at Hong Kong University of Science and Technology, and an adjunct professor at Peking University. Current central Europe international business school according to the way accounting teaching professor, deputy provost, central Europe international business school education development foundation secretary general, CGMA100 north Asia management accounting leaders, vice President of China association of chief accountants, executive director, societe generale (China) co., LTD., independent director, China Kweichow Moutai Distillery (Group) Co., Ltd.., independent director, Jingdong Group independent director. |
| Zhang Jingzhong | He once served in the Research Office of the Political and Legal Committee of Zhejiang Provincial Party Committee. He is currently the director of Zhejiang Tianji Law Firm, an independent director of Shanghai Chenguang Stationery Co., Ltd., an independent director of Kweichow Moutai Co., Ltd., and an independent director of Gansu Huangtai Liquor Co., Ltd. |
| Fu Zhigang | He once served as the director of the Quality Department of China Kweichow Moutai Distilley (Group) Co., Ltd., the director of the Quality Department of Kweichow Moutai Co., Ltd., and the secretary of the Production Party branch of Kweichow Moutai Co., Ltd. Currently, he is the director and deputy secretary of the Party branch and director of the Central Procurement Center of China Kweichow Moutai Distilley (Group) Co., LTD., and employee director of the Centralized Procurement Center of Kweichow Moutai Liquor Co., LTD, director. |
| You Yalin | He used to be assistant to the general manager, director of the Party Committee Office, Secretary of the Party Committee, director of the National Security Office, Director of the confidentiality Office, and director of the petition Office of China Kweichow Moutai Distillery (Group) Co., LTD. He is currently the chairman and supervisor of the Board of Supervisors of Kweichow Moutai Co., Ltd. |
| Che Xingyu | He used to be the director of the Enterprise Management Department of Kweichow Moutai Co., Ltd., a member of the Office of the Leading Group of China Kweichow Moutai Distilley (Group) Co., Ltd., and the full-time chairman of the Board of Supervisors of the Management Office of the Subsidiary Board of Supervisors. Currently, he is the director and Deputy Secretary of the Party Committee of the Life Service and Security Center of China Kweichow Moutai Distilley (Group) Co., LTD., supervisor, |
| Director. | |
| Liu Chenglong | He served as the director of the Legal Protection Department of Kweichow Moutai (Group) distillery Co., Ltd, and the director of the Legal Protection Department of Kweichow Moutai Co., Ltd. Currently, he is the director of the Human Resources and Social Security Department of China Kweichow Moutai Distilley (Group) Co., Ltd., the vice president of the Party School (Staff Training School), the staff supervisor and the director of the Human Resources and Social Security Department of Kweichow Moutai Co., Ltd. |
| Zhong Zhengqiang | He served as director and Deputy Secretary of Workshop 13 of Kweichow Moutai Co., Ltd.; Assistant General Manager and Director of Production Management Department. He is currently the deputy general manager of Kweichow Moutai Co., Ltd. |
| Tu Huabin | Assistant general manager of Kweichow Moutai Co., LTD., director of production management department, new workshop preparation group leader, party branch secretary of production, assistant general manager of China Kweichow Moutai (Group) distillery Co., Ltd., Kweichow Moutai (Group) distillery Co., Ltd. Deputy Party secretary, vice chairman, general manager. Currently, he is the deputy general manager of Kweichow Moutai Co., LTD., and serves as the Party Secretary of Kweichow Moutai Co., LTD., and Yixing Liquor Branch. |
| Wang Xiaowei | He served as Deputy Secretary and Deputy Director of the Party Branch of the 4 Workshop of Kweichow Moutai Co., Ltd., Secretary and Deputy Director of the Party Branch of Kweichow Moutai Co., Ltd., and Secretary and Deputy Director of the 25 Workshop of Kweichow Moutai Co., Ltd. Currently, he is the deputy general manager of Kweichow Moutai Co., Ltd., and the Party Secretary and chairman of Kweichow Moutai Sales Co., Ltd. |
| Jiang Yan | She served as general manager of Moutai CCB (Guizhou) Investment Fund Management Co., LTD., chairman of Moutai (Shanghai) Financial Leasing Co., LTD., and vice chairman of Guiyang GYB Financial Leasing Co., LTD. Currently, he is deputy general manager, Chief Financial Officer and Secretary of the Board of Directors of Kweichow Moutai Co., Ltd., chairman of Moutai CCB (Guizhou) Investment Fund Management Co., Ltd., and Party Branch Secretary of Moutai (Shanghai) Financial Leasing Co., Ltd. |
Other information
√Applicable □N/A
4.2 The current and outgoing directors, supervisors and senior management personnel during thereporting periodA. Appointment in shareholder entity
√Applicable ?N/A
| Name of incumbent | Name of shareholder units | Positions held in shareholder units | Start date of term of service | End date of term of service |
| Ding Xiongjun | China Kweichow Moutai Distillery (Group) Co., Ltd. | Party secretary, chairman and director | August 2021 | |
| Li Jingren | China Kweichow Moutai Distillery (Group) Co., Ltd. | Deputy Party Secretary, Vice Chairman and General Manager | July 2019 | |
| Director | October 2018 | |||
| Chief accountant | October 2018 | August 2021 | ||
| Fu Zhigang | China Kweichow Moutai Distillery (Group) Co., Ltd. | Director of Centralized Procurement Center and Deputy Secretary of Party Branch | March 2019 | |
| Che Xingyu | China Kweichow Moutai Distillery (Group) Co., Ltd. | Director of Life Service Guarantee Center and Deputy Secretary of Party | December 2020 |
| Committee | ||||
| Liu Chenglong | China Kweichow Moutai Distillery (Group) Co., Ltd. | Director of Human Resources and Social Security Department, Vice President of Party School of Party Committee (Staff Training School) | February 2020 |
B. Appointment in other units
√Applicable ?N/A
| Name of incumbent | Name of other units | Positions held in other units | Start date of term of service | End date of term of service |
| Lu Jinhai | Shenzhen Qianhai Daoming Investment Management Co., Ltd. | Partner | January 2016 | |
| Xu Dingbo | China Europe International Business School | Professor of Accounting, Deputy Provost, Secretary General of Education Development Foundation, Essilor | January 2004 | |
| Societe Generale (China) Limited | Independent Director | December 2015 | ||
| JD.COM Group | Independent Director | May 2018 | ||
| Zhang Jingzhong | Zhejiang T&C Law Firm | Director | October 1988 | |
| Zhejiang Jinggong Technology Co., Ltd | Independent Director | January 2015 | August 2021 | |
| All China Lawyers Association | Vice President | April 2016 | October 2021 | |
| Lily Group Co., Ltd | Independent Director | August 2017 | October 2021 | |
| Shanghai M&G Co., Ltd | Independent Director | May 2017 | ||
| Gansu Huangtai Wine-Marketing Industry Co., Ltd. | Independent Director | October 2020 | ||
| Liu Chenglong | China Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd. | Supervisor | June 2013 | October 2021 |
| Kweichow Moutai Distillery Group Changli Winery Co., Ltd. | Director | December 2015 | November 2021 | |
| Kweichow Moutai Distillery (Group) Real Estate Investment Development Co., Ltd. | Director | December 2015 | ||
| Moutai & CCB Trust (Guizhou) Investment Fund Management Co., Ltd. | Director | June 2017 | September 2021 | |
| Kweichow Moutai Distillery (Group) Sanya Investment Industry Co., Ltd. | Director | August 2017 | September 2021 | |
| Kweichow Moutai Group Finance Co., Ltd. | Director | December 2018 |
| Jiang Yan | Moutai & CCB Trust (Guizhou) Investment Fund Management Co., Ltd. | Chairman of the Board | December 2017 | |
| General Manager | December 2017 | March 2022 | ||
| Moutai(Shanghai)Financial Leasing Co., Ltd. | Secretary of Party Branch | December 2017 | ||
| Chairman of the Board | December 2017 | March 2022 | ||
| Guiyang GYB Financial Leasing Co., Ltd | Vice Chairman | March 2021 | December 2021 |
4.3 Remuneration of directors, supervisors and senior management personnel
√Applicable ?N/A
| Decision-making procedures for remuneration of directors, supervisors and senior managers | The annual remuneration decision-making procedures and basis of directors, supervisors and senior management personnel who receive remuneration in the Company shall be determined by the relevant regulations of Guizhou Provincial State-owned Assets Supervision and Administration Commission and the Company’s Measures for the Evaluation and Remuneration Management of Deputy Leaders and Measures for the Implementation of Wage Management, while the remuneration of independent directors shall be determined by the Shareholders Meeting. |
| Basis for determining the remuneration of directors, supervisors and senior managers | It shall be determined by relevant systems such as Measures for the Administration of Remuneration of Heads of Enterprises Supervised by State-owned Assets Supervision and Administration Commission of Guizhou Province, Measures for the Evaluation of Operating Performance of Heads of Enterprises Supervised by State-owned Assets Supervision and Administration Commission of Guizhou Province, Measures for the Evaluation and Remuneration Management of Deputy Personnel of Company Leadership Team, and Measures for the Implementation of Company Wage Management, and the remuneration of independent directors is decided by the shareholders’ meeting. |
| Actual payment of remuneration of directors, supervisors and senior management personnel | For details, please refer to “Changes in Shareholding and Remuneration of Incumbent and Outgoing Directors, Supervisors and Senior Management during the Reporting Period” in this report. |
| Total actual remuneration received by all directors, supervisors and senior management personnel at the end of the reporting period | For details, please refer to “Changes in Shareholding and Remuneration of Incumbent and Outgoing Directors, Supervisors and Senior Management during the Reporting Period” in this report. |
4.4 Changes in directors, supervisors and senior management personnel of the company
√Applicable ?N/A
| Name | Position | Situation of change | Reasons of change |
| Ding Xiongjun | Chairman, Director | Elected | Election of Shareholders Meeting and Board of Directors. For details, please refer to the Announcement of Resolutions of the First Extraordinary General Meeting of Kweichow Moutai in 2021 (Announcement No.: P.2021-026) and the Announcement of Resolutions of the Eighth Meeting of the Third Board of Directors of Kweichow Moutai in 2021 (Announcement No.: P.2021-027) disclosed on September 25, 2021. |
| Jiang Yan | Deputy General Manager, Chief Financial Officer and Secretary of the Board of Directors | Employed | Appointed by the Board of Directors. For details, please refer to the Resolution Announcement of the 11th Meeting of the Third Board of Directors of Kweichow Moutai in 2021 disclosed on November 16, 2021 (Announcement No.: P.2021-029) and the Resolution Announcement of the First Meeting of the Third Board of Directors of Kweichow Moutai in 2022 disclosed on January 27, 2022 (Announcement No.: P.2022-002). |
| Gao Weidong | Chairman, Director | Left post | Resolutions of the Shareholders Meeting. For details, please refer to the Announcement on Resolutions of the First Extraordinary General Meeting of Kweichow Moutai in 2021 (Announcement No.: P.2021-026) disclosed on September 25, 2021. |
| Wang Yan | Director | Left post | Resign. For details, please refer to the Announcement of Kweichow Moutai on Resignation of Directors disclosed on January 8, 2021 (Announcement No.: P.2021-002). |
| Liu Gang | Deputy General Manager, Chief Financial Officer and Secretary of the Board of Directors | Left post | Board resolution. For details, please refer to the Announcement of Resolutions of the 9th Meeting of the Third Board of Directors of Kweichow Moutai in 2021 (Announcement No.: P.2021-028) disclosed on October 9, 2021. |
4.5 Explanation of punishment by securities regulatory agencies in recent three years?Applicable √N/A
4.6 Others
?Applicable √N/A
5. Board meetings during reporting period
| Session of the meeting | Date of convening | Meeting resolution |
| The first annual meeting of the third Board of Directors in 2021 | February 8,2021 | Please refer to the Announcement of the Resolution of the First Meeting of the Third Board of Directors of Kweichow Moutai in 2021 (Announcement No. Lin 2021-003 disclosed on February 10, 2021). |
| The second meeting of the third Board of Directors in 2021 | March 29, 2021 | For details, see the Resolution Announcement of the Second Meeting of the Third Board of Directors of Kweichow Moutai in 2021 (Announcement No. Lin 2021-004 disclosed on March 31, 2021:). |
| The third meeting of the third Board of Directors in 2021 | April 26, 2021 | For details, see the Resolution Announcement of the Third Meeting of the Third Board of Directors of Kweichow Moutai in 2021 (Announcement No. Lin 2021-008 disclosed on April 28, 2021). |
| The fourth meeting of the third Board of Directors in 2021 | May 17, 2021 | The meeting deliberated and adopted the motion on convening the 2020 Annual General Meeting of Shareholders. |
| The fifth meeting of the third Board of Directors in 2021 | July 28, 2021 | For details, see the Resolution Announcement of the Fifth Meeting of the Third Board of Directors of Kweichow Moutai in 2021 (Announcement No. Lin 2021-015 disclosed on July 29, 2021). |
| The sixth meeting of the third Board of Directors in 2021 | July 29, 2021 | For details, see the Resolution Announcement of the Sixth Meeting of the Third Board of Directors of Kweichow Moutai in 2021 (Announcement No. Lin 2021-016 disclosed on July 31, 2021). |
| The seventh meeting of the third Board of Directors in 2021 | September 7,2021 | For details, see the Announcement of the Resolution of the Seventh Meeting of the Third Board of Directors of Kweichow Moutai in 2021 (Announcement No. Lin 2021-018 disclosed on September 9, 2021). |
| The eighth meeting of the third Board of Directors in 2021 | September 24, 2021 | For details, see the Resolution Announcement of the Eighth Meeting of the Third Board of Directors of Kweichow Moutai in 2021 (Announcement No. Lin 2021-027 disclosed on September 25, 2021). |
| The ninth meeting of the third Board of Directors in 2021 | October 8,2021 | For details, see the Announcement of the Resolution of the Ninth Meeting of the Third Board of Directors of Kweichow Moutai in 2021 (Announcement Lin No. 2021-028 disclosed on October 9, 2021). |
| The Tenth meeting of the third Board of Directors in 2021 | October 21, 2021 | The meeting deliberated and adopted the third quarter 2021 Report. |
| The eleventh meeting of the third Board of Directors in 2021 | November 15, 2021 | Please refer to the Resolution Announcement of the 11th Meeting of the Third Board of Directors of Kweichow Moutai in 2021 (Announcement No. Lin 2021-029 disclosed on November 16, 2021). |
| The twelfth meeting of the third Board of Directors in 2021 | December 9,2021 | Please refer to the Resolution Announcement of the 12th Meeting of the Third Board of Directors of Kweichow Moutai in 2021 (Announcement No. Lin 2021-030 disclosed on December 10, 2021). |
| The thirteenth meeting of the third Board of Directors in 2021 | December 30,2021 | The meeting deliberated and passed the “on the review of <general manager office meeting rules> motion” and “on the capital purchase and Yixing wine branch talent turnover room”. |
6. Performance of duties by the directors
6.1The directors attend the board of directors and the general meeting of shareholders
| surname and personal name | Whether an independent director | Participation in the Board of Directors | Joining the shareholders’ general meeting | |||||
| Number of board attendance this year | Number of in-person attendance | Number of participation by communication | Number of commissioned attendance | Absence, number | Did not personally attend the meeting for twice in a row | Number of attendance at shareholders’ meetings | ||
| Ding Xiongjun | no | 6 | 6 | 5 | 0 | 0 | no | 0 |
| Li Jingren | no | 13 | 13 | 11 | 0 | 0 | no | 2 |
| Lu Jinhai | yes | 13 | 12 | 12 | 1 | 0 | no | 1 |
| Xu Dingbo | yes | 13 | 13 | 12 | 0 | 0 | no | 1 |
| Zhang Jingzhong | yes | 13 | 13 | 11 | 0 | 0 | no | 2 |
| Fu Zhigang | no | 13 | 13 | 11 | 0 | 0 | no | 2 |
Failure to personally attend board meetings for two consecutive occasions?Applicable √N/A
| Number of board meetings held within the year | 13 |
| Including: the number of live meetings | 1 |
| Number of meetings held by communication mode | 11 |
| The number of meetings were held on site combined with communication methods | 1 |
6.2 Explanation of directors' objections to company-related matters
?Applicable √N/A
6.3 Other
?Applicable √N/A
7. Situation of a special committee under the Board of Directors
√Applicable ?N/A
7.1 The members of a special committee under the Board of Directors
| Special Committee category | Member name |
| The Audit committee | Xu Dingbo, Ding Xiongjun, Lu Jinhai |
| The Nomination committee | Lu Jinhai, Zhang Jingzhong, Fu Zhigang |
| The Salary and Assessment Committee | Zhang Jingzhong, Li Jingren, Lu Jinhai |
| The Strategy Committee | Ding Xiongjun, Li Jingren and Zhang Jingzhong |
| The Risk Management Committee | Li Jingren, Xu Dingbo, Fu Zhigang |
7.2 The audit committee held four meetings during the reporting period
| Date of convening | content of meeting | Important comments and suggestions |
| March 29, 2021 | The first annual meeting of the Audit Committee in 2021 | Deliberated and passed the 2020 audit committee of the board performance report, 2020 annual report (full text and abstract), 2020 financial budget plan, 2021 financial budget plan , 2020 internal control audit report, 2021 financial audit institutions and internal control audit institutions, on daily related transactions with related parties, and agreed to submit the relevant proposals to the board of directors for consideration according to the provisions. |
| April 26, 2021 | The Second Annual Meeting of the Audit Committee in 2021 | Deliberated and passed the “First Quarter of 2021 Report”, “Proposal on Accounting Policy Change” and other motions, and agreed to submit the motion to the board of directors of the company for deliberation. |
| July 29, 2021 | The third annual meeting of the Audit Committee in 2021 | Deliberated and adopted the 2021 Semi-Annual Report (Full text and Abstract), and agreed to submit the motion to the board of directors of the company for deliberation. |
| October 21, 2021 | The Fourth Meeting of the Audit Committee in 2021 | Deliberated and adopted the Third Quarter 2021 Report, and agreed to submit the motion to the company’s board of directors for deliberation. |
7.3 The nominating committee convene a meeting during the reporting period
| Date of convening | content of meeting | Important comments and suggestions |
| November 15, 2021 | The First Meeting of the Nomination Committee in 2021 | Deliberated and passed the “Motion on Nominating Candidates of Directors”, “Motion on the appointment of Senior Managers” and other motions, and agreed to submit the motion to the board of directors of the company for deliberation. |
7.4 The strategy committee held a meeting during the reporting period
| Date of convening | content of meeting | Important comments and suggestions |
| December 9,2021 | The first annual meeting of the Strategy Committee in 2021 | Deliberated and passed the proposal on the investment and implementation of the First phase of the Packaging Logistics Park Project, and agreed to submit the proposal to the board of directors of the company for deliberation. |
7.5The risk management committee hold a meeting during the reporting period
| Date of convening | content of meeting | Important comments and suggestions |
| March 29th, 2021 | The first annual meeting of the risk management committee in 2021 | We deliberated and passed the 2020 Annual Report (full text and abstract), 2020 Internal Control Evaluation Report, Proposal on Daily Related Transactions and other motions, and agreed to submit the motions to the board of directors of the company for deliberation. |
7.6 Specific circumstances where objections exist
?Applicable √N/A
8. Explanation that the Board of Supervisors finds the risks of the CompanyThe Board of Supervisors has no objection to the supervision matters during the reporting period.
9. Report on the employees of the parent company and its main subsidiaries at the end of theperiod
9.1 Employee condition
| Number of active employees in the parent company | 28,756 |
| Number of active employees in the main subsidiary | 1,215 |
| Total number of current employees | 29,971 |
| The number of retired employees of the parent company and its main subsidiary that shall bear the expenses | 1,657 |
| Professional composition | |
| Professional composition category | Number of majors |
| operating personnel | 24,868 |
| salesman | 1,056 |
| artisan | 587 |
| financial staff | 222 |
| clerical staff | 1,670 |
| Other personnel | 1,568 |
| Total | 29,971 |
| Educational background | |
| Education background type | Quantity (person) |
| Graduate degree or above | 304 |
| university degree | 7,269 |
| college degree | 4,001 |
| Technical secondary school, high school and below | 18,397 |
| Total | 29,971 |
9.2 Compensation policy
√ Applicable?N/A
First, the senior managers implement the annual salary system, according to the relevant regulations ofSASAC and the Company; Second, the intermediate managers implement the quasi annual salarysystem, according to the work nature, responsibilities, risk and performance, the performance paysystem, and adopt the total wage contract system according to different management needs, thetechnical content, knowledge content, labor intensity and performance of different series and posts.
9.3 Training plan
In order to meet the requirements of the company’s strategic development for human resources andimprove the company’s core competitiveness, 167 staff training projects will be carried out in 2022,including 54 company-level training projects and 113 department-level training projects. First, toimprove the quality of training. According to the principle of “classification, overall consideration,focus, tendency, internal training, outsourcing” training plan, made more targeted, more detailed,practical adjustment, curriculum design more optimization, teaching content, increase training and percapita training class, constantly improve the training quality; second, strict training content. In strictaccordance with the “each employee receives at least 42 hours of professional training every year”,“training for 24 hours or more, national laws and regulations, company rules and regulations, corporateculture included in the training courses” and other provisions, the safety, regulations, culture,environmental protection and others into the general training; third, highlight the characteristic content.The training not only sets up professional knowledge of wine production, professional skills and qualityimprovement training related to production, but also provides various special training, such asproduction technology, finance, comprehensive management, equipment management, qualificationevidence collection, pre-job training of various functional units.
9.4 Labor service outsourcing condition
The company accepts the labor service of Kweichow Moutai Liquor Factory (Group) TechnologyDevelopment Co., Ltd., the holding subsidiary of the parent company, for packaging some products ofMoutai-flavor series liquor. The transaction amount is calculated based on the actual packagingworkload. The annual transaction amount in 2021 was 202 million yuan.
10. Profit distribution or capital reserve conversion plan
10.1The formulation, implementation or adjustment of the cash dividend policies
√ Applicable?N/A
The articles of Association of the company defines the principles, conditions, methods, cycles, cashdividend ratio, profit distribution decision and adjustment procedures and mechanisms of profitdistribution.
According to the “2020 Annual Profit Distribution Plan” approved by the company’s annual generalmeeting of shareholders in 2020, the company is based on the total share capital of 1,256,197,800 sharesand distributed cash dividend of CNY 192.93 (before tax) to all the shareholders of the company forevery 10 shares. The profit distribution plan shall be expressed by the independent directors of thecompany and approved by the board of directors of the company and submitted to the general meetingof shareholders for deliberation and approval. When the shareholders’ meeting deliberated on the bill,the small and medium shareholders were counted separately. The profit distribution has beenimplemented in June 2021.
During the reporting period, the company’s profit distribution shall comply with the provisions of theArticles of Association of the company.
10.2 Special explanation of the cash dividend policy
√ Applicable?N/A
| Whether it complies with the provisions of the articles of association or the resolution of the general meeting of shareholders | √ Yes?No |
| Whether the dividend standard and proportion are clear | √ Yes?No |
| Whether the relevant decision-making procedures and mechanisms are complete | √ Yes?No |
| Whether the independent directors perform their duties and play their due role | √ Yes?No |
| Whether minority shareholders have the opportunity to fully express their opinions and appeals, and whether their legitimate rights and interests have been fully protected | √ Yes?No |
10.3 If the profits are made during the reporting period and the parent company’s distributableprofits available to shareholders are positive, but fails to put forward the cash profit distributionplan, the company shall disclose in detail the reasons, the use and use plan of the undistributedprofits?Applicable√ N/A
11. Situation and impact of the Company’s equity incentive plan, employee stock ownership planor other employee incentive measures
11.1 The relevant incentive matters have been disclosed in the interim announcement and there isno progress or change in the subsequent implementation?Applicable√ N/A
11.2 Incentives if not disclosed or with subsequent progress in the interim announcementEquity incentive?Applicable√ N/A
Other specifications?Applicable√ N/A
Employee stock ownership plan condition?Applicable√ N/A
Other incentives?Applicable√ N/A
11.3 The equity incentive situation granted by the directors and senior managers during thereporting period?Applicable√ N/A
11.4 The evaluation mechanism of senior management personnel and the establishment andimplementation of the incentive mechanism during the reporting period
√ Applicable?N/A
Evaluation and incentive mechanism of senior managers in 2021, in accordance with the Measures forthe Management of Compensation of Principals of Enterprises of Guizhou Province, the Measures forthe Performance Assessment of Principals of Enterprises of Guizhou Province and other relevantprovisions, And the company’s “leadership deputy personnel assessment and salary managementmeasures” relevant provisions implementation, In accordance with the Notice of SasAC on the BusinessPerformance Assessment and Salary Audit Results of the Main Principals of Moutai Group in 2020 andthe Notice of SasAC on the Compensation Audit Opinions and Related Matters of the Principals ofMoutai Group in 2020, Combined with the company’s annual operating conditions and performanceevaluation results, To comprehensively determine the remuneration of senior management personnelcomprehensively.
12. Construction and implementation of the internal control system during the reporting period
√Applicable ?N/A
According to the basic specification of enterprise internal control and its supporting guidelines and otherinternal control regulatory requirements, combined with the company’s internal control system andevaluation method, on the basis of daily supervision and special supervision, the board of directors ofthe company on December 31, 2021 (internal control evaluation report base date) internal controleffectiveness of the evaluation. See the Shanghai Stock Exchange website along with this report(website: www.sse.com.The cn) 2021 Internal Control Evaluation Report.
Description of the major defects existing in the internal control during the reporting period?Applicable√ N/A
13. Management and control of the subsidiaries during the reporting period
√Applicable ?N/A.
The company adheres to the principles of “centralized management and control, one enterprise and onepolicy”, “combination of management and release, dynamic authorization”, “combination of blocks,management and service”, “based on corporate governance and functional management and control asthe core” as the control principles, and implements control over subsidiaries and subsidiaries. In 2021,the Company adjusted and optimized the control mode: from “management based” to “managementcombination”, which stimulated the development of the subsidiary with the original management andfunctional control line and the importance of “legal management”; the third further optimized thecontrol office and corresponding line responsibilities, further highlighting the coordination and controlresponsibilities of the control office.
To strengthen the management of the subsidiary, standardize its body and procedures, the companyirregular system review, in accordance with the management principle of legitimacy, applicability,timeliness, problem oriented improvement principle, front review subsidiary the articles of associationand “three” rules of procedure, the articles of association and “three will” rules of procedure of theoverall framework, responsibilities and specific scope of study, discussion. Through the evaluation ofthe articles of association of the subsidiary and the rules of procedure of the “three meetings”, thecompany should strengthen the restriction and supervision of the power operation of the subsidiaryleadership, improve the work efficiency and work level, and promote the legalization,institutionalization and scientization of the decision-making of the discussion body.
14. Relevant information description of the internal control audit report
√Applicable ?N/A
See the Shanghai Stock Exchange website along with this report (website: www.sse.com.The cn) Part21 was disclosed in the Company’s 2021 Internal Control Audit Report.
Whether to disclose the internal control audit report: Yes
Type of internal control audit report opinion: standard unqualified opinion
15. Rectification of self-inspection problems in the special action of governance of listedcompaniesAccording to the requirements of the Announcement of China Securities Regulatory Commission on theSpecial Action of Listed Companies and the Notice of Guizhou Securities Regulatory Bureau onMatters Related to the Self-examination of The Governance of Listed Companies, the companyconscientiously carried out the special self-inspection of listed companies according to the specialself-inspection list of the governance of listed companies.
In view of the problems found in self-inspection, the company attaches great importance to andconscientiously rectify. As of the end of this report, there are the following four problems: controllingshareholders have overdue failed to fulfill the commitment of the equity incentive plan, seniormanagement in the controlling shareholder part-time, independent directors for the outbreak of theannual working time of less than 10 working days, to facilitate the daily work, the company and thecontrolling shareholders exist part of the common office system.
In the next step, the company will continue to carry out the rectification work as required, strengthen themodernization of corporate governance capacity and governance level, constantly improve the corporategovernance system and mechanism, continue to optimize the internal control system, steadily improvethe effectiveness of corporate governance, and promote the high-quality development of the company.
16. Other
?Applicable√ N/A
Section V Environment and Social Responsibility
1. Environmental information situation
1.1 Environmental information of the company and its major subsidiaries that are key emissionunits announced by the environmental protection authorities
√Applicable ?N/A
A. Emission information
√Applicable ?N/A
(1) Main pollutants: waste water, waste gas, solid waste.
(2) Name of characteristic pollutants: COD, ammonia nitrogen, sulfur dioxide, nitrogen oxides, smoke(dust).
(3) Emissions of pollutants from January to December 2021.
①Wastewater
The company has five wastewater treatment plants, each with one outlet, located in the old factory areaand Zhonghua area of the company’s headquarter, and the Dadi area, Xinzhai area and Erhe area ofHeyixing Liquor Branch, with direct discharge of wastewater after treatment to standards.
| Name of sewage treatment plants | COD | Ammonia nitrogen | Pollutant emission standards implemented | ||
| Average emission concentration (mg/l) | Total emissions (ton) | Average emission concentration (mg/l) | Total emissions (ton) | ||
| 7000t/d sewage treatment plant | 18.410 | 13.860 | 0.367 | 0.319 | Emission Standards for Pollutants in Fermented Alcohol and White Wine Industry (GB27631-2011) Table 3 Direct Emission Standards |
| Xinzhai sewage treatment plant of Heyixing Liquor Branch | 25.130 | 8.484 | 0.379 | 0.121 | |
| 4000t/d sewage treatment plant | 25.724 | 11.166 | 0.810 | 0.379 | |
| Dadi sewage treatment plant of Heyixing Liquor Branch | 36.222 | 16. 400 | 1.283 | 0.621 | |
| Erhe sewage treatment plant of Heyixing Liquor Branch | 22.568 | 8.931 | 0.468 | 0.208 | Standards for Discharge of Pollutants from Urban Sewage Treatment Plants (GB18918-2002) Class A |
②Exhaust gas
The company’s gas boilers are located in the old factory and Zhonghua area of the company’sheadquarters, and in the Dadi area, Xinzhai area and Erhe area of Heyixing Liquor Branch. Thecompany’s gas boilers use natural gas as the energy source, with direct emissions of boiler exhaust.
| Name of facilities | Sulfur dioxide | Nitrogen oxides | Smoke (dust) | Standards implemented | |||
| Average emission concentration | Total emissions (ton) | Average emission concentration | Total emissions (ton) | Average emission concentration | Total emissions (ton) | ||
| (mg/m3) | (mg/m3) | (mg/m3) | |||||
| Gas boilers in the old factory (including the Zhonghua area) of the company headquarters | 3.00 | 2.470 | 73.624 | 63.750 | 2.044 | 1.690 | Emission Standards for Boiler Air Pollutants (GB13271-2014) Table 2 |
| Gas boilers in Xinzhai and Dadi areas of Heyixing Liquor Branch | 3.00 | 0.631 | 48.828 | 10.469 | 10.373 | 2.252 | |
| Gas boilers in Erhe area of Heyixing Liquor Branch | 3.00 | 0.290 | 56.047 | 5.670 | 12.425 | 1.200 |
③Solid waste disposal
The company’s solid waste lees, waste cellar sludge and waste yeast are handed over toKweichow Moutai (Group) Circular Economy Industrial Investment and Development Co., Ltd. andother units for comprehensive utilization and disposal, while domestic waste is entrusted to third-partyunits for transportation to waste incineration power plants for incineration.
(4) Total approved emissions
The company has declared and obtained the emission permit according to the “Management Measuresof Emission Permit (for Trial Implementation)” and related requirements. The total approved emissionsfor the reporting period are: COD 60.097 tons; ammonia nitrogen 6.0097 tons; nitrogen oxides
203.8662 tons; sulfur dioxide and (powder) dust in accordance with Table 2 of the Emission Standardsfor Boiler Air Pollutants (GB13271-2014).
B. Construction and operation of pollution prevention facilities
√Applicable ?N/A
Wastewater pollutant control facilities are mainly sewage treatment plants and other equipment facilities,whose construction has been completed and in normal operation; the company began to implement theboiler “coal to gas” project in 2011, and completed the comprehensive transformation in 2014,eliminating the coal-fired boilers and building 33 gas boilers, which are now in normal operation.
C. Environmental Impact Assessment of Construction Projects and Other Administrative Permitsfor Environmental Protection
√Applicable ?N/A
(1) The company carried out environmental impact assessment for new, reformed and expanded projectsin accordance with the law and obtained 3 approvals for administrative permits for environmentalimpact assessment in 2021.
(2) Environmental protection inspection and acceptance of completed projects have been carried out inaccordance with the law and 5 online recordings have been completed.
D. Emergency response plan for environmental emergencies
√Applicable ?N/A
According to the Management Measures for the Filing of Emergency Response Plans for Enterprisesand Institutions (for Trial Implementation) (Huanfa [2015] No. 4) and other relevant documents, theCompany’s plants (Old Plant Area/Zhonghua area), and Heyixing Wine Branch (Dadi Area, XinzhaiArea and Erhe Area) have prepared emergency environmental response plans and obtained filing formsfrom environmental protection authorities, and conducted emergency response drills for emergencyenvironmental events in July 2021.
E. Self-monitoring environmental program
√Applicable ?N/A
According to the Measures for Environmental Information Disclosure by Enterprises and Institutions(Ministry of Environmental Protection Decree No. 31), Self-monitoring Technical Guide for EmissionUnits Wine and Beverage Manufacturing (HJ1085-2020), Self-monitoring Technical Guide forEmission Units Thermal Power Generation and Boilers (HJ820-2017) and Self-monitoring TechnicalGuide for Emission Units General Rules (HJ819-2017) and other documents, in order to grasp the statusof pollutant emissions from our enterprise and its impact on the surrounding environment quality, fulfillour legal obligations and social responsibilities, we have developed a self-monitoring program to ensurethat our self-monitoring meets the requirements of environmental management.
F. Administrative penalties for environmental issues during the reporting period?Applicable √ N/A
G. Other environmental information that should be made public?Applicable √ N/A
1.2 Environmental information of the company other than key emission units?Applicable √ N/A
1.3 Relevant information conducive to ecological protection, pollution prevention and control, andenvironmental responsibility fulfillment
√Applicable ?N/A
The company adheres to the road of green development. Focusing on the construction requirements of“one base, one benchmark”, the company has linked up with Tsinghua University’s Academy ofEnvironmental Sciences and other scientific research institutions to further clarify the direction and pathof Maotai’s green development. We have launched researches on ecological capacity, pollution controlcapacity improvement, and the layout of “the Production, Living and Ecological Space”. We haveimplemented “five special projects”, such as water enhancement project, gas enhancement project, soilconsolidation project, micro-protection project and comprehensive monitoring and evaluation project ofecosystems, and carried out “five special actions”, such as energy-saving, carbon reduction andefficiency improvement action, green product design action, green transformation action of industrialchains, green science and technology innovation action and green low-carbon life action. Ourenvironmental protection work focuses on “gas, water, slag, green, carbon” and other aspects,constantly building facilities, optimizing mechanisms, strengthening supervision and making guaranteesto effectively protect the ecological environment on which Maotai depends for its survival anddevelopment.
The company actively integrates into the development of Guizhou’s “National Ecological CivilizationPilot Zone” initiative, carries out ecological protection of the Chishui River with utmost efforts, andsolidly promotes ecological construction. Since 2014, the company has decided to contribute CNY 500million annually, specifically for the ecological protection of the Chishui River basin. In addition, bufferzones and no-construction zones for medium and long-term ecological environmental protection areplanned for Maotai, and greening and restoration of the barren slopes on the west bank of the ChishuiRiver are also planned. Meanwhile, the company will make every effort to promote regional ecologicalenvironmental protection legislation, making “water, air, soil, microorganisms, cultural heritage, and
planning and construction” as key legislative protection objects to better protect the irreproducibleecological environment.
1.4 Measures taken to reduce its carbon emissions during the reporting period and their effects
√Applicable ?N/A
First, carry out ecological restoration and greening beautification. In 2021, the company made efforts toimprove the regional environment by carrying out bare soil treatment, vigorously implementinggreening projects, organizing employees to participate in forest protection and greening activities,planting an area of about 1,430,000 square meters, adding 160,000 square meters of greening to theplant area, with a total greening area of about 1.43 million square meters, as well as investing tocomplete the landscape greening of the wine making and starter-making workshops in Zhonghua areaduring the Thirteenth Five-Year Plan. We established a positive and negative list of regional plants,gradually reducing exotic tree species and effectively protecting the native environment; second,actively promoted vehicle exhaust treatment. Our commuter vehicles are gradually replaced with naturalgas vehicles, the single and double number restrictions on employee vehicles are implemented andgradual replacement with new energy vehicles is encouraged. In this way, our factory areas can reduceexhaust emissions by 120 million m? per year and achieve an excellent air quality rate of over 98%.
2. Social Responsibility Work
√Applicable ?N/A
For details, please refer to our “Social Responsibility and ESG Report 2021” disclosed on the website ofShanghai Stock Exchange (URL: www.sse.com.cn) at the same time as this report.
3.Specific work on consolidating and expanding the progress in poverty alleviation and ruralrevitalization
√Applicable ?N/A
In 2021, the company always adhered to the guidance of Xi Jinping’s Thought on Socialism withChinese Characteristics for a New Era, deeply implemented the spirit of the important speech byGeneral Secretary Xi Jinping during his inspection of Guizhou, conscientiously implemented the spiritof the national and provincial summing-up and commendation conferences on poverty alleviation, andstrictly followed the requirements of “four no-takes”, taking the consolidation of poverty alleviation andrural revitalization progress as important political tasks and striving to fulfill our social responsibilities.
3.1 Work Progress
A. Help build and strengthen the work team. First, select and enhance the strength of the support team.The company has further promoted and appointed comrades with excellent performance andoutstanding achievements in support and assistance, so as to stimulate the motivation and dedication ofcadres and staff. In accordance with the requirements, we have selected and sent outstanding youngcadres to the front line of Daozhen town as the first secretary, cadres and helpers, thereby strengtheningthe team of helpers, and successfully completing the rotation of villages in rural revitalization in 2021.Second, strict team management. In order to strictly manage the work, the company has formulatedmanagement methods for the help team in Daozhen, promoting the implementation of help work byclarifying work responsibilities and strengthening daily management. Third, explore new paths of talentcultivation. We have conducted mutual posting of affiliated cadres with Chishui City to train andreserve talents for promoting project construction, playing a leading role in party building andpromoting tourism industry development. Fourth, strengthen agricultural technology guidance. Weworked together with Daozhen County Agricultural and Rural Bureau to organize township agriculturalservice center leaders and growers for “training sessions on sorghum cultivation”, systematicallyteaching sorghum seedling transplanting, pest control, harvesting and storage to further enhance thetechnical reserves and planting confidence of farming-related cadres and growers.
B. Help solidify the industrial base. First, optimize the construction of raw and auxiliary material bases.Combined with the development needs to strengthen the construction of raw and auxiliary materialbases, the company has invested in deepening the construction of sorghum demonstration bases,optimizing the base construction of raw and auxiliary materials such as rice straw, wheat, etc. The areas
cover Renhuai, Xishui, Congjiang and many other counties or cities, promoting the transition oftraditional agriculture to industrialization and specialization of modern agriculture in poverty-alliviatedareas, thereby driving nearly 100,000 households of farmers to increase income. Second, focus on thedevelopment of edible mushroom industry. Based on Daozhen’s industrial positioning of “a vegetableand mushroom township”, we have mobilized dealers to donate funds to help the development ofDaozhen’s edible mushroom industry, and join hands with the county government to promote the scale,quality and branding of Daozhen’s edible mushroom industry by centering on our assistance goal ofhelping Daozhen build the edible mushroom industry. Third, deepen the cooperation mode with theguaranteed vegetable base in Renhuai City. We purchased vegetables in poverty alleviated areas in theprocurement mode of “farmers + guaranteed bases (cooperatives) + canteens” to realize industrializedemployment in local places for poverty-alleviated population.
C. Continue to strengthen education support. First, we invested a total of CNY 100 million in 2021, tosolve the “last mile” problem from home to university for nearly 20,000 students by focusing on“education support” through the “China Maotai - the backbone of the country” public welfare project.Second, a public welfare project of “Dream Libraries” and a reading program for rural children werelaunched, covering five schools in Daozhen County, gathering positive energy for the revitalization ofrural culture. Thirdly, we coordinated to build a civic education base and a remote education station forrural revitalization in Daozhen County, helping to build a talent team in the poverty-alleviated areas andenhancing the development momentum of the areas themselves.
D. Expand the consumption channels of agricultural products. First, strengthen the top design. Thecompany’s support team in Daozhen organized a “meeting to promote Daozhen goods out of themountain”, systematically sorting out the problems in Daozhen’s agricultural and sideline products,production, packaging and sales, as well as providing scientific advice and suggestions to promoteDaozhen goods. Second, give full play to the assistance of consumption. Through internal purchase,social forces and other ways to increase the purchase of agricultural and sideline products inpoverty-alleviated areas of Daozhen County and Renhuai City. In 2021, the completion of directprocurement of high-quality agricultural products amounted to more than CNY 48 million, apart fromcoordinating social forces to help Daozhen’s sales of high-quality agricultural products. Third, create awell-known brand. We helped coordinate Daozhen’s agricultural and sideline products into theJingdong Group, the RT-Mart and other online and offline platforms, recommending Daozhen’sagricultural and sideline products through company activities or publicity media to enhance its brandinfluence.
3.2 Next work plan
First, continue to thoroughly implement the guiding opinions and arrangements of the Party CentralCommittee and the provincial government on consolidating and expanding the progress in povertyalleviation and rural revitalization, and make every effort to promote the implementation of the work.Second, further strengthen the study of policies related to rural revitalization, understand the spirit of thedocuments and formulate effective measures to strengthen work coordination and to improve themechanism of coordination between departments. Third, continue to play the advantage of Maotai’sresources. Fully implement the “Implementation Opinions of Maotai on Playing the Function ofState-owned Enterprises to Achieve Rural Revitalization and Agricultural and Rural Modernization”,and effectively carry out practical projects, so that the fruits of development can benefit wider areas andmore people. Fourth, in accordance with the deployment of higher-level work, implement our supportfor the pilot construction of beautiful red villages. Fifth, further strengthen the foundation of sociallivelihood. Continue to deepen the “1+10+1” system of advancing rural revitalization by party building,coordinate grass-roots party organizations to understand the situation of assisting villages in a timelymanner, and try to support the development of industries, education and medical care, while activelyguiding social forces to join the Daozhen support team and strengthen the helping force, so as toconsolidate the progress in poverty alleviation and promote the comprehensive rural revitalization.
Section VI Significant Events
1. Undertakings of Commitment Fulfillment
1.1 Undertakings of the Company’s actual controller, shareholders, related parties and acquirers,as well as the Company and other commitment makers fulfilled in the reporting period or ongoingby the end of this reporting period
√Applicable ?N/A
| Commitment Background | Type | Committed Parties | Content | Commitment time and period | If there is a fulfillment period | If fulfilled timely and strictly | State the specific reason in case of failure to fulfill | Explain the next plan in case of failure to fulfill |
| Commitments related to shareholding reform | Other | China Kweichow Moutai Distillery (Group) Co., Ltd. | Equity incentive commitment: After the completion of the equity share reform, the company will develop the equity incentive scheme for the management and core technical team according to the relevant national policies and regulations. | Advance the development of equity incentives for the company’s management and core technical team by the end of December 2017. | Yes | No | The higher authorities have not issued relevant guidance and specific measures. |
1.2 If there is a profit forecast for the company’s assets or projects, and the reporting period isstill in the profit forecast period, the company provides an explanation on whether the assets orprojects meet the original profit forecast and its reasons?Have met ?Have not met √N/A
1.3The completion of performance commitments and their impact on the goodwill impairmenttest?Applicable √ N/A
2. Non-operating appropriation of funds by controlling shareholders and other related partiesduring the reporting period?Applicable √ N/A
3. Non-compliance with guarantees
?Applicable √ N/A
4. Explanation of the board of directors regarding the “Non-standard audit opinion” by the CPAfirm?Applicable √ N/A
5. Analysis of the reasons for and effects of changes in accounting policies, accounting estimates orcorrections of significant accounting errors by the Company
5.1 Analysis of the reasons for and effects of changes in accounting policies and accountingestimates
√Applicable ?N/A
For details, please refer to Section X of this report on financial reporting V. Significant accountingpolicies and accounting estimates 23. Changes of significant accounting policies and accountingestimates.
5.2 Analysis of the reasons for and effects of corrections of significant accounting errors by theCompany?Applicable √ N/A
5.3 Communication with the previous CPA firm
?Applicable √ N/A
6. Engagement and disengagement of CPA firms
Unit: CNY 10,000
| Current CPA | |
| Name of the domestic CPA firm | Baker Tilly China CPAs |
| Remuneration of the domestic CPA firm | 97 |
| Years of audit by the domestic CPA firm | 4 |
| Name | Remuneration | |
| Internal control audit CPA firm | Baker Tilly China CPAs | 41 |
Note on the engagement and disengagement of CPA firms?Applicable √ N/A
Note on reappointing the CPA firm during the audit?Applicable √ N/A
7. Cases facing the risk of delisting
7.1 Reasons of delisting risk warnings
?Applicable √ N/A
7.2 Measures to be taken by the Company in response
?Applicable √ N/A
7.3 Circumstances and reasons for facing termination of listing
?Applicable √ N/A
8. Matters related to bankruptcy restructuring
?Applicable √ N/A
9. Significant litigation and arbitration matters
?The company has significant litigation and arbitration matters during the year
√ The company has no significant litigation and arbitration matters during the year
10. The listed company and its directors, supervisors, senior management, controllingshareholders and actual controllers are suspected of violating the law, being punished and theirrectification?Applicable √ N/A
11. Description of the integrity of the Company and its controlling shareholders and actualcontrollers during the reporting period
√Applicable ?N/A
The integrity of the Company and its controlling shareholders during the reporting period is good.
12. Significant related party transactions
12.1 Related party transactions related to daily operations
A. Matters that have been disclosed in the interim announcement with no progress or changes insubsequent implementation?Applicable √ N/A
B. Matters that have been disclosed in the interim announcement with progress or changes insubsequent implementation?Applicable √ N/A
C. Matters not disclosed in the interim announcement
√Applicable ?N/A
(1) Related party transactions with the same related party as those considered and approved by theBoard of Directors
Unit: CNY
| Name of related parties | Relationship | Type of Related party transactions | Content of Related party transactions | Pricing Principles for Related party transactions | Connected transaction price | Amount of Related party transactions | Proportion of the amount of similar transactions (%) | Settlement of Related party transactions | Market Price | Reasons for large differences between transaction prices and market reference prices |
| China Kweichow Moutai Distillery (Group) Co., Ltd. | Parent company | Acceptance of labor services | Comprehensive Service Fee | Agreed Price | 379,394.43 | 100 | cash payment | |||
| Kweichow Moutai Distillery (Group) Logistics Co., Ltd. | Holding subsidiary of the parent company | Acceptance of labor services | transportation services | Referto independent third-party transaction prices | 215,293,693.93 | 73.86 | cash payment | |||
| Shenren Packaging and Printing Co., Ltd., Renhuai City, Guizhou Province | Other | Purchase of goods | Purchase of goods | The same purchase price as the supply price of other unrelated suppliers of the | 242,357,820.96 | 8.57 | cash payment |
| company | ||||||||||
| CHINESE-FOREIGN VENTURE DRAGON AND LION CAP CO.,LTD ZHUHAI S.E.Z | Holding subsidiary of the parent company | Purchase of goods | Purchase of goods | The same purchase price as the supply price of other unrelated suppliers of the company | 186,644,711.14 | 6.6 | cash payment | |||
| Kweichow Moutai (Group) Circular Economy Industrial Investment and Development Co., Ltd. | Wholly-owned subsidiary of the parent company | Purchase of goods | Purchase of goods | Agreed Price | 150,339,280.00 | 100 | cash payment | |||
| Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | Other | Purchase of goods | Purchase of goods | The same purchase price as the supply price of other unrelated suppliers of the company | 109,617,071.39 | 3.54 | cash payment | |||
| Guizhou Fumingxing Packaging Co., Ltd. | Other | Purchase of goods | Purchase of goods | The same purchase price as the supply price of other unrelated suppliers of the company | 73,963,369.22 | 2.62 | cash payment | |||
| Guizhou New Huaxi Glass Co., Ltd. | Other | Purchase of goods | Purchase of goods | The same purchase price as the supply price of other unrelated suppliers of the company | 60,580,925.36 | 2.14 | cash payment | |||
| Guizhou Maotai Distillert (Group) Xijiu Co., Ltd. | Wholly-owned subsidiary of the parent company | Purchase of goods | Purchase of goods | Agreed Price | 2,892,054.00 | 42.15 | cash payment | |||
| Kweichow Moutai Winery (Group) Health Wine Co., Ltd. | Other | Purchase of goods | Purchase of goods | Agreed Price | 2,203,000.00 | 32.11 | cash payment | |||
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | Holding subsidiary of the parent company | Purchase of goods | Purchase of goods | Agreed Price | 1,766,767.13 | 25.75 | cash payment | |||
| China Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd. | Wholly-owned subsidiary of the parent company | Purchase of goods | Purchase of goods | Agreed Price | 33,274.34 | 100 | cash payment | |||
| Guizhou Maotai Distillert (Group) Xijiu Co., Ltd. | Wholly-owned subsidiary of the parent company | Other utility costs such as water, electricity and gas (purchase) | Receiving water services | Agreed Price | 3,925,458.51 | 100 | cash payment | |||
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | Holding subsidiary of the parent company | Acceptance of labor services | Labor cost | Agreed Price | 201,743,603.42 | 27.22 | cash payment | |||
| Hotel Management Company Of Moutai Group | Wholly-owned subsidiary of the parent company | Acceptance of labor services | Labor cost | Agreed Price | 61,437,621.87 | 8.29 | cash payment | |||
| Kweichow Moutai Logistics | Other | Acceptance of labor | Labor cost | Agreed Price | 95,320,754.85 | 12.86 | cash payment |
| Park Grain Storage Co., Ltd. | services | |||||||||
| Kweichow Moutai (group) International Travel Service Co., Ltd. | Other | Acceptance of labor services | Labor cost | Agreed Price | 24,511,528.39 | 3.31 | cash payment | |||
| Kweichow Moutai (Group) Circular Economy Industrial Investment and Development Co., Ltd. | Wholly-owned subsidiary of the parent company | Acceptance of labor services | Labor cost | Agreed Price | 15,019,725.64 | 2.03 | cash payment | |||
| Kweichow Moutai Winery (Group) Health Wine Sales Co., Ltd. | Other | Acceptance of labor services | Labor cost | Agreed Price | 4,091,215.49 | 0.55 | cash payment | |||
| Kweichow Moutai Distillery (Group) Logistics Co., Ltd. | Holding subsidiary of parent company | Acceptance of labor services | Labor cost | Agreed Price | 573,223.59 | 0.08 | cash payment | |||
| China Kweichow Moutai Distillery (Group) Co., Ltd. | Parent company | Rent in and rent out | Rental fee | Agreed Price | 26,724,386.73 | 58.41 | cash payment | |||
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | Holding subsidiary of parent company | Rent in and rent out | Rental fee | Agreed Price | 11,712,556.79 | 25.60 | cash payment | |||
| Kweichow Moutai Winery (Group) Health Wine Sales Co., Ltd. | Other | Rent in and rent out | Rental fee | Agreed Price | 3,000,000.00 | 6.56 | cash payment | |||
| Kweichow Moutai Distillery (Group) Guiyang High-tech Real Estate Investment Development Co., Ltd. | Other | Rent in and rent out | Rental fee | Agreed Price | 1,691,467.44 | 3.70 | cash payment | |||
| Kweichow Zunyi Moutai Airport Ecological Park Investment and Development Co., Ltd. | Holding subsidiary of parent company | Rent in and rent out | Rental fee | Agreed Price | 236,674.53 | 0.52 | cash payment | |||
| Kweichow Moutai Distillery (Group) Guiyang High-tech Real Estate Investment Development Co., Ltd. | Other | Purchase of goods | Purchase of offices | The sale price is the same as the purchase price of the company’s other unaffiliated dealers | 9,741,492.16 | 19.20 | cash payment | |||
| Kweichow Moutai Group Marketing Co., Ltd. | Wholly-owned subsidiary of the parent company | Sales of goods | Sales of goods | The sale price is the same as the purchase price of the company’s other unaffiliated dealers | 5,193,690,831.85 | 4.90 | cash payment | |||
| Hotel Management Company of Moutai Group | Wholly-owned subsidiary of the parent company | Sales of goods | Sales of goods | The sale price is the same as the purchase price of the company’s other unaffiliated dealers | 19,511,175.24 | 0.02 | cash payment | |||
| China Kweichow Moutai Distillery (Group) Co., Ltd. | Parent company | Sales of goods | Sales of goods | The sale price is the same as the purchase price of the company’s other unaffiliated dealers | 7,293,281.43 | 0.01 | cash payment | |||
| Shanghai Moutai Trading Co., Ltd. | Other | Sales of goods | Sales of goods | The sale price is the same as the purchase price of the company’s other unaffiliated | 5,526,159.30 | 0.01 | cash payment |
| dealers | |||||||||||
| China Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd. | Wholly-owned subsidiary of the parent company | Sales of goods | Sales of goods | The sale price is the same as the purchase price of the company’s other unaffiliated dealers | 4,778,230.09 | 0.005 | cash payment | ||||
| Guizhou Maotai Distillert (Group) Xijiu Co., Ltd. | Wholly-owned subsidiary of the parent company | Sales of goods | Sales of goods | The sale price is the same as the purchase price of the company’s other unaffiliated dealers | 3,372,637.17 | 0.003 | cash payment | ||||
| Beijing Moutai Trading Co., Ltd. | Wholly-owned subsidiary of the parent company | Sales of goods | Sales of goods | The sale price is the same as the purchase price of the company’s other unaffiliated dealers | 2,729,246.02 | 0.003 | cash payment | ||||
| Kweichow Moutai Winery (Group) Health Wine Co., Ltd. | Wholly-owned subsidiary of the parent company | Sales of goods | Sales of goods | The sale price is the same as the purchase price of the company’s other unaffiliated dealers | 1,723,539.82 | 0.002 | cash payment | ||||
| Shanghai Kweichow Moutai Industrial Co., Ltd. | Wholly-owned subsidiary of the parent company | Sales of goods | Sales of goods | The sale price is the same as the purchase price of the company’s other unaffiliated dealers | 1,309,890.28 | 0.001 | cash payment | ||||
| Kweichow Zunyi Moutai Airport Ecological Park Investment and Development Co., Ltd. | Other | Sales of goods | Sales of goods | The sale price is the same as the purchase price of the company’s other unaffiliated dealers | 315,142.49 | 0.0003 | cash payment | ||||
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | Holding subsidiary of parent company | Providing services | Labor fee | Agreement price | 682,486.89 | 100 | cash payment | ||||
| Guizhou Maotai Distillert (Group) Xijiu Co., Ltd. | Wholly-owned subsidiary of the parent company | Providing services | Labor fee | Agreement price | 560,412.74 | 100 | cash payment | ||||
| Kweichow Moutai Distillery (Group) Logistics Co., Ltd. | Holding subsidiary of parent company | Providing services | Labor fee | Agreement price | 27,771.05 | 100 | cash payment | ||||
| Kweichow Moutai Group Marketing Co., Ltd. | Wholly-owned subsidiary of the parent company | Rent in and rent out | Rental fee | Agreement price | 495,146.47 | 59.99 | cash payment | ||||
| China Kweichow Moutai Distillery (Group) Co., Ltd. | Parent company | Rent in and rent out | Rental fee | Agreement price | 330,275.22 | 40.01 | cash payment | ||||
| Total | 6,748,147,297.37 | ||||||||||
(2) Related party transactions with the same related party approved by the Shareholders Meeting.
The company registered trademark of the parent company China Kweichow Moutai Distillery (Group)Co., Ltd., and the trademark usage fee is CNY 1,332.73 million during the reporting period.
(3) Related transactions with other related parties
A. The Company purchased raw materials from Shanghai Rencai Printing Co., Ltd., and the amountincurred in the current period is CNY 12.49 million.
B. The Company purchased comprehensive security insurance for female employees from Huagui LifeInsurance Co., Ltd., and the amount incurred in the current period is CNY 477,500.
C. The ending deposit balance of the Company in Bank of Guizhou is CNY 23.81 billion CNY(including a large-denomination certificate of deposit of CNY 2 billion), the current interest income isCNY 445.24 million, and the investment income is CNY 59.76 million. Kweichow Moutai GroupFinance Co., Ltd., a holding subsidiary of the Company, subscribed for the bonds issued by Bank ofGuizhou Co., Ltd. from the open market at a cost of CNY 100 million, and the recognized interestincome is CNY 179,600 in the current period. As of the end of the period, the balance of the provisionfor impairment of the debt investment is CNY 56,700, the accrued interest balance is CNY 179,600, andthe carrying amount is CNY 100.12 million.
12.2Affiliated transactions arising from the acquisition or sale of assets or equity
A. Matters disclosed in the interim announcement but without progress or change in subsequentimplementation
□Applicable √N/A
B. Matters disclosed in the interim announcement but without progress or change in subsequentimplementation
□Applicable √N/A
C. Matters not disclosed in the interim announcement
□Applicable √N/A
D. If performance agreement is involved, the realization of performance during the reportingperiod shall be disclosed
□Applicable √N/A
12.3 Important related party transactions jointly invested
A. Matters disclosed in the temporary announcement without subsequent progress or change
□Applicable √N/A
B. Matters disclosed in the temporary announcement with subsequent progress or change
□Applicable √N/A
C. Matters not disclosed in the temporary announcement
□Applicable √N/A
12.4 Related debt transactions
A. Matters disclosed in the temporary announcement without subsequent progress or change
□Applicable √N/A
B. Matters disclosed in the temporary announcement with subsequent progress or change
□Applicable √N/A
C. Matters not disclosed in the temporary announcement
□Applicable √N/A
12.5 Financial business between the Company and the financial company with which theCompany is associated, the financial company in which the Company holds a majority of sharesand the related parties
√Applicable □ N/A
A. Deposit business
√Applicable □ N/A
Unit: CNY
| Related party | Related party relationship | Maximum deposit per day | Range of deposit rate | Opening balance | Current period | Closing balance | |
| Total deposit in the current period | Total withdrawal in the current period | ||||||
| Guizhou Xijiu Sales Co., Ltd. | Other | 6,712,436,958.20 | 28,788,362,072.05 | 25,766,406,343.85 | 9,734,392,686.40 | ||
| China Kweichow Moutai Distillery (Group) Co., Ltd. | Parent company | 705,138,050.22 | 42,116,523,132.88 | 40,325,735,817.77 | 2,495,925,365.33 | ||
| Kweichow Moutai Group Marketing Co., Ltd. | Wholly-owned subsidiary of the parent company | 2,510,738,390.91 | 10,333,655,933.31 | 8,718,711,304.62 | 4,125,683,019.60 | ||
| Kweichow Moutaichun Marketing Company | Other | 920,842,428.98 | 4,279,679,667.30 | 4,588,681,902.62 | 611,840,193.66 | ||
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | Majority-owned subsidiary of the parent company | 1,053,210,194.61 | 5,523,138,667.67 | 4,858,421,165.80 | 1,717,927,696.48 | ||
| Kweichow Moutai Winery (Group) Health Wine Sales Co., Ltd. | Other | 300,139,345.18 | 1,345,166,318.83 | 941,362,389.43 | 703,943,274.58 | ||
| Guizhou Renhuai Shenren Packaging and Printing Co., Ltd. | Other | 173,286,572.76 | 850,552,541.62 | 813,582,346.16 | 210,256,768.22 | ||
| China Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd. | Wholly-owned subsidiary of the parent company | 204,287,610.43 | 578,479,529.42 | 564,209,290.16 | 218,557,849.69 | ||
| ChangLi Moutai Wine Trade Co., Ltd. | Other | 152,585,956.02 | 846,608,322.83 | 713,434,724.86 | 285,759,553.99 | ||
| Kweichow Moutai Distillery (Group) Logistics Co., Ltd. | Majority-owned subsidiary of the parent company | 108,370,683.60 | 718,004,995.05 | 772,569,797.09 | 53,805,881.56 | ||
| Beijing Moutai Trading Co., Ltd. | Wholly-owned subsidiary of the parent company | 150,354,370.95 | 469,246,525.46 | 587,149,260.91 | 32,451,635.50 | ||
| Shanghai Moutai Trading Co., Ltd. | Other | 53,455,768.17 | 341,598,600.17 | 348,378,120.80 | 46,676,247.54 | ||
| KWEICHOW MOUTAI WINERY(GROUP) BAIJIN LIQUOR SALES CO., LTD. | Other | 224,537,066.64 | 95,444,427.43 | 256,250,753.22 | 63,730,740.85 | ||
| Guizhou Maotai Ecological Agriculture Sales Co., Ltd. | Other | 58,614,228.79 | 339,428,074.23 | 362,038,494.43 | 36,003,808.59 | ||
| Kweichow Moutai (Group) Circular Economy Industr | Wholly-owned subsidiary of the parent | 37,080,922.96 | 496,595,645.51 | 403,771,331.19 | 129,905,237.28 | ||
| Co., Ltd. | company | ||||||
| Shanghai Kweichow Moutai Industrial Co., Ltd. | Wholly-owned subsidiary of the parent company | 24,541,545.55 | 173,615,134.48 | 182,188,718.38 | 15,967,961.65 | ||
| Guizhou Zunpeng Liquor Industry Co., Ltd. | Other | 6,207,766.48 | 453,457,901.96 | 341,349,114.52 | 118,316,553.92 | ||
| Health Industry Co., Ltd. of Kweichow Moutai Group. | Other | 63,850,975.86 | 232,073,169.61 | 256,554,795.15 | 39,369,350.32 | ||
| Kweichow Moutai Distillery (Group) Real Estate Investment Development Co., Ltd. | Wholly-owned subsidiary of the parent company | 100,151,761.05 | 188,328,986.99 | 270,214,376.20 | 18,266,371.84 | ||
| Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | Other | 18,366,982.68 | 169,849,461.05 | 172,060,336.88 | 16,156,106.85 | ||
| CHINESE-FOREIGN VENTURE DRAGON AND LION CAP CO.,LTD ZHUHAI S.E.Z | Majority-owned subsidiary of the parent company | 61,111,183.48 | 304,635,699.32 | 306,278,758.09 | 59,468,124.71 | ||
| Guizhou Fuming Packaging Co. Ltd | Other | 17,141,404.68 | 97,529,116.77 | 102,899,843.04 | 11,770,678.41 | ||
| Guizhou Jiuyuan Property Co., Ltd. | Other | 25,917,286.51 | 55,607,363.83 | 53,199,390.07 | 28,325,260.27 | ||
| GUI ZHOU NEW HUAXI GLASS CO., LTD | Other | 1,379,775.63 | 102,859,277.54 | 103,559,472.79 | 679,580.38 | ||
| Tianchao Shangpin Liquor Industry(Guizhou) Co., Ltd. | Other | 142,935,451.25 | 286,801,127.23 | 414,856,000.00 | 14,880,578.48 | ||
| Zhongshan Sanrun Printing Consumables Co., Ltd. | Other | 28,305,077.01 | 430,939,956.08 | 459,245,033.09 | |||
| GUIZHOU MAOTAI DISTILLERT(GROUP) XIJIU CO., LTD. | Wholly-owned subsidiary of the parent company | 215,328,273.97 | 1,649,952,804.33 | 1,291,290,593.61 | 573,990,484.69 | ||
| KWEICHOW MOUTAI DISTILLERY GROUP CHANGLI WINERY CO., LTD. | Majority-owned subsidiary of the parent company | 7,864,923.85 | 276,717,314.98 | 275,104,255.86 | 9,477,982.97 | ||
| Kweichow Moutai (group) International Travel Service Co., Ltd. | Other | 6,395,353.49 | 49,741,638.61 | 30,294,650.38 | 25,842,341.72 | ||
| Kweichow Moutai Distillery (Group) Foreign Investment Cooperation Management Co., Ltd. | Majority-owned subsidiary of the parent company | 17,661,451.08 | 54,703,868.32 | 72,365,319.40 | |||
| KWEICHOW MOUTAI WINERY(GROUP)BAIJIN LIQUOR CO., LTD. | Other | 4,754,545.99 | 322,149,948.42 | 278,049,260.17 | 48,855,234.24 | ||
| Kweichow Moutai (Group) Ecological Agriculture Industry Development Co., Ltd. | Wholly-owned subsidiary of the parent company | 7,080,670.17 | 78,479,510.92 | 83,450,000.00 | 2,110,181.09 | ||
| Hotel Management Company Of Moutai Group | Wholly-owned subsidiary of the parent company | 39,622,015.86 | 79,060,587.80 | 81,960,227.60 | 36,722,376.06 | ||
| Kweichow Moutai | Other | 39,163,54 | 116,114,495. | 137,967,061. | 17,310,9 |
| Distillery (Group) Sanya Investment Co., Ltd. | 2.59 | 77 | 76 | 76.60 | |||
| Kweichow Zunyi Moutai Airport Co., Ltd. | Majority-owned subsidiary of the parent company | 6,020,201.77 | 705,640,084.78 | 649,071,535.08 | 62,588,751.47 | ||
| Kweichow Moutai Distillery (Group) Guiyang Business Co., Ltd. | Wholly-owned subsidiary of the parent company | 2,364,476.57 | 3,868,456.77 | 4,285,735.55 | 1,947,197.79 | ||
| Kweichow Zunyi Moutai Airport Ecological Park Investment and Development Co., Ltd. | Other | 486,511.01 | 37,016,991.11 | 37,500,000.00 | 3,502.12 | ||
| Kweichow Moutai Winery (Group) Health Wine Co., Ltd. | Wholly-owned subsidiary of the parent company | 39,304,385.43 | 2,450,554,141.16 | 2,378,049,237.47 | 111,809,289.12 | ||
| Moutai & CCB Trust (Guizhou) Investment Fund Management Co., Ltd. | Majority-owned subsidiary of the parent company | 807,602.96 | 145.76 | 803,730.42 | 4,018.30 | ||
| Moutai Financial Leasing Co., Ltd. | Wholly-owned subsidiary of the parent company | 5,150.13 | 118.55 | 5,268.68 | |||
| Moutai & CCB Trust (Guizhou) Investment Fund (Limited Partnership) | Majority-owned subsidiary of the parent company | 840.34 | 2.99 | 843.33 | |||
| Kweichow Moutai Distillery (Group) Guiyang High-tech Real Estate Investment Development Co., Ltd. | Other | 11,964.96 | 621,600.89 | 11,986.14 | 621,579.71 | ||
| Guizhou Hengdao Forestry and Agriculture Technology Development Co., Ltd. | Other | 281.00 | 383,587.70 | 383,840.83 | 27.87 | ||
| Kweichow Moutai Distillery (Group) Guiding Jingqi Glasswork Co., Ltd. | Other | 108,906,206.61 | 55,963,940.17 | 52,942,266.44 | |||
| Guizhou Renhuai Renshuai Liquor Industry Co., Ltd. | Other | 32,016,874.24 | 2,913,269.33 | 29,103,604.91 | |||
| Kweichow Moutai Distillery (Group) Lvsheng Organic Fertilizer Co., Ltd. | Other | 770,815.42 | 591,621.31 | 179,194.11 | |||
| Total | / | 14,241,859,949.77 | 105,584,880,843.75 | 98,063,165,146.20 | 21,763,575,647.32 |
Note: The above deposit interest rates range from 0.35% to 2.75%.
Interest paid to related parties
| Related party | This reporting period |
| Guizhou Xijiu Sales Co., Ltd. | 108,362,072.05 |
| Kweichow Moutai Group Marketing Co., Ltd. | 16,906,786.89 |
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | 11,545,138.89 |
| Kweichow Moutaichun Marketing Company | 7,160,221.58 |
| China Kweichow Moutai Distillery (Group) Co., Ltd. | 12,838,051.86 |
| Guizhou Renhuai Shenren Packaging and Printing Co., Ltd. | 2,552,541.62 |
| China Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd. | 1,877,899.92 |
| Changli Moutai Wine Trading Co., Ltd. | 2,182,551.69 |
| Kweichow Moutai Distillery (Group) Platinum Liquor Sales Co., Ltd. | 1,263,300.22 |
| Kweichow Moutai Distillery (Group) Logistics Co., Ltd. | 844,471.54 |
| Kweichow Moutai Winery (Group) Health Wine Sales Co., Ltd. | 1,705,436.82 |
| Kweichow Moutai Group Health Industry Co., Ltd. | 573,169.61 |
| Tianchao Shangpin Wine Industry (Guizhou) Co., Ltd. | 301,127.23 |
| Guizhou Jiuyuan Property Co., Ltd. | 407,973.76 |
| Guizhou Maotai Distillert (Group) Xijiu Co., Ltd. | 456,797.84 |
| Kweichow Moutai Ecological Agriculture Sales Co., Ltd. | 428,074.23 |
| Beijing Moutai Trading Co., Ltd. | 246,525.46 |
| Kweichow Moutai Distillery (Group) Real Estate Investment Development Co., Ltd. | 192,542.66 |
| Chinese-Foreign Venture Dragon And Lion Cap Co., Ltd Zhuhai S.E.Z | 163,293.69 |
| Shanghai Moutai Trading Co., Ltd. | 198,600.17 |
| Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | 114,917.05 |
| Kweichow Moutai (Group) Circular Economy Industrial Investment and Development Co., Ltd. | 647,329.13 |
| Kweichow Moutai Winery (Group) Health Wine Co., Ltd. | 586,454.62 |
| Shanghai Kweichow Moutai Industrial Co., Ltd. | 103,632.88 |
| Guizhou Zunpeng Liquor Industry Co., Ltd. | 473,901.96 |
| Gui Zhou New Huaxi Glass Co., Ltd | 73,550.70 |
| Kweichow Moutai Winery(Group)Baijin Liquor Co., Ltd.. | 73,294.29 |
| Gui Zhou New Huaxi Glass Co., Ltd | 93,938.83 |
| Hotel Management Company Of Moutai Group | 70,097.95 |
| Kweichow Moutai (group) International Travel Service Co., Ltd. | 56,743.61 |
| Kweichow Zunyi Moutai Airport Co., Ltd. | 301,102.66 |
| Guizhou Moutai Distillery (Group) Guiding Jingqi Glass Products Co., Ltd. | 213,054.05 |
| Zhongshan Sanrun Printing Consumables Co., Ltd. | 39,956.08 |
| Kweichow Moutai Distillery (Group) Sanya Investment Co., Ltd. | 44,495.77 |
| Kweichow Moutai Distillery (Group) Foreign Investment Cooperation Management Co., Ltd. | 42,584.06 |
| Kweichow Moutai (Group) Ecological Agriculture Industry Development Co., Ltd. | 35,478.66 |
| Kweichow Moutai Distillery Group Changli Winery Co., Ltd. | 49,318.35 |
| Kweichow Zunyi Moutai Airport Ecological Park Investment and Development Co., Ltd. | 16,991.11 |
| Kweichow Moutai Distillery (Group) Guiyang Business Co., Ltd. | 27,712.60 |
| Moutai & CCB Trust (Guizhou) Investment Fund Management Co., Ltd. | 145.76 |
| Kweichow Moutai Distillery (Group) Guiyang High-tech Real Estate Investment Development Co., Ltd. | 621,600.89 |
| Moutai Financial Leasing Co., Ltd | 18.55 |
| Guizhou Hengdao Danlin Agricultural Technology Development Co., Ltd. | 7.02 |
| Moutai & CCB Trust (Guizhou) Investment Fund (Limited Partnership) | 2.99 |
| Guizhou Renhuai Renshuai Wine Industry Co., Ltd. | 4,220.74 |
| Kweichow Moutai Distillery (Group) Lvsheng Organic Fertilizer Co., Ltd. | 69.92 |
| Total | 173,897,197.96 |
B. Loan business
√Applicable □N/A
Unit: CNY
| Related party | Relation | Loan amount | Interest Rate | Opening balance | Amount for this period | Closing balance | |
| Total loan amount for the current period | Total repayment amount for the current period | ||||||
| China Kweichow Moutai Distillery (Group) Co., Ltd. | Parent company | 3,500,000,000.00 | 3.80% | 3,000,000,000.00 | 3,500,000,000.00 | 3,000,000,000.00 | 3,500,000,000.00 |
| Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | Other | 20,000,000.00 | 3.80% | 18,355,728.00 | 11,644,272.00 | 20,000,000.00 | 10,000,000.00 |
| Chinese-Foreign Venture Dragon And Lion Cap Co., Ltd Zhuhai S.E.Z | Holding subsidiary of parent company | 10,000,000.00 | 4.05% | 10,000,000.00 | 10,000,000.00 | ||
| Total | / | 3,530,000,000.00 | / | 3,028,355,728.00 | 3,511,644,272.00 | 3,030,000,000.00 | 3,510,000,000.00 |
Interest charged to related parties
| Item | Related party | This reporting period |
| Loan interest income | China Kweichow Moutai Distillery (Group) Co., Ltd. | 109,865,697.45 |
| Loan interest income | Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | 647,083.70 |
| Loan interest income | Chinese-Foreign Venture Dragon And Lion Cap Co., Ltd Zhuhai S.E.Z | 89,150.94 |
| Total | 110,601,932.09 |
C. Credit business or other financial business
√Applicable □N/A
Unit: CNY
| Related party | Relation | Business type | Total amount | Actual amount |
| Kweichow Moutai (Group) Ecological Agriculture Industry Development Co., Ltd. | Wholly owned subsidiary of parent company | Entrusted deposit | 9,955,184.18 | 9,955,184.18 |
| Guizhou Hengdao Danlin Agricultural Technology Development Co., Ltd. | Other | Entrusted loans | 9,955,184.18 | 9,955,184.18 |
D. Other instructions
√Applicable □N/A
The Kweichow Moutai Group Finance Company, a controlling subsidiary of the Company, haswithdrawn the loans to Guiyang GYB Financial Leasing Co., LTD. at expiration, with recognizedinterest income of CNY 11.13 million in the current period. Bonds issued by Guiyang GYB FinancialLeasing Co., LTD. was subscribed from the open market with cost of CNY 20.00 million, andrecognized interest income of CNY 857,900 in the current period. As of the end of the period, thebalance of the debt investment impairment provision is CNY 11,300, the accrued interest balance isCNY 153,200, and the carrying amount is CNY 20.14 million.
13. Significant contracts and their performance
13.1 Trusteeship, contracting and leasing
A. Trusteeship
□Applicable √N/A
B. Contracting
□Applicable √N/A
C. Leasing
□Applicable √N/A
13.2 Major guarantees
□Applicable √N/A
13.3 Entrusting others to manage cash assets
A. Entrusted assets managementa. Overview of entrusted assets management
□Applicable √N/A
Other situations
□Applicable √N/A
b. Principal entrusted assets management
□Applicable √N/A
Other situations
□Applicable √N/A
c. Provision for impairment of entrusted assets management
□Applicable √N/A
B. Entrusted loansa. Overview of entrusted loans
□Applicable √N/A
Other situations
□Applicable √N/A
b. Principal entrusted loans
□Applicable √N/A
Other situations
□Applicable √N/A
c. Provision for impairment of entrusted loans
□Applicable √N/A
C. Other situations
□Applicable √N/A
13.4 Other significant contracts
□Applicable √N/A
14. Instruction of other major events that have a significant impact on investors’ value judgmentsand investment decisions
□Applicable √N/A
Section VII Changes in Shares and Information about Shareholders
1. Changes in share capital
1.1 Changes in shares
A. Changes in sharesDuring the reporting period, there is no change to the total number of shares and share capital structureof the Company.
B. Explanation of changes in shares
□Applicable √N/A
C. The impact of changes in shares on financial indicators such as earnings per share and netassets per share in the last year and the latest period (if any)
□Applicable √N/A
D. Other contents deemed necessary by the Company or required by securities regulators todisclose
□Applicable √N/A
1.2 Changes in restricted shares
□Applicable √N/A
2. Securities issuance and listing
2.1 Issues of securities as of the reporting period
□Applicable √N/A
Explanation of securities issuance as of the reporting period (for bonds with different interest rates inthe duration, please explain separately):
□Applicable √N/A
2.2 Changes in the Company’s total shares and shareholder structure, and changes in theCompany’s asset and liability structure
□Applicable √N/A
2.3 Existing employees’ shares
□Applicable √N/A
3. Shareholders and actual controllers
3.1 Total number of shareholders
3.2 Shareholdings of the top ten shareholders and top ten tradable shareholders (or shareholderswithout restrictions on sales) as of the end of the reporting period
Unit: share
| Shareholdings of the top ten shareholders | ||||||
| (full name) | Increase or decrease during the | Number of shares held at the end of | Proportion (%) | Number of | Staking, tokenizing or freezing | Nature of |
The total number of ordinary shareholders as of the endof the reporting period
| The total number of ordinary shareholders as of the end of the reporting period | 153,535 |
| The total number of ordinary shareholders at the end of the previous month before the disclosure date of the annual report | 162,591 |
| reporting period | the period | shares held with restrictions on sales | Share status | Quantity | shareholders | ||
| China Kweichow Moutai Distillery (Group) Co., Ltd. | 678,291,955 | 54.00 | None | State-own legal person | |||
| Hong Kong Securities Clearing Company Ltd. (HKSCC) | -14,672,136 | 89,681,844 | 7.14 | Unknown | Unknown | ||
| Guizhou Provincial State-owned Capital Operation Co., Ltd. | -1,827,151 | 56,996,777 | 4.54 | Unknown | State-own legal person | ||
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. (formerly known as Kweichow Moutai Distillery Group Technology Development Co., Ltd.) | 27,812,088 | 2.21 | None | State-own legal person | |||
| Central Huijin Asset Management Co., Ltd. | -390,196 | 10,397,104 | 0.83 | Unknown | State-own legal person | ||
| China Securities Finance Corporation Limited | -91 | 8,039,447 | 0.64 | Unknown | Unknown | ||
| Shenzhen Jinhui Rongsheng Wealth Management Co., Ltd. - Jinhui Rongsheng No. 3 Private Securities Investment Fund | 908,400 | 5,929,350 | 0.47 | Unknown | Unknown | ||
| Bank of China Limited - China Merchants CSI Liquor Index Graded Securities Investment Fund | 2,683,033 | 5,838,354 | 0.46 | Unknown | Unknown | ||
| Zhuhai Ruifeng Huibang Asset Management Co., Ltd. - Ruifeng Huibang No. 3 Private Securities Investment Fund | 1,205,785 | 5,366,717 | 0.43 | Unknown | Unknown |
| Industrial and Commercial Bank of China - Shanghai Stock Exchange 50 Exchange-traded Open-end Index Securities Investment Fund | 1,596,504 | 5,335,765 | 0.42 | Unknown | Unknown | ||
| Shareholdings of the top ten shareholders without restrictions on sales | |||||||
| Shareholder name | The number of tradable shares held without restrictions on sales | Type and quantity of shares | |||||
| Type | Quantity | ||||||
| China Kweichow Moutai Distillery (Group) Co., Ltd. | 678,291,955 | ordinary shares | 678,291,955 | ||||
| Hong Kong Securities Clearing Company Ltd. (HKSCC) | 89,681,844 | ordinary shares | 89,681,844 | ||||
| Guizhou Provincial State-owned Capital Operation Co., Ltd. | 56,996,777 | ordinary shares | 56,996,777 | ||||
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. (Formerly known as Kweichow Moutai Distillery Group Technology Development Co., Ltd.) | 27,812,088 | ordinary shares | 27,812,088 | ||||
| Central Huijin Asset Management Co., Ltd. | 10,397,104 | ordinary shares | 10,397,104 | ||||
| China Securities Finance Corporation Limited | 8,039,447 | ordinary shares | 8,039,447 | ||||
| Shenzhen Jinhui Rongsheng Wealth Management Co., Ltd. - Jinhui Rongsheng No. 3 Private Securities Investment Fund | 5,929,350 | ordinary shares | 5,929,350 | ||||
| Bank of China Limited - China Merchants CSI Liquor Index Graded Securities Investment Fund | 5,838,354 | ordinary shares | 5,838,354 | ||||
| Zhuhai Ruifeng Huibang Asset Management Co., Ltd. - Ruifeng Huibang No. 3 Private Securities Investment Fund | 5,366,717 | ordinary shares | 5,366,717 | ||||
| Industrial and Commercial Bank of China - Shanghai Stock Exchange 50 Exchange-traded Open-end Index Securities Investment Fund | 5,335,765 | ordinary shares | 5,335,765 | ||||
| Explanation of the relations or concerted actions of the above shareholders | Among the above shareholders, there are relations between China Kweichow Moutai Distillery (Group) Co., Ltd. and Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. (formerly known as Kweichow Moutai Distillery Group Technology Development Co., Ltd.). In addition, the Company is not aware of the relations among other shareholders and whether they are persons acting in concert. | ||||||
Number of shares held by the top ten shareholders with restrictions on sales and restrictions on sales
□Applicable √N/A
3.3 Strategic investors or general legal persons become the top 10 shareholders due to placementof new shares
□Applicable √N/A
4. Controlling shareholders and actual controller
4.1 Controlling shareholder
A. Legal person
√Applicable □N/A
| Name | China Kweichow Moutai Distillery (Group) Co., Ltd. |
| Legal Representative | Ding Xiongjun |
| Date of establishment | January 24, 1998 |
| Main business | Production and operation of alcoholic products (main business); production technology consulting and services of alcoholic products; production and sales of packaging materials and beverages; catering, accommodation, tourism, logistics and transportation; import and export trade business; Internet industry; real estate development and leasing, parking lot management; education, health; ecological agriculture.. |
| Shareholdings of other domestic and overseas listed companies that controlled and participated in during the reporting period | Holding 0.24% of the shares of Bank of Communications Co., Ltd.; holding 5.16% of the shares of Huachuang Yangan Co., Ltd.; holding 1.45% of the shares of Bank of Guiyang Co., Ltd.; holding 11.55% of the shares of Guizhou Radio and Television Information Network Co., Ltd.; holding 12% of the shares of Bank of Guizhou Co., Ltd. |
B. Natural person
□Applicable √N/A
C. Special instructions for the fact that the Company does not have controlling shareholders
□Applicable √N/A
D. Explanation on changes of controlling shareholders during the reporting period
□Applicable √N/A
E. Block diagram of the property rights and control relationship between the Company and thecontrolling shareholders
√Applicable □N/A
4.2 The actual controller
A. Legal person
√Applicable □N/A
| Name | State-owned Assets Supervision and Administration Commission of the People's Government of Guizhou Province |
| The person in charge or the legal representative of the entity | Xiao Kailin |
B. Natural persons
□Applicable √N/A
C. Special instructions for the fact that the Company does not have an actual controller
□Applicable √N/A
China Kweichow Moutai Distillery (Group) Co., Ltd.
Kweichow Moutai Co., Ltd.
Kweichow Moutai Co., Ltd.54%
D. Explanation on the change of the Company’s control during the reporting period
□Applicable √N/A
E. Block diagram of the property rights and control relationship between the Company and theactual controller
√Applicable □N/A
F. The actual controller controls the Company through trust or other asset management methods
□Applicable √N/A
4.3 Other information about the controlling shareholder and actual controller
□Applicable √N/A
5. The accumulative number of pledged shares of the Company’s controlling shareholder or thelargest shareholder and its persons acting in concert account for more than 80% of theCompany’s shares held by them
□Applicable √N/A
6. Other legal person shareholders holding more than 10% of the shares
□Applicable √N/A
7. Explanation of share restriction and reduction
□Applicable √N/A
8. The specific implementation of share repurchase during the reporting period
□Applicable √N/A
Section VIII Preferred Shares
□Applicable √N/A
Section IX Information about Bond
1. Corporate bonds, company bonds and non-financial corporate debt financing instruments
□Applicable √N/A
2. Convertible corporate bonds
State-owned Assets Supervision and Administration Commission of
the People's Government of Guizhou ProvinceChina Kweichow Moutai Distillery (Group) Co., Ltd.
China Kweichow Moutai Distillery (Group) Co., Ltd.
Kweichow Moutai Co., Ltd.
Kweichow Moutai Co., Ltd.54%
54%90%
□Applicable √N/A
Section X Financial Report
1. Audit report
√Applicable □N/A
2. Financial statements
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
December 31, 2021
Prepared by: Kweichow Moutai Co., Ltd.
Unit: CNY
| Item | Notes | December 31, 2021 | December 31, 2020 |
| CURRENT ASSETS | |||
| Cash and Cash equivalents | 1 | 51,810,243,607.11 | 36,091,090,060.90 |
| Settlements Provision | |||
| Loans to banks and other financial institutions | 2 | 135,067,287,778.03 | 118,199,586,541.06 |
| Financial assets held for trading | |||
| Derivative financial assets | |||
| Notes receivable | 3 | 1,532,728,979.67 | |
| Accounts receivable | 4 | ||
| Financing receivables | |||
| Prepayments | 5 | 389,109,841.28 | 898,436,259.15 |
| Insurance premium receivable | |||
| Due from reinsurers | |||
| Reinsurance contract reserves receivable | |||
| Other receivables | 6 | 33,158,974.32 | 34,488,582.19 |
| Including: Interest receivable | |||
| Dividends receivable | |||
| Financial assets purchased under agreements to resell | |||
| Inventories | 7 | 33,394,365,084.83 | 28,869,087,678.06 |
| Contract assets | |||
| Assets classified as held for sale | |||
| Current portion of non-current assets | |||
| Other current assets | 8 | 71,527,560.74 | 26,736,855.91 |
| Total current assets | 220,765,692,846.31 | 185,652,154,956.94 | |
| NON-CURRENT ASSETS | |||
| Loans and advances | 9 | 3,425,175,000.00 | 2,953,036,834.80 |
| Debt investment | 10 | 170,468,623.71 | 20,143,397.78 |
| Other debt investments | |||
| Long-term receivables | |||
| Long-term equity investments | |||
| Other equity instruments investments | |||
| Other non-current financial assets | 11 | 9,830,052.91 | |
| Investment properties | 12 | 5,242,431.75 | |
| Fixed assets | 13 | 17,472,173,182.85 | 16,225,082,847.29 |
| Construction in progress | 14 | 2,321,988,541.82 | 2,447,444,843.03 |
| Productive biological assets | |||
| Oil and gas assets | |||
| Right-of-use asset | 15 | 362,785,970.23 | |
| Intangible assets | 16 | 6,208,358,330.24 | 4,817,170,981.91 |
| Development expenditures | |||
| Goodwill | |||
| Long-term prepaid expenses | 17 | 139,342,455.82 | 147,721,526.43 |
| Deferred tax assets | 18 | 2,237,206,443.84 | 1,123,225,086.37 |
| Other non-current assets | 19 | 2,059,761,333.33 | |
| Total non-current assets | 34,402,502,313.59 | 27,743,655,570.52 | |
| Total assets | 255,168,195,159.90 | 213,395,810,527.46 | |
| Current liabilities | |||
| Short-term borrowings | |||
| Borrowing from the central bank | |||
| Deposits and balances from banks and other financial institutions | |||
| Financial liabilities held for trading | |||
| Derivative financial liabilities | |||
| Notes payable | |||
| Accounts payable | 20 | 2,009,832,495.56 | 1,342,267,668.12 |
| Receipts in advance | |||
| Contract liabilities | 21 | 12,718,465,288.02 | 13,321,549,147.69 |
| Financial assets sold under agreements to buy | |||
| Customer deposits and balances from banks and other financial institutions | 22 | 21,763,575,647.32 | 14,241,859,949.77 |
| Customer brokerage deposits | |||
| Securities underwriting brokerage deposits | |||
| Payroll and employee benefits payable | 23 | 3,677,845,718.53 | 2,981,125,503.86 |
| Taxes payable | 24 | 11,979,802,144.01 | 8,919,821,015.58 |
| Other payables | 25 | 4,124,404,781.29 | 3,257,245,259.42 |
| Including: Interest payable | |||
| Dividend payable | |||
| Fees and commission payable | |||
| Payable reinsurance | |||
| Liabilities classified as held for sale | |||
| Current portion of non-current liabilities | 26 | 104,319,886.87 | |
| Other current liabilities | 27 | 1,535,976,293.22 | 1,609,801,368.51 |
| Total current liabilities | 57,914,222,254.82 | 45,673,669,912.95 | |
| Non-current liabilities | |||
| Insurance reserves | |||
| Long-term borrowings | |||
| Bonds payable | |||
| Including: Preference share | |||
| Perpetual debt | |||
| Lease liabilities | 28 | 296,466,199.74 | |
| Long-term Payable | |||
| Long-term payroll and employee benefits payable | |||
| Provisions | |||
| Deferred income | |||
| Deferred tax liabilities | 18 | 1,457,513.23 | |
| Other non-current liabilities | |||
| Total non-current liabilities | 296,466,199.74 | 1,457,513.23 | |
| Total liabilities | 58,210,688,454.56 | 45,675,127,426.18 | |
| SHAREHOLDERS’EQUITY： | |||
| Paid-in capital | 29 | 1,256,197,800.00 | 1,256,197,800.00 |
| Other equity instruments | |||
| Including: Preference share | |||
| Perpetual debt | |||
| Capital reserve | 30 | 1,374,964,415.72 | 1,374,964,415.72 |
| Less: treasury shares | |||
| Other comprehensive income | 31 | -13,017,880.78 | -5,331,367.75 |
| Special reserve | |||
| Surplus reserve | 32 | 25,142,832,818.16 | 20,174,922,608.93 |
| General risk reserve | 33 | 1,061,529,724.00 | 927,577,822.67 |
| Retained earnings | 34 | 160,716,861,920.19 | 137,594,403,807.99 |
| Equity attributable to owners of the parent | 189,539,368,797.29 | 161,322,735,087.56 | |
| Non-controlling interests | 7,418,137,908.05 | 6,397,948,013.72 | |
| Total shareholders’ equity | 196,957,506,705.34 | 167,720,683,101.28 | |
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | 255,168,195,159.90 | 213,395,810,527.46 | |
Legal Representative: Ding XiongjunChief Accountant: Jiang YanHead of Accounting Department: Cai Congying
COMPANY STATEMENT OF FINANCIAL POSITION
December 31, 2021
Prepared by: Kweichow Moutai Co., Ltd.Unit: CNY
| Item | Notes | December 31, 2021 | December 31, 2020 |
| CURRENT ASSETS | |||
| Cash and Cash equivalents | 79,115,779,990.88 | 50,925,698,935.43 | |
| Financial assets held for trading | |||
| Derivative financial assets | |||
| Notes receivable | 142,286,376.00 | ||
| Accounts receivable | 1 | 1,480,080,983.77 | 9,203,780,107.14 |
| Financing receivables | |||
| Prepayments | 355,933,658.53 | 858,363,840.62 | |
| Other receivables | 2 | 9,210,501.43 | 42,323,669.01 |
| Including: Interest receivable | |||
| Dividends receivable | |||
| Inventories | 32,424,250,538.15 | 28,162,833,603.66 | |
| Contract assets | |||
| Assets classified as held for sale | |||
| Current portion of non-current assets | |||
| Other current assets | 74,711.92 | ||
| Total current assets | 113,385,330,384.68 | 89,335,286,531.86 | |
| NON-CURRENT ASSETS | |||
| Debt investment | |||
| Other debt investments | |||
| Long-term receivables | |||
| Long-term equity investments | 3 | 1,624,535,587.55 | 1,624,535,587.55 |
| Other equity instruments investments | |||
| Other non-current financial assets | 9,830,052.91 | ||
| Investment properties | |||
| Fixed assets | 16,992,010,693.65 | 15,742,514,190.13 | |
| Construction in progress | 2,280,929,738.91 | 2,447,444,843.03 | |
| Productive biological assets | |||
| Oil and gas assets | |||
| Right-of-use asset | 249,696,982.21 | ||
| Intangible assets | 6,207,018,624.16 | 4,815,945,940.55 | |
| Development expenditures | |||
| Goodwill | |||
| Long-term prepaid expenses | 137,500,000.25 | 147,500,000.21 | |
| Deferred tax assets | 639,335,397.34 | 521,030,214.32 | |
| Other non-current assets | 2,059,761,333.33 | ||
| Total non-current assets | 30,190,788,357.40 | 25,308,800,828.70 | |
| Total assets | 143,576,118,742.08 | 114,644,087,360.56 | |
| Current liabilities | |||
| Short-term borrowings | |||
| Financial liabilities held for trading | |||
| Derivative financial liabilities | |||
| Notes payable | |||
| Accounts payable | 1,859,402,871.20 | 1,077,677,482.55 | |
| Receipts in advance | |||
| Contract liabilities | 142,568.14 | 557,514,370.46 | |
| Payroll and employee benefits payable | 3,551,461,301.23 | 2,846,669,812.23 | |
| Taxes payable | 6,857,150,756.70 | 5,032,321,722.08 | |
| Other payables | 1,374,157,867.96 | 926,532,063.22 | |
| Including: Interest payable | |||
| Dividend payable | |||
| Liabilities classified as held for sale | |||
| Current portion of non-current liabilities | 63,501,723.59 | ||
| Other current liabilities | 18,533.86 | ||
| Total current liabilities | 13,705,835,622.68 | 10,440,715,450.54 | |
| Non-current liabilities | |||
| Long-term borrowings | |||
| Bonds payable | |||
| Including: Preference share | |||
| Perpetual debt | |||
| Lease liabilities | 225,090,785.68 | ||
| Long-term Payable | |||
| Long-term payroll and employee benefits payable | |||
| Provisions | |||
| Deferred income | |||
| Deferred tax liabilities | 1,457,513.23 | ||
| Other non-current liabilities | |||
| Total non-current liabilities | 225,090,785.68 | 1,457,513.23 | |
| Total liabilities | 13,930,926,408.36 | 10,442,172,963.77 | |
| SHAREHOLDERS’ EQUITY： | |||
| Paid-in capital | 1,256,197,800.00 | 1,256,197,800.00 | |
| Other equity instruments | |||
| Including: Preference share | |||
| Perpetual debt | |||
| Capital reserve | 1,374,303,082.72 | 1,374,303,082.72 | |
| Less: treasury shares | |||
| Other comprehensive income | |||
| Special reserve | |||
| Surplus reserve | 25,142,832,818.16 | 20,174,922,608.93 | |
| Retained earnings | 101,871,858,632.84 | 81,396,490,905.14 | |
| Total shareholders’ equity | 129,645,192,333.72 | 104,201,914,396.79 | |
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | 143,576,118,742.08 | 114,644,087,360.56 | |
Legal Representative: Ding XiongjunChief Accountant: Jiang YanHead of Accounting Department: Cai Congying
CONSOLIDATED INCOME STATEMENTFor the year ended 31 December 2021
Prepared by: Kweichow Moutai Co., Ltd.
Unit: CNY
| Item | Notes | 2021 | 2020 |
| I. Total revenue | 109,464,278,563.89 | 97,993,240,501.21 | |
| Including: Operating proceeds | 35 | 106,190,154,843.76 | 94,915,380,916.72 |
| Interest income | 36 | 3,274,123,720.13 | 3,077,859,584.49 |
| Net earned premiums | |||
| Net fee and commission revenue | 36 | ||
| II. Total operating costs | 34,776,902,467.47 | 31,305,130,587.56 | |
| Including: Operating costs | 35 | 8,983,377,809.96 | 8,154,001,476.28 |
| Interest expenses | 36 | 173,897,197.98 | 111,128,537.31 |
| Fees and commission expenses | 36 | 115,082.12 | 105,888.96 |
| Surrenders | |||
| Net payments for insurance claims |
| Net provision of insurance reserve | |||
| Policyholder dividends | |||
| Reinsurance expenses | |||
| Taxes and surcharges | 37 | 15,304,469,070.03 | 13,886,517,290.78 |
| Selling expenses | 38 | 2,737,369,434.78 | 2,547,745,650.95 |
| General and administrative expenses | 39 | 8,450,274,065.03 | 6,789,844,289.39 |
| R&D expenses | 40 | 61,923,213.59 | 50,398,036.33 |
| Financial expenses | 41 | -934,523,406.02 | -234,610,582.44 |
| Including: Interest expense | 13,529,867.76 | ||
| Interest income | 944,578,412.02 | 278,697,733.32 | |
| Add: Other income | 42 | 20,515,911.19 | 13,138,152.69 |
| Investment income/(loss) | 43 | 58,255,937.39 | 305,631.46 |
| Including: Share of profits or loss of associates and joint ventures | |||
| Gain from derecognition of financial assets measured at amortized cost | |||
| Exchange gains or losses | |||
| Net exposure hedging gains/ (losses) | |||
| Gain/ (loss) on the changes in fair value | 44 | -2,244,726.29 | 4,897,994.43 |
| Credit impairment losses | 45 | -13,022,441.19 | -71,371,809.85 |
| Assets impairment losses | |||
| Gain/ (loss) from disposal of assets | |||
| III. Operating profit | 74,750,880,777.52 | 66,635,079,882.38 | |
| Add: Non-operating income | 46 | 68,989,219.74 | 11,051,136.15 |
| Less: Non-Operating costs | 47 | 291,838,102.50 | 449,189,027.42 |
| IV. Profit/(loss) before tax | 74,528,031,894.76 | 66,196,941,991.11 | |
| Less: Income tax expense | 48 | 18,807,501,938.30 | 16,673,612,108.71 |
| V. Net profit /(loss) | 55,720,529,956.46 | 49,523,329,882.40 | |
| (1) Categorized by operation continuity | |||
| 1. Net profit from continuing operations | 55,720,529,956.46 | 49,523,329,882.40 | |
| 2. Net profit from discontinuing operations | |||
| (2) Categorized by ownership | |||
| 1. Net profit attributable to owners of the parent | 52,460,144,378.16 | 46,697,285,429.81 | |
| 2. Net profit attributable to non-controlling interests | 3,260,385,578.30 | 2,826,044,452.59 | |
| VI. Other comprehensive income, net of tax | 49 | -7,686,513.03 | 1,867,354.04 |
| (1) Other comprehensive income, net of tax, attributable to owners of the parent | -7,686,513.03 | 1,867,354.04 | |
| 1. Other comprehensive income that will not be reclassified to profit or loss | |||
| 1.1 Remeasurement gains or losses of a defined benefit plan | |||
| 1.2 Other comprehensive income using the equity method that will not be reclassified to profit or loss | |||
| 1.3 Changes in fair value of other equity instrument investments | |||
| 1.4 Changes in fair value of enterprise’s own credit risk | |||
| 2. Other comprehensive income to be reclassified to profit or loss | -7,686,513.03 | 1,867,354.04 | |
| 2.1 Other comprehensive income that can be reclassified to profit or loss in equity method | |||
| 2.2 Changes in fair value of other debt investments | |||
| 2.3 Amount of financial assets reclassified into other comprehensive income | |||
| 2.4 Provision for credit impairment of other debt investments | |||
| 2.5 Cash flow hedging reserves | |||
| 2.6 Exchange differences on translation of foreign currency financial statements | -7,686,513.03 | 1,867,354.04 | |
| 2.7 Others | |||
| (2) Other comprehensive income, net of tax, attributable to non-controlling interests | |||
| VII. Total comprehensive income | 55,712,843,443.43 | 49,525,197,236.44 | |
| (1) Total comprehensive income attributable to owners of the parent | 52,452,457,865.13 | 46,699,152,783.85 | |
| (2) Total comprehensive income attributable to non-controlling interests | 3,260,385,578.30 | 2,826,044,452.59 | |
| VIII. Earnings per share | |||
| (1) Basic earnings per share (CNY / share) | 41.76 | 37.17 | |
| (2) Diluted earnings per share (CNY / share) | 41.76 | 37.17 | |
Legal Representative: Ding XiongjunChief Accountant: Jiang YanHead of Accounting Department: Cai Congying
INCOME STATEMENT OF COMPANY
For the year ended 31 December 2021
Prepared by: Kweichow Moutai Co., Ltd.
Unit: CNY
| Item | Notes | 2021 | 2020 |
| I. Total revenue | 4 | 37,344,898,964.17 | 27,474,592,438.64 |
| Less: Total operating costs | 4 | 8,991,912,828.37 | 7,770,822,451.00 |
| Taxes and surcharges | 14,172,007,646.53 | 12,801,958,138.67 | |
| Selling expenses | 562,890,060.03 | 102,662,855.84 | |
| Administrative expenses | 7,891,014,092.82 | 5,485,599,325.68 | |
| Research and development expenses | 61,923,213.59 | 50,398,036.33 | |
| Finance expenses | -1,229,581,298.58 | -910,287,572.32 | |
| with positive value) | 9,093,212.00 | ||
| Interest income (expressed with positive value) | 1,228,595,916.86 | 943,450,751.53 | |
| Add: Other income | 6,279,409.80 | 5,371,922.84 | |
| Investment income/(loss) | 5 | 44,799,409,723.82 | 34,474,979,155.43 |
| Including: Share of profits or loss of associates and joint ventures | |||
| Gain from derecognition of financial assets measured at amortized cost | |||
| Net exposure hedging gains/ (losses) | |||
| Gain/ (loss) on the changes in fair value | -2,244,726.29 | 4,897,994.43 | |
| Credit impairment losses | -85,848.47 | -1,545,197.60 | |
| Assets impairment losses | |||
| Gain/ (loss) from disposal of assets | |||
| II. Operating profit/Loss | 51,698,090,980.27 | 36,657,143,078.54 | |
| Add: Non-operating income | 51,287,742.20 | 6,486,699.48 | |
| Less: Non-operating costs | 265,265,782.93 | 336,421,577.72 | |
| III.Profit/(loss) before tax | 51,484,112,939.54 | 36,327,208,200.30 |
| Less: Income tax expense | 1,805,010,847.21 | 534,972,481.19 | |
| IV. Net profit /(loss) | 49,679,102,092.33 | 35,792,235,719.11 | |
| (1) Net profit from continuing operations | 49,679,102,092.33 | 35,792,235,719.11 | |
| (2) Net profit from discontinuing operations | |||
| V. Other comprehensive income, net of tax | |||
| (1) Other comprehensive income, net of tax | |||
| 1. Other comprehensive income that will not be reclassified to profit or loss | |||
| 2. Other comprehensive income using the equity method that will not be reclassified to profit or loss | |||
| 3. Changes in fair value of other equity instrument investments | |||
| 4. Changes in fair value of enterprise’s own credit risk | |||
| (2) Other comprehensive income to be reclassified to profit or loss | |||
| 1. Other comprehensive income that can be reclassified to profit or loss in equity method | |||
| 2. Changes in fair value of other debt investments | |||
| 3. Change in the fair value of available-for-sale financial assets | |||
| 4. Amount of financial assets reclassified into other comprehensive income | |||
| 5. Reclassification of held-to-maturity investments as available-for-sale financial assets | |||
| 6. Exchange differences on translation of foreign currency financial statements | |||
| 7. Others | |||
| VI. Total comprehensive income | 49,679,102,092.33 | 35,792,235,719.11 | |
| VII. Earnings per share | |||
| (1) Basic earnings per share (CNY / share) | 39.55 | 28.49 | |
| (2) Diluted earnings per share (CNY / share) | 39.55 | 28.49 | |
Legal Representative: Ding XiongjunChief Accountant: Jiang YanHead of Accounting Department: Cai Congying
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 December 2021
Prepared by: Kweichow Moutai Co., Ltd.
Unit: CNY
| Item | Notes | 2021 | 2020 |
| I. CASH FLOWS FROM OPERATING ACTIVITIES | |||
| Cash receipts from the sale of goods and the rendering of services | 119,320,536,796.65 | 107,024,384,560.17 | |
| Net increase in customer bank deposits and due to banks and other financial institutions | 7,511,166,145.93 | 3,189,100,199.87 | |
| Net increase in loans from the central bank | |||
| Net increase in funds borrowed from other financial institutions | |||
| Cash premiums received on original insurance contracts | |||
| Net cash received from re-insurance business | |||
| Net increase in deposits and investments from | |||
| insurers | |||
| Cash received from interest, fees and commission | 3,145,747,032.91 | 3,075,945,383.34 | |
| Net increase in funds deposit | |||
| Net increase in repurchase business funds | |||
| Net income from securities trading brokerage business | |||
| Tax refunds received | |||
| Cash received relating to other operating activities | 50 (1) | 1,643,536,862.48 | 221,421,226.63 |
| Sub-total of cash inflows | 131,620,986,837.97 | 113,510,851,370.01 | |
| Cash paid for purchase of goods and services | 7,745,959,630.90 | 7,230,646,129.19 | |
| Net increase in loans and payments on behalf of customers | 484,244,272.00 | 2,978,755,728.00 | |
| Net increase in deposits with central bank and other financial institutions | 559,089,326.28 | -2,506,406,682.56 | |
| Payments for claims for original insurance contracts | |||
| Net increase in funds lent | -400,000,000.00 | 200,000,000.00 | |
| Cash paid for interest, fees and commission | 163,462,728.48 | 107,241,768.26 | |
| Commissions on insurance policies paid | |||
| Cash paid to and on behalf of employee | 10,061,366,201.66 | 8,161,813,197.26 | |
| Cash paid for taxes | 44,609,684,025.28 | 41,622,706,350.37 | |
| Cash paid relating to other operating activities | 50 (2) | 4,368,504,506.00 | 4,047,026,186.46 |
| Sub-total of cash outflows | 67,592,310,690.60 | 61,841,782,676.98 | |
| Net cash flows from operating activities | 64,028,676,147.37 | 51,669,068,693.03 | |
| II. CASH FLOWS FROM INVESTING ACTIVITIES | |||
| Cash received from disposal of investments | 6,079,930.68 | 314,906,521.48 | |
| Cash received from investment income | 860,000.00 | ||
| Net proceeds from disposal of property, plant and equipment, intangible assets and other long-term assets | 2,463,474.29 | 495,904.85 | |
| Cash received from disposal of subsidiaries and other business units | |||
| Cash received relating to other investing activities | 50 (3) | 9,983,452.63 | 6,675,319.03 |
| Sub-total of cash inflows | 19,386,857.60 | 322,077,745.36 | |
| Purchase of property, plant and equipment, intangible assets and other non-current assets | 3,408,784,532.01 | 2,089,769,498.78 | |
| Cash paid for investments | 2,150,000,000.00 | 20,000,000.00 | |
| Net increase in secured loans | |||
| Net cash paid for acquisition of a subsidiary and other operating units | |||
| Cash paid relating to other investing activities | 50 (4) | 23,048,029.93 | 17,535,402.30 |
| Sub-total of cash outflows | 5,581,832,561.94 | 2,127,304,901.08 | |
| Net cash flows from investing activities | -5,562,445,704.34 | -1,805,227,155.72 | |
| III. Cash flows from financing activities | |||
| Cash received from investment | |||
| Including: Cash receipts from capital contributions from non-controlling interests of subsidiaries | |||
| Proceeds from borrowings | |||
| Cash receipts relating to other financing activities | |||
| Subtotal of cash inflows | |||
| Repayments for debts | |||
| Cash payments for distribution of dividends or | 26,476,019,839.37 | 24,091,029,750.51 | |
| profit and interest expenses | |||
| Including: Dividends or profit paid to non-controlling shareholders of subsidiaries | 2,240,195,683.97 | 2,704,262,179.11 | |
| Cash payments relating to other financing activities | 50 (5) | 88,121,549.59 | 36,507,157.75 |
| Subtotal of cash outflows | 26,564,141,388.96 | 24,127,536,908.26 | |
| Net cash flows from financing activities | -26,564,141,388.96 | -24,127,536,908.26 | |
| IV. EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS | -2,026,542.60 | 380,639.36 | |
| V. NET INCREASE IN CASH AND CASH EQUIVALENTS | 31,900,062,511.47 | 25,736,685,268.41 | |
| Add: Cash and cash equivalents at beginning of year | 146,740,524,868.05 | 121,003,839,599.64 | |
| VI. CASH AND CASH EQUIVALENTS AT END OF YEAR | 178,640,587,379.52 | 146,740,524,868.05 |
Legal Representative: Ding XiongjunChief Accountant: Jiang YanHead of Accounting Department: Cai Congying
COMPANY STATEMENT OF CASH FLOWSFor the year ended 31 December 2021
Prepared by: Kweichow Moutai Co., Ltd.
Unit: CNY
| Item | Notes | 2021 | 2020 |
| I. CASH FLOWS FROM OPERATING ACTIVITIES | |||
| Cash receipts from the sale of goods and the rendering of services | 48,582,727,792.21 | 29,748,943,961.12 | |
| Tax refunds received | |||
| Cash received relating to other operating activities | 1,330,181,729.83 | 669,399,842.28 | |
| Sub-total of cash inflows | 49,912,909,522.04 | 30,418,343,803.40 | |
| Cash paid for purchase of goods and services | 7,730,438,800.94 | 7,196,881,556.42 | |
| Cash paid to and on behalf of employee | 9,421,372,112.36 | 7,615,738,706.94 | |
| Cash paid for taxes | 17,808,661,856.89 | 16,700,898,450.93 | |
| Cash paid relating to other operating activities | 2,170,307,857.51 | 948,160,346.44 | |
| Sub-total of cash outflows | 37,130,780,627.70 | 32,461,679,060.73 | |
| Net cash flows from operating activities | 12,782,128,894.34 | -2,043,335,257.33 | |
| II. CASH FLOWS FROM INVESTING ACTIVITIES | |||
| Cash received from disposal of investments | 6,079,930.68 | 314,906,521.48 | |
| Cash received from investment income | 44,741,153,786.43 | 34,940,030,979.52 | |
| Net proceeds from disposal of property, plant and equipment, intangible assets and other long-term assets | 2,453,676.06 | ||
| Cash received from disposal of subsidiaries and other business units | |||
| Cash received relating to other investing activities | 9,983,452.63 | 6,675,319.03 | |
| Sub-total of cash inflows | 44,759,670,845.80 | 35,261,612,820.03 | |
| Purchase of property, plant and equipment, intangible assets and other non-current assets | 3,349,912,221.23 | 2,081,844,620.34 | |
| Cash paid for investments | 2,000,000,000.00 | 4,507,157.75 | |
| Cash Paid for disposal of subsidiaries and other business units | |||
| Cash paid relating to other investing activities | 23,048,029.93 | 17,535,402.30 | |
| Sub-total of cash outflows | 5,372,960,251.16 | 2,103,887,180.39 | |
| Net cash flows from investing activities | 39,386,710,594.64 | 33,157,725,639.64 | |
| III. Cash flows from financing activities | |||
| Cash received from investment | |||
| Proceeds from borrowings | |||
| Cash receipts relating to other financing activities | |||
| Subtotal of cash inflows | |||
| Repayments for debts | |||
| Cash payments for distribution of dividends or profit and interest expenses | 24,235,824,155.40 | 21,386,767,571.40 | |
| Cash payments relating to other financing activities | 53,056,483.06 | ||
| Subtotal of cash outflows | 24,288,880,638.46 | 21,386,767,571.40 | |
| Net cash flows from financing activities | -24,288,880,638.46 | -21,386,767,571.40 | |
| IV. EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS | |||
| V. NET INCREASE IN CASH AND CASH EQUIVALENTS | 27,879,958,850.52 | 9,727,622,810.91 | |
| Add: Cash and cash equivalents at beginning of year | 50,053,974,421.28 | 40,326,351,610.37 | |
| VI. CASH AND CASH EQUIVALENTS AT END OF YEAR | 77,933,933,271.80 | 50,053,974,421.28 | |
Legal Representative: Ding XiongjunChief Accountant: Jiang YanHead of Accounting Department: Cai Congying
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2021
Prepared by: Kweichow Moutai Co., Ltd.
Unit: CNY
| Item | 2021 | ||||||||||||||
| Equity attributable to owners of the parent | Non-controlling interests | equity | |||||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General reserve | Retained earnings | Others | Subtotal | |||||
| preference share | Perpetual debt | Others | |||||||||||||
| 1. Balance at the end of previous year | 1,256,197,800.00 | 1,374,964,415.72 | -5,331,367.75 | 20,174,922,608.93 | 927,577,822.67 | 137,594,403,807.99 | 161,322,735,087.56 | 6,397,948,013.72 | 167,720,683,101.28 | ||||||
| Add: changes in accounting policies | |||||||||||||||
| Corrections of prior period errors | |||||||||||||||
| Business combination under common control | |||||||||||||||
| Others | |||||||||||||||
| 2. Balance at the beginning of the year | 1,256,197,800.00 | 1,374,964,415.72 | -5,331,367.75 | 20,174,922,608.93 | 927,577,822.67 | 137,594,403,807.99 | 161,322,735,087.56 | 6,397,948,013.72 | 167,720,683,101.28 | ||||||
| 3. Increase/(decrease) during the period | -7,686,513.03 | 4,967,910,209.23 | 133,951,901.33 | 23,122,458,112.20 | 28,216,633,709.73 | 1,020,189,894.33 | 29,236,823,604.06 | ||||||||
| (1) Total comprehensive income | -7,686,513.03 | 52,460,144,378.16 | 52,452,457,865.13 | 3,260,385,578.30 | 55,712,843,443.43 | ||||||||||
| (2) Shareholders’ contributions and reduction | |||||||||||||||
| (i) Shareholders ‘contributions in ordinary share | |||||||||||||||
| (ii) Other equity instruments | |||||||||||||||
| contributions | |||||||||||||||
| (iii) Amount of share-based payments recognized in equity | |||||||||||||||
| (iv) Others | |||||||||||||||
| (3) Profit distribution | 4,967,910,209.23 | 133,951,901.33 | -29,337,686,265.96 | -24,235,824,155.40 | -2,240,195,683.97 | -26,476,019,839.37 | |||||||||
| (i) Transfer to surplus reserve | 4,967,910,209.23 | -4,967,910,209.23 | |||||||||||||
| (ii) Transfer to general reserve | 133,951,901.33 | -133,951,901.33 | |||||||||||||
| (iii) Distribution to shareholders | -24,235,824,155.40 | -24,235,824,155.40 | -2,240,195,683.97 | -26,476,019,839.37 | |||||||||||
| (iv) Others | |||||||||||||||
| (4) Transfer within equity | |||||||||||||||
| (i) Capital reserves converted to share capital | |||||||||||||||
| (ii) Surplus reserves converted to share capital | |||||||||||||||
| (iii) Loss made up by surplus reserves | |||||||||||||||
| (iv) Changes in the defined benefit plan transferred to retained earnings | |||||||||||||||
| (v) Other comprehensive income transferred to retained earnings | |||||||||||||||
| (vi) Others | |||||||||||||||
| (5) Special reserve | |||||||||||||||
| (i) Additions |
| (ii) Utilisation | |||||||||||||||
| (6) Others | |||||||||||||||
| 4. Balance at the end of the period | 1,256,197,800.00 | 1,374,964,415.72 | -13,017,880.78 | 25,142,832,818.16 | 1,061,529,724.00 | 160,716,861,920.19 | 189,539,368,797.29 | 7,418,137,908.05 | 196,957,506,705.34 |
| Item | 2020 | ||||||||||||||
| Equity attributable to owners of the parent | |||||||||||||||
| Share capital | Other equity instruments | Capital reserve | Share capital | Other equity instruments | Capital reserve | Share capital | Other equity instruments | Capital reserve | Share capital | ||||||
| preference share | Perpetual debt | Others | |||||||||||||
| 1. Balance at the end of previous year | 1,256,197,800.00 | 1,374,964,415.72 | -7,198,721.79 | 16,595,699,037.02 | 898,349,936.77 | 115,892,337,407.39 | |||||||||
| Add: changes in accounting policies | |||||||||||||||
| Corrections of prior period errors | |||||||||||||||
| Business combination under common control | |||||||||||||||
| Others | |||||||||||||||
| 2. Balance at the beginning of the year | 1,256,197,800.00 | 1,374,964,415.72 | -7,198,721.79 | 16,595,699,037.02 | 898,349,936.77 | 115,892,337,407.39 | |||||||||
| 3. Increase/(decrease) during the period | 1,867,354.04 | 3,579,223,571.91 | 29,227,885.90 | 21,702,066,400.60 | |||||||||||
| (1) Total comprehensive income | 1,867,354.04 | 46,697,285,429.81 | |||||||||||||
| (2) Shareholders’ contributions and reduction | |||||||||||||||
| (i) Shareholders ‘contributions in ordinary share | |||||||||||||||
| (ii) Other equity instruments contributions | |||||||||||||||
| (iii) Amount of share-based payments recognized in equity | |||||||||||||||
| (iv) Others | |||||||||||||||
| (3) Profit distribution | 3,579,223,571.91 | 29,227,885.90 | -24,995,219,029.21 | ||||||||||||
| (i) Transfer to surplus reserve | 3,579,223,571.91 | -3,579,223,571.91 | |||||||||||||
| (ii) Transfer to general reserve | 29,227,885.90 | -29,227,885.90 | |||||||||||||
| (iii) Distribution to shareholders | -21,386,767,571.40 | ||||||||||||||
| (iv) Others | |||||||||||||||
| (4) Transfer within equity | |||||||||||||||
| (i) Capital reserves converted to share capital | |||||||||||||||
| (ii) Surplus reserves converted to share capital | |||||||||||||||
| (iii) Loss made up by surplus reserves | |||||||||||||||
| (iv) Changes in the defined | |||||||||||||||
| benefit plan transferred to retained earnings | |||||||||||||||
| (v) Other comprehensive income transferred to retained earnings | |||||||||||||||
| (vi) Others | |||||||||||||||
| (5) Special reserve | |||||||||||||||
| (i) Additions | |||||||||||||||
| (ii) Utilisation | |||||||||||||||
| (6) Others | |||||||||||||||
| 4. Balance at the end of the period | 1,256,197,800.00 | 1,374,964,415.72 | -5,331,367.75 | 20,174,922,608.93 | 927,577,822.67 | 137,594,403,807.99 |
Legal Representative: Ding XiongjunChief Accountant: Jiang YanHead of Accounting Department: Cai Congying
COMPANY STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2021
Prepared by: Kweichow Moutai Co., Ltd.
Unit: CNY
| Item | 2021 | ||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: treasury shares | Other comprehensive income | Special reserve | Surplus reserve | Retained earnings | equity | |||
| preference share | Perpetual debt | Others | |||||||||
| 1. Balance at the end of previous year | 1,256,197,800.00 | 1,374,303,082.72 | 20,174,922,608.93 | 81,396,490,905.14 | 104,201,914,396.79 | ||||||
| Add: changes in accounting policies | |||||||||||
| Corrections of prior period errors | |||||||||||
| Others | |||||||||||
| 2. Balance at the beginning of the year | 1,256,197,800.00 | 1,374,303,082.72 | 20,174,922,608.93 | 81,396,490,905.14 | 104,201,914,396.79 | ||||||
| 3. Increase/(decrease) during the period | 4,967,910,209.23 | 20,475,367,727.70 | 25,443,277,936.93 | ||||||||
| (1) Total comprehensive income | 49,679,102,092.33 | 49,679,102,092.33 | |||||||||
| (2) Shareholders’ contributions and reduction | |||||||||||
| (i)Shareholders’ contributions in ordinary share | |||||||||||
| (ii) Other equity instruments contributions | |||||||||||
| (iii) Amount of share-based payments recognized in equity | |||||||||||
| (iv) Others | |||||||||||
| (3). Profit distribution | 4,967,910,209.23 | -29,203,734,364.63 | -24,235,824,155.40 | ||||||||
| (i) Transfer to surplus reserve | 4,967,910,209.23 | -4,967,910,209.23 | |||||||||
| (ii) Distribution to shareholders | -24,235,824,155.40 | -24,235,824,155.40 | |||||||||
| (iii) Others | |||||||||||
| (4) Transfer within equity | |||||||||||
| (i) Capital reserves converted to share capital | |||||||||||
| (ii) Surplus reserves converted to share capital | |||||||||||
| (iii) Loss made up by surplus reserves | |||||||||||
| (iv) Changes in the defined benefit plan transferred to retained earnings | |||||||||||
| (v) Other comprehensive income transferred to retained earnings | |||||||||||
| (vi) Others | |||||||||||
| (5). Special reserve | |||||||||||
| (i). Additions | |||||||||||
| (ii). Utilisation | |||||||||||
| (6) Others | |||||||||||
| 4. Balance at the end of the period | 1,256,197,800.00 | 1,374,303,082.72 | 25,142,832,818.16 | 101,871,858,632.84 | 129,645,192,333.72 |
| Item | 2020 | ||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: treasury shares | Other comprehensive income | Special reserve | Surplus reserve | Retained earnings | equity | |||
| Perpetual debt | Others | ||||||||||
| 1. Balance at the end of previous year | 1,256,197,800.00 | 1,374,303,082.72 | 16,595,699,037.02 | 70,570,246,329.34 | 89,796,446,249.08 | ||||||
| Add: changes in accounting policies | |||||||||||
| Corrections of prior period errors | |||||||||||
| Others | |||||||||||
| 2. Balance at the beginning of the year | 1,256,197,800.00 | 1,374,303,082.72 | 16,595,699,037.02 | 70,570,246,329.34 | 89,796,446,249.08 | ||||||
| 3. Increase/(decrease) during the period | 3,579,223,571.91 | 10,826,244,575.80 | 14,405,468,147.71 | ||||||||
| (1) Total comprehensive income | 35,792,235,719.11 | 35,792,235,719.11 | |||||||||
| (2) Shareholders’ contributions and reduction | |||||||||||
| (i) Shareholders’ contributions in ordinary share | |||||||||||
| (ii)Other equity instruments contributions | |||||||||||
| (iii) Amount of share-based payments recognized in equity | |||||||||||
| (iv) Others | |||||||||||
| (3). Profit distribution | 3,579,223,571.91 | -24,965,991,143.31 | -21,386,767,571.40 | ||||||||
| (i) Transfer to surplus reserve | 3,579,223,571.91 | -3,579,223,571.91 | |||||||||
| (ii) Distribution to shareholders | -21,386,767,571.40 | -21,386,767,571.40 | |||||||||
| (iii) Others | |||||||||||
| (4) Transfer within equity | |||||||||||
| (i) Capital reserves converted to share capital | |||||||||||
| (ii) Surplus reserves converted to share capital | |||||||||||
| (iii) Loss made up by surplus reserves | |||||||||||
| (iv) Changes |
| in the defined benefit plan transferred to retained earnings | |||||||||||
| (v) Other comprehensive income transferred to retained earnings | |||||||||||
| (vi) Others | |||||||||||
| (5). Special reserve | |||||||||||
| (i). Additions | |||||||||||
| (ii). Utilisation | |||||||||||
| (6) Others | |||||||||||
| 4. Balance at the end of the period | 1,256,197,800.00 | 1,374,303,082.72 | 20,174,922,608.93 | 81,396,490,905.14 | 104,201,914,396.79 |
Legal Representative: Ding XiongjunChief Accountant: Jiang YanHead of Accounting Department: Cai Congying
3. Company Profile
3.1 Company Overview
√applicable □Non-applicable
Kweichow Moutai Co., Ltd. is established after being approved by Guizhou Provincial People’sGovernment in its document of (1999) No. 291, Reply on Approving the Establishment of KweichowMoutai Co., Ltd.. As an incorporated company, its main promoter is China Kweichow Moutai Distillery(Group) Co., Ltd., with Kweichow Moutai Distillery (Group) Technology Development Co., Ltd.,Guizhou Textile Collective Industry Association, Research Institute of Tsinghua University in Shenzhen,China National Research Institute of Food and Fermentation Industries, Beijing Sugar Tobacco & WineGroup Co., Ltd., Jiangsu CANDY & WINE & TOBACCO Parent Co., Shanghai Jieqiang TobaccoSugar & Wine (Group) Co., Ltd. as co-founders.
The company was established on November 20,1999. Its registered capital at its establishment wasCNY 185 million. After being approved by CSRC with the document of [2001] No.41 and Ministry ofFinance with the document of [2001] No. 56, the corporation publicly offered 71,500,000 A shares(including 6,500,000 state-owned shares) at Shanghai Stock Exchange on July 31, 2001, marking a totalcapital of its shares at 250,000,000 shares. On August 20, 2001, the corporation completed registrationfor alternation of registered capital from Administration for Industry& Commerce of Guizhou Province.
According to the plan of profit distribution and converting capital reserves into share capital audited andapproved by the 2001 Annual General Meeting, the corporation set the total share capital at the end of2001- 250,000,000 shares as the baseline, and distributed dividends (CNY 6 every 10 shares, taxinclusive) to all shareholders, and converted capital reserves into increased share capital at a 10:1 ratio,totally increasing 25,000,000 shares. After this profit distribution, the total capital share increased from250,000,000 shares to 275,000,000 shares. On February 13, 2003, the corporation completedregistration for alternation of registered capital from Administration for Industry& Commerce ofGuizhou Province.
According to the plan of profit distribution audited and approved by the 2002 Annual General Meeting,the corporation set the total share capital at the end of 2002- 275,000,000 shares as the baseline, anddistributed dividends (CNY 2 every 10 shares, tax inclusive) to all shareholders. With the same baseline,the corporation distributed bonus shares (1 bonus share every 10 share) to all shareholders. After thisprofit distribution, the total capital share increased from 275,000,000 shares to 302,500,000 shares. OnJune 10, 2004, the corporation completed registration for alternation of registered capital fromAdministration for Industry& Commerce of Guizhou Province.
According to the plan of profit distribution and converting capital reserves into share capital audited andapproved by the 2003 Annual General Meeting, the corporation set the total share capital at the end of2003- 302,500,000 shares as the baseline, and distributed dividends (CNY 3 every 10 shares, taxinclusive) to all shareholders, and converted capital reserves into increased share capital at a 10:3 ratio.After this profit distribution, the total capital share increased from 302,500,000 shares to 393,250,000shares. On June 24, 2005, the corporation completed registration for alternation of registered capitalfrom Administration for Industry& Commerce of Guizhou Province.
According to the plan of profit distribution and converting capital reserves into share capital audited andapproved by the 2004 Annual General Meeting, the corporation set the total share capital at the end of2004- 393,250,000 shares as the baseline, and distributed dividends (CNY 5 every 10 shares, taxinclusive) to all shareholders, and converted capital reserves into increased share capital at a 10:2 ratio.After this profit distribution, the total capital share increased from 393,250,000 shares to 471,900,000shares. On January 11, 2006, the corporation completed registration for alternation of registered capitalfrom Administration for Industry& Commerce of Guizhou Province.
According to the Reform Plan of Equity Division of Kweichow Moutai Co., Ltd. (Revised Version)audited and approved by the second provisional General Meeting and the Meeting of relevantshareholders, the corporation set the total share capital at the end of 2005- 471,900,000 shares as the
baseline, and converted every 10 capital reserves into 10 increased share capital. After this profitdistribution, the total capital share increased from 471,900,000 shares to 943,800,000 shares. OnNovember 17,2006, the corporation completed registration for alternation of registered capital fromAdministration for Industry& Commerce of Guizhou Province.
According to the 2010 annual plan for profit distribution audited and approved by the 2010 AnnualGeneral Meeting, the corporation set the total share capital at the end of 2010- 943,800,000 shares as thebaseline, and distributed dividends (CNY 23 every 10 shares, tax inclusive) and bonus share (1 bonusshare for every 10 shares) to all shareholders. After this profit distribution, the total capital shareincreased from 943,800,000 shares to 1,038,180,000 shares. On October 27, 2011, the corporationcompleted registration for alternation of registered capital from Administration for Industry&Commerce of Guizhou Province.
According to the 2013 annual plan for profit distribution audited and approved by the 2013 AnnualGeneral Meeting, the corporation set the total share capital at the end of 2013- 1,038,180,000 shares asthe baseline, and distributed dividends (CNY 43.74 every 10 shares, tax inclusive) and bonus share (1share every 10 shares) to all shareholders. After this profit distribution, the total capital share increasedfrom 1,038,180,000 shares to 1,141,998,000 shares. On August 5, 2014, the corporation completedregistration for alternation of registered capital from Administration for Industry& Commerce ofGuizhou Province.
According to the 2014 annual plan for profit distribution audited and approved by the 2014 AnnualGeneral Meeting, the corporation set the total share capital at the end of 2014- 1,141,998,000 shares asthe baseline, and distributed dividends (CNY 43.74 every 10 shares, tax inclusive) and bonus share (1share every 10 shares) to all shareholders. After this profit distribution, the total capital share increasedfrom 1,141,998, 000 shares to 1,256,197,800 shares. On October 29,2015, the corporation completedregistration for alternation of registered capital from Administration for Industry& Commerce ofGuizhou Province.
The corporate’s business scope includes: production and marketing of Moutai wine and wines of series,production and marking of beverage, food and package materials, the development of anti-counterfeittechnology and the research and development of IT-related products, the service of management ofhotel, housing, catering, entertainment, bath and parking lot, and vehicle transporting (dangerouschemicals not included) and maintenance.
3.2 Scope of consolidated financial statements
√applicable □Non-applicable
This year, eight subsidiaries were included in the consolidated financial statement, including GuizhouMoutai Chiew Import And Export Co., Ltd., Guizhou Xijiu Sales Co., Ltd., Kweichou Moutai GroupFinance Co., Ltd., Moutai Custom Marketing (Guizhou) Co., Ltd., Beijing Friendship MessengerTrading Co., Ltd., Kweichow Moutai Paris Trading, Guizhou Laymau Wine Industry Co., Ltd. andKweichow Moutai-Flavor Liquor Marketing Co., Ltd.
4. Basis of preparation of financial statements
4.1 Basis of preparation of financial statements
The company has prepared its financial statements on a going concern basis.
4.2 Going concern
√applicable □non-applicable
Since the date of this report, there are no events resulting in significant uncertainties over going concernof the operation of this company for at least 12 months.
5. Significant accounting policies and accounting estimates
Specific accounting policies and accounting estimates:
√applicable □non-applicable
5.1 Statement of compliance with accounting standards for business enterprisesThe financial statements have been prepared in accordance with the requirements of accountingstandards for business enterprises, which truly and completely reflect the Company’s financial status,operating results, changes in shareholders’ equity, cash flow and other relevant information.
5.2 Accounting period
The accounting year of the Company is from 1 January to 31 December.
5.3 Operating cycle
√applicable □non-applicable
The Company sets 12 months as an operating cycle.
5.4 Reporting Currency
The Company’s functional currency is CNY.
5.5 Accounting treatments of “Business combination involving entities under common control”and “Business combination involving entities not under common control”
√applicable □non-applicable
(1) Business combination involving entities under common control
For business combination involving entities under common control, assets and liabilities obtained by thecombining party through business combination shall be measured at the book value of the combinedcompany at the combination date. The capital reserve (stock premium or capital premium) is adjustedaccording to the difference between the book value of net asset acquired through combination and thebook value of consideration paid for the combination (or total par value of shares issued). If the capitalreserve (stock premium or capital premium) is insufficient to offset, the retained earnings shall beadjusted.
(2) Business combination not under common control
For business combination involving entities not under common control, the combination cost iscalculated at fair value of the assets, liabilities incurred or assumed and the equity securities issued bythe combining party on combination date in the purpose of gaining the combined party’s control. Forbusiness combination involving entities not under common control that are achieved step by step inmultiple exchanges and transactions, different approaches in accounting treatment are adopted forindividual financial statements and combination financial statements as follows.A. For individual financial statements, the initial investment cost of the investment is calculated as thesum of the book value of the combined party’s equity investment held by the combining party beforethe combination date and the increased investment cost on the combination date. If the combined party’sequity held by the combining party entails other comprehensive profits, then the profits (e.g. the part ofthe difference of fair value of saleable financial assets that is calculated in capital reserves, the same forthe follows) shall be calculated as the investment profits of the current period.
B. For combination financial statements, the combined party’s equity held by the combining partybefore the combination date shall be recalculated in fair value of the equity on combination date. Themargin of its fair value and book value shall be calculated into the investment profits of the currentperiod. If the combined party’s equity held by the combining party entails other comprehensive profits,then the profits shall be calculated as the investment profits of the current period of the combinationdate. Fees, commissions, and other transaction expenses and other relevant administration expense paidfor combination shall be calculated into current profits or losses as they occur. Transaction fees ofequity securities and debt securities paid by the combining party for combination consideration shall beincluded in the initial measurement amount of equity or debt securities. The Company shall recognizethe difference of the combination costs in excess of the fair value of the net identifiable asset acquiredfrom the acquiree through combination as goodwill. After the review, if the combination costs are stillin short of the fair value of the net identifiable asset acquired from the acquiree through combination,include the difference in the current profits or losses.
5.6 Base of consolidated financial statements
√applicable □non-applicable
The combination financial statements of the Company comply with ‘Norms for Enterprise AccountingNo.33- Combination Financial Statements’ and relevant regulations. At combination, all major internaltransactions and businesses within combination rage have been offset. The subsidy’s shareholder’sequity that is not owned by the parent company shall be listed individually in the shareholder’s equityitem in the combination financial statements as minor shareholder equity. When composingcombination financial statements, necessary adjustments shall be made according to the Company’saccounting policies and accounting period if the accounting policies and accounting period of thesubsidiary corporation is different from those of the Company. For subsidiary corporations acquired bycombination under common control, their operating results and cash flow shall be included in thefinancial statement in the current period. Adjustments shall be made in relevant projects in the lastyear’s financial statements. The statement entity formed after the combination remains since theultimate controlling part takes control. For subsidiary corporations acquired by combination not undercommon control, their operating results and cash flow shall be included in the financial statement sincethe Company takes control.
5.7 Cash and cash equivalents
Cash equivalents include Cash on hand, Bank balances, other monetary funds, provision at central bankretrievable at any time, deposits with other banks, placements with banks, buying securities and returnsale within the same industry and other investments featuring short investment period (generally duewithin three months since purchase), high mobility, easy convertibility to cash with known amount andlow risk of value change.
5.8 Foreign operations and foreign currency translation
√applicable □non-applicable
(1) Foreign currency operations
The amount in the foreign currency shall be translated into CNY currency according to the middle rateof exchange rate in foreign currency market on the day of transaction. At the end of the period, thebalance of monetary foreign currency account shall be translated into CNY currency according to themiddle rate of exchange rate at the end of the period. The difference between the translated CNYbalance and the original book balance shall be calculated as exchange gains or lost, and recorded intoitems like ‘finance expense’ and ‘construction in progress’. For non-monetary foreign currency projectscalculated with historical cost, the spot exchange rate on transaction day is employed, and the amount ofreporting currency stay unchanged.
(2) Foreign currency translation
Assets and liabilities in the balance sheets shall be translated at the spot exchange rates on balance sheetdate. Shareholders’ equity items, except for the item of “undistributed profits”, are translated at the spotexchange rates on the dates when the transactions occur. Revenue and expense items in the incomestatement are translated at the spot exchange rates on the dates when the transactions occur or at theexchange rate determined in a systematical and reasonable method and similar to the spot exchange rateon the day when the transactions occur. Differences arising from the above translations of foreigncurrency financial statements are separately listed under other comprehensive income in theconsolidated balance sheet. Cash flow projects operated overseas shall be translated at approximateexchange rate of spot rate on the date of cash flow. The amount of cash affected by fluctuations ofexchange rate shall be separately listed in the table of cash flow.
5.9 Financial instruments
√applicable □non-applicable
(1) Recognition and derecognition of financial instruments
When the Company becomes a party to a financial instrument contract, the related financial asset orfinancial liability should be recognized. Transaction of financial assets by regular means shall berecognized and derecognized according to accounting on transaction date. Regular means refers togaining or giving financial assets within the time period designated by law or regulations according tocontract items. Transaction date refers to the date that the Company promises to purchase or sellfinancial assets.
Derecognition of financial assets (or part of financial assets) shall be conducted- written off from theaccount and asset liability list, if it meets following conditions: A. expiration of the right to acquire cashflow of financial assets; B. Transfer of the right to obtain cash flow of financial assets, and (a)substantively transferring almost all risks and rewards of the possession of financial assets, or (b)though substantively neither transferring nor retaining almost all risks and rewards of the possession offinancial assets, relinquishing the control over the financial assets.
(2) Classification and measurement of financial assets
Based on the business model of financial asset management and the contract cash flow characteristics offinancial assets, the Company classifies financial assets into: financial assets measured at amortized cost;financial assets measured at fair value with their changes included into other comprehensive income;and financial assets measured at fair value with their changes included into current profits/losses. Thefollowing measurement of financial assets depends on its classification.
A．Financial assets measured at amortized cost
The business model in which the Company manages financial assets measured at amortized cost aims toreceive contract cash flow. Furthermore, the characteristics of the contract cash flow of such financialassets are consistent with basic borrowing and lending arrangements, which means that cash flowgenerated on a specific date serves only as payment for principal and interests based on the amount ofunpaid principal. The Company adopts the effective interest method for such financial interests,performs subsequent measurement of them at amortized cost, and includes the gains or losses fromderecognition, changes or impairment of them into current profits/losses.
B．Financial assets at fair value at fair value through other comprehensive income
The financial assets that meet the following conditions are of this category: The business model inwhich the Company manages such financial assets both aims to receive contract cash flow and for thepurpose of sale; furthermore, the characteristics of the contract cash flow of such financial assets areconsistent with basic borrowing and lending arrangements. The Company measure such financial assetsat fair value and include their changes into other comprehensive income, but record impairment lossesor gains, exchange gains or losses and interest income calculated in the effective interest method intocurrent profits/losses.
C．Equity instrument investments at fair value at fair value through other comprehensive incomThe Company irrevocably chooses to designate part of non-transactional equity instrument investmentsas financial assets calculated with fair value whose changes are included in other comprehensive income,and only relevant dividend income is calculated into current profits or losses. Changes in fair value arerecognized as other comprehensive income. When the financial asset is derecognized, cumulative gainsor losses should be transferred into retained earnings.
D. Financial assets at fair value at fair value through current profits/losses
For financial assets other than the above financial assets measured at amortized cost and financial assetsmeasured at fair value with their changes included into other comprehensive income, the Companyclassifies them as financial assets measured at fair value with their changes included into currentprofits/losses. In addition, at the initial recognition, the Company specifies partial financial assets asfinancial assets measured at fair value with their changes included into current profits/losses, in order toeliminate or substantially reduce accounting mismatch. For such financial assets, the Company performssubsequent measurement using fair value and records changes in the fair value into current profits/losses.
When and only when the Company changes its business mode for management of financial assets, willbe influenced relevant financial assets be reclassified. For financial assets measured at fair value withtheir changes included into current profits/losses, relevant transaction fees are calculated into currentprofits or losses; while for other financial assets, relevant transaction fees are included into the initialrecognition amount.
(3) Classification and measurement of financial liabilities
At their initial recognition, financial liabilities are divided into financial liabilities measured atamortized cost and financial liabilities measured at fair value with their changes included into currentprofits or losses.
Financial liabilities meeting the following conditions are specified as financial liabilities measured atfair value with their changes included into current profits or losses at initial measurement: (A) Thespecification can eliminate or notably reduce account mismatch; (B) Based on risk management orinvestment strategy from official documents, management and business evaluation are conducted onfinancial liability combination or financial asset and financial liability combination on the basis of fairvalue, which are reported to key management personnel inside the company; (C) The financial liabilitiesinclude embedded derivatives that need to be separated.
The Company recognize the classification of financial liabilities at initial recognition. For financialliabilities measured at fair value with their changes included into current profits or losses, relevanttransaction fees are calculated into current profits or losses; while for other financial liabilities, relevanttransaction fees are included into the initial recognition amount.
The subsequent measurement of financial liabilities depends on its classification:
A. Financial liabilities measured at amortized cost
For financial liabilities of this category, effective interest rate is adopted, and subsequent measurementis performed at amortized cost.
B. Financial liabilities measured at fair value with their changes included into current profits orlosses
Financial liabilities measured at fair value with their changes included into current profits/losses includetrading financial liabilities (including derivatives classified as financial liabilities) and the financialliabilities specified to be measured at fair value with their changes included into current profits/losses atthe initial recognition.
(4)Offsetting of financial instruments
Financial assets and financial liabilities meeting the following conditions simultaneously shall be listedin balance sheet in their net amounts after manual offset: The Company has the legal right to offsetrecognized financial assets and financial liabilities and may execute the legal right currently andsimultaneously; The Company plans to settle or simultaneously encash the financial assets in netamounts and pay off the financial liabilities.
(5)Impairment of financial assets
For financial assets measured at amortized cost and debt instrument investment measured at fair valuewith its changes included into other comprehensive income, the Company recognizes the provision forloss based on the expected credit loss.
When assessing expected credit loss, the Company considers reasonable and well-founded informationon past matters, present conditions and forecast of future economic conditions, sets the risk of default as
the weight, and calculates the weighted amount of the difference of present value between the cash flowaccording to the contract and the cash flow expected to be gained in practice.
On each balance sheet date, the Company calculates expected credit loss for financial instruments atdifferent stages. If the credit risk of financial instrument hasn’t substantially increased since the initialrecognition, then it is in the first stage, and the Company will measure the loss provision at the amountequivalent to the expected credit loss for the next 12 months. If the credit risk has substantiallyincreased since the initial recognition without credit impairment, then the financial instrument is in thesecond stage, and the Company will measure the loss provision at the amount equivalent to the expectedcredit loss for the entire duration. If credit impairment has occurred since the initial recognition, then thefinancial instrument is in the third stage, and the Company will measure the loss provision by theamount equivalent to the expected credit loss for the entire duration.
For financial instruments featuring relatively low credit risk on asset balance date, the Companyassumes no substantial increase of credit risk since the initial recognition, and will measure the lossprovision at the amount equivalent to the expected credit loss for the next 12 months.
For financial instruments that are in the first stage or second stage, or featuring relatively low credit risk,the Company will calculate the interest income according to the book balance and the effective interestrate without deducting provision. For financial instruments that are in the third stage, the Company willcalculate the interest income according to the amortization cost and the effective interest rate, deductingprovision from the book balance.
For notes receivable and accounts receivable formed in daily operations like sale of product andprovision of labor, regardless of substantial financing component, the Company will measure the lossprovision by the amount equivalent to the expected credit loss for the entire duration
When the information about the expected credit loss of a single financial asset cannot be evaluated at areasonable cost, the Company shall divide the accounts receivables portfolio according to credit riskcharacteristics and measure the expected credit loss based on portfolios. The foundation to determineportfolio and provision means are as follow:
| Bank acceptances portfolios Accounts receivable portfolios | Bank acceptances Accounts receivable of related party within range of merge |
| Other accounts retrievable portfolios Other accounts retrievable portfolios | Other accounts retrievable with lower credit risk (e.g. advances to employees, deposit, security fund) Other accounts retrievable of related party within range of merge |
| Other portfolios | Other accounts apart from above portfolios |
For accounts retrievable divided as portfolio and accounts retrievable formed in daily operations likesale of product and provision of labor, the Company calculates the expected credit loss through thecomparative table of accounts retrievable and accounts retrievable age and the expected credit loss rateover the entire duration based on the current situation and prediction of future economic situationconsulting historical credit loss experience. For other notes retrievable and accounts retrievableclassified as portfolio, the company will calculate the expected credit loss through the exposure atdefault and expected credit loss rate for the following 12 months or over the entire duration based on thecurrent situation and prediction of future economic situation consulting historical credit loss experience.
The Company calculates provision withdrawn or reversed into profits/ losses of the current period. Forliability instruments in fair value whose changes are included in other comprehensive profits, theCompany calculates impairment losses or income into profits/ losses of the current period, whileadjusting other comprehensive profits.
(6) Transfer of financial assets
If almost all the risks and rewards in respect of the ownership of the financial asset are transferred, thefinancial asset shall be derecognized; if they are retained, the financial asset shall not be derecognized.
If almost all the risks and rewards in respect of the ownership of the financial asset are neithertransferred nor retained, the Company will conduct further evaluation: If the enterprise does not retaincontrol over the asset, then its financial assets shall be derecognized, and the rights and obligationsproduced or retained during transfer shall be separately recognized as assets or liabilities. If theenterprise retains control over the asset, then relevant financial assets shall be recognized according tothe degree to which it continues to be involved in the transferred financial assets, and relevant liabilitiesshall be recognized.
If the enterprise continues to involve itself by obligation of guarantee for transferred financial assets,then the lower one of the book value and guarantee amount of financial assets on transfer date shall beselected and recognized as the transferred financial assets. The relevant liabilities are determined as thesum of guarantee amount and fair value of guarantee contract (usually the consideration received fromobligation of guarantee). The guarantee amount refers to the highest amount repayable among theconsiderations an enterprise receives.
5.10 Inventory
√applicable □N/A
(1) Classification of inventory
Inventories are classified as: raw materials, semi-finished goods, goods in progress, finished goods, andrevolving materials.
(2) Measurement method of dispatched inventories
The planned cost is used for daily accounting of raw materials, and the difference of material costshould be carried forward on a monthly basis to adjust the dispatch cost into the actual cost. Thesemi-finished goods and finished goods shall be accounted according to the actual cost, and the movingweighted average method shall be used in accounting for costs of sales.
(3) Basis to determine net realizable values of inventories and method of write-downof inventoriesAt the end of the period, inventory is measured according to the lower of cost and net realizable value.The difference between cost of one inventory and net realizable value is higher than the write-down ofinventories.
(4) Inventory system
The Company adopts perpetual inventory system
(5) Amortization method of low-cost consumables and packing materials
One-time amortization method is adopted.
5.11 Long-term equity investment
√applicable □N/A
(1) (1)Judgment criteria of control and significant influence
The majority of long-term equity investments of the Company are investments to subsidiaries.Subsidiaries refer to invested parties upon which the Company can exert control. Control refers to thefact that the investing party has power over the invested party, enjoys variable returns and can influencethe return amount by exercising power over the invested party. The term ‘significant influence’ refers tothe power to participate in decision-making on the financial and operating policies of the investee, butwith no control or joint control over the formulation of these policies.
(2) Determination of the investment cost
A. Long-term equity investments resulting from combination
For business combination under common control, for the long-term equity investments obtained by cashpaid, non-monetary assets paid or assumed liabilities as consideration by the acquirer, on the mergerdate, the initial investment cost of long-term equity investment shall be taken as the share of the owner’sequity of the investee in the book value of the final control party’s consolidated financial statements.According to the margin amount between initial investment cost and cash payment, non-monetary assetpaid or assumed liabilities, capital reserve should be written down. If the capital reserve is not sufficientto be written down, then the retained earnings shall be written down. For investments obtained by equitysecurities issued by the acquirer, on the merger date, the initial investment cost of long-term equityinvestment shall be taken as the share of the owner’s equity of the investee in the book value of the finalcontrol party’s consolidated financial statements. Setting total book value of issued shares as sharecapital, according to the difference between the initial investment cost and total book value of issuedshares, capital reserve shall be written down; if the capital reserve is not sufficient to be written down,then the retained earnings shall be written down.
For business combination not under common control, on the merger date, the combination costaccording to ‘Business Accounting Norms No.20- Business combinations’ should be calculated as theinitial investment cost of long-term equity investment.
B. Other long-term equity investments not resulting from combination
For the long-term equity investments obtained by cash paid, the Company recognizes their fair value asthe initial investment costs. For the long-term equity investments acquired by the issue of equitysecurities, the initial investment cost shall be the fair value of the equity securities issued.
(3) Subsequent measurement and recognition of profits and losses
The investments of subsidiaries are measured with the cost method, and shall be adjusted according toequity law according to initial investment cost when making the combination financial statements. Costsshall be added or retrieved in adjustment of long-term equity investments. The cash dividends or profitsdeclared by the investee shall be recognized as the investment income of the current period.
For long-term equity investments measured under the equity method, if the initial investment costs arehigher than the investor’s attributable share of the fair value of the investee’s identifiable net assets,initial investment cost shall be calculated as long-term equity investment cost; if the initial investmentcosts are lower than the investor’s attributable share of the fair value of the investee’s identifiable netassets, the margin shall be calculated into profits/ losses of the current period, and long-term equityinvestment cost shall be increased. The Company shall, according to the shares of net profits and othercomprehensive income realized by the investee that shall be enjoyed or borne by the Company,recognize the profit and loss on the investments of the current period. When recognizing the net lossesof the invested party, the losses should be limited to zero at least according to book value and otherlong-term equities of long-term equity investment. Nonetheless, if the Company bears the obligation foradditional losses and meets conditions to recognize expected liabilities, then it shall continue torecognize investment losses and calculate it into liabilities. When recognizing the net profits and lossesand other comprehensive income of the investee that the Company shall enjoy or bear, the Companyshall calculate the part is enjoys or bears according to share-holding ratio on the basis that theCompany’s share-holding ratio remains the same, and include the part directly into share-holders’equities, and make adjustments to book value of long-term equity investments. For the part of theinterest or dividend from the invested party that is favorable for declaration and distribution, the bookvalue of long-term equity investments shall be reduced accordingly. For unachieved internal transactionprofits and losses between the Company and the invested party, the part of the Company shall becalculated according to the ratio that should be shared or born by the company and be offset, on thebasis of which the recognition of investment profits/ losses shall be conducted. The part of assetimpairment incurred in internal transaction loss shall not be offset.
5.12 Investment property
(1) When adopting cost model:
Method of depreciation or amortization
The company shall deduct expected net residual value (residual value rate: 5%) and cumulativeimpairment provision from the cost of investment property, and conduct depreciation or amortizationusing straight-line method within the service life (20 years).
5.13 Fixed assets
(1) Recognition of fixed assets
√applicable □non-applicable
Fixed assets refer to tangible assets with relatively high unit value, which are held for the purpose ofproducing commodities, providing services, renting or business management with useful life exceedingone accounting year.
(2) Method of depreciation
√applicable □non-applicable
| Category | Depreciation method | Estimated useful life (Year) | Residual value rate | Annual depreciation rate |
| Buildings | Straight-line method | 20 | 5% | 4.75% |
| Machinery and equipment | Straight-line method | 10 | 5% | 9.5% |
| Electronic equipment and others | Straight-line method | 5 | 5% | 19% |
| Vehicles | Straight-line method | 5 | 5% | 19% |
A. After January 1
st, 2014, the amount less than CNY 1,000,000 spent on newly-purchased equipmentand apparatus for the special use of R&D shall be calculated into cost of the current period.B. After January 1
st
, 2014, the amount more than CNY 1,000,000 spent on newly-purchasedequipment and apparatus for the special use of R&D, shall be depreciated according to thefollowing table:
| Asset category | Estimated useful life (Year) |
| Machine equipment | 6 years |
| Electronic equipment | 2 years |
(3) (3)Method of impairment test and provision for impairment for fixed assets
At the end of the period, check on fixed assets shall be implemented item by item. If the recoverableamount is lower than book value because of outdated technology, impairment or long-term idlecondition, the Company shall calculate the difference between recoverable amount and book value asthe provision for impairment for fixed assets. Provision for impairment for fixed assets shall beconducted in terms of individual asset.
5.14 Construction in progress
√Applicable □N/A
Accounting method for construction in progress: each construction in progress is initially measured atthe actual cost.
(1) The construction in progress shall be transferred to fixed assets in the following conditions:
A. The acquired fixed assets are ready for use;B. The physical construction of the construction in progress has been completed or substantiallycompleted;C. The acquired fixed assets conform to the design requirements or contract requirements, they can beused normally, and it needs little or no expenditure on the acquired construction in progress.
(2) The new construction, reconstruction and expansion projects of the company’s fixed assets areincluded in the construction in progress according to the actual expenditure incurred. Borrowing interestand foreign exchange gains and losses incurred in the construction of borrowed loans can be capitalizedand included in the cost of construction in progress before the fixed assets reach the intended usablestate if the fixed assets meet the capitalization conditions.
(3) On the balance sheet date, the construction in progress shall be checked by items. If there isevidence that the construction in progress is impaired, the provision for impairment shall be made basedon the difference between the recoverable amount and the carrying amount.
The main factors in making provision for impairment of construction in progress are as follows:
A. Suspended construction for a long time and is not expected to restart construction in the next threeyears;B. The constructed projects are backward in terms of technology and performance, and it is uncertainfor the economic benefits brought to the enterprise;C. Other circumstances sufficient to prove that the construction in progress has been impaired.
5.15 Borrowing costs
√Applicable □N/A
The principle to confirm the capitalization of borrowing costs is as follows: the borrowing costs such asinterest on borrowings, amortization of discounts or premiums, auxiliary costs, and exchangedifferences due to foreign currencies incurred by the Company due to borrowings, which can be directlyattributed to the acquisition & construction or production of assets that meet the capitalizationconditions, shall be capitalized and included in the cost of the asset; other borrowing costs shall berecognized as expenses in the period in which they are incurred and included in profit or loss.
Determination method of capitalization period:
(1) Begin capitalization: borrowing costs can only begin to be capitalized if the following threeconditions are all met simultaneously
A. Asset expenditure has occurred;B. The borrowing costs have been incurred;C. The acquisition & construction or production activities to make the asset ready for its intended use orsale have begun.
(2) Suspension of capitalization: if the acquisition and construction of fixed assets is suspendedabnormally, and the suspension lasts for more than 3 months, the capitalization of borrowing costs willbe suspended, and the borrowing costs incurred during the interruption period will be recognized ascurrent expenses until the assets are acquisition and construction activities resumed.
(3) Stop capitalization: when the acquired and constructed fixed assets reach the intended usable state,stop the capitalization of borrowing costs.
The calculation method of the capitalized amount of borrowing costs:
A. If a special loan is borrowed for the acquisition, construction or production of assets that meet thecapitalization conditions, the interest expense actually incurred in the current period of the special loanshall be determined after deduction of the interest income obtained by depositing the unused loan fundsin the bank or by temporary investment;
B. If general borrowings are occupied for the purpose of acquisition, construction or production ofassets that meet the capitalization conditions, the Company shall calculate and determine amount ofinterest of general borrowings to be capitalized based on weighted average number of asset expendituresover which the accumulated asset expenditure exceeds the special borrowings multiplied by the
capitalization rate of the occupied general borrowings. The capitalization rate is calculated based on theweighted average rate of borrowings, and the auxiliary expenses incurred by general borrowings shallnot be capitalized.
5.16 Intangible assets
(1) Valuation method, service life, impairment test
√Applicable □N/A
A. Pricing of intangible assets: intangible assets are initially measured at the cost when they are actuallyacquired. For the intangible assets developed by the Company, the expenditures in the research stageshall be included in the current profit and loss when incurred; the expenditures in the development stageshall be recognized as intangible assets (patented technology and non-patented technology) if thefollowing conditions are all met simultaneously:
a. It is technically feasible to complete the intangible asset so that it can be used or sold;b. There is intention to complete the intangible asset for use or sales.c. The usefulness of methods for intangible assets to generate economic benefits include that there is apotential market for the products manufactured by applying the intangible assets or that there is apotential market for the intangible assets themselves;d. It is able to finish the development of the intangible assets, and able to use or sell the intangible assets,with the support of sufficient technologies, financial resources and other resources.e. The expenditure attributable to the intangible asset during its development phase can be measuredreliably.
B. Amortization of intangible assets: The intangible assets are amortized in the straight-line methodover the beneficial years from the month of acquisition, and intangible assets with indefinite useful livesare not amortized.
C. On the balance sheet date, each intangible asset should be checked, and if there is any sign ofimpairment, an impairment provision should be made based on the difference between the recoverableamount and the carrying amount.
(2). Accounting policy for internal research and development expenditures
□Applicable √N/A
5.17 Long-term prepaid expenses
√Applicable □N/A
Long-term prepaid expenses are expenses that have occurred but should be borne by the current andsubsequent periods for a period of more than one year.
5.18 Employee benefits
The Company’s employee benefits refer to various forms of remuneration and compensation given bythe Company to the employees for obtaining services provided by employees or for termination of laborrelations, including short-term benefits, post-employment benefits, termination benefits and otherlong-term employee benefits. The benefits provided by the Company to employees’ spouses, children,dependents, survivors of deceased employees and other beneficiaries also belong to employee benefits.
(1) Accounting treatment of short-term benefits
√Applicable □N/A
Short-term benefits are the benefits that the Company expects to pay in full within 12 months after theend of the annual reporting period in which the employee provides relevant services, excluding thecompensation for the employment termination. The Company’s short-term remuneration specificallyincludes: employee wages, bonuses, allowances and subsidies, employee welfare expenses, socialinsurance premiums such as medical insurance premiums, work-related injury insurance premiums and
maternity insurance premiums, housing provident fund, labor union funds and employee educationfunds, short-term paid absences, short-term profit-sharing plans, non-monetary benefits, and othershort-term benefits.
During the accounting period in which the employees provide services, the Company recognizes theactual short-term benefits as liabilities, and includes the current profits and losses or relevant asset costsaccording to the beneficiaries of the services provided by the employees. Non-monetary short-termbenefits shall be measured at fair value.
(2) Accounting treatment of post-employment benefits
√Applicable □N/A
Post-employment benefits refer to various forms of benefits provided by the Company in order to obtainthe services provided by the employees after the employees retire or terminate the labor relationshipwith the enterprise.
Defined contribution plan: The contributions to be paid to a separate entity in exchange for the servicesprovided by employees during the accounting period on the balance sheet date are recognized asemployee compensation liabilities, and are included in the current profit and loss or related asset costs.
(3) Accounting treatment of termination benefits
√Applicable □N/A
Employee benefits liabilities shall be recognized and included into profit or loss for the current periodon the earlier date of the two following circumstances:
a. When the Company is not able to withdraw the benefits from termination of employment orresignation persuasion unilaterally;
b. When the Company recognizes costs and fees relevant to reforming the termination benefits payment.
(4) Accounting treatment method of other long-term employee benefits
□Applicable √N/A
5.19 Revenue
(1) Accounting policies adopted for revenue recognition and measurement
√Applicable □N/A
Revenue refers to the total inflow of economic benefits that are formed in the daily activities of theCompany and will lead to an increase in owners’ equity and have nothing to do with the capital investedby the owners.
When the Company has fulfilled its performance obligations in the contract, that is, recognized theRevenue when the customer obtains control over the relevant commodities, which means that thecustomer is able to dominate the use of the commodity and obtain almost all economic benefits from it.After the Company delivers the product to the customer as agreed in the contract, the Revenue isrecognized based on the net amount after deducting the consideration payable to the customer. TheCompany recognizes the amount of contract consideration that has been collected from the customer asa contract liability before entering into a contract with the customer, having received the order but notdelivering the product to the customer.
(2) Differences in accounting policies for Revenue recognition due to the adoption of different businessmodels for similar businesses
□Applicable √N/A
5.20 Government grants
√Applicable □N/A
Government grants refer to the monetary or non-monetary assets that the Company obtains from thegovernment for free, but does not include the capital invested by the government as the owner of theCompany. Government grants are divided into asset-related government grants and income-relatedgovernment grants. Government grants can only be confirmed if they meet the following conditions atthe same time:
(1) Judgment basis and accounting treatment method of government grants related to assetsGovernment grants related to assets shall be written off against the carrying amount of related assets orrecognized as deferred income. If government grants related to assets are recognized as deferred income,they shall be included in profit or loss in stages within the useful life of the relevant assets in areasonable and systematic manner. Government grants measured at the nominal amount are directlyincluded in the current profit and loss. If the relevant assets are sold, transferred, scrapped or damagedbefore the end of their useful life, the undistributed balance of relevant deferred income shall betransferred to the profit and loss of the current period of asset disposal.
(2) Judgment basis and accounting treatment method of government grants related to incomeGovernment grants related to income shall be dealt with according to the following circumstances:
A. If it is used to compensate the Company’s relevant expenses or losses in future periods, it should berecognized as deferred income and included into the current profit and loss or written off of the relatedcosts when the relevant expenses, losses are recognized;
B. If it is used to compensate the Company’s relevant expenses or losses incurred, it is directly includedinto the current profit and loss or written off of the related costs.
(3) Government grants related to the daily activities of the Company shall be included in other incomeor written off relevant costs according to the nature of economic business. Government grants unrelatedto the daily activities of the Company shall be included in non-operating income and expenditure.
5.21 Deferred tax assets/Deferred tax liabilities
√Applicable □N/A
On the balance sheet date, according to the deductible temporary differences and taxable temporarydifferences of asset and liability items, the applicable tax rate is used to calculate the amount of deferredtax assets and deferred tax liabilities.
5.22 Lease
(1) Accounting treatment of operating lease
□Applicable √N/A
(2) Accounting treatment of financial lease
□Applicable √N/A
(3) Determination and accounting treatment of lease under the new lease standards
√Applicable □N/A
A. As the lessee
On the contract start date, the Company evaluates whether the contract is a lease or includes a lease. Ifone party in the contract transfers the right to control the use of one or more identified assets within acertain period in exchange for consideration, the contract is a lease or includes a lease. In order todetermine whether the contract transfers the right to control the use of the identified asset for a certainperiod, the Company evaluates whether the customer in the contract is entitled to receive substantiallyall the economic benefits arising from the use of the identified asset during the period of use, and hasthe right to dominate the use of the identified asset during the period of use. The general accountingtreatment is as follows:
On the commencement date of the lease term, the Company recognizes its right to use the leased assetduring the lease term as a right-of-use asset, including the initial measurement amount of the leaseliabilities; for the lease payments paid on or before the commencement date of the lease term, if there isa lease incentive, the following items should be deducted, including the relevant amount of the leaseincentive that has been enjoyed, the initial direct expenses incurred by the lessee, and the costs of thelessee for dismantling and removing the leased asset, restoring the site where the leased asset is located,or restoring the leased asset to the state agreed in the lease terms.
On the commencement date of the lease term, the Company recognizes the present value of unpaid leasepayments as lease liabilities, excluding short-term lease and low-value assets lease. When calculatingthe present value of lease payments, the Company takes the interest rate implicit in the lease as thediscount rate; if the interest rate implicit in the lease cannot be determined, the incremental borrowingrate of the lessee is used as the discount rate.
The Company subsequently adopts the straight-line method to depreciate the right-of-use assets,calculates the interest expenses of the lease liabilities in each period of the lease term, and includes themin the current profit and loss, unless otherwise stipulated to be included in the cost of the relevant assets.Variable lease payments that are not included in the measurement of lease liabilities are included in thecurrent profit and loss when they are actually incurred, unless otherwise stipulated to be included in thecost of the relevant asset.
The Company does not recognize right-of-use assets and lease liabilities for short-term lease andlow-value asset lease. In each period of the lease term, it is included in the relevant asset cost or currentprofit and loss on a straight-line basis.
B. As the lessor
As a lessor, a financial lease refers to substantially transfer almost all the risks and rewards related to theownership of the leased asset on the lease commencement date, and all other leases are operating leases.
a. Rental income from operating leases is recognized as current profit and loss on a straight-line basisover each period of the lease term.
b. On the start date of the lease term, the Company recognizes the finance lease receivables for thefinance lease, and derecognizes the finance lease assets. During the initial measurement of the financelease receivables, the net investment in the lease is taken as the entry value of the finance leasereceivables. The net lease investment is the sum of the unguaranteed residual value and the presentvalue of the lease receipts not yet received at the commencement date of the lease term which isdiscounted at the interest rate implicit in the lease.
5.23 Changes in significant accounting policies and accounting estimates
(1) Changes in significant accounting policies
√Applicable □N/A
The Ministry of Finance revised and issued Accounting Standards for Business Enterprises No. 21 -Leases (hereinafter referred to as New Lease Standards) in December 2018. The Company willimplement and follow the new lease standards from January 1, 2021. No adjustment will be made to thecomparative financial statements, and the above accounting policies have been approved by theCompany’s board of directors.
When measuring the lease liability, the Company discounts the lease payments at the incrementalborrowing rate at 1 January 2021.
Unit: CNY
| Undiscounted amount of operating lease commitments on January 1, 2021 | 639,664,840.54 |
| Incremental borrowing rate on January 1, 2021 | 3.20%-3.40% |
| Lease liabilities discounted at the incremental borrowing rate | 536,281,365.04 |
| on January 1, 2021 | |
| including: lease liabilities due within one year | 121,378,096.65 |
| Lease liabilities due over one year | 414,903,268.39 |
Please refer to this section for the changes in the corresponding accounting statement items: V.Significant accounting policies and accounting estimates; 23. Changes in significant accounting policiesand accounting estimates; (3) Adjustments to the financial statements at the beginning of the executionyear of any new standard governing leases from 2021.
(2) Changes in significant accounting estimates
□Applicable √N/A
(3) Adjustments to the financial statements at the beginning of the execution year of any new standardgoverning leases from 2021
√Applicable □N/A
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unit: CNY
| Item | 31 December 2020 | January 1, 2021 | Adjustments |
| CURRENT ASSETS | |||
| Cash and Cash equivalents | 36,091,090,060.90 | 36,091,090,060.90 | |
| Settlements Provision | |||
| Loans to banks and other financial institutions | 118,199,586,541.06 | 118,199,586,541.06 | |
| Financial assets held for trading | |||
| Derivative financial assets | |||
| Notes receivable | 1,532,728,979.67 | 1,532,728,979.67 | |
| Accounts receivable | |||
| Financing receivable | |||
| Prepayments | 898,436,259.15 | 898,436,259.15 | |
| Insurance premium receivable | |||
| Due from reinsurers | |||
| Reinsurance contract reserves receivable | |||
| Other receivables | 34,488,582.19 | 34,488,582.19 | |
| Including: Interest receivable | |||
| Dividends receivable | |||
| Financial assets purchased under agreements to resell | |||
| Inventories | 28,869,087,678.06 | 28,869,087,678.06 | |
| Contract assets | |||
| Assets classified as held for sale | |||
| Current portion of non-current assets | |||
| Other current assets | 26,736,855.91 | 26,736,855.91 | |
| Total current assets | 185,652,154,956.94 | 185,652,154,956.94 | |
| NON-CURRENT ASSETS | |||
| Loans and advances | 2,953,036,834.80 | 2,953,036,834.80 | |
| Debt investment | 20,143,397.78 | 20,143,397.78 | |
| Other debt investments | |||
| Long-term receivables | |||
| Long-term equity investments | |||
| Other equity instruments investments | |||
| Other non-current financial assets | 9,830,052.91 | 9,830,052.91 | |
| Investment properties | |||
| Fixed assets | 16,225,082,847.29 | 16,225,082,847.29 | |
| Construction in progress | 2,447,444,843.03 | 2,447,444,843.03 | |
| Productive biological assets | |||
| Oil and gas assets | |||
| Right-of-use asset | 536,281,365.04 | 536,281,365.04 | |
| Intangible assets | 4,817,170,981.91 | 4,817,170,981.91 | |
| Development expenditures | |||
| Goodwill | |||
| Long-term prepaid expenses | 147,721,526.43 | 147,721,526.43 | |
| Deferred tax assets | 1,123,225,086.37 | 1,123,225,086.37 | |
| Other non-current assets | |||
| Total non-current assets | 27,743,655,570.52 | 28,279,936,935.56 | 536,281,365.04 |
| Total assets | 213,395,810,527.46 | 213,932,091,892.50 | 536,281,365.04 |
| Current liabilities | |||
| Short-term borrowings | |||
| Borrowing from the central bank | |||
| Deposits and balances from banks and other financial institutions | |||
| Financial liabilities held for trading | |||
| Derivative financial liabilities | |||
| Notes payable | |||
| Accounts payable | 1,342,267,668.12 | 1,342,267,668.12 | |
| Receipts in advance | |||
| Contract liabilities | 13,321,549,147.69 | 13,321,549,147.69 | |
| Financial assets sold under agreements to buy | |||
| Customer deposits and balances from banks and other financial institutions | 14,241,859,949.77 | 14,241,859,949.77 | |
| Customer brokerage deposits | |||
| Securities underwriting brokerage deposits | |||
| Payroll and employee benefits payable | 2,981,125,503.86 | 2,981,125,503.86 | |
| Taxes payable | 8,919,821,015.58 | 8,919,821,015.58 | |
| Other payables | 3,257,245,259.42 | 3,257,245,259.42 | |
| Including: Interest payable | |||
| Dividend payable | |||
| Fees and commission payable | |||
| Payable reinsurance | |||
| Liabilities classified as held for sale | |||
| Current portion of non-current liabilities | 121,378,096.65 | 121,378,096.65 | |
| Other current liabilities | 1,609,801,368.51 | 1,609,801,368.51 | |
| Total current liabilities | 45,673,669,912.95 | 45,795,048,009.60 | 121,378,096.65 |
| Non-current liabilities | |||
| Insurance reserves | |||
| Long-term borrowings | |||
| Bonds payable | |||
| Including: Preference share | |||
| Perpetual debt | |||
| Lease liabilities | 414,903,268.39 | 414,903,268.39 | |
| Long-term Payable | |||
| Long-term payroll and employee benefits payable | |||
| Provisions | |||
| Deferred income | |||
| Deferred tax liabilities | 1,457,513.23 | 1,457,513.23 | |
| Other non-current liabilities | |||
| Total non-current liabilities | 1,457,513.23 | 416,360,781.62 | 414,903,268.39 |
| Total liabilities | 45,675,127,426.18 | 46,211,408,791.22 | 536,281,365.04 |
| SHAREHOLDERS’ EQUITY： | |||
| Paid-in capital | 1,256,197,800.00 | 1,256,197,800.00 | |
| Other equity instruments | |||
| Including: Preference share | |||
| Perpetual debt | |||
| Capital reserve | 1,374,964,415.72 | 1,374,964,415.72 | |
| Less: treasury shares | |||
| Other comprehensive income | -5,331,367.75 | -5,331,367.75 | |
| Special reserve | |||
| Surplus reserve | 20,174,922,608.93 | 20,174,922,608.93 | |
| General risk reserve | 927,577,822.67 | 927,577,822.67 | |
| Retained earnings | 137,594,403,807.99 | 137,594,403,807.99 | |
| Equity attributable to owners of the parent | 161,322,735,087.56 | 161,322,735,087.56 | |
| Non-controlling interests | 6,397,948,013.72 | 6,397,948,013.72 | |
| Total shareholders’ equity | 167,720,683,101.28 | 167,720,683,101.28 | |
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | 213,395,810,527.46 | 213,932,091,892.50 | 536,281,365.04 |
Adjustment of each item:
√Applicable □N/A
The Ministry of Finance revised and issued Accounting Standards for Business Enterprises No. 21 -Leases (Cai Kuai (2018) No. 35) in December 2018. The Company will implement and follow the newlease standards from January 1, 2021. The Company separately lists the right-of-use assets and leaseliabilities in the balance sheet in accordance with the provisions of the new standard. According to thelinking regulations, the enterprise that implements this new standard for the first time shall adjust theamount of retained earnings at the beginning of the period and other relevant items in the financialstatements according to the cumulative impact of the first implementation of this new standard, and notadjust the comparative financial data.
COMPANY STATEMENT OF FINANCIAL POSITION
Unit: CNY
| Item | 31 December 2020 | January 1, 2021 | Adjustments |
| CURRENT ASSETS | |||
| Cash and Cash equivalents | 50,925,698,935.43 | 50,925,698,935.43 | |
| Financial assets held for trading | |||
| Derivative financial assets | |||
| Notes receivable | 142,286,376.00 | 142,286,376.00 | |
| Accounts receivable | 9,203,780,107.14 | 9,203,780,107.14 | |
| Financing receivables | |||
| Prepayments | 858,363,840.62 | 858,363,840.62 | |
| Other receivables | 42,323,669.01 | 42,323,669.01 | |
| Including: Interest receivable | |||
| Dividends receivable | |||
| Inventories | 28,162,833,603.66 | 28,162,833,603.66 | |
| Contract assets | |||
| Assets classified as held for sale | |||
| Current portion of non-current assets | |||
| Other current assets | |||
| Total current assets | 89,335,286,531.86 | 89,335,286,531.86 | |
| NON-CURRENT ASSETS | |||
| Debt investment | |||
| Other debt investments | |||
| Long-term receivables | |||
| Long-term equity investments | 1,624,535,587.55 | 1,624,535,587.55 | |
| Other equity instruments investments | |||
| Other non-current financial assets | 9,830,052.91 | 9,830,052.91 | |
| Investment properties | |||
| Fixed assets | 15,742,514,190.13 | 15,742,514,190.13 | |
| Construction in progress | 2,447,444,843.03 | 2,447,444,843.03 | |
| Productive biological assets | |||
| Oil and gas assets | |||
| Right-of-use asset | 470,585,429.10 | 470,585,429.10 | |
| Intangible assets | 4,815,945,940.55 | 4,815,945,940.55 | |
| Development expenditures | |||
| Goodwill | |||
| Long-term prepaid expenses | 147,500,000.21 | 147,500,000.21 | |
| Deferred tax assets | 521,030,214.32 | 521,030,214.32 | |
| Other non-current assets | |||
| Total non-current assets | 25,308,800,828.70 | 25,779,386,257.80 | 470,585,429.10 |
| Total assets | 114,644,087,360.56 | 115,114,672,789.66 | 470,585,429.10 |
| Current liabilities | |||
| Short-term borrowings | |||
| Financial liabilities held for trading | |||
| Derivative financial liabilities | |||
| Notes payable | |||
| Accounts payable | 1,077,677,482.55 | 1,077,677,482.55 | |
| Receipts in advance | |||
| Contract liabilities | 557,514,370.46 | 557,514,370.46 | |
| Payroll and employee benefits payable | 2,846,669,812.23 | 2,846,669,812.23 | |
| Taxes payable | 5,032,321,722.08 | 5,032,321,722.08 | |
| Other payables | 926,532,063.22 | 926,532,063.22 | |
| Including: Interest payable | |||
| Dividend payable | |||
| Liabilities classified as held for sale | |||
| Current portion of non-current liabilities | 101,062,708.92 | 101,062,708.92 | |
| Other current liabilities | |||
| Total current liabilities | 10,440,715,450.54 | 10,541,778,159.46 | 101,062,708.92 |
| Non-current liabilities | |||
| Long-term borrowings | |||
| Bonds payable | |||
| Including: Preference share | |||
| Perpetual debt | |||
| Lease liabilities | 369,522,720.18 | 369,522,720.18 | |
| Long-term Payable | |||
| Long-term payroll and employee benefits payable | |||
| Provisions | |||
| Deferred income | |||
| Deferred tax liabilities | 1,457,513.23 | 1,457,513.23 | |
| Other non-current liabilities | |||
| Total non-current liabilities | 1,457,513.23 | 370,980,233.41 | 369,522,720.18 |
| Total liabilities | 10,442,172,963.77 | 10,912,758,392.87 | 470,585,429.10 |
| SHAREHOLDERS’ EQUITY： | |||
| Paid-in capital | 1,256,197,800.00 | 1,256,197,800.00 | |
| Other equity instruments | |||
| Including: Preference share | |||
| Perpetual debt | |||
| Capital reserve | 1,374,303,082.72 | 1,374,303,082.72 | |
| Less: treasury shares | |||
| Other comprehensive income | |||
| Special reserve | |||
| Surplus reserve | 20,174,922,608.93 | 20,174,922,608.93 | |
| Retained earnings | 81,396,490,905.14 | 81,396,490,905.14 | |
| Total shareholders’ equity | 104,201,914,396.79 | 104,201,914,396.79 | |
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | 114,644,087,360.56 | 115,114,672,789.66 | 470,585,429.10 |
Adjustment of each item:
√Applicable □N/A
The Ministry of Finance revised and issued Accounting Standards for Business Enterprises No. 21 -Leases (Cai Kuai (2018) No. 35) in December 2018. The Company will implement and follow the newlease standards from January 1, 2021. The Company separately lists the right-of-use assets and leaseliabilities in the balance sheet in accordance with the provisions of the new standard. According to thelinking regulations, the enterprise that implements this new standard for the first time shall adjust theamount of retained earnings at the beginning of the period and other relevant items in the financialstatements according to the cumulative impact of the first implementation of this new standard, and notadjust the comparative financial data.
(4) Explanation on adjustment of previous comparative financial data for implementation of the newlease standards for the first time from 2021
□Applicable √N/A
6. Tax
6.1 Main taxes and tax rates
Main taxes and tax rates
√Applicable □N/A
| Tax | Tax basis | Tax rate |
| VAT | Calculation of output tax and input tax on product sales revenue | 13% |
| Consumption tax | Taxable price and sales volume of sales revenue of alcoholic products | 20%、CNY 0.5 /500ml |
| City construction and maintenance tax | Turnover tax payable | 7% |
| Enterprise income tax | Taxable income | 25% |
| Education surcharges | Turnover tax payable | 3% |
| Local education surcharges | Turnover tax payable | 2% |
Disclosure of taxpayers with different corporate income tax rates
√Applicable □N/A
| Tax entity | Income tax rate (%) |
| Kweichow Moutai Paris Trading Co., Ltd. | 26.5、27.5 |
6.2 Tax benefits
□Applicable √N/A
7. Notes to consolidated financial statements
7.1 Cash and Cash equivalents
√Applicable □N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Cash on hand | 9,500.00 | 9,554.00 |
| Bank balances | 51,810,234,107.11 | 36,091,080,506.90 |
| Other monetary fund | ||
| Total | 51,810,243,607.11 | 36,091,090,060.90 |
| including: total amount deposited abroad | 20,665,732.96 | 17,011,338.58 |
Cash and cash equivalents with restrictions on use
| Item | Closing balance | Opening balance |
| Statutory deposit reserve with the central bank | 6,381,004,565.81 | 6,821,915,239.53 |
7.2 Loans to banks and other financial institutions
Unit: CNY
| Item | Closing balance | Opening balance |
| Deposits with other banks | 135,071,807,332.94 | 117,800,411,402.21 |
| Loans to banks and other financial institutions | 402,680,555.57 | |
| Less: impairment | 4,519,554.91 | 3,505,416.72 |
| Carrying amount | 135,067,287,778.03 | 118,199,586,541.06 |
Loans to banks and other financial institutions with restrictions on use
| Item | Closing balance | Opening balance |
| Deposits with other banks that can not be withdrawn at any time | 1,000,000,000.00 |
7.3 Notes receivable
(1) Categories of notes receivable
√Applicable □N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Bank acceptances | 1,532,728,979.67 | |
| Total | 1,532,728,979.67 |
7.4 Accounts receivable
(1) Disclosed by aging
√Applicable □N/A
Unit: CNY
| Aging | Book balance at the end of the reporting period |
| Within 1 year | |
| 1 to 2 years | |
| 2 to 3 years | |
| More than 3 years | |
| 3 to 4 years | |
| 4 to 5 years | |
| More than 5 years | 3,097,678.25 |
| Total | 3,097,678.25 |
(2) Disclosed by bad debt provision methods
√Applicable □N/A
Unit: CNY
| Category | Closing balance | Opening balance | ||||||||
| Book balance | Bad debt provision | Carrying amount | Book balance | Bad debt provision | Carrying amount | |||||
| Amount | Proportion (%) | Amount | Proportion (%) | Amount | Proportion (%) | Amount | Proportion (%) | |||
| Bad debt provision assessed individually | ||||||||||
| Bad debt provision assessed by groups | 3,097,678.25 | 100.00 | 3,097,678.25 | 100.00 | 3,243,804.43 | 100.00 | 3,243,804.43 | 100.00 | ||
| Including: bad debt provision assessed by groups | 3,097,678.25 | 100.00 | 3,097,678.25 | 100.00 | 3,243,804.43 | 100.00 | 3,243,804.43 | 100.00 | ||
| Total | 3,097,678.25 | / | 3,097,678.25 | / | 3,243,804.43 | / | 3,243,804.43 | / | ||
Bad debt provision assessed by groups:
√ Applicable □ N/A
Items assessed by groups: aging of accounts
Unit: CNY
| Closing balance | |||
| Accounts receivable | Bad debt provision | Proportion (%) | |
| Within 1 year | |||
| 1-2 years | |||
| 2-3 years | |||
| 3-4 years | |||
| 4-5 years | |||
| More than 5 years | 3,097,678.25 | 3,097,678.25 | 100.00 |
| Total | 3,097,678.25 | 3,097,678.25 | 100.00 |
Recognition criteria and explanations for bad debt provision assessed by groups:
□ Applicable √ N/A
Refer to the disclosure of other receivables if bad debt provision is made based on the general ECLmodel:
□ Applicable √ N/A
(3) Bad debt provision
√ Applicable □ N/A
Unit: CNY
| Category | Opening balance | Changes in the current period | Closing balance | |||
| Provision | Recovery or reversal | Write-off | Other changes | |||
| Bad debt provision assessed by groups | 3,243,804.43 | 47,413.76 | 98,712.42 | 3,097,678.25 | ||
| Total | 3,243,804.43 | 47,413.76 | 98,712.42 | 3,097,678.25 | ||
(4) Accounts receivable written off at the end of the reporting period
√ Applicable □ N/A
Unit: CNY
| Item | Amount of write-off |
| Actual write-off of accounts receivable | 98,712.42 |
Significant write-off of accounts receivable
□ Applicable √ N/A
Explanations on write-off of accounts receivable:
□ Applicable √ N/A
(5) Top five accounts receivable based on debtors
√ Applicable □ N/A
Unit: CNY
| Entity | Closing balance | Proportion to total closing balance of accounts receivable (%) | Closing balance of bad debt provision |
| Yunnan Kunming Yuanwei Economic and Trade Co., Ltd. | 847,620.00 | 27.36 | 847,620.00 |
| Tianjin Feimeng Industrial Co., Ltd. | 784,900.00 | 25.34 | 784,900.00 |
| Shanghai International Famous Wine Development Co., Ltd. | 375,776.00 | 12.13 | 375,776.00 |
| Shenzhen Friendship Shopping Mall | 194,200.00 | 6.27 | 194,200.00 |
| Shenzhen Grain and Oil Import and Export Corporation Beijing Branch | 109,504.86 | 3.54 | 109,504.86 |
| Total | 2,312,000.86 | 74.64 | 2,312,000.86 |
7.5 Prepayments
(1) Aging analysis of prepayments
√ Applicable □ N/A
Unit: CNY
| Aging | Closing balance | Opening balance | ||
| Amount | Proportion (%) | Amount | Proportion (%) | |
| Within 1 year | 377,984,374.85 | 97.14 | 136,773,510.50 | 15.22 |
| 1-2 years | 1,575,835.77 | 0.40 | 609,099,761.73 | 67.79 |
| 2-3 years | 1,343,437.85 | 0.35 | 122,235,839.95 | 13.61 |
| More than 3 years | 8,206,192.81 | 2.11 | 30,327,146.97 | 3.38 |
| Total | 389,109,841.28 | 100.00 | 898,436,259.15 | 100.00 |
(2) Top five prepayments based on the payers
√ Applicable □ N/A
| Entity | Closing balance | Proportion to the total closing balance of prepayment (%) |
| Renhuai Municipal People’s Government | 173,000,000.00 | 44.46 |
| Xishui County People’s Government | 130,339,307.06 | 33.50 |
| Guizhou Renhuai Grain and Oil Collection and Storage Co., Ltd. | 50,300,844.00 | 12.93 |
| iSoftStone Information Technology (Group) Co., Ltd. | 2,269,329.41 | 0.58 |
| Guizhou Radio and Television Station | 1,698,113.21 | 0.43 |
| Total | 357,607,593.68 | 91.90 |
7.6 Other receivables
Presentation of items
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Interest receivable | ||
| Dividends receivable | ||
| Other receivables | 33,158,974.32 | 34,488,582.19 |
| Total | 33,158,974.32 | 34,488,582.19 |
Other receivables
(1) Disclosure by aging
√ Applicable □ N/A
Unit: CNY
| Aging | Book balance at the end of the reporting period |
| Within 1 year | 29,081,462.35 |
| Subtotal of within 1 year | 29,081,462.35 |
| 1-2 years | 1,695,588.73 |
| 2-3 years | 1,499,488.43 |
| 3-4 years | 967,917.47 |
| 4-5 years | 37,951.22 |
| More than 5 years | 5,100,600.00 |
| Total | 38,383,008.20 |
(2) Details of classification by nature
√ Applicable □ N/A
Unit: CNY
| Nature | Book balance at the end of the reporting period | Book balance at the beginning of the reporting period |
| Petty cash | 16,271,192.50 | 10,399,194.10 |
| Current Account | 22,111,815.70 | 29,458,352.01 |
| Total | 38,383,008.20 | 39,857,546.11 |
(3) Details of bad debt provision
√ Applicable □ N/A
Unit: CNY
| Bad debt provision | Stage I | Stage II | Stage III | Total |
| 12-month ECL | Lifetime ECL (not impaired) | Lifetime ECL (impaired) | ||
| As at 1 January 2021 | 211,315.55 | 5,157,648.37 | 5,368,963.92 | |
| Changes due to financial instruments recognised as at 1 January 2021 | ||||
| --Transfer to stage II | ||||
| --Transfer to stage III | ||||
| --Reverse to stage II | ||||
| --Reverse to stage I | ||||
| Provision | 81,250.63 | 13,662.43 | 94,913.06 | |
| Reversal | 211,398.75 | 18,414.35 | 229,813.10 | |
| Elimination | ||||
| Write-off | 10,030.00 | 10,030.00 | ||
| Other changes | ||||
| As at 31 December 2021 | 81,167.43 | 5,142,866.45 | 5,224,033.88 |
Explanations on significant changes in the book balance of other receivables where there are changes inprovision for the current period:
□Applicable √ N/A
(1). Bad debt provision
√ Applicable □ N/A
Unit: CNY
| Category | Opening balance | Changes in the current period | Closing balance | |||
| Provision | Recovery or reversal | Write-off | Other changes | |||
| Bad debt provision assessed by aging groups | 5,368,963.92 | 94,913.06 | 229,813.10 | 10,030.00 | 5,224,033.88 | |
| Total | 5,368,963.92 | 94,913.06 | 229,813.10 | 10,030.00 | 5,224,033.88 | |
Significant recovery or reversal of bad debt provision for the current period:
□ Applicable √ N/A
(2). Other receivables written off as at the end of the current period
√ Applicable □ N/A
Unit: CNY
| Item | Amount of write-off |
| Actual write-off of other receivables | 10,030.00 |
Significant write-off of other receivables:
□ Applicable √ N/A
Explanations on write-off of other receivables:
□ Applicable √ N/A
(3). Top five other receivables based on debtors
√ Applicable □ N/A
Unit: CNY
| Entity | Nature | Closing balance | Aging | Proportion to the total closing balance of other receivables (%) | Bad debt provision |
| 11th Construction Engineering Co., Ltd. of Guizhou Construction Engineering Group | Current Account | 1,584,682.49 | Within 1 year | 4.13 | |
| Guizhou Kailin Xifeng Synthetic Ammonia Co., Ltd. | Current Account | 1,000,000.00 | Within 1 year | 2.61 | 52,000.00 |
| Xinghe Industry (Shenzhen) Co., Ltd. | Current Account | 869,520.12 | Within 1 year | 2.27 | |
| Guiyang Urban Construction Investment (Group) Co., Ltd. | Current Account | 801,039.00 | 2-3 years | 2.09 | |
| Shenzhen Jinzhaolin Trading Co., Ltd. | Current Account | 781,672.56 | Within 1 year | 2.04 | |
| Total | / | 5,036,914.17 | / | 13.14 | 52,000.00 |
A. The receivable of the 11th Construction Engineering Co., Ltd. of Guizhou Construction EngineeringGroup is the payment for office fit-out from majority-owned subsidiary Guizhou Laymau Wine IndustryCo., Ltd..
B. The receivable of Guizhou Kailin Xifeng Synthetic Ammonia Co., Ltd. is the deposit paid to thesupplier.
C. The receivable of Xinghe industry (Shenzhen) Co., Ltd. is the rental deposit paid by
majority-owned subsidiary Kweichow Moutai Sales Co., Ltd.
D. The receivable of Guiyang Urban Construction Investment (Group) Co., Ltd. is the rental depositpaid by majority-owned subsidiary Kweichow Moutai Sales Co., Ltd.
E. The receivable of Shenzhen Jinzhaolin Trading Co., Ltd. is the prepayment for promotion frommajority-owned subsidiary Guizhou Laymau Wine Industry Co., Ltd.., and the relevant notes wereentered in the books of account in January 2022.
7.7 Inventories
(1). Categories of inventories
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance | ||||
| Book balance | Write-down of inventories/impairment provision of contract performance costs | Carrying amount | Book balance | Write-down of inventories/impairment provision of contract performance costs | Carrying amount | |
| Raw materials | 4,019,538,465.82 | 4,019,538,465.82 | 3,485,831,193.61 | 3,485,831,193.61 | ||
| Goods in progress | 14,310,650,087.51 | 1,283,984.83 | 14,309,366,102.68 | 11,941,066,479.64 | 1,283,984.83 | 11,939,782,494.81 |
| Finished goods | 1,319,352,631.84 | 1,319,352,631.84 | 1,047,225,896.31 | 1,047,225,896.31 | ||
| Semi-finished goods | 13,746,107,884.49 | 13,746,107,884.49 | 12,396,248,093.33 | 12,396,248,093.33 | ||
| Total | 33,395,649,069.66 | 1,283,984.83 | 33,394,365,084.83 | 28,870,371,662.89 | 1,283,984.83 | 28,869,087,678.06 |
(2). Write-down of inventories and impairment provision of contract performance costs
√ Applicable □ N/A
Unit: CNY
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance | ||
| Provision | Others | Reversal or elimination | Others | |||
| Goods in progress | 1,283,984.83 | 1,283,984.83 | ||||
| Total | 1,283,984.83 | 1,283,984.83 | ||||
7.8 Other current assets
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| VAT not deducted at the end of the reporting period | 67,014,310.91 | 22,218,754.41 |
| Prepaid income tax | 4,513,249.83 | 4,518,101.50 |
| Total | 71,527,560.74 | 26,736,855.91 |
7.9 Loans and advances
Unit: CNY
| Item | Closing balance | Opening balance |
| Loans and advances | 3,425,175,000.00 | 2,953,036,834.80 |
| Item | Closing balance | Opening balance |
| Total amount of loans and advances | 3,513,000,000.00 | 3,028,755,728.00 |
| Less: provision for loan impairment | 87,825,000.00 | 75,718,893.20 |
| Carrying amount of loans and advances | 3,425,175,000.00 | 2,953,036,834.80 |
7.10 Debt investment
(1). Debt investment
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance | ||||
| Book balance | Provision for impairment | Carrying amount | Book balance | Provision for impairment | Carrying amount | |
| Guiyang GYB Financial Leasing Co., LTD. | 20,153,150.69 | 11,340.00 | 20,141,810.69 | 20,155,277.78 | 11,880.00 | 20,143,397.78 |
| Bank of Guiyang Co. Ltd. | 50,232,273.98 | 28,350.00 | 50,203,923.98 | |||
| Bank of Guizhou Co., Ltd. | 100,179,589.04 | 56,700.00 | 100,122,889.04 | |||
| Total | 170,565,013.71 | 96,390.00 | 170,468,623.71 | 20,155,277.78 | 11,880.00 | 20,143,397.78 |
(2). Provision for impairment
√ Applicable □ N/A
Unit: CNY
| Provision for impairment | Stage I | Stage II | Stage III | Total |
| 12-month ECL | Lifetime ECL (not impaired) | Lifetime ECL (impaired) | ||
| As at 1 January 2021 | 11,880.00 | 11,880.00 | ||
| Balance at 1 January 2021 in the current period | ||||
| --Transfer to stage II | ||||
| --Transfer to stage III | ||||
| --Reverse to stage II | ||||
| --Reverse to stage I | ||||
| Provision | 85,050.00 | 85,050.00 | ||
| Reversal | 540.00 | 540.00 | ||
| Elimination | ||||
| Write-off | ||||
| Other changes | ||||
| As at 31 December 2021 | 96,390.00 | 96,390.00 |
Explanations on significant changes in the book balance of debt investments where there are changes inprovision for the current period:
□ Applicable √ N/A
7.11 Other non-current financial assets
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Kweichow Moutai Distillery (Group) Foreign Investment Cooperation Management Co., Ltd. | 9,830,052.91 | |
| Total | 9,830,052.91 |
7.12 Investment properties
Measurement of investment properties
(1). Investment properties measured at cost
(2). Unit: CNY
| Item | Buildings | Land use rights | Construction in progress | Total |
| I. Cost | ||||
| 1. Opening balance | ||||
| 2. Increase in the current period | 6,023,231.76 | 6,023,231.76 | ||
| (1) Purchases | ||||
| (2) Transfer from inventories\fixed assets\construction in progress | 6,023,231.76 | 6,023,231.76 | ||
| (3) Increase arising from business combination | ||||
| 3. Decrease in the current period | ||||
| (1) Disposal | ||||
| (2) Other transfer-out | ||||
| 4. Closing balance | 6,023,231.76 | 6,023,231.76 | ||
| Ⅱ. Accumulated depreciation and amortization | ||||
| 1. Opening balance | ||||
| 2. Increase in the current period | 780,800.01 | 780,800.01 | ||
| (1) Depreciation or amortization | 286,459.93 | 286,459.93 | ||
| (2) Transfer from inventories\fixed assets\construction in progress | 494,340.08 | 494,340.08 | ||
| 3. Decrease in the current period | ||||
| (1) Disposal | ||||
| (2) Other transfer-out | ||||
| 4. Closing balance | 780,800.01 | 780,800.01 | ||
| III. Provision for impairment | ||||
| 1. Opening balance | ||||
| 2. Increase in the current period | ||||
| (1) Provision | ||||
| 3. Decrease in the current period | ||||
| (1) Disposal | ||||
| (2) Other transfer-out | ||||
| 4. Closing balance | ||||
| IV. Carrying amount | ||||
| 1. Carrying amount at the end of the reporting period | 5,242,431.75 | 5,242,431.75 | ||
| 2. Carrying amount at the beginning of the reporting period | ||||
(1). Investment property of which certificates of title have not been obtained
□ Applicable √ N/A
Others
□ Applicable √ N/A
7.13 Fixed assets
Presentation of items
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Fixed assets | 17,472,173,182.85 | 16,225,082,847.29 |
| Disposal of fixed assets | ||
| Total | 17,472,173,182.85 | 16,225,082,847.29 |
Fixed assets
(1). Details of fixed assets
√ Applicable □ N/A
Unit: CNY
| Item | Buildings | Machinery and equipment | Vehicles | Electronic equipment and others | Total |
| I. Cost： | |||||
| 1. Opening Balance | 22,132,224,920.44 | 1,999,629,112.98 | 276,593,468.31 | 777,794,492.36 | 25,186,241,994.09 |
| 2. Increase in the current period | 2,450,899,506.50 | 78,839,832.19 | 49,663,726.77 | 49,862,986.39 | 2,629,266,051.85 |
| (1) Additions | 41,200,048.72 | 651,810.69 | 18,738,972.91 | 11,099,469.07 | 71,690,301.39 |
| (2) Transfer from construction in progress | 2,409,699,457.78 | 78,188,021.50 | 30,924,753.86 | 38,763,517.32 | 2,557,575,750.46 |
| (3) Increase arising from business combination | |||||
| (4) Foreign currency translation | |||||
| 3. Decrease in the current period | 84,725,840.68 | 45,204,306.62 | 17,725,859.31 | 9,249,576.82 | 156,905,583.43 |
| (1) Disposal or retirement | 51,624,105.92 | 45,204,306.62 | 17,725,859.31 | 9,247,071.17 | 123,801,343.02 |
| (2) Foreign currency translation | 7,014,133.31 | 2,505.65 | 7,016,638.96 | ||
| (3) Transfer to investment properties | 6,023,231.76 | 6,023,231.76 | |||
| (4) Transfer to construction in progress | 20,064,369.69 | 20,064,369.69 | |||
| 4. Closing balance | 24,498,398,586.26 | 2,033,264,638.55 | 308,531,335.77 | 818,407,901.93 | 27,658,602,462.51 |
| II. Accumulated depreciation | |||||
| 1. Opening balance | 6,893,835,855.08 | 1,261,486,281.12 | 204,581,877.52 | 600,187,916.28 | 8,960,091,930.00 |
| 2. Increase in the current period | 1,131,097,966.69 | 137,766,944.46 | 22,208,035.32 | 53,474,504.99 | 1,344,547,451.46 |
| (1) Provision | 1,131,097,966.69 | 137,766,944.46 | 22,208,035.32 | 53,474,504.99 | 1,344,547,451.46 |
| (2) Foreign currency translation | |||||
| 3. Decrease in the current period | 56,316,578.05 | 38,665,455.21 | 16,158,488.77 | 8,136,796.57 | 119,277,318.60 |
| (1) Disposal or retirement | 47,039,249.90 | 38,665,455.21 | 16,158,488.77 | 8,134,978.48 | 109,998,172.36 |
| (2) Foreign currency translation | 1,243,683.79 | 1,818.09 | 1,245,501.88 | ||
| (3) Transfer to investment properties | 494,340.08 | 494,340.08 | |||
| (4) Transfer to construction in progress | 7,539,304.28 | 7,539,304.28 | |||
| 4. Closing balance | 7,968,617,243.72 | 1,360,587,770.37 | 210,631,424.07 | 645,525,624.70 | 10,185,362,062.86 |
| III. Provision for impairment | |||||
| 1. Opening balance | 1,060,865.02 | 6,351.78 | 1,067,216.80 | ||
| 2. Increase in the current period | |||||
| (1) Provision | |||||
| 3. Decrease in the current period | |||||
| (1) Disposal or retirement | |||||
| 4. Closing balance | 1,060,865.02 | 6,351.78 | 1,067,216.80 | ||
| IV. Carrying amount | |||||
| 1. Carrying amount at the end of the reporting period | 16,529,781,342.54 | 671,616,003.16 | 97,899,911.70 | 172,875,925.45 | 17,472,173,182.85 |
| 2. Carrying amount at the beginning of the reporting period | 15,238,389,065.36 | 737,081,966.84 | 72,011,590.79 | 177,600,224.30 | 16,225,082,847.29 |
(2). Fixed assets of which certificates of title have not been obtained
√ Applicable □ N/A
Unit: CNY
| Item | Carrying amount | Reasons why certificates of title have not been obtained |
| Second phase of the “12th Five Year Plan” 10,000 ton Moutai liquor project (2012): technical transformation project that added 2,500 tons of Moutai liquor production capacity | 558,732,546.81 | In procedure |
| Technological transformation project launched in 2011 that added 2,000 tons of Moutai Prince production capacity and supporting facilities | 346,872,092.02 | In procedure |
| Technological transformation project launched in 2012 that added 2,800 tons of Moutai Prince production capacity and supporting facilities | 217,128,781.77 | In procedure |
| Moutai Huanshan liquor storage area project | 473,072,853.57 | In procedure |
| Technological transformation project for Moutai flavor liquor series and supporting facilities | 930,374,657.42 | In procedure |
7.14 Construction in progress
Presentation of items
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Construction in progress | 2,321,988,541.82 | 2,447,444,843.03 |
| Materials for construction of fixed assets | ||
| Total | 2,321,988,541.82 | 2,447,444,843.03 |
Construction in progress
(1). Construction in progress
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance | ||||
| Book balance | Provision for impairment | Carrying amount | Book balance | Provision for impairment | Carrying amount | |
| Construction in progress | 2,321,988,541.82 | 2,321,988,541.82 | 2,447,444,843.03 | 2,447,444,843.03 | ||
| Total | 2,321,988,541.82 | 2,321,988,541.82 | 2,447,444,843.03 | 2,447,444,843.03 | ||
(2). Changes in significant construction in progress
√ Applicable □ N/A
Unit:CNY
| Item | Budget | Opening balance | Increase in the current period | Transfer to fixed asset | Other decreases | Closing balance | Amount injected as a proportion of budget amount (%) | Construction progress | Amount of accumulated capitalized interest | Including: capitalized interest for the current period | ||
| Prepaid expenses | 197,400,282.45 | 221,393.58 | 133,370,392.21 | 64,251,283.82 | ||||||||
| Technological transformation project for Moutai flavor liquor series and supporting facilities (6,400 tons) | 3,454,160,000.00 | 38,657,886.81 | 28,641,680.46 | 67,299,567.27 | 55 | 100% | ||||||
| Moutai Huanshan liquor storage area project | 1,602,000,000.00 | 63,605,346.05 | 32,058,971.17 | 86,726,408.66 | 8,937,908.56 | 80 | 100% | |||||
| Phase I Moutai liquor technological transformation project in Zhonghua Area | 3,797,000,000.00 | 3,487,111.66 | 3,487,111.66 | 104 | 100% | |||||||
| “12th Five-Year Plan” expansion and technological transformation project: Phase II Moutai liquor technological transformation project in Zhonghua Area | 2,667,325,000.00 | 109,555,579.84 | 31,181,870.16 | 109,426,929.74 | 31,310,520.26 | 99 | 100% | |||||
| Technological transformation project for the starter-making production room that produces 4,000 tons of Moutai liquor annually in Plot 7 and supporting facilities | 289,000,000.00 | 93 | 100% | |||||||||
| Landslide control, slope protection and anti-sliding support project in the liquor production area between Zhonghua Hengyi Road and Henger Road | 450,000,000.00 | 98,061,623.74 | 91,960,188.09 | 6,101,435.65 | 58 | 100% |
| Hengsi Road (link between Tanmao Express and Zhonghua Area) Project in Zhonghua Area | 356,320,000.00 | 246,738,070.34 | 235,921,809.08 | 10,816,261.26 | 69 | 90% | ||||||
| “13th Five-Year Plan” project for the construction of the first batch of liquor storehouses in Zhonghua Area | 189,000,000.00 | 41 | 100% | |||||||||
| Embankment reinforcement and renovation project in the plant area | 218,210,000.00 | 1,481,132.07 | 1,481,132.07 | 49 | 100% | |||||||
| Upgrading and renovation of the network of pipes for separating clean and dirty water in the old plant area | 199,000,000.00 | 63 | 100% | |||||||||
| No. 4 liquor making workshop maintenance and renovation project | 39,590,000.00 | 1,296,275.23 | 1,296,275.23 | 43 | 100% | |||||||
| Moutai Cultural and Sports Center | 261,000,000.00 | 131,543,467.87 | 5,224,689.66 | 136,768,157.53 | 64 | 100% | ||||||
| Link between Plot 7 and Tanmao Express Road | 28,830,000.00 | 10,873,850.61 | 10,873,850.61 | 81 | 100% | |||||||
| “13th Five-Year Plan” Moutai liquor technological transformation project in Zhonghua Area and supporting facilities | 3,559,000,000.00 | 665,093,144.27 | 248,107,359.05 | 709,623,093.98 | 203,577,409.34 | 57 | 95% | |||||
| Moutai plant water supply network renovation project | 60,100,000.00 | 29,487,939.19 | 1,944,954.12 | 31,432,893.31 | 57 | 90% | ||||||
| 30,000-ton technological transformation project for Moutai flavor liquor series and supporting facilities | 8,384,000,000.00 | 674,837,982.48 | 1,621,224,919.20 | 681,700,000.00 | 1,614,362,901.68 | 45 | 58% | |||||
| Fire station in Tanchang Area and supporting facilities | 84,590,000.00 | 13,071,450.13 | 13,071,450.13 | 51 | 100% |
| Liquor making workshop cooling water recycling project | 430,000,000.00 | 83,082,357.83 | 59,025,806.64 | 142,108,164.47 | 35 | 90% | ||||||
| 3000T/H sewage treatment plant upgrading and renovation in the Dadi Area of Plant 201 | 47,940,000.00 | 22,914,131.90 | 22,914,131.90 | 51 | 90% | |||||||
| Phase I of the packaging logistics park project | 7,833,000,000.00 | 141,509.43 | 141,509.43 | |||||||||
| Upgrading and renovation of the network of pipes for separating clean and dirty water, river dredging and riverbed repair at Plant 301 of Heyixing Liquor Branch | 26,200,000.00 | 4,954,128.43 | 4,954,128.43 | 21 | 35% |
Upgradingandrenovation ofthe network ofpipes forseparatingclean anddirty water inthe Dadi Areaof Plant 201of HeyixingLiquor Branch
| 33,420,000.00 | 7,706,422.00 | 7,706,422.00 | 26 | 40% | ||||||||
| Others | 105,894,050.50 | 342,048,905.41 | 251,655,252.30 | 196,287,703.61 | ||||||||
| Total | 34,009,685,000.00 | 2,447,444,843.03 | 2,432,119,449.25 | 2,557,575,750.46 | 2,321,988,541.82 | / | / |
7.15 Right-of-use asset
√ Applicable □ N/A
Unit: CNY
| Item | Buildings | Machinery and equipment | Total |
| I. Cost | |||
| 1. Opening balance | 525,953,161.51 | 10,328,203.53 | 536,281,365.04 |
| 2. Increase in the current period | 83,679,272.44 | 9,525,145.70 | 93,204,418.14 |
| 3. Decrease in the current period | 198,301,402.36 | 2,142,838.02 | 200,444,240.38 |
| 4. Closing balance | 411,331,031.59 | 17,710,511.21 | 429,041,542.80 |
| II. Accumulated depreciation | |||
| 1. Opening balance | |||
| 2. Increase in the current period | 96,795,992.07 | 4,812,054.11 | 101,608,046.18 |
| 3. Decrease in the current period | 35,173,903.78 | 178,569.83 | 35,352,473.61 |
| 4. Closing balance | 61,622,088.29 | 4,633,484.28 | 66,255,572.57 |
| III. Provision for impairment | |||
| 1. Opening balance | |||
| 2. Increase in the current period | |||
| (1) Provision | |||
| 3. Decrease in the current period | |||
| (1) Disposal | |||
| 4. Closing balance | |||
| IV. Carrying amount | |||
| 1. Carrying amount at the end of the reporting period | 349,708,943.30 | 13,077,026.93 | 362,785,970.23 |
| 2. Carrying amount at the beginning of the reporting period | 525,953,161.51 | 10,328,203.53 | 536,281,365.04 |
7.16 Intangible assets
(1). Intangible assets
√ Applicable □ N/A
Unit: CNY
| Item | Land use rights | Software development fees | Total |
| I. Cost | |||
| 1. Opening balance | 5,463,040,902.80 | 49,294,481.51 | 5,512,335,384.31 |
| 2. Increase in the current period | 1,514,894,351.39 | 377,415.91 | 1,515,271,767.30 |
| (1) Additions | 1,514,894,351.39 | 377,415.91 | 1,515,271,767.30 |
| (2) Internal R&D | |||
| (3) Increase arising from business combination | |||
| 3. Decrease in the current | |||
| period | |||
| (1) Disposal | |||
| 4. Closing balance | 6,977,935,254.19 | 49,671,897.42 | 7,027,607,151.61 |
| II. Accumulated amortization | |||
| 1. Opening balance | 659,517,220.54 | 35,647,181.86 | 695,164,402.40 |
| 2. Increase in the current period | 120,559,705.74 | 3,524,713.23 | 124,084,418.97 |
| (1) Provision | 120,559,705.74 | 3,524,713.23 | 124,084,418.97 |
| 3. Decrease in the current period | |||
| (1) Disposal | |||
| 4. Closing balance | 780,076,926.28 | 39,171,895.09 | 819,248,821.37 |
| III. Provision for impairment | |||
| 1. Opening balance | |||
| 2. Increase in the current period | |||
| (1) Provision | |||
| 3. Decrease in the current period | |||
| (1) Disposal | |||
| 4. Closing balance | |||
| IV. Carrying amount | |||
| 1. Carrying amount at the end of the reporting period | 6,197,858,327.91 | 10,500,002.33 | 6,208,358,330.24 |
| 2. Carrying amount at the beginning of the reporting period | 4,803,523,682.26 | 13,647,299.65 | 4,817,170,981.91 |
(2). Land use rights of which certificates of title have not been obtained
√ Applicable □ N/A
Unit: CNY
| Item | Carrying amount | Reasons why certificates of title have not been obtained |
| Moutai Huanshan liquor storage area project | 144,000,000.00 | In procedure |
| Phase I and phase II Moutai liquor technological transformation project in Zhonghua Area | 2,108,400,462.64 | In procedure |
| Second phase of the “12th Five Year Plan” 10,000 ton Moutai liquor project (2012): technical transformation project that added 2,500 tons of Moutai liquor production capacity | 330,000,000.00 | In procedure |
| Maoyuan Road construction and Plot 5 liquor storehouse construction project | 363,071,300.00 | In procedure |
| Technological transformation project for the starter-making production room in Plot 7 and supporting facilities | 250,000,000.00 | In procedure |
| The first batch of construction projects in Tanchang Area of the circular economy science and technology demonstration park | 428,000,000.00 | In procedure |
| Technological transformation project for Moutai flavor liquor series and supporting facilities | 352,681,578.55 | In procedure |
| 2,000-ton Moutai Prince technological transformation project and 2,800-ton Moutai Prince technological transformation project | 30,000,000.00 | In procedure |
| “13th Five-Year Plan” Moutai liquor technological transformation project in Zhonghua Area and supporting facilities | 215,259,100.00 | In procedure |
| 30,000-ton technological transformation project for Moutai flavor liquor series and supporting facilities | 841,671,558.95 | Under construction |
| Moutai international hotel construction project | 673,430,000.00 | In procedure |
7.17 Long-term prepaid expenses
√ Applicable □ N/A
Unit: CNY
| Item | Opening balance | Increase in the current period | Other reductions | Closing balance | |
| Zhongshu Urban Area - Moutai Road reconstruction project | 147,500,000.21 | 9,999,999.96 | 137,500,000.25 | ||
| Cost of major repairs to fixed assets | 221,526.22 | 1,238,679.26 | 473,849.77 | 986,355.71 | |
| Office fit out cost | 1,070,124.90 | 214,025.04 | 856,099.86 | ||
| Total | 147,721,526.43 | 2,308,804.16 | 10,687,874.77 | 139,342,455.82 |
Note: The company and Renhuai Urban Development, Construction, Investment and Operation Co., Ltd.jointly completed transfer and amortization for the Zhongshu Urban Area - Moutai Road reconstructionproject according to the resolution of the third meeting of the second board of directors in 2013.
7.18 Deferred tax assets/deferred tax liabilities
(1). Deferred tax assets before offset
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance | ||
| Deductible temporary differences | Deferred tax assets | Deductible temporary differences | Deferred tax assets | |
| Provision for impairment of assets | 66,916,641.87 | 16,729,160.47 | 55,903,585.82 | 13,975,896.46 |
| Unrealized profit of internal transactions | 6,303,346,118.88 | 1,575,836,529.72 | 2,342,118,180.24 | 585,529,545.06 |
| Accrued but unpaid achievements-related wages | 214,872,045.38 | 53,718,011.35 | 214,872,045.38 | 53,718,011.35 |
| Others | 2,363,690,969.19 | 590,922,742.30 | 1,880,006,533.97 | 470,001,633.50 |
| Total | 8,948,825,775.32 | 2,237,206,443.84 | 4,492,900,345.41 | 1,123,225,086.37 |
(2). Deferred tax liabilities before offset
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance | ||
| Taxable temporary | Deferred tax | Taxable temporary | Deferred tax liabilities | |
| differences | liabilities | differences | ||
| Assets appreciation arising from business combination not under common control | ||||
| Changes in fair value of other debt investments | ||||
| Changes in fair value of in other equity instruments investments | ||||
| Changes in fair value of other non-current financial assets | 5,830,052.91 | 1,457,513.23 | ||
| Total | 5,830,052.91 | 1,457,513.23 |
(3). Deferred tax assets or liabilities presented at the net amount after offset
□ Applicable √ N/A
(4). Unrecognized deferred tax assets
□ Applicable √ N/A
(5). Deductible losses for which deferred tax assets are not recognized will be expired in thefollowing year
□ Applicable √ N/A
7.19 Other non-current assets
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance | ||||
| Book balance | Provision for impairment | Carrying amount | Book balance | Provision for impairment | Carrying amount | |
| Contract acquisition cost | ||||||
| Contract performance cost | ||||||
| Return cost receivable | ||||||
| Contract assets | ||||||
| Certificates of deposit | 2,059,761,333.33 | 2,059,761,333.33 | ||||
| Total | 2,059,761,333.33 | 2,059,761,333.33 | ||||
7.20 Accounts payable
(1). Presentation of accounts payable
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Trade accounts payable | 2,009,832,495.56 | 1,342,267,668.12 |
| Total | 2,009,832,495.56 | 1,342,267,668.12 |
7.21 Contract liabilities
(1). Contract liabilities
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Prepayments | 12,718,465,288.02 | 13,321,549,147.69 |
| Total | 12,718,465,288.02 | 13,321,549,147.69 |
7.22 Customer deposits and balances from banks and other financial institutions
Unit: CNY
| Item | Closing balance | Opening balance |
| Customer deposits | 21,763,575,647.32 | 14,241,859,949.77 |
| Total | 21,763,575,647.32 | 14,241,859,949.77 |
7.23 Payroll and employee benefits payable
(1). Presentation of payroll and employee benefits payable
√ Applicable □ N/A
Unit: CNY
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| I. Short-term benefits | 2,913,327,473.61 | 9,590,272,175.88 | 8,828,323,955.46 | 3,675,275,694.03 |
| II. Post-employment benefits – Defined contribution plan | 67,754,030.25 | 1,334,433,592.43 | 1,399,631,419.95 | 2,556,202.73 |
| III. Termination benefits | 44,000.00 | 23,539,812.68 | 23,569,990.91 | 13,821.77 |
| Total | 2,981,125,503.86 | 10,948,245,580.99 | 10,251,525,366.32 | 3,677,845,718.53 |
(2). Presentation of short-term benefits
√ Applicable □ N/A
Unit: CNY
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| I. Wages or salaries, bonuses, allowances and subsidies | 2,850,160,827.76 | 7,809,070,214.14 | 7,048,507,477.75 | 3,610,723,564.15 |
| II. Staff welfare | 262,186,601.48 | 262,150,146.28 | 36,455.20 | |
| III. Social security contributions | 44,906,932.03 | 712,049,379.23 | 721,269,656.87 | 35,686,654.39 |
| Including: Medical insurance | 42,487,600.55 | 670,551,507.08 | 677,354,054.02 | 35,685,053.61 |
| Work injury insurance | 2,419,331.48 | 41,497,872.15 | 43,915,602.85 | 1,600.78 |
| IV. Housing funds | 28,716.00 | 625,836,484.57 | 625,865,200.57 | |
| V. Labor union and employee education costs | 18,230,997.82 | 159,114,141.49 | 150,130,150.32 | 27,214,988.99 |
| VI. Short-term paid leave | ||||
| VII. Short-term profit-sharing plan | ||||
| Ⅷ. Others | 22,015,354.97 | 20,401,323.67 | 1,614,031.30 | |
| Total | 2,913,327,473.61 | 9,590,272,175.88 | 8,828,323,955.46 | 3,675,275,694.03 |
Note: “Others” is labor remuneration.
(3). Defined contribution plan
√ Applicable □ N/A
Unit: CNY
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| 1. Basic pension insurance | 57,703,888.44 | 804,095,643.58 | 861,707,086.62 | 92,445.40 |
| 2. Unemployment insurance | 2,523,534.73 | 35,105,421.07 | 37,626,810.21 | 2,145.59 |
| 3. Enterprise annuity | 7,526,607.08 | 495,232,527.78 | 500,297,523.12 | 2,461,611.74 |
| Total | 67,754,030.25 | 1,334,433,592.43 | 1,399,631,419.95 | 2,556,202.73 |
7.24 Taxes payable
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Value added tax | 1,933,633,784.18 | 1,643,379,279.88 |
| Consumption tax | 4,123,882,929.27 | 4,459,274,304.55 |
| Enterprise income tax | 5,254,498,943.15 | 2,424,108,672.50 |
| Individual income tax | 84,112,032.43 | 33,289,158.95 |
| City construction and maintenance tax | 343,737,264.76 | 215,690,203.31 |
| Education surcharges | 135,636,926.73 | 80,876,611.91 |
| Local education surcharges | 91,717,665.75 | 55,207,436.90 |
| Stamp duty | 11,280,516.53 | 6,963,385.30 |
| Property tax | 721,095.74 | 1,018,686.72 |
| Land use tax | 9,420.06 | 13,275.56 |
| Others | 571,565.41 | |
| Total | 11,979,802,144.01 | 8,919,821,015.58 |
7.25 Other payables
Presentation of items
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Interest payable | ||
| Dividends payable | ||
| Other payables | 4,124,404,781.29 | 3,257,245,259.42 |
| Total | 4,124,404,781.29 | 3,257,245,259.42 |
Other payables
(1). Other payables presented by nature
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Material quality deposit | 286,891,441.71 | 276,381,894.05 |
| Project quality deposit | 103,727,351.31 | 122,107,035.45 |
| Dealer deposit | 2,016,098,008.20 | 1,636,956,073.84 |
| Current Account | 1,717,687,980.07 | 1,221,800,256.08 |
| Total | 4,124,404,781.29 | 3,257,245,259.42 |
(2). Significant other payables aged over 1 year
□ Applicable √ N/A
Others:
□ Applicable √ N/A
7.26 Current portion of non-current liabilities
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Lease liabilities due within one year | 104,319,886.87 | 121,378,096.65 |
| Total | 104,319,886.87 | 121,378,096.65 |
7.27 Other current liabilities
Other current liabilities
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Pending output VAT | 1,535,976,293.22 | 1,609,801,368.51 |
| Total | 1,535,976,293.22 | 1,609,801,368.51 |
7.28 Lease liabilities
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Long-term lease liabilities | 296,466,199.74 | 414,903,268.39 |
| Total | 296,466,199.74 | 414,903,268.39 |
7.29 Paid-in capital
√ Applicable □ N/A
Unit: CNY
| Opening balance | Changes in the current period (+, -) | Closing balance | |||||
| New shares issued | Share donation | Capitalization of capital reserve | Others | Subtotal | |||
| Number of shares | 1,256,197,800.00 | 1,256,197,800.00 | |||||
7.30 Capital reserve
√ Applicable □ N/A
Unit: CNY
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| Capital premium | 1,374,048,653.54 | 1,374,048,653.54 | ||
| Other capital reserves | 915,762.18 | 915,762.18 | ||
| Total | 1,374,964,415.72 | 1,374,964,415.72 |
7.31 Other comprehensive income
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Closing balance | ||||||
| Amount incurred before income tax in the current period | Less: Amount included in other comprehensive income in the prior | Less: Amount included in other comprehensive income in the prior | Less: Income tax expenses | Attributable to the Company after tax | Attributable to minority interests after tax | |||
| periods that is transferred to profit or loss for the current period | periods that is transferred to retained earnings for the current period | |||||||
| I. Other comprehensive income that cannot be reclassified to profit or loss | ||||||||
| Including: Remeasurement of changes in defined benefit plan | ||||||||
| Other comprehensive income that cannot be transferred to profit or loss under equity method | ||||||||
| Changes in fair value of in other equity instruments investments | ||||||||
| Changes in fair value of the Company’s own credit risk | ||||||||
| II. Other comprehensive | -5,331,367.75 | -7,686,513.03 | -7,686,513.03 | -13,017,880.78 |
| income to be reclassified to profit or loss | ||||||||
| Including: Other comprehensive income that may be transferred to profit or loss under equity method | ||||||||
| Changes in fair value of other debt investments | ||||||||
| Amount of financial assets reclassified to other comprehensive income | ||||||||
| Provision for credit impairment of other debt investments | ||||||||
| Cash flow hedging reserves | ||||||||
| Exchange differences on translation of foreign currency financial statements | -5,331,367.75 | -7,686,513.03 | -7,686,513.03 | -13,017,880.78 | ||||
| Total other comprehensive income | -5,331,367.75 | -7,686,513.03 | -7,686,513.03 | -13,017,880.78 |
7.32 Surplus reserve
√ Applicable □ N/A
Unit: CNY
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| Statutory surplus reserve | 20,174,922,608.93 | 4,967,910,209.23 | 25,142,832,818.16 | |
| Discretionary surplus reserve | ||||
| Reserve fund | ||||
| Enterprise development fund | ||||
| Others | ||||
| Total | 20,174,922,608.93 | 4,967,910,209.23 | 25,142,832,818.16 |
7.33 General risk reserve
Unit: CNY
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| General risk reserve | 927,577,822.67 | 133,951,901.33 | 1,061,529,724.00 | |
| Total | 927,577,822.67 | 133,951,901.33 | 1,061,529,724.00 |
Note: The general risk reserve was set aside by Kweichow Moutai Group Finance Co., Ltd., amajority-owned subsidiary of the Company, in accordance with the provisions of the Measures for theAdministration of the Setting Aside of Reserves for Financial Enterprises (Cai Jin [2012] No. 20)promulgated by the Ministry of Finance.
7.34 Retained earnings
√ Applicable □ N/A
Unit: CNY
| Item | Current period | Prior period |
| Before adjustment: retained earnings of the prior period | 137,594,403,807.99 | 115,892,337,407.39 |
| Adjustment: Total retained earnings at the beginning of the reporting period (increase “+”, decrease “-”) | ||
| After adjustment: retained earnings at the beginning of the reporting period | 137,594,403,807.99 | 115,892,337,407.39 |
| Add: Net profit attributable to owners of the Company for the current period | 52,460,144,378.16 | 46,697,285,429.81 |
| Less: Transfer to statutory surplus reserve | 4,967,910,209.23 | 3,579,223,571.91 |
| Transfer to discretionary surplus reserve | ||
| Transfer to general risk reserve | 133,951,901.33 | 29,227,885.90 |
| Declaration of dividends on ordinary shares | 24,235,824,155.40 | 21,386,767,571.40 |
| Conversion of ordinary shares’ dividends into share capital | ||
| Retained earnings at the end of the reporting period | 160,716,861,920.19 | 137,594,403,807.99 |
7.35 Operating proceeds and costs of sales
(1). Operating proceeds and costs of sales
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period | ||
| Revenue | Cost | Revenue | Cost | |
| Main | 106,059,290,342.18 | 8,890,990,510.72 | 94,821,999,102.45 | 8,083,371,418.24 |
| business | ||||
| Others | 130,864,501.58 | 92,387,299.24 | 93,381,814.27 | 70,630,058.04 |
| Total | 106,190,154,843.76 | 8,983,377,809.96 | 94,915,380,916.72 | 8,154,001,476.28 |
Note: Other operating proceeds and costs are mainly the revenue and costs of Moutai InternationalHotel.
(2). Description of contractual obligations
√ Applicable □ N/A
Revenue is recognized when the customer obtains control of the goods specified in the contract and theCompany fulfills its obligations under the contract.
(3). Description of apportionment to remaining contractual obligations
√ Applicable □ N/A
The amount of revenue corresponding to contractual obligations that have not yet been performed orhave not been fulfilled at the end of the reporting period is CNY 12,718,465,288.02.
7.36 Interest income, interest expense, net fee and commission revenue, and fees and commissionexpenses
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period |
| Interest income | 3,274,123,720.13 | 3,077,859,584.49 |
| Fees and commission revenue | ||
| Interest expense | 173,897,197.98 | 111,128,537.31 |
| Fees and commission expense | 115,082.12 | 105,888.96 |
7.37 Taxes and surcharges
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period |
| Consumption tax | 12,056,605,155.34 | 10,958,391,087.32 |
| City maintenance and construction tax | 1,734,297,928.93 | 1,574,078,013.46 |
| Education surcharges | 743,270,540.94 | 670,869,561.91 |
| House property tax | 158,049,318.08 | 142,475,530.38 |
| Land use tax | 38,625,999.87 | 34,836,782.87 |
| Vehicle and vessel usage tax | 393,682.35 | 269,578.61 |
| Stamp duty | 75,936,478.31 | 58,095,473.30 |
| Local education surcharges | 495,513,694.19 | 447,326,056.68 |
| Environmental protection tax | 187,817.17 | 175,206.25 |
| Others | 1,588,454.85 | |
| Total | 15,304,469,070.03 | 13,886,517,290.78 |
7.38 Selling expenses
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period |
| Advertising and marketing expenses | 2,362,973,054.42 | 2,189,674,995.48 |
| Transportation expenses and | 15,581,555.64 | 12,762,118.95 |
| transportation insurance expenses | ||
| Marketing travel expenses and office expenses | 65,584,708.40 | 56,919,357.36 |
| Others | 293,230,116.32 | 288,389,179.16 |
| Total | 2,737,369,434.78 | 2,547,745,650.95 |
7.39 General and administrative expenses
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period |
| Payroll and employee benefits | 3,964,469,622.29 | 3,279,447,243.22 |
| Trademark licensing fees | 1,332,728,678.71 | 1,195,642,243.60 |
| Depreciation on fixed assets | 394,652,013.52 | 371,103,457.14 |
| Environmental remediation expenses | 125,256,351.95 | 76,743,481.36 |
| Company expenses | 186,406,218.53 | 176,360,506.15 |
| Amortization of intangible assets | 124,084,418.97 | 110,349,099.00 |
| Property insurance | 62,245,135.74 | 60,322,596.02 |
| Raw material base expenses | 228,662,175.32 | 179,552,860.11 |
| Rent for the use of property | 20,126,797.76 | 22,870,672.67 |
| Business reception expenses | 9,841,359.31 | 9,973,302.25 |
| Intermediary expenses | 28,716,580.54 | 21,222,461.03 |
| Rent for the use of land | 2,636,686.30 | 4,361,551.06 |
| Board expenses | 4,722,307.27 | 3,815,997.52 |
| Others | 1,965,725,718.82 | 1,278,078,818.26 |
| Total | 8,450,274,065.03 | 6,789,844,289.39 |
7.40 R&D expenses
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period |
| Payroll and employee benefits | 22,645,218.77 | 20,873,377.72 |
| Consumable | 4,300,483.79 | 3,971,325.60 |
| R&D cooperation expenses | 26,605,729.70 | 19,270,124.21 |
| Depreciation on fixed assets | 4,758,510.21 | 5,122,301.55 |
| Company expenses | 1,898,827.45 | 318,214.08 |
| Others | 1,714,443.67 | 842,693.17 |
| Total | 61,923,213.59 | 50,398,036.33 |
7.41 Financial expenses
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period |
| Interest expense (lease liabilities) | 13,529,867.76 | |
| Interest income | -944,578,412.02 | -278,697,733.32 |
| Others | -3,474,861.76 | 44,087,150.88 |
| Total | -934,523,406.02 | -234,610,582.44 |
7.42 Other income
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred | Amount |
| in the current period | ||
| Financial support for the economic development of Shanghai Pudong New Area | 4,677,000.00 | 2,794,000.00 |
| Incentives given by Jinan municipal government for innovation and development | 2,630,000.00 | 2,010,000.00 |
| Incentives given by Changsha Municipal Development and Reform Bureau to support industrial development | 2,030,000.00 | |
| Incentives for key enterprises given by Beijing Xicheng District Development and Reform Commission | 1,200,000.00 | |
| Funds earmarked by Guiyang Municipal Bureau of Commerce for foreign economic and trade development | 300,000.00 | |
| Funds earmarked by Nanning Municipal Bureau of Commerce for service industry development | 240,000.00 | |
| Incentives given by Guiyang city to support the stable development of above-norm wholesale, retail and catering enterprises in response to COVID-19 and encourage them to reach their design capacity and increase efficiency | 200,000.00 | |
| Incentives given by Taohua town government of Xihu District, Nanchang | 190,000.00 | |
| Town-level financial incentives given by Nanchang city | 35,000.00 | |
| Incentives for “four above” enterprises given by Zhengzhou city | 80,000.00 | |
| Incentives for best progressive enterprises given by the bureau of commerce of Chaoyang District, Changchun | 80,000.00 | |
| Incentives given by Wuhan city to encourage enterprises to meet retail sales targets and go above the norm | 80,000.00 | |
| “Sales competition month” incentives and incentives for “four above” enterprises given by Gulou District, Nanjing | 61,000.00 | |
| Nanning city’s support for the development of above-norm commercial and trade enterprises and other for-profit service industries above designated size | 50,000.00 | |
| District-level incentives for high quality development given by Hefei city | 30,000.00 | |
| Grants for COVID-19 prevention and control | 20,000.00 | |
| Funds earmarked by Changsha city for guiding service industries | 20,000.00 | |
| Incentives for contributions given by Beijing Xicheng District Government | 1,000,000.00 | |
| Subsidies given by Guizhou Provincial Department of Commerce for increases in imports and exports | 767,000.00 | |
| Rent subsidies given by the investment attraction service center of Guanshanhu District, Guiyang | 500,000.00 | |
| Incentives given by Jinan Municipal Bureau of Commerce to promote trade during the pandemic | 100,000.00 | |
| Incentives for for-profit service industries given by Nanning city | 50,000.00 | |
| Incentives given by Shanxi Yangqu Industrial Park for outstanding contributions | 50,000.00 | |
| Incentives given by the bureau of commerce of Guanshanhu District, Guiyang | 50,000.00 | |
| Training grants given by Guiyang Employment and Vocational Skills Development Center | 11,500.00 | |
| Refund of service charges for withholding individual income tax | 8,537,082.76 | 5,805,652.69 |
| Additional value-added tax credit | 55,828.43 | |
| Total | 20,515,911.19 | 13,138,152.69 |
7.43 Investment income
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period |
| Income from long-term equity investments under equity method | ||
| Investment income on disposal of long-term equity investments | 237,455.55 | |
| Investment income from holding held-for-trading financial assets | ||
| Dividend income from holding investments in other equity instruments | ||
| Interest income from holding debt investments | ||
| Interest income from holding other debt investments | ||
| Investment income from disposal of held-for-trading financial assets | ||
| Investment income from disposal of investments in other equity instruments | ||
| Investment income from disposal of debt investments | ||
| Investment income from disposal of other debt investments | ||
| Income from debt restructuring | ||
| Investment income from disposal of other non-current financial assets | -1,505,395.94 | 68,175.91 |
| Interest income from holding certificates of deposit | 59,761,333.33 | |
| Total | 58,255,937.39 | 305,631.46 |
7.44 Gains from changes in fair value
√ Applicable □ N/A
Unit: CNY
| Source resulting in gains from changes in fair values | Amount incurred in the current period | Amount incurred in the prior period |
| Held-for-trading financial assets | ||
| Including: Gains from changes in fair values arising from derivatives | ||
| Held-for-trading financial liabilities | ||
| Investment properties carried at fair value | ||
| Other non-current financial assets | -2,244,726.29 | 4,897,994.43 |
| Total | -2,244,726.29 | 4,897,994.43 |
7.45 Credit impairment losses
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period |
| Bad debt provision of notes receivable | ||
| Bad debt provision of accounts receivable | 47,413.76 | |
| Bad debt provision of other receivables | 134,900.04 | 3,060,659.45 |
| Impairment on debt investments | -84,510.00 | -11,880.00 |
| Impairment on other debt investments | ||
| Bad debt provision of long-term |
| receivables | ||
| Impairment on contract assets | ||
| Others | -13,120,244.99 | -74,420,589.30 |
| Total | -13,022,441.19 | -71,371,809.85 |
Note: “Others” is mainly the provision for impairment of loans issued by the company’smajority-owned subsidiary Kweichow Moutai Group Finance Co., Ltd.
7.46 Non-operating income
Non-operating income
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period | Amount included in non-recurring profit or loss in the current period |
| Total gains on disposal of non-current assets | 3,437.33 | 13,939.82 | 3,437.33 |
| Including: Gains on disposal of fixed assets | 3,437.33 | 13,939.82 | 3,437.33 |
| Gains on disposal of intangible assets | |||
| Gains on exchange of non-monetary assets | |||
| Donations received | |||
| Government grants | |||
| Gains on fines and damages | 66,338,633.29 | 5,853,430.16 | 66,338,633.29 |
| Others | 2,647,149.12 | 5,183,766.17 | 2,647,149.12 |
| Total | 68,989,219.74 | 11,051,136.15 | 68,989,219.74 |
7.47 Non-operating costs
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period | Amount included in non-recurring profit or loss in the current period |
| Total losses on disposal of non-current assets | 11,924,267.10 | 114,053.74 | 11,924,267.10 |
| Including: Losses on disposal of fixed assets | 11,924,267.10 | 114,053.74 | 11,924,267.10 |
| Losses on disposal of intangible assets | |||
| Losses on exchange of non-monetary assets | |||
| Donations to third parties | 271,167,088.19 | 443,979,504.00 | 271,167,088.19 |
| Amercement outlay | 200,000.00 | 200,000.00 | |
| Others | 8,546,747.21 | 5,095,469.68 | 8,546,747.21 |
| Total | 291,838,102.50 | 449,189,027.42 | 291,838,102.50 |
7.48 Income tax expense
(1). Income tax expenses
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period |
| Current tax expenses | 19,922,940,809.01 | 16,768,125,335.29 |
| Deferred tax expenses | -1,115,438,870.71 | -94,513,226.58 |
| Total | 18,807,501,938.30 | 16,673,612,108.71 |
(2). Reconciliation of income tax expenses to the accounting profit
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period |
| Total profit | 74,528,031,894.76 |
| Income tax expenses calculated at statutory/applicable tax rate | 18,632,007,973.69 |
| Effect of different tax rates applicable to subsidiaries | 123,348.19 |
| Effect of adjustment to income tax of prior periods | |
| Effect of non-taxable income | |
| Effect of non-deductible costs, expenses and losses | 175,756,116.42 |
| Effect of using deductible losses for which deferred tax assets were previously not recognized | -385,500.00 |
| Effect of deductible temporary differences or deductible losses unrecognized in the current period | |
| Income tax expense | 18,807,501,938.30 |
Others:
□ Applicable √ N/A
7.49 Other comprehensive income
√ Applicable □ N/A
See Note 31 Other Comprehensive Income for details
7.50 Items of the cash flow statement
(1). Cash received relating to other operating activities
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period |
| Interest income from self-owned funds | 549,608,351.20 | 53,004,711.11 |
| Other income received | 1,093,928,511.28 | 168,416,515.52 |
| Total | 1,643,536,862.48 | 221,421,226.63 |
(2). Cash paid relating to other operating activities
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period |
| Advertising and publicity expenses paid | 1,047,792,182.25 | 1,192,070,830.64 |
| Transportation expenses and transportation insurance expenses paid | 238,511,859.13 | 363,860,058.26 |
| Property insurance premiums paid | 56,151,552.10 | 74,790,069.53 |
| Other expenses paid | 3,026,048,912.52 | 2,416,305,228.03 |
| Total | 4,368,504,506.00 | 4,047,026,186.46 |
(3). Cash received relating to other investing activities
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current | Amount incurred in the prior |
| period | period | |
| Performance bond received for capital construction | 9,983,452.63 | 6,675,319.03 |
| Total | 9,983,452.63 | 6,675,319.03 |
(4). Cash paid relating to other investing activities
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period |
| Refunded performance bond for capital construction | 23,048,029.93 | 17,535,402.30 |
| Total | 23,048,029.93 | 17,535,402.30 |
(5). Cash payments relating to other financing activities
√ Applicable □ N/A
Unit: CNY
| Item | Amount incurred in the current period | Amount incurred in the prior period |
| Amount paid to repay lease liabilities | 88,121,549.59 | |
| Disposal of equity interests in Tier-3 subsidiaries | 32,000,000.00 | |
| Acquisition of minority shareholders equity interests in subsidiaries | 4,507,157.75 | |
| Total | 88,121,549.59 | 36,507,157.75 |
7.51 Supplementary information to the cash flow statement
(1). Supplementary information to the cash flow statement
√ Applicable □ N/A
Unit: CNY
| Supplementary information | Current period | Prior period |
| 1．Reconciliation of net profit to cash flow from operating activities: | ||
| Net profit | 55,720,529,956.46 | 49,523,329,882.40 |
| Add: Provision for impairment losses of assets | ||
| Credit impairment losses | 13,022,441.19 | 71,371,809.85 |
| Depreciation of fixed assets, depletion of oil and gas assets, depreciation of productive biological assets | 1,344,833,911.39 | 1,195,956,468.60 |
| Amortization of right-of-use assets | 101,608,046.18 | |
| Amortization of intangible assets | 124,084,418.97 | 110,349,099.00 |
| Amortization of long-term prepaid expenses | 10,687,874.77 | 10,562,811.76 |
| Losses on disposal of fixed assets, intangible assets and other long-term assets (gains are indicated by “－”) | ||
| Losses on retirement of fixed assets (gains are indicated by “－”) | 11,920,829.77 | 100,113.92 |
| Losses on changes in fair values (gains are indicated by “－”) | 2,244,726.29 | -4,897,994.43 |
| Financial expenses (income is indicated by “－”) | 13,529,867.76 | |
| Losses arising from investments (gains are indicated by “－”) | -58,255,937.39 | -305,631.46 |
| Decrease in deferred tax assets (increase is indicated by “－”) | -1,113,981,357.47 | -23,278,138.80 |
| Increase in deferred tax liabilities (decrease is indicated by “－”) | -1,457,513.23 | -71,235,087.78 |
| Decrease in inventories (increase is indicated by “－”) | -4,525,277,406.77 | -3,584,166,871.73 |
| Decrease in receivables from operating activities (increase is indicated by “－”) | 504,305,749.89 | -504,008,375.44 |
| Increase in payables from operating activities (decrease is indicated by “－”) | 11,880,880,539.56 | 4,945,290,607.14 |
| Others | ||
| Net cash flow from operating activities | 64,028,676,147.37 | 51,669,068,693.03 |
| 2．Significant investing and financing activities that do not involve cash receipts and payments: | ||
| Conversion of debt into capital | ||
| Convertible bonds due within one year | ||
| Fixed assets acquired under finance leases | ||
| 3．Net changes in cash and cash equivalents: | ||
| Closing balance of cash | 178,640,587,379.52 | 146,740,524,868.05 |
| Less: Opening balance of cash | 146,740,524,868.05 | 121,003,839,599.64 |
| Add: Closing balance of cash equivalents | ||
| Less: Opening balance of cash equivalents | ||
| Net increase in cash and cash equivalents | 31,900,062,511.47 | 25,736,685,268.41 |
(2). Composition of cash and cash equivalents
√ Applicable □ N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| I. Cash | 178,640,587,379.52 | 146,740,524,868.05 |
| Including: Cash on hand | 9,500.00 | 9,554.00 |
| Bank balances | 42,099,344,994.22 | 27,989,073,619.13 |
| Other monetary funds | ||
| Deposits with the central bank | 2,705,674,089.61 | 1,054,398,626.03 |
| Deposits with other banks | 133,835,558,795.69 | 117,697,043,068.89 |
| Placements with banks | ||
| II. Cash equivalents | ||
| Including: Investments in debt securities due within three months | ||
| III. Closing balance of cash and cash equivalents | 178,640,587,379.52 | 146,740,524,868.05 |
| Including: Restricted cash and cash equivalents of the Company and subsidiaries within the Group |
Others:
□ Applicable √ N/A
7.52 Notes to items in the statement of changes in owners’ equity
Describe matters such as the names and the adjustment amount of the items included in “others” inrespect of adjustments to the closing balances of the prior reporting period:
□ Applicable √ N/A
7.53 Assets with restricted ownership or right-of-use
√ Applicable □ N/A
Unit: CNY
| Item | Carrying amount at the end of the reporting period | Reasons of restriction |
| Cash and Cash equivalents | 6,381,004,565.81 | Cash and Cash equivalents deposited in the central bank’s statutory deposit reserve |
| Loans to banks and other financial institutions | 1,000,000,000.00 | Interbank deposits that cannot be withdrawn in advance |
| Total | 7,381,004,565.81 | / |
7.54 Foreign currency monetary items
(1). Foreign currency monetary items
√ Applicable □ N/A
Unit: CNY
| Item | Closing balances of foreign currencies | Exchange rates for translation | Closing balance of RMB |
| Cash and Cash equivalents | |||
| Including: USD | |||
| EUR | 2,862,408.82 | 7.2197 | 20,665,732.96 |
| HKD |
(2). Description of foreign operations: for significant foreign operations, major domicile and
functional currency and its basis of selection shall be disclosed, and reasons for foreignoperations changing their functional currencies shall also be disclosed.
√ Applicable □ N/A
The Company’s wholly-owned subsidiary, Kweichow Moutai Paris Trading, is registered in Paris,France, and its functional currency is Euro.
7.55 Government grants
(1). Basic information of government grants
√ Applicable □ N/A
Unit: CNY
| Category | Amount | Presenting items | Amount included in profit or loss |
| Financial support for the economic development of Shanghai Pudong New Area | 4,677,000.00 | Other income | 4,677,000.00 |
| Incentives given by Jinan municipal government for innovation and development | 2,630,000.00 | Other income | 2,630,000.00 |
| Incentives given by Changsha Municipal Development and Reform Bureau to support industrial development | 2,030,000.00 | Other income | 2,030,000.00 |
| Incentives for key enterprises given by Beijing Xicheng District Development and Reform Commission | 1,200,000.00 | Other income | 1,200,000.00 |
| Funds earmarked by Guiyang Municipal Bureau of Commerce for foreign economic and trade development | 300,000.00 | Other income | 300,000.00 |
| Funds earmarked by Nanning Municipal Bureau of Commerce for service industry development | 240,000.00 | Other income | 240,000.00 |
| Incentives given by Guiyang city to support the stable development of above-norm wholesale, retail and catering enterprises in response to COVID-19 and encourage them to reach their design capacity and increase efficiency | 200,000.00 | Other income | 200,000.00 |
| Incentives given by Taohua town government of Xihu District, Nanchang | 190,000.00 | Other income | 190,000.00 |
| Town-level financial incentives given by Nanchang city | 35,000.00 | Other income | 35,000.00 |
| Incentives for “four above” enterprises given by Zhengzhou city | 80,000.00 | Other income | 80,000.00 |
| Incentives for best progressive enterprises given by the bureau of commerce of Chaoyang District, Changchun | 80,000.00 | Other income | 80,000.00 |
| Incentives given by Wuhan city to encourage enterprises to meet retail sales targets and go above | 80,000.00 | Other income | 80,000.00 |
| the norm | |||
| “Sales competition month” incentives and incentives for “four above” enterprises given by Gulou District, Nanjing | 61,000.00 | Other income | 61,000.00 |
| Nanning city’s support for the development of above-norm commercial and trade enterprises and other for-profit service industries above designated size | 50,000.00 | Other income | 50,000.00 |
| District-level incentives for high quality development given by Hefei city | 30,000.00 | Other income | 30,000.00 |
| Grants for COVID-19 prevention and control | 20,000.00 | Other income | 20,000.00 |
| Funds earmarked by Changsha city for guiding service industries | 20,000.00 | Other income | 20,000.00 |
(2). Return of government grants
□ Applicable √ N/A
8. Equity in other entities
8.1 Equity in subsidiaries
A. Composition of the Group
√Applicable □N/A
| Subsidiary | Main place of business | Place of registration | Business nature | Shareholding ratio | method | |
| Directly | Indirectly | |||||
| GUIZHOU MOUTAI CHIEW IMPORT AND EXPORT CO., LTD. | Guiyang, Guizhou | 70 | Investment | |||
| Kweichow Moutai Sales Co., Ltd. | Renhuai, Guizhou | 95 | Investment | |||
| Kweichow Moutai Group Finance Co., Ltd. | Renhuai, Guizhou | 51 | Investment | |||
| Moutai Custom Marketing (Guizhou) Co., Ltd. | Guiyang, Guizhou | 70 | Investment | |||
| Beijing Friendship Messenger Trading Co., Ltd. | Beijing | 70 | Investment | |||
| Kweichow Moutai Paris Trading | Paris, France | 100 | Investment | |||
| Guizhou Laymau Wine Industry Co., Ltd. | Guiyang, Guizhou | 43 | Investment | |||
| Kweichow Moutai-Flavor Liquor Marketing Co., Ltd. | Renhuai, Guizhou | 100 | Investment | |||
The basis for holding half or less voting rights but still controlling the investee, and holding more thanhalf of the voting rights but not controlling the investee:
The Company holds 43% of the equity in Guizhou Laymau Wine Industry Co., Ltd., but may actuallycontrol this company, in that the Company has a majority of the board members in Guizhou LaymauWine Industry Co., Ltd..
B. important non-wholly owned subsidiaries
√Applicable □N/A
Unit: CNY
| Subsidiary | Shareholding of minority shareholders | Profit and loss attributable to minority | Dividends declared and distributed to minority | Closing balance of minority shareholders’ |
| proportion | shareholders in the current period | shareholders in the current period | equity for the period | |
| Kweichow Moutai Sales Co., Ltd. | 5% | 2,401,959,199.09 | 2,124,324,789.09 | 2,839,006,474.21 |
Explanation of the difference between the shareholding proportion of minority shareholders and thevoting right proportion of subsidiaries:
√Applicable □N/A
Others:
√Applicable □N/A
C. Major financial information of significant non-wholly owned subsidiaries
√Applicable □N/A
Unit: CNY 10,000
| Subsidiary | Closing balance | Opening balance | ||||||||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | |
| Kweichow Moutai Sales Co., Ltd. | 7,588,967.01 | 62,919.92 | 7,651,886.93 | 1,968,312.40 | 5,561.59 | 1,973,873.99 | 7,829,326.95 | 47,568.47 | 7,876,895.42 | 2,754,151.29 | 2,754,151.29 | |
9. Risks relevant to financial instruments
√Applicable □N/A
The main financial instruments of the Company include other non-current financial assets, cash andcash equivalents etc. These financial instruments are created mainly for the operating financing of theCompany. The Company has many other financial assets and liabilities, such as accounts receivable,other receivables, accounts payable and other payables, which are directly produced as a result ofoperation.
The major risks caused by the financial instruments of the Company are credit risk, liquidity risk,exchange rate risk and interest rate risk.
9.1 Credit risk
The financial assets of the Company include cash and cash equivalents, accounts receivable, otherreceivables etc. The credit risk in these financial assets originates from breach of the agreement by thecounter party. The maximum risk exposure is equivalent to the carrying amount of these instrument.
No guaranty is required as the Company only trades with the recognized and reputable third parties. Thecredit risk is managed by customers in a centralized manner. The Company faces a low credit risk as itcollects accounts in advance during sales.
| Subsidiary | Current period | Prior period | ||||||
| Operating income | Net profit | Total comprehensive income | Cash flow from operating activities | Operating income | Net profit | Total comprehensive income | Cash flow from operating activities | |
| Kweichow Moutai Sales Co., Ltd. | 9,061,083.73 | 4,803,918.40 | 4,803,918.40 | 3,616,271.47 | 8,224,889.10 | 4,423,287.59 | 4,423,287.59 | 4,794,099.85 |
9.2 Liquidity risk
Liquidity risk refers to the risk of shortage of funds when the enterprise performs its obligation ofsettlement through delivery of cash or other financial assets.
The policy of the Company is to ensure that it has sufficient cash to repay the debts due. Thesubsidiaries shall be responsible for their own cash flow predictions. The finance department of theCompany shall constantly monitor the short-term and long-term funds demands at the group level tomaintain the fund demands according to the summary of the cash flow predictions of the subsidiaries.
9.3 Exchange rate risk
The foreign exchange fluctuation risk faced by the Company is mainly related to the operating activitiesof the Company (when the receipts and payments are not settled in a foreign currency other than thefunctional currency of the Company) and its net investment in overseas subsidiaries. The foreignexchange risk sustained by the Company is mainly related to the United States dollars and Euro. TheCompany’s major business activities are priced and settled in CNY except for those settled in USD andEUR.
9.4 Interest rate risk
Interest rate risk refers to the risk of fluctuation in the fair value of the financial instruments or thefuture cash flow due to the change in the market interest rate. The risk of fluctuation in the marketinterest rate faced by the Company is mainly related to the liabilities with the interest accrued at afloating interest rate. As at December 31, 2021, the Company has no liabilities with the interest accruedat a floating interest rate.
10. Disclosure of fair value
10.1 Fair value of assets and liabilities measured at fair value at the end of the period
√Applicable □N/A
10.2 The basis for determining the market price of continuous and non-continuous level 1 fairvalue measurement items
√Applicable □N/A
10.3 Qualitative and quantitative information on the valuation techniques used and importantparameters for continuous and non-continuous level 2 fair value measurement items
√Applicable □N/A
10.4 Qualitative and quantitative information on the valuation techniques used and importantparameters for continuous and non-continuous level 3 fair value measurement items
√Applicable □N/A
10.5 Continuous level 3 fair value measurement items, adjustment information between theopening and closing carrying amount and sensitivity analysis of unobservable parameters
√Applicable □N/A
10.6 Continuous fair value measurement items, if there is a conversion between various levelsduring the current period, the reasons for the conversion and the policy for determining thetiming of the conversion
√Applicable □N/A
10.7 Changes in valuation technology during the current period and reasons for the changes
√Applicable □N/A
10.8 The fair value of financial assets and financial liabilities not measured at fair value
√Applicable □N/A
11.Related parties and related party transactions
11.1 The Company’s parent company
√Applicable □N/A
Unit: CNY 10,000
| Parent company | Place of registration | Business nature | Registered capital | Shareholding ratio of parent company to the Company | Proportion of voting rights of parent company to the company |
| China Kweichow Moutai Distillery (Group) Co., Ltd. | Guiyang, Guizhou | 1,000,000 | 54.00 | 54.00 |
11.2 Subsidiaries of the Company
√Applicable □N/A
Please refer to “VIII. Equity in other entities” for the details of the subsidiaries of the Company
11.3 Other related parties
√Applicable □N/A
| Name of other related parties | Relationship with the company |
| Beijing Moutai Trading Co., Ltd. | Wholly-owned subsidiary of the parent company |
| ChangLi Moutai Wine Trade Co., Ltd. | Other |
| Shanghai Moutai Trading Co., Ltd. | Other |
| Guizhou Fuming Packaging Co. Ltd | Other |
| Guizhou Hengdao Forestry and Agriculture Technology Development Co., Ltd. | Other |
| Guizhou Jiuyuan Property Co., Ltd. | Other |
| Guizhou Kunen Bioengineering Co., Ltd. | Other |
| Kweichow Moutai (group) International Travel Service Co., Ltd. | Other |
| Kweichow Moutai (Group) Ecological Agriculture Industry Development Co., Ltd. | Wholly-owned subsidiary of the parent company |
| Kweichow Moutaichun Marketing Company | Other |
| Health Industry Co., Ltd. of Kweichow Moutai Group. | Other |
| KWEICHOW MOUTAI WINERY(GROUP)BAIJIN LIQUOR SALES CO., LTD. | Other |
| Kweichow Moutai Winery(Group)Baijin Liquor Co., Ltd.. | Other |
| Kweichow Moutai Winery (Group) Health Wine Sales Co., Ltd. | Other |
| Kweichow Moutai Winery (Group) Health Wine Co., Ltd. | Wholly-owned subsidiary of the parent company |
| Kweichow Moutai Distillery Group Changli Winery Co., Ltd. | Majority-owned subsidiary of the parent company |
| Kweichow Moutai Distillery (Group) Foreign Investment Cooperation Management Co., Ltd. | Majority-owned subsidiary of the parent company |
| Kweichow Moutai Distillery (Group) Guiyang High-tech Real Estate Investment Development Co., Ltd. | Other |
| Kweichow Moutai Distillery (Group) Guiyang Business Co., Ltd. | Wholly-owned subsidiary of the parent company |
| Kweichow Moutai Distillery (Group) Sanya Investment Co., Ltd. | Other |
| Kweichow Moutai Distillery (Group) Logistics Co., Ltd. | Majority-owned subsidiary of the parent company |
| Guizhou Maotai Distillert(Group) Xijiu Co., Ltd. | Wholly-owned subsidiary of the parent company |
| Kweichow Moutai (Group) Circular Economy Industrial Investment and Development Co., Ltd. | Wholly-owned subsidiary of the parent company |
| Kweichow Moutai Distillery (Group) Real Estate Investment Development Co., Ltd. | Wholly-owned subsidiary of the parent company |
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | Majority-owned subsidiary of the parent company |
| Guizhou Maotai Ecological Agriculture Sales Co., Ltd. | Other |
| Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | Other |
| Kweichow Zunyi Moutai Airport Co., Ltd. | Majority-owned subsidiary of the parent company |
| Guizhou Renhuai Shenren Packaging and Printing Co., Ltd. | Other |
| Guizhou Xijiu Sales Co., Ltd. | Other |
| Gui Zhou New Huaxi Glass Co., Ltd | Other |
| Moutai & CCB Trust (Guizhou) Investment Fund (Limited Partnership) | Majority-owned subsidiary of the parent company |
| Moutai & CCB Trust (Guizhou) Investment Fund Management Co., Ltd. | Majority-owned subsidiary of the parent company |
| Shanghai Kweichow Moutai Industrial Co., Ltd. | Wholly-owned subsidiary of the parent company |
| Shanghai Rencai Printing Affairs Co., Ltd. | Other |
| Tianchao Shangpin Liquor Industry(Guizhou) Co.，Ltd. | Other |
| Hotel Management Company Of Moutai Group | Wholly-owned subsidiary of the parent company |
| Kweichow Zunyi Moutai Airport Ecological Park Investment and Development Co., Ltd. | Other |
| China Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd. | Wholly-owned subsidiary of the parent company |
| Chinese-Foreign Venture Dragon And Lion Cap Co., Ltd Zhuhai S.E.Z | Majority-owned subsidiary of the parent company |
| Moutai Financial Leasing Co., Ltd | Wholly-owned subsidiary of the parent company |
| Kweichow Moutai Group Marketing Co., Ltd. | Wholly-owned |
| subsidiary of the parent company | |
| Huagui Life Insurance Co., Ltd. | Joint stock company of the parent company |
| Guiyang GYB Financial Leasing Co., Ltd. | Joint stock company of the parent company |
| Zhongshan Sanrun Printing Consumables Co., Ltd. | Other |
| Bank of Guizhou Co., Ltd. | Other |
| Guizhou Zunpeng Liquor Industry Co., Ltd. | Other |
| Kweichow Moutai Distillery (Group) Guiding Jingqi Glasswork Co., Ltd. | Other |
| Kweichow Moutai Distillery (Group) Lvsheng Organic Fertilizer Co., Ltd. | Other |
| Guizhou Renhuai Renshuai Liquor Industry Co., Ltd. | Other |
Others
(1) ChangLi Moutai Wine Trade Co., Ltd. is a wholly-owned subsidiary of Kweichow Moutai DistilleryGroup Changli Winery Co., Ltd.;
(2) Shanghai Moutai Trading Co., Ltd. is a wholly-owned subsidiary of Shanghai Kweichow MoutaiIndustrial Co., Ltd.;
(3) Guizhou Fuming Packaging Co.Ltd is a majority-owned subsidiary of Kweichow Moutai Distillery(Group) Technology Development Co., Ltd.;
(4) Guizhou Hengdao Forestry and Agriculture Technology Development Co., Ltd. is a majority-ownedsubsidiary of Kweichow Moutai (Group) Ecological Agriculture Industry Development Co., Ltd.;
(5) Guizhou Jiu yuan Property Co., Ltd. is a majority-owned subsidiary of China Kweichow MoutaiDistillery (Group) Cultural Tourism Co., Ltd.;
(6) Guizhou Kunen Bioengineering Co., Ltd. is a majority-owned subsidiary of
Kweichow Moutai Distillery (Group) Foreign Investment Cooperation Management Co., Ltd.;
(7) Kweichow Moutai (group) International Travel Service Co., Ltd. is a wholly-owned subsidiary ofChina Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd.;
(8) Kweichow Moutaichun Marketing Company is a wholly-owned subsidiary of Kweichow MoutaiDistillery (Group) Technology Development Co., Ltd.;
(9) Health Industry Co., Ltd. of Kweichow Moutai Group. is a majority-owned subsidiary of KweichowMoutai Winery (Group) Health Wine Co., Ltd.;
(10) KWEICHOW MOUTAI WINERY (GROUP) BAIJIN LIQUOR SALES CO., LTD. is awholly-owned subsidiary of Kweichow Moutai Winery(Group)Baijin Liquor Co., Ltd..;
(11) KWEICHOW MOUTAI WINERY (GROUP)BAIJIN LIQUOR CO., LTD. is a majority-ownedsubsidiary of Kweichow Moutai Winery (Group) Health Wine Co., Ltd.;
(12) Kweichow Moutai Winery (Group) Health Wine Sales Co., Ltd. is a wholly-owned subsidiary ofKweichow Moutai Winery (Group) Health Wine Co., Ltd.;
(13) Kweichow Moutai Distillery (Group) Guiyang High-tech Real Estate Investment Development Co.,Ltd. is a wholly-owned subsidiary of Kweichow Moutai Distillery (Group) Real Estate InvestmentDevelopment Co., Ltd.;
(14) Kweichow Moutai Distillery (Group) Sanya Investment Co., Ltd. is a wholly-owned subsidiary ofKweichow Moutai Distillery (Group) Real Estate Investment Development Co., Ltd.;
(15) Guizhou Maotai Ecological Agriculture Sales Co., Ltd. is a wholly-owned subsidiary of KweichowMoutai (Group) Ecological Agriculture Industry Development Co., Ltd.;
(16) Kweichow Moutai Logistics Park Grain Storage Co., Ltd. is a majority-owned subsidiary ofKweichow Moutai Distillery (Group) Logistics Co., Ltd.;
(17) Guizhou Renhuai Shenren Packaging and Printing Co., Ltd. is a majority-owned subsidiary ofKweichow Moutai Distillery (Group) Technology Development Co., Ltd.;
(18) GUIZHOU XIJIU SALES CO., LTD. is a wholly-owned subsidiary of GUIZHOU MAOTAIDISTILLERT (GROUP) XIJIU CO., LTD.;
(19) GUI ZHOU NEW HUAXI GLASS CO., LTD is a majority-owned subsidiary of KweichowMoutai Distillery (Group) Technology Development Co., Ltd.;
(20) Shanghai Rencai Printing Affairs Co., Ltd. is an associate of Kweichow Moutai Distillery (Group)Technology Development Co., Ltd.;
(21) Tianchao Shangpin Liquor Industry (Guizhou) Co.，Ltd. is a majority-owned subsidiary ofKweichow Moutai Distillery (Group) Technology Development Co., Ltd.;
(22) Kweichow Zunyi Moutai Airport Ecological Park Investment and Development Co., Ltd. is awholly-owned subsidiary of Kweichow Zunyi Moutai Airport Co., Ltd.;
(23) Zhongshan Sanrun Printing Consumables Co., Ltd. is a majority-owned subsidiary ofCHINESE-FOREIGN VENTURE DRAGON AND LION CAP CO., LTD ZHUHAI S.E.Z;
(24) Bank of Guizhou Co., Ltd. is an associate of the parent company;
(25) Guizhou Zunpeng Liquor Industry Co., Ltd. is a majority-owned subsidiary of Kweichow Moutai(Group) Circular Economy Industrial Investment and Development Co., Ltd.;
(26) Kweichow Moutai Distillery (Group) Guiding Jingqi Glasswork Co., Ltd. is a wholly-ownedsubsidiary of Kweichow Moutai Distillery (Group) Technology Development Co., Ltd.;
(27) Kweichow Moutai Distillery (Group) Lvsheng Organic Fertilizer Co., Ltd. is a majority-ownedsubsidiary of Kweichow Moutai (Group) Circular Economy Industrial Investment and Development Co.,Ltd.;
(28) Guizhou Renhuai Renshuai Liquor Industry Co., Ltd. is a wholly-owned subsidiary of KweichowMoutai Winery (Group) Health Wine Co., Ltd.;
11.4 Related party transaction
A. Related party transactions of purchase and sales of goods, render and accept servicesPurchase of goods / accept of services
√Applicable □N/A
Unit: CNY
| Related party | Related party transaction | Current period | Prior period |
| China Kweichow Moutai Distillery (Group) Co., Ltd. | Right to use the trademark | 1,332,728,678.71 | 1,195,642,243.74 |
| Kweichow Moutai Distillery (Group) Logistics Co., Ltd. | Goods transportation service | 215,293,693.93 | 238,165,178.44 |
| Guizhou Renhuai Shenren Packaging and Printing Co., Ltd. | Purchase of goods | 242,357,820.96 | 186,661,814.93 |
| Chinese-Foreign Venture Dragon And Lion Cap Co., Ltd Zhuhai S.E.Z | Purchase of goods | 186,644,711.14 | 185,429,878.58 |
| Shanghai Rencai Printing Affairs Co., Ltd. | Purchase of goods | 12,490,908.50 | 159,859,493.05 |
| Kweichow Moutai (Group) Circular Economy Industrial Investment and Development Co., Ltd. | Purchase of goods | 150,339,280.00 | 136,786,770.00 |
| Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | Purchase of goods | 109,617,071.39 | 111,857,416.69 |
| Guizhou Fuming Packaging Co.Ltd | Purchase of goods | 73,963,369.22 | 57,005,297.86 |
| Gui Zhou New Huaxi Glass Co., Ltd | Purchase of goods | 60,580,925.36 | 54,943,356.56 |
| Guizhou Maotai Ecological Agriculture Sales Co., Ltd. | Purchase of goods | 2,576,091.90 | |
| Guizhou Maotai Distillert (Group) Xijiu Co., Ltd. | Purchase of goods | 2,892,054.00 | |
| Kweichow Moutai Winery (Group) Health Wine Sales Co., Ltd. | Purchase of goods | 2,203,000.00 | |
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | Purchase of goods | 1,766,767.13 | |
| China Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd. | Purchase of goods | 33,274.34 | |
| Kweichow Moutai Distillery (Group) Guiyang High-tech Real Estate Investment Development Co., Ltd. | Purchase of offices | 9,741,492.16 | |
| China Kweichow Moutai Distillery (Group) Co., Ltd. | Comprehensive service fee | 379,394.43 | 76,169,819.49 |
| Huagui Life Insurance Co., Ltd. | Purchase of insurances | 477,500.00 | 22,998,000.57 |
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | Labor cost | 201,743,603.42 | 172,331,684.53 |
| Hotel Management Company Of Moutai Group | Labor cost | 61,437,621.87 | 60,660,418.26 |
| Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | Labor cost | 95,320,754.85 | |
| Kweichow Moutai (group) International Travel Service Co., Ltd. | Labor cost | 24,511,528.39 | 23,004,681.50 |
| Kweichow Moutai (Group) Circular Economy Industrial Investment and Development Co., Ltd. | Labor cost | 15,019,725.64 | |
| Kweichow Moutai Winery (Group) Health Wine Sales Co., Ltd. | Labor cost | 4,091,215.49 | |
| Kweichow Moutai Distillery (Group) Logistics Co., Ltd. | Labor cost | 573,223.59 | |
| China Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd. | Labor cost | 3,360.00 | |
| Guizhou Maotai Distillert (Group) Xijiu Co., Ltd. | Acceptance of water supply services | 3,925,458.51 | 7,800,185.70 |
Sales of goods / render of services
√Applicable □N/A
Unit: CNY
| Related party | Related party transaction | Current period | Prior period |
| Kweichow Moutai Group Marketing Co., Ltd. | Sales of goods | 5,193,690,831.85 | 4,611,179,958.71 |
| Kweichow Zunyi Moutai Airport Co., Ltd. | Sales of goods | 183,857,776.11 | |
| China Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd. | Sales of goods | 4,778,230.09 | 179,759,579.66 |
| Beijing Moutai Trading Co., Ltd. | Sales of goods | 2,729,246.02 | 174,659,531.86 |
| Shanghai Moutai Trading Co., Ltd. | Sales of goods | 5,526,159.30 | 113,817,222.12 |
| Shanghai Kweichow Moutai Industrial Co., Ltd. | Sales of goods | 1,309,890.28 | 107,038,224.75 |
| Hotel Management Company of Moutai Group | Sales of goods | 19,511,175.24 | 19,990,384.98 |
| China Kweichow Moutai Distillery (Group) Co., Ltd. | Sales of goods | 7,293,281.43 | 14,798,007.04 |
| Kweichow Zunyi Moutai Airport Ecological Park Investment and Development Co., Ltd. | Sales of goods | 315,142.49 | 2,843,124.81 |
| Guizhou Maotai Distillert (Group) Xijiu Co., Ltd. | Sales of goods | 3,372,637.17 | |
| Kweichow Moutai Winery (Group) Health Wine Co., Ltd. | Sales of goods | 1,723,539.82 | |
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | Sales of goods | 1,191,902.06 | |
| Guizhou Maotai Distillert (Group) Xijiu Co., Ltd. | Provision of vapor service | 2,745,540.73 | |
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | Labor cost | 682,486.89 | |
| Guizhou Maotai Distillert (Group) Xijiu Co., Ltd. | Labor cost | 560,412.74 | |
| Kweichow Moutai Distillery (Group) Logistics Co., Ltd. | Labor cost | 27,771.05 | |
| Guizhou Renhuai Shenren Packaging and Printing Co., Ltd. | Labor cost | 14,507.24 |
Description of related party transactions of purchase and sales of goods, render and accept services
√Applicable □N/A
B. Related entrusted management / contracting and entrusted management / outsourcingEntrusted management / contracting of the Company
√Applicable □N/A
Description of related trusteeship / contract
√Applicable □N/A
Entrusted management / outsourcing of the Company
√Applicable □N/A
Description of related management / outsourcing
√Applicable □N/A
C. Related leaseThe Company as the lessor:
√Applicable □N/A
Unit: CNY
| Lessee | Types of leased assets | Lease income in the current period | Lease income in the prior period |
| China Kweichow Moutai Distillery (Group) Co., Ltd. | Plant and buildings | 330,275.22 | |
| Kweichow Moutai Group Marketing Co., Ltd. | Plant and buildings | 495,146.47 | |
| Guizhou Kunen Bioengineering Co., Ltd. | Plant and buildings, machinery and equipment | 6,422,018.35 |
The Company as the lessee:
√Applicable □N/A
Unit: CNY
| Lessor | Types of leased assets | Lease expenses in the current period | Lease expenses in the prior period |
| China Kweichow Moutai Distillery (Group) Co., Ltd. | Plant and buildings | 21,301,731.00 | 21,545,894.21 |
| China Kweichow Moutai Distillery (Group) Co., Ltd. | Land use rights | 5,422,655.73 | 4,361,551.06 |
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | Plant and buildings, machinery and equipment | 11,712,556.79 | 12,572,144.06 |
| Kweichow Moutai Winery (Group) Health Wine Sales Co., Ltd. | Plant and buildings, machinery and equipment | 3,000,000.00 | |
| Kweichow Moutai Distillery (Group) Guiyang High-tech Real Estate Investment Development Co., Ltd. | Plant and buildings | 1,691,467.44 | |
| Kweichow Moutai Distillery (Group) Real Estate Investment Development Co., Ltd. | Plant and buildings | 312,794.29 | |
| Kweichow Zunyi Moutai Airport Co., Ltd. | Plant and buildings | 236,674.53 | 78,891.51 |
According to relevant provisions in Accounting Standards for Business Enterprises No. 21 - Leases (CaiKuai [2018] No. 35) amended and promulgated the Ministry of Finance in 2018, the Companypresented the accounting treatment of the leasing businesses in the items including right-of-use assets,lease liabilities and current portion of non-current liabilities as of January 1, 2021 according to the newleasing standards.
Description of related lease
√Applicable □N/A
D. Funds borrowing from related parties
√Applicable □N/A
Unit: CNY
| Related party | Amount | Starting date | Expiry date | Description |
| Lending | ||||
| Guiyang GYB Financial Leasing Co., Ltd. | 200,000,000.00 | 2021-01-12 | 2021-04-14 | |
| Guiyang GYB Financial Leasing Co., Ltd. | 100,000,000.00 | 2021-01-26 | 2021-04-16 | |
| Guiyang GYB Financial Leasing Co., Ltd. | 100,000,000.00 | 2021-02-05 | 2021-04-27 | |
| Guiyang GYB Financial Leasing Co., Ltd. | 100,000,000.00 | 2021-04-21 | 2021-07-15 | |
| Guiyang GYB Financial Leasing Co., Ltd. | 130,000,000.00 | 2021-04-30 | 2021-07-23 | |
| Guiyang GYB Financial Leasing Co., Ltd. | 100,000,000.00 | 2021-04-28 | 2021-07-23 | |
| Guiyang GYB Financial Leasing Co., Ltd. | 70,000,000.00 | 2021-07-08 | 2021-10-08 | |
| Guiyang GYB Financial Leasing Co., Ltd. | 100,000,000.00 | 2021-07-15 | 2021-10-14 | |
| Guiyang GYB Financial Leasing Co., Ltd. | 230,000,000.00 | 2021-07-23 | 2021-08-23 | |
The funds lent by Kweichow Moutai Group Finance Co., Ltd. a majority-owned company of theCompany, to Guiyang GYB Financial Leasing Co., Ltd. has been due and recovered, and the interestincome recognized in the current period is CNY 11,130,600.
E. Remuneration of key management personnel
□Applicable √N/A
F. Other related party transactions
√Applicable □N/A
a. Kweichow Moutai Group Finance Co., Ltd. a majority-owned company of the Company, hasbusinesses with its related parties in terms of deposit, loan, discount and letter of guarantee.
“Customer deposits and balances from banks and other financial institutions” mean the deposit balancesand accrued interests of the related parties at Kweichow Moutai Group Finance Co., Ltd.; “Interestexpenses” mean the interests on deposits payable by Kweichow Moutai Group Finance Co., Ltd. to therelated parties; “Interest income” means the interest collected by Kweichow Moutai Group Finance Co.,Ltd. from the related parties for its provision of the loan transaction; “Loans and advances” mean theloan balances provided by Kweichow Moutai Group Finance Co., Ltd. to the related parties. (Unit:
CNY)
(1) Customer deposits and balances from banks and other financial institutions
| Related party | December 31, 2021 |
| Guizhou Xijiu Sales Co., Ltd. | 9,734,392,686.40 |
| China Kweichow Moutai Distillery (Group) Co., Ltd. | 2,495,925,365.33 |
| Kweichow Moutai Group Marketing Co., Ltd. | 4,125,683,019.60 |
| Kweichow Moutaichun Marketing Company | 611,840,193.66 |
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | 1,717,927,696.48 |
| Kweichow Moutai Winery (Group) Health Wine Sales Co., Ltd. | 703,943,274.58 |
| Guizhou Renhuai Shenren Packaging and Printing Co., Ltd. | 210,256,768.22 |
| China Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd. | 218,557,849.69 |
| ChangLi Moutai Wine Trade Co., Ltd. | 285,759,553.99 |
| Kweichow Moutai Distillery (Group) Logistics Co., Ltd. | 53,805,881.56 |
| Beijing Moutai Trading Co., Ltd. | 32,451,635.50 |
| Shanghai Moutai Trading Co., Ltd. | 46,676,247.54 |
| KWEICHOW MOUTAI WINERY(GROUP)BAIJIN LIQUOR SALES CO., LTD. | 63,730,740.85 |
| Guizhou Maotai Ecological Agriculture Sales Co., Ltd. | 36,003,808.59 |
| Kweichow Moutai (Group) Circular Economy Industrial Investment and Development Co., Ltd. | 129,905,237.28 |
| Shanghai Kweichow Moutai Industrial Co., Ltd. | 15,967,961.65 |
| Guizhou Zunpeng Liquor Industry Co., Ltd. | 118,316,553.92 |
| Health Industry Co., Ltd. of Kweichow Moutai Group. | 39,369,350.32 |
| Kweichow Moutai Distillery (Group) Real Estate Investment Development Co., Ltd. | 18,266,371.84 |
| Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | 16,156,106.85 |
| Chinese-Foreign Venture Dragon And Lion Cap Co., Ltd Zhuhai S.E.Z | 59,468,124.71 |
| Guizhou Fuming Packaging Co., Ltd | 11,770,678.41 |
| Guizhou Jiuyuan Property Co., Ltd. | 28,325,260.27 |
| Gui Zhou New Huaxi Glass Co., Ltd | 679,580.38 |
| Tianchao Shangpin Liquor Industry(Guizhou) Co.，Ltd. | 14,880,578.48 |
| Guizhou Maotai Distillert (Group) Xijiu Co., Ltd. | 573,990,484.69 |
| Kweichow Moutai Distillery Group Changli Winery Co., Ltd. | 9,477,982.97 |
| Kweichow Moutai (group) International Travel Service Co., Ltd. | 25,842,341.72 |
| Kweichow Moutai Winery(Group)Baijin Liquor Co., Ltd.. | 48,855,234.24 |
| Kweichow Moutai (Group) Ecological Agriculture Industry Development Co., Ltd. | 2,110,181.09 |
| Hotel Management Company Of Moutai Group | 36,722,376.06 |
| Kweichow Moutai Distillery (Group) Sanya Investment Co., Ltd. | 17,310,976.60 |
| Kweichow Zunyi Moutai Airport Co., Ltd. | 62,588,751.47 |
| Kweichow Moutai Distillery (Group) Guiyang Business Co., Ltd. | 1,947,197.79 |
| Kweichow Zunyi Moutai Airport Ecological Park Investment and Development Co., Ltd. | 3,502.12 |
| Kweichow Moutai Winery (Group) Health Wine Co., Ltd. | 111,809,289.12 |
| Moutai & CCB Trust (Guizhou) Investment Fund Management Co., Ltd. | 4,018.30 |
| Moutai Financial Leasing Co., Ltd | 5,268.68 |
| Moutai & CCB Trust (Guizhou) Investment Fund (Limited Partnership) | 843.33 |
| Kweichow Moutai Distillery (Group) Guiyang High-tech Real Estate Investment Development Co., Ltd. | 621,579.71 |
| Guizhou Hengdao Forestry and Agriculture Technology Development Co., Ltd. | 27.87 |
| Kweichow Moutai Distillery (Group) Guiding Jingqi Glasswork Co., Ltd. | 52,942,266.44 |
| Guizhou Renhuai Renshuai Liquor Industry Co., Ltd. | 29,103,604.91 |
| Kweichow Moutai Distillery (Group) Lvsheng Organic Fertilizer Co., Ltd. | 179,194.11 |
| Total | 21,763,575,647.32 |
(2) Interest expenses
| Related party | Current reporting period |
| Guizhou Xijiu Sales Co., Ltd. | 108,362,072.05 |
| Kweichow Moutai Group Marketing Co., Ltd. | 16,906,786.89 |
| Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | 11,545,138.89 |
| Kweichow Moutaichun Marketing Company | 7,160,221.58 |
| China Kweichow Moutai Distillery (Group) Co., Ltd. | 12,838,051.86 |
| Guizhou Renhuai Shenren Packaging and Printing Co., Ltd. | 2,552,541.62 |
| China Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd. | 1,877,899.92 |
| ChangLi Moutai Wine Trade Co., Ltd. | 2,182,551.69 |
| KWEICHOW MOUTAI WINERY(GROUP)BAIJIN LIQUOR SALES CO., LTD. | 1,263,300.22 |
| Kweichow Moutai Distillery (Group) Logistics Co., Ltd. | 844,471.54 |
| Kweichow Moutai Winery (Group) Health Wine Sales Co., Ltd. | 1,705,436.82 |
| Health Industry Co., Ltd. of Kweichow Moutai Group. | 573,169.61 |
| Tianchao Shangpin Liquor Industry(Guizhou) Co.，Ltd. | 301,127.23 |
| Guizhou Jiuyuan Property Co., Ltd. | 407,973.76 |
| Guizhou Maotai Distillert (Group) Xijiu Co., Ltd. | 456,797.84 |
| Guizhou Maotai Ecological Agriculture Sales Co., Ltd. | 428,074.23 |
| Beijing Moutai Trading Co., Ltd. | 246,525.46 |
| Kweichow Moutai Distillery (Group) Real Estate Investment Development Co., Ltd. | 192,542.66 |
| Chinese-Foreign Venture Dragon And Lion Cap Co., Ltd Zhuhai S.E.Z | 163,293.69 |
| Shanghai Moutai Trading Co., Ltd. | 198,600.17 |
| Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | 114,917.05 |
| Kweichow Moutai (Group) Circular Economy Industrial Investment and Development Co., Ltd. | 647,329.13 |
| Kweichow Moutai Winery (Group) Health Wine Co., Ltd. | 586,454.62 |
| Shanghai Kweichow Moutai Industrial Co., Ltd. | 103,632.88 |
| Guizhou Zunpeng Liquor Industry Co., Ltd. | 473,901.96 |
| Gui Zhou New Huaxi Glass Co., Ltd | 73,550.70 |
| Kweichow Moutai Winery(Group)Baijin Liquor Co., Ltd.. | 73,294.29 |
| Guizhou Fuming Packaging Co., Ltd | 93,938.83 |
| Hotel Management Company Of Moutai Group | 70,097.95 |
| Kweichow Moutai (group) International Travel Service Co., Ltd. | 56,743.61 |
| Kweichow Zunyi Moutai Airport Co., Ltd. | 301,102.66 |
| Kweichow Moutai Distillery (Group) Guiding Jingqi Glasswork Co., Ltd. | 213,054.05 |
| Zhongshan Sanrun Printing Consumables Co., Ltd. | 39,956.08 |
| Kweichow Moutai Distillery (Group) Sanya Investment Co., Ltd. | 44,495.77 |
| Kweichow Moutai Distillery (Group) Foreign Investment Cooperation Management Co., Ltd. | 42,584.06 |
| Kweichow Moutai (Group) Ecological Agriculture Industry Development Co., Ltd. | 35,478.66 |
| Kweichow Moutai Distillery Group Changli Winery Co., Ltd. | 49,318.35 |
| Kweichow Zunyi Moutai Airport Ecological Park Investment and Development Co., Ltd. | 16,991.11 |
| Kweichow Moutai Distillery (Group) Guiyang Business Co., Ltd. | 27,712.60 |
| Moutai & CCB Trust (Guizhou) Investment Fund Management Co., Ltd. | 145.76 |
| Kweichow Moutai Distillery (Group) Guiyang High-tech Real Estate Investment Development Co., Ltd. | 621,600.89 |
| Moutai Financial Leasing Co., Ltd | 18.55 |
| Guizhou Hengdao Forestry and Agriculture Technology Development Co., Ltd. | 7.02 |
| Moutai & CCB Trust (Guizhou) Investment Fund (Limited Partnership) | 2.99 |
| Guizhou Renhuai Renshuai Liquor Industry Co., Ltd. | 4,220.74 |
| Kweichow Moutai Distillery (Group) Lvsheng Organic Fertilizer Co., Ltd. | 69.92 |
| Total | 173,897,197.96 |
(3) Loans and advances
| Item | Related party | December 31, 2021 |
| Mortgage loan | Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | 10,000,000.00 |
| Credit loan | China Kweichow Moutai Distillery (Group) Co., Ltd. | 3,500,000,000.00 |
| Total | 3,510,000,000.00 | |
| Less: Provision for impairment of loans | 87,750,000.00 | |
| Carrying amount of loans and advances | 3,422,250,000.00 |
(4) Interest income
| Item | Related party | Current reporting period |
| Loan interest income | Chinese-Foreign Venture Dragon And Lion Cap Co., Ltd Zhuhai S.E.Z | 89,150.94 |
| Loan interest income | Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | 647,083.70 |
| Loan interest income | China Kweichow Moutai Distillery (Group) Co., Ltd. | 109,865,697.45 |
| Total | 110,601,932.09 |
(5) Entrusted loan
| Principal | Borrower | December 31, 2021 |
| Kweichow Moutai (Group) Ecological Agriculture Industry Development Co., Ltd. | Guizhou Hengdao Forestry and Agriculture Technology Development Co., Ltd. | 9,955,184.18 |
(6) Kweichow Moutai Group Finance Co., Ltd. a majority-owned company of the Company, haspurchased the bonds issued by Guiyang GYB Financial Leasing Co., Ltd. from the open market at a costof CNY 20 million. The interest income confirmed in the current period is CNY 857.90 thousand. As atthe end of the period, the balance of the provision for impairment of this bond investment is CNY 11.3thousand. The balance of the accrued interest is CNY 153.2 thousand. The carrying amount is CNY20,141.80 thousand.
b.The deposit balance of the Company in Bank of Guizhou at the end of the period is CNY23,810,899,200 (including a large-amount deposit of CNY 2 billion). The interest income of the currentperiod is CNY 445,237,300. The investment income is CNY 59,761,300 Kweichow Moutai GroupFinance Co., Ltd., a majority-owned company of the Company, has purchased the bonds issued by Bankof Guizhou Co., Ltd. from the open market at a cost of CNY 100 million. The interest incomeconfirmed in the current period is CNY 179.6 thousand. As at the end of the period, the balance of theprovision for impairment of this bond investment is CNY 56.7 thousand. The balance of the accruedinterest is CNY 179.6 thousand. The carrying amount is CNY 100,122,900.
11.5 Receivables and payables of related parties
A. Receivables
√Applicable □N/A
Unit: CNY
| Item | Related party | Closing balance | Opening balance | ||
| book balance | Bad debt provision | book balance | Bad debts | ||
| Other receivables | Kweichow Moutai Distillery (Group) Guiyang High-tech Real Estate Investment Development Co., Ltd. | 100,000.00 | |||
Other receivables of Kweichow Moutai Distillery (Group) Guiyang High-tech Real Estate InvestmentDevelopment Co., Ltd. are the leasing security deposits to be paid by GUIZHOU MOUTAI CHIEWIMPORT AND EXPORT CO., LTD., a majority-owned company of the Company.B. Payables
√Applicable □N/A
Unit: CNY
| Item | Related party | Book balance at the end of the reporting period | Book balance at the beginning of the reporting period |
| Other payables | China Kweichow Moutai Distillery (Group) Co., Ltd. | 806,014,062.86 | 442,335,049.85 |
| Other payables | Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | 47,171,388.10 | 52,219,850.77 |
| Other payables | Kweichow Moutai Distillery (Group) Logistics Co., Ltd. | 70,400,854.08 | 89,833,895.59 |
| Other payables | Kweichow Moutai Winery (Group) Health Wine Sales Co., Ltd. | 7,091,215.49 | |
| Other payables | Hotel Management Company Of Moutai Group | 4,510,977.34 | 1,066,037.73 |
| Other payables | Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | 1,609,349.28 | 1,309,349.28 |
| Other payables | Shanghai Rencai Printing Affairs Co., Ltd. | 1,395,000.00 | 1,400,000.00 |
| Other payables | Guizhou Renhuai Shenren Packaging and Printing Co., Ltd. | 949,643.50 | 1,015,643.50 |
| Other payables | Guizhou Fuming Packaging Co.Ltd | 890,000.00 | 1,000,000.00 |
| Other payables | Gui Zhou New Huaxi Glass Co., Ltd | 888,000.00 | 1,000,000.00 |
| Other payables | Chinese-Foreign Venture Dragon And Lion Cap Co., Ltd Zhuhai S.E.Z | 965,000.00 | 1,000,000.00 |
| Other payables | Beijing Moutai Trading Co., Ltd. | 700,000.00 | 700,000.00 |
| Other payables | Kweichow Moutai Winery (Group) Health Wine Co., Ltd. | 591,695.00 | 591,695.00 |
| Other payables | Guizhou Maotai Distillert (Group) Xijiu Co., Ltd. | 504,376.93 | 5,148,504.89 |
| Other payables | Kweichow Moutai Group Marketing Co., Ltd. | 260,000.00 | 260,000.00 |
| Other payables | China Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd. | 110,000.00 | 310,000.00 |
| Other payables | Kweichow Moutai (Group) Circular Economy Industrial Investment and Development Co., Ltd. | 158,992.00 | 100,000.00 |
| Other payables | Shanghai Kweichow Moutai Industrial Co., Ltd. | 100,000.00 | 500,000.00 |
| Other payables | Shanghai Moutai Trading Co., Ltd. | 100,000.00 | 500,000.00 |
| Other payables | Kweichow Zunyi Moutai Airport Ecological Park Investment and Development Co., Ltd. | 50,000.00 | |
| Other payables | Kweichow Moutai (group) International Travel Service Co., Ltd. | 212,350.00 | 20,650,151.00 |
| Other | Kweichow Moutai Winery(Group)Baijin Liquor Co., Ltd.. | 300,000.00 |
| payables | |||
| Other payables | Kweichow Zunyi Moutai Airport Co., Ltd. | 7,722,900.00 | |
| Other payables | Kweichow Moutai (Group) Ecological Agriculture Industry Development Co., Ltd. | 23,777.50 | 36,163.61 |
| Other payables | ChangLi Moutai Wine Trade Co., Ltd. | 14,696.65 | |
| Contractual liabilities | Kweichow Moutai Group Marketing Co., Ltd. | 79,358,066.37 | 40,691,971.68 |
| Contractual liabilities | Kweichow Zunyi Moutai Airport Co., Ltd. | 8,046.90 | 3,737,549.64 |
| Contractual liabilities | Beijing Moutai Trading Co., Ltd. | 221,238.94 | 221,238.94 |
| Contractual liabilities | Shanghai Kweichow Moutai Industrial Co., Ltd. | 41,444.25 | |
| Contractual liabilities | Kweichow Zunyi Moutai Airport Ecological Park Investment and Development Co., Ltd. | 38,221.24 | 31,849.00 |
| Contractual liabilities | China Kweichow Moutai Distillery (Group) Cultural Tourism Co., Ltd. | 2,978.76 | 4,778,230.09 |
| Leasing liabilities | China Kweichow Moutai Distillery (Group) Co., Ltd. | 245,892,878.88 | |
| Leasing liabilities | Kweichow Moutai Distillery (Group) Guiyang High-tech Real Estate Investment Development Co., Ltd. | 7,212,098.95 | |
| Leasing liabilities | Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | 33,308,809.87 | |
| Accounts payable | Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | 58,396,226.41 | |
| Accounts payable | Kweichow Moutai (Group) Circular Economy Industrial Investment and Development Co., Ltd. | 15,019,725.64 | |
| Accounts payable | Hotel Management Company Of Moutai Group | 4,840,909.43 | 4,195,383.02 |
| Accounts payable | Guizhou Renhuai Shenren Packaging and Printing Co., Ltd. | 16,181,715.39 | |
| Accounts payable | Kweichow Moutai Distillery (Group) Logistics Co., Ltd. | 43,448,338.14 | 23,816,979.96 |
| Accounts payable | Kweichow Moutai Distillery (Group) Technology Development Co., Ltd. | 14,855,345.00 | 1,241,299.13 |
| Accounts payable | Kweichow Moutai Group Marketing Co., Ltd. | 2,217.00 | |
| Accounts payable | Shanghai Rencai Printing Affairs Co., Ltd. | 14,502,744.53 | |
| Accounts payable | Kweichow Moutai Logistics Park Grain Storage Co., Ltd. | 6,399,547.32 |
Note: Absorption of deposits from and issuance of loans and advances to related parties by KweichowMoutai Group Finance Co., Ltd. a majority-owned subsidiary of the CompanyIt has been disclosed in “(6) Other related party transactions, 4. Related party transaction, XI. Relatedparties and related party transactions, Section X Financial Statements”.
11.6 Commitment of related parties
□ Applicable √ N/A
12. Subsequent events
12.1 Important non-adjustment events
□ Applicable √ N/A
12.2 Profit distribution
√Applicable □N/A
Unit: CNY
| Profit or dividend to be distributed | 27,228,087,315.00 |
12.3 Sales return
?Applicable√ N/A
12.4 Notes to other subsequent events after the balance sheet date
?Applicable√ N/A
13. Notes to major account of the Company’s financial statements
13.1 Accounts receivable
A. Disclosure by aging
√Applicable □N/A
Unit: CNY
| Aging | Closing book balance |
| Within 1 year | 1,480,080,983.77 |
| Subtotal for within 1 year | 1,480,080,983.77 |
| 1-2 years | |
| 2-3 years | |
| 3-4 years | |
| 4-5 years | |
| More than 5 years | |
| Total | 1,480,080,983.77 |
B. Disclosed by bad debt provision methods
√Applicable □N/A
Unit: CNY
| Category | Closing balance | Opening balance | ||||||||
| book balance | Bad debt provision | amount | book balance | Bad debt provision | amount | |||||
| Amount | Proportion (%) | Amount | Proportion (%) | Amount | Proportion (%) | Amount | Proportion (%) | |||
| Bad debt provision assessed individually | ||||||||||
| Bad debt provision assessed by groups | 1,480,080,983.77 | 100 | 1,480,080,983.77 | 9,203,780,107.14 | 100 | 9,203,780,107.14 | ||||
| Including: | ||||||||||
| Combination of related parties within the scope of consolidation | 1,480,080,983.77 | 100 | 1,480,080,983.77 | 9,203,780,107.14 | 100 | 9,203,780,107.14 | ||||
| Total | 1,480,080,983.77 | / | / | 1,480,080,983.77 | 9,203,780,107.14 | / | / | 9,203,780,107.14 | ||
Bad debt provision assessed by groups:
?Applicable√ N/A
C. Top five accounts receivable based on debtors
√Applicable □N/A
Unit: CNY
| Entity | Closing balance | Proportion to total closing balance of accounts receivable (%) | Closing balance of bad debt provision |
| Kweichow Moutai Sales Co., Ltd. | 881,539,635.14 | 59.56 | |
| Kweichow Moutai-Flavor Liquor Marketing Co., Ltd. | 583,588,956.00 | 39.43 | |
| GUIZHOU MOUTAI CHIEW IMPORT AND EXPORT CO., LTD. | 14,952,392.63 | 1.01 | |
| Total | 1,480,080,983.77 | 100.00 |
13.2 Other receivables
Presentation of items
√Applicable □N/A
Unit: CNY
| Item | Closing balance | Opening balance |
| Interest receivable | ||
| Dividends receivable | ||
| Other receivables | 9,210,501.43 | 42,323,669.01 |
| Total | 9,210,501.43 | 42,323,669.01 |
Other receivablesA. Disclosure by aging
√Applicable □N/A
Unit: CNY
| Aging | Book balance at the end of the reporting period |
| Within 1 year | 8,853,850.09 |
| Subtotal for within 1 year | 8,853,850.09 |
| 1-2 years | 420,700.00 |
| 2-3 years | 7,313.00 |
| 3-4 years | |
| 4-5 years | 37,951.22 |
| More than 5 years | 5,100,000.00 |
| Total | 14,419,814.31 |
B. Details of classification by nature
√Applicable □N/A
Unit: CNY
| Nature | Book balance at the end of the reporting period | Book balance at the beginning of the reporting period |
| Petty cash | 2,840,284.11 | 4,966,015.96 |
| Current Account | 11,579,530.20 | 42,481,117.46 |
| Total | 14,419,814.31 | 47,447,133.42 |
C. Details of bad debt provision
√Applicable □N/A
Unit: CNY
| Bad debt provision | Stage I | Stage II | Stage III | Total |
| 12month ECL | Lifetime ECL (not impaired) | Lifetime ECL (impaired) |
| As at January 1, 2021 | 8,981.39 | 5,114,483.02 | 5,123,464.41 | |
| Balance at 1 January 2021 in the current period | ||||
| -- Transfer to stage II | ||||
| -- Transfer to stage III | ||||
| -- Reverse to stage II | ||||
| -- Reverse to stage II | ||||
| Provision | 81,250.63 | 13,662.43 | 94,913.06 | |
| Reversal | 9,064.59 | 9,064.59 | ||
| Elimination | ||||
| Write-off | ||||
| Other changes | ||||
| As at December 31, 2021 | 81,167.43 | 5,128,145.45 | 5,209,312.88 |
Explanations on significant changes in the book balance of other receivables where there are changes inprovision for the current period:
?Applicable√ N/AD. Details of bad debt provision
√Applicable □N/A
Unit: CNY
| Category | Opening balance | Changes in the current period | Closing balance | |||
| Provision | Recovery or reversal | Elimination or write-off | Other changes | |||
| Bad debt provision assessed by aging | 5,123,464.41 | 94,913.06 | 9,064.59 | 5,209,312.88 | ||
| Total | 5,123,464.41 | 94,913.06 | 9,064.59 | 5,209,312.88 | ||
Significant recovery or reversal of bad debt provision for the current period:
?Applicable√ N/A
E. Top five other receivables based on debtors
√Applicable □N/A
Unit: CNY
| Entity | Nature | Closing balance | Aging | Proportion to the total closing balance of other receivables (%) | Closing balance |
| GUIZHOU MOUTAI CHIEW IMPORT AND EXPORT CO., LTD. | Current Account | 1,858,505.80 | Within 1 year | 12.89 | |
| Guizhou Kailin Xifeng Synthetic Ammonia Co., Ltd. | Current Account | 1,000,000.00 | Within 1 year | 6.93 | 52,000.00 |
| Kweichow Moutai-Flavor Liquor Marketing Co., Ltd. | Current Account | 496,619.90 | Within 1 year | 3.44 | |
| Mu Jun | Petty cash | 420,700.00 | 1-2 years | 2.92 | |
| Luo Nanbo | Petty cash | 313,334.50 | Within 1 year | 2.17 | |
| Total | / | 4,089,160.20 | / | 28.35 | 52,000.00 |
Note:
a. The receivables of GUIZHOU MOUTAI CHIEW IMPORT AND EXPORT CO., LTD. are the socialinsurance advances.
b. The receivables of Guizhou Kailin Xifeng Synthetic Ammonia Co., Ltd. are the security deposits paidto the supplier.
c. The receivables of Kweichow Moutai-Flavor Liquor Marketing Co., Ltd. are enterprise annuityadvances.
d. Mu Jun is an employee of the Company, and the accounts are the borrowings for handling the landownership business.
e. Luo Nanbo is an employee of the Company, and the accounts are the borrowings for handling thelitigation and anti-counterfeit businesses.
13.3 Long-term equity investments
√Applicable □N/A
Unit: CNY
| Item | Closing balance | Opening balance | ||||
| book balance | Provision | Carrying amount | book balance | Provision | Carrying amount | |
| Investment in subsidiaries | 1,624,535,587.55 | 1,624,535,587.55 | 1,624,535,587.55 | 1,624,535,587.55 | ||
| Total | 1,624,535,587.55 | 1,624,535,587.55 | 1,624,535,587.55 | 1,624,535,587.55 | ||
A. Investment in subsidiaries
√Applicable □N/A
Unit: CNY
| Investee | Opening balance | Increase in the current period | Decrease in the current period | Closing balance | Provision for impairment in the current period | Closing balance of provisions for impairment |
| Kweichow Moutai Sales Co., Ltd. | 9,500,000.00 | 9,500,000.00 | ||||
| GUIZHOU MOUTAI CHIEW IMPORT AND EXPORT CO., LTD. | 5,600,000.00 | 5,600,000.00 | ||||
| Kweichow Moutai Group Finance Co., Ltd. | 1,275,000,000.00 | 1,275,000,000.00 | ||||
| Moutai Custom Marketing (Guizhou) Co., Ltd. | 14,000,000.00 | 14,000,000.00 | ||||
| Beijing Friendship Messenger Trading Co., Ltd. | 22,507,157.75 | 22,507,157.75 | ||||
| Kweichow | 80,728,429.80 | 80,728,429.80 |
| Moutai Paris Trading | ||||||
| Guizhou Laymau Wine Industry Co., Ltd. | 17,200,000.00 | 17,200,000.00 | ||||
| Kweichow Moutai-Flavor Liquor Marketing Co., Ltd. | 200,000,000.00 | 200,000,000.00 | ||||
| Total | 1,624,535,587.55 | 1,624,535,587.55 |
13.4 Operating proceeds and costs of sales
A. Operating proceeds and costs of sales
√Applicable □N/A
Unit: CNY
| Item | Current period | Prior period | ||
| Revenue | Cost | Revenue | Cost | |
| Main business | 37,237,062,420.65 | 8,898,857,511.93 | 27,387,426,280.99 | 7,696,025,939.31 |
| Others | 107,836,543.52 | 93,055,316.44 | 87,166,157.65 | 74,796,511.69 |
| Total | 37,344,898,964.17 | 8,991,912,828.37 | 27,474,592,438.64 | 7,770,822,451.00 |
Note: Other operating proceeds and costs are mainly the perating proceeds and costs of MoutaiInternational Hotel.
B. Description of performance obligation
√Applicable □N/A
The revenue is confirmed when the customer acquires the control of the goods agreed in the contractand the Company fulfills the contract performance obligation.
C. Description of allocation to the remaining performance obligations
√Applicable □N/A
The revenue of the performance obligations which have been contracted but not fulfilled or notcompletely fulfilled in the current reporting period is CNY 142,568.14.
13.5 Investment income
√Applicable □N/A
Unit: CNY
| Item | Current period | Prior period |
| Income from long-term equity investments under cost method | 44,741,153,786.43 | 34,474,910,979.52 |
| Income from long-term equity investments under equity method | ||
| Investment income on disposal of long-term equity investments | ||
| Investment income from holding held-for-trading financial assets | ||
| Dividend income from holding investments in other equity instruments | ||
| Interest income from holding debt investments | ||
| Interest income from holding other debt investments | ||
| Investment income from disposal of |
| held-for-trading financial assets | ||
| Investment income from disposal of investments in other equity instruments | ||
| Investment income from disposal of debt investments | ||
| Investment income from disposal of other debt investments | ||
| Income from debt reconstruction | ||
| Investment income from disposal of other debt investments | -1,505,395.94 | 68,175.91 |
| Interest income from holding large-amount deposits | 59,761,333.33 | |
| Total | 44,799,409,723.82 | 34,474,979,155.43 |
14. Supplementary information
14.1 Details of current non-recurring profit and loss
√Applicable □N/A
Unit: CNY
| Item | Amount | Description |
| Gains and losses on disposal of non-current assets | -11,920,829.77 | |
| Government grant included in the current profit and loss (except for the government grant which are closely related to the business of the company and are in accordance with the national unified standard quota) | 4,616,000.00 | |
| Profits and losses arising from contingencies unrelated to the normal operation of the company | ||
| In addition to the effective hedging business related to the company’s normal business operations, the profit and loss of fair value changes arising from the holding of trading financial assets, derivative financial assets, trading financial liabilities, derivative financial liabilities, and investment income obtained from the disposal of trading financial assets, derivative financial assets, trading financial liabilities, derivative financial liabilities and other debt investment | -3,750,122.23 | |
| Other non-operating income and expenses except the above items | -210,928,052.99 | |
| Other profit and loss items conforming to the definition of non-recurring profit and loss | 61,031,069.26 | |
| Less: The impact of income tax | -40,237,983.93 | |
| The impact on non-controlling interests | 244,326.28 | |
| Total | -120,958,278.08 |
The reasons shall be explained for the non-recurring profit and loss items defined by the companyaccording to the definition of “explanatory Announcement No. 1 of information disclosure ofcompanies offering securities to the public - non recurring profit and loss” and the items ofnon-recurring profit and loss listed in the explanatory announcement of information disclosure ofcompanies offering securities to the public No. 1 - non recurring profit and loss as recurring profit andloss items.?Applicable√ N/A
14.2 Return on net assets and earnings per share
√Applicable □N/A
| Profit in the reporting period | Weighted | Earnings per share |
| Average return on net assets (%) | Basic earnings per share | Diluted earnings per share | |
| Net profit attributable to ordinary shareholders of the company | 29.90 | 41.76 | 41.76 |
| Net profit attributable to ordinary shareholders of the company after deducting non-recurring profit and loss | 29.97 | 41.86 | 41.86 |
14.3 Differences of accounting data under domestic and foreign accounting standards?Applicable√ N/A
Chairman: Ding XiongjunDate of approval and submission by the Board: March 29, 2022
Amendment?Applicable√ N/A