Shenzhen Topband Co., Ltd.
Annual Report 2021
Topband's investor relations mini-program
March 2022
Section I Important Notes, Contents and Definitions
The Board of Directors, the Board of Supervisors and directors, supervisors and seniorexecutives of the Company hereby assure that the content set out in the Annual Report is true,accurate and complete. It shall be free from false records, misleading statements or major omissions,and shall bear individual and joint legal liabilities therein.Wu Yongqiang, the principal of the Company, Xiangwei, accounting head, and Luo Muchen,accounting department head (the person in charge of accounting department) hereby guarantee thetruth, accuracy and completeness of the financial report in this annual report.All directors have attended the Board meeting at which the Report was scrutinized.There is no significant risk affecting the financial condition and sustainable profitability of theCompany, but there may be risks of declining market demand, increased competition in the industry,raw material price fluctuations, changes in export tax rebate policy and foreign exchange ratefluctuations due to the macro environment home and abroad. For detailed risk warnings, pleaserefer to the “Possible Risk Factors” in Section III of this report and investors are advised to payattention to investment risks.The profit distribution plan approved by the Board of Directors was as follows: based on1,256,978,072 shares, a cash dividend of 0.50 yuan (tax included) for every 10 shares should bedistributed to all shareholders, with 0 bonus shares (tax included) and no capital increase by way oftransfer of reserved funds. If the total share capital of the Company changed due to the sharerepurchase, exercise of stock options and other reasons before the implementation of the profitdistribution plan, the total amount of distribution should be adjusted accordingly in the principlethat the distribution ratio per share remains unchanged. Investors are advised to pay attention to therisk that the total distribution may be adjusted due to changes in total share capital.This report has been prepared in Chinese and translated into English. Should there be anydiscrepancies or misunderstandings between the two versions, the Chinese version shall prevail.
Chairman’s AddressDear shareholders and all friends who care about Topband:
Topband is a technical company always insisting on one thing - providing customers withintelligent control solutions to benefit everyone based on the core technology of "electronic control,motor, battery, power supply and Internet of Things platform".
All employees made hard efforts in 2021 in the face of many challenges from the externalenvironment. Customers and suppliers gave great trust to us. Finally, the Company exceeded therevenue target set at the beginning of the year and ensured the supply to customers.
Co-creation and sharing of values, and common construction of sustainable ecology . Fora long time, Topband has adhered to the core values of "accomplishing customers and achievingcommon development" and the concept of "equality, health, fairness and justice", and has beenworking with industrial chain partners to build sustainable development of ecology, achievingmutual benefit and common growth. In 2021, the supply side faced severe difficulties, i.e. theshortage of raw materials accompanied by the price increase. We formulated the priority supplyguarantee strategy quickly to ensure the delivery of customer orders by stocking in advance andstock allocation at high prices, and provided supplier empowerment training. Although we lostsome profits, we won the trust and support of customers and suppliers. We believe that the more weare in danger, the more we should show our responsibility and truly regard our customers andsuppliers as a community of destiny. We insist on embracing partners with common values activelyto create a healthier ecological environment.
Adhering to the value of technology and the development of the future market growthunder innovation-driven strategy. Topband has always insisted on providing various intelligentsolutions for sectors such as tools, household appliances, new energy and industry based on the coretechnology of "electronic control, motor, battery, power supply and Internet of Things platform ". Inthe past decade, the R&D investment of the Company accounted for about 7% of its operatingrevenues, and technology and product innovation boosted the performance growth of the Companycontinuously. In 2021, the innovative product platform of the Company grew rapidly, further
consolidating its position in the intelligent control industry. The proportion of our independent andcontrollable business increased steadily. Many innovative products emerged, such as inverters,thermostats, cooking machines, lawn mowers and floor washers, contributing a steady stream ofpower to the future development of the Company. Topband has truly entered the business model oflong-term development under innovation-driven strategy. There is no ceiling for the futuredevelopment of the Company. As long as we firmly grasp the technology and product innovation,there will be no shortage of market, which is especially worthy of our pride.Constant evolution of the organization and simulation of vitality to improveorganizational capacity. Topband is a self-circulating and self-growing organism, which can adaptto the changes of the external environment quickly and grow continuously. In 2021, we reorganizedthe process and organization, reduced the decision-making level and determined the mission andvision of each organization, making everyone clear about their respective responsibilities andperform their own duties. We adhered to the employment philosophy of "respecting human nature,identifying needs, giving opportunities, giving full play to value, and achieving commondevelopment", and promoted more than 40 BU (Business Unit) general managers from successfulpractice, allowing more outstanding talents with great ambition, sense of mission and internal drive,market insight and determination, battle control ability and courage to take up managementpositions. At the same time, we strengthened the construction of cadre and key professional teams,integrated excellent resources and formed a reasonable talent structure to promote the valuerealization of employees and achieve common development of the Company and individuals.Organizational dividends have been gradually manifested with the improvement of organizationalcapacity, which will become the greatest wealth of the Company.Looking forward to 2022, Topband is also welcoming new development opportunities with thedevelopment of society towards the trend of "intelligence, low carbonization, regionalization andshort chain". The Company formulated a blueprint for the next ten years and strategies for eachbusiness unit for the next three years in 2021. To achieve our long-term goals, we will seize thehistorical opportunities of intelligence, scenarios and green and low carbon systems to innovate thebusiness model actively, focus on independent innovation and provide customers with intelligentsolutions through insight into the pain spots of users, scenarios and industries while building
demand insight, resource integration and core platform capabilities. In 2022, we will seize businessopportunities and further optimize internal management.Seizing opportunities to lead industry growth. For mature business, we should go to thefront end to gain insight into market opportunities, deeply understand customer needs, seize newopportunities constantly and strive for more orders to ensure the scale advantage of the Company.For growing business, we should improve our ability continuously and give full play to our existingadvantages to incubate and market innovative products constantly and achieve commercial success.At the same time, we should continue to expand new tracks and open up new growth points, andfinally achieve long-term strategic goals.Optimization of internal management and improvement of operational efficiency. Withthe gradual diversification of the Company's business, in order to adapt to the ever-changingbusiness structure and promote the faster development of business, we will deepen the businessmodel of independent operation, clear responsibilities and effective supervision of differentbusiness under the control of the Group and the support of the platform, continue to consolidate theresults of process reengineering, focus on customer satisfaction and the improvement of operationalefficiency, insist on shifting the business focus forward, change the operation mode ofmiddleground and background functions actively, and meanwhile promote the improvement ofdigitalization, intelligent manufacturing and integrated supply chain continuously to make differentbusinesses grow healthily on the platform of the Company.Facing the future, the fearless Topband staff will continue to uphold the customer-centeredconcept and create value for society under the guidance of entrepreneurship. Let's go forward handin hand, contribute our strength to the intelligent and low-carbon society, and create an intelligentand bright future together.
Chairman of Shenzhen Topband Co., Ltd.
March 22, 2022
Contents
Section I Important Notes, Contents and Definitions ...... 2
Section II Company Profile and Main Financial Indicators ...... 9
Section III Discussion and Analysis of the Management ...... 15
Section IV Corporate Governance ...... 78
Section V Environmental and Social Responsibility ...... 116
Section VI Important Matters ...... 117
Section VII Share Change and Shareholders ...... 135
Section VIII Information on Preferred Shares ...... 148
Section IX Relevant Information of Bonds ...... 149
Section X Financial Report ...... 150
Directory of documents for future reference
I. Accounting statements containing the signatures and seals of the legal representative, thefinancial head and the accounting department head.II. The original audit report bearing the seal of the accounting firm and the signatures and seals ofthe certified public accountants.III. The originals of all the company documents publicly disclosed in newspapers designated by theCSRC during the reporting period and the original manuscripts of announcements.IV. The original of the Annual Report 2021 bearing the signature of the chairman.V. All the above documents are ready and complete, and are available for reference at the office ofthe Board of Directors of the Company.
Interpretation
Term | Mean | Definitions |
Company, the Company, Topband shares | Mean | Shenzhen Topband Co., Ltd. |
Yuan, 10,000 yuan | Mean | Yuan, 10,000 yuan |
CSRC | Mean | China Securities Regulatory Commission |
Exchange | Mean | Shenzhen Stock Exchange |
Reporting period | Mean | From January 1, 2021 to December 31, 2021 |
Articles of Association | Mean | Articles of Association of Shenzhen Topband Co., Ltd. |
Huizhou Topband | Mean | Huizhou Topband Electrical Technology Co., Ltd. |
YAKO Automation | Mean | Shenzhen YAKO Automation Technology Co., Ltd. |
HCD | Mean | Shenzhen Allied Control System Co., Ltd. |
Topband Software | Mean | Shenzhen Topband Software Technology Co., Ltd. |
ORVIBO | Mean | Shenzhen ORVIBO Technology Co., Ltd. |
Chongqing Yiyuan | Mean | Chongqing Topband Industrial Co., Ltd. |
Topband Ningbo | Mean | Ningbo Topband Intelligent Control Co., Ltd. |
Meanstone Intelligent | Mean | Shenzhen Meanstone Intelligent Technology Co., Ltd. |
HANSC Intelligent | Mean | Shenzhen HANSC Intelligent Technology Co., Ltd. |
Hong Kong Topband | Mean | Topband (Hong Kong) Co., Ltd. |
Topband Smart Europe | Mean | Topband Smart Europe Company Limited |
Topband Mexico | Mean | Topband Mexico Company Limited |
Topband Lithium Battery | Mean | Shenzhen Topband Battery Co., Ltd. |
IOT | Mean | Internet of Things |
ICT | Mean | Information Communications Technology |
T-SMART | Mean | Topband One-Stop Smart Home Solution |
AI | Mean | Artificial Intelligence |
BLDC Motor | Mean | Brushless DC Motor |
BG and BU | Mean | Business Group and Business Unit |
IPD | Mean | Integrated Product Development |
ISC | Mean | Integrated Supply Chain |
Section II Company Profile and Main Financial IndicatorsI. Company information
Stock abbreviation | Topband | Stock code | 002139 |
Listed stock exchange | Shenzhen Stock Exchange | ||
Chinese name of the Company | Shenzhen Topband Co., Ltd. | ||
Chinese abbreviation of the Company name | Topband | ||
Name of the Company in foreign language (if any) | Shenzhen Topband Co., Ltd. | ||
Legal representative of the Company | Wu Yongqiang | ||
Registered address | Room 413, Block B, Research Institute of Tsinghua University, High-Tech Industrial Park, Yuehai Street, Nanshan District, Shenzhen | ||
Postal code of registered address | 518057 | ||
Historical changes of registered address of the Company | None | ||
Office address | Topband Industrial Park, Keji Second Road, Shiyan Subdistrict, Baoan District, Shenzhen | ||
Postal code of office address | 518108 | ||
Company website | http://www.topband.com.cn | ||
wenzh@topband.com.cn |
II. Contact person and contact information
Secretary of the Board of Directors | |
Name | Wen Zhaohui |
Address | Topband Industrial Park, Keji Second Road, Shiyan Subdistrict, Baoan District, Shenzhen |
Tel | 0755-26957035 |
Fax | 0755-26957440 |
wenzh@topband.com.cn |
III. Information disclosure and storage place
Website of the stock exchange for disclosure of the Company's annual report | http://www.cninfo.com.cn |
Name and website of the media for disclosure of the Company's annual report | Securities Times and CNINFO (http://www.cninfo.com.cn) |
Location where the Company’s annual report is available | Office of the Board of Directors of the Company |
IV. Changes in registration
Organization code | 91440300192413773Q |
Changes in the main business of the Company since its listing (if any) | No change |
Previous changes in controlling shareholders (if any) | No change |
V. Other relevant information
Accounting firm engaged by the Company
Name of accounting firm | BAKER TILLY International Accounting Firm (Special General Partnership) |
Office address of accounting firm | Areas A-1 and A-5, Building 68, No. 19 Chegongzhuang West Road, Haidian District, Beijing City |
Name of undersigned accountant | Chen Zhigang, Zhao Yang |
Sponsor engaged by the Company to perform continuous supervision duties during the reporting period
√ applicable □ not applicable
Name of Sponsor | Office address of Sponsor | Name of Sponsor’s representative | Continuous supervision period |
China Securities Co., Ltd. | Room 2203, North Tower, Shanghai Securities Building, No. 528 Pudong South Road, Shanghai | Xu Chao and Zhu Mingqiang | 2021/6/3-2022/12/31 |
Financial consultant engaged by the Company to perform continuous supervision duties during the reportingperiod
□ applicable √ not applicable
VI. Main accounting data and financial indicatorsWhether the Company is required to retroactively adjust or restate the accounting data of previous years
√ Yes □ No
Reasons for retroactive adjustment and restatement
Correction of accounting errors
Unit: Yuan
2021 | 2020 | Increase or decrease in the current year over the previous year | 2019 | ||||
Before adjustment | After adjustment | After adjustment | Before adjustment | After adjustment | |||
Operating income (yuan) | 7,767,034,835.03 | 5,560,182,998.21 | 5,560,182,998.21 | 39.69% | 4,098,855,380.70 | 4,098,855,380.70 | |
Net profit attributable to shareholders of listed companies (yuan) | 564,964,282.18 | 533,516,814.04 | 532,161,123.64 | 6.16% | 330,827,437.00 | 326,982,110.07 | |
Net profit attributable to shareholders of listed company after deducting non-recurring profit and loss (yuan) | 432,038,218.88 | 382,743,934.45 | 381,388,244.05 | 13.28% | 198,463,874.89 | 194,618,547.96 | |
Net cash flow from operating activities (yuan) | -224,562,545.86 | 647,900,708.38 | 647,900,708.38 | -134.66% | 404,477,700.20 | 404,477,700.20 | |
Basic earnings per share (yuan / share) | 0.47 | 0.51 | 0.51 | -7.84% | 0.33 | 0.32 | |
Diluted earnings per share (yuan / share) | 0.47 | 0.51 | 0.51 | -7.84% | 0.32 | 0.32 | |
Weighted average return on net assets | 13.11% | 19.04% | 19.12% | -6.01% | 13.92% | 13.62% | |
End of 2021 | End of 2020 | Increase or decrease at the end of the current year compared with the end of the previous year | End of 2019 | ||||
Before adjustment | After adjustment | After adjustment | Before adjustment | After adjustment | |||
Total assets (yuan) | 9,606,992,402.39 | 6,808,735,037.28 | 6,774,684,691.87 | 41.81% | 5,121,650,811.96 | 5,089,457,576.89 | |
Net assets attributable | 5,028,315,406.63 | 3,463,681,980.54 | 3,457,256,863.83 | 45.44% | 2,510,384,699.83 | 2,492,678,420.43 |
Reasons for changes in accounting policies and correction of accounting errors
In view of the Company's plan to split its holding subsidiary Shenzhen Yako Automation Technology Co.,Ltd. (hereinafter referred to as Yakotec) for A-share listing, the Company found important early errors in the auditprocess of share reform of Yakotec and made the following adjustments to its accounting based on the principleof prudence in order to maintain the consistency of IPO audits:
(1) Capitalization adjustment of research and development expenses
R&D projects of Yakotec are divided into research stage and development stage. Projects meeting R&Dcapitalization conditions were capitalized in previous years. We made retroactive adjustments and expensed theprojects capitalized in the previous period in this audit.
(2) Adjustment of share-based payment
Yakotec granted equity to key employees through the shareholding platform. However, it was not recognizedas share-based payment, and the corresponding expenses were not accrued. According to the definition in theAccounting Standards for Business Enterprises No.11 - Share-based Payment, share-based payment refers to thetransaction in which an enterprise grants equity instruments or undertakes liabilities determined on the basis ofequity instruments in order to obtain services from employees and other parties. Therefore, the equity granted toemployees by Yakotec was retroactively recognized as share-based payment, and the corresponding expenseswere adjusted and accrued. Corrections were made with the retroactive restatement method.Whichever was the lower of the Company’s net profit before or after deduction of non-recurring profit and loss forthe last three fiscal years was negative, and the audit report for the latest year showed that there was uncertaintyabout the Company’s ability to continue as a going concern.
□ Yes √ No
The lower of the net profit before or after deduction of non-recurring profit and loss was negative
□ Yes √ No
VII. Differences in accounting data under domestic and foreign accounting standards
1. Differences in net profit and net assets between financial reports disclosed in accordance withInternational Accounting Standards and those disclosed in accordance with PRC GAAP simultaneously
□ applicable √ not applicable
There is no difference in net profit and net assets between financial reports disclosed in accordance withInternational Accounting Standards and those disclosed in accordance with PRC GAAP during the reportingperiod.
(2) Difference between the net profit and net assets in the financial reports disclosed in accordance withboth overseas accounting standards and Chinese accounting standards at the same time
□ applicable √ not applicable
There is no difference in net profit and net assets between financial reports disclosed in accordance with foreignaccounting standards and those disclosed in accordance with PRC GAAP during the reporting period.VIII. Main financial indicators by quarters
Unit: Yuan
First quarter | Second quarter | Third quarter | Fourth quarter | |
Operating income | 1,697,665,239.89 | 1,946,380,372.51 | 1,974,866,843.92 | 2,148,122,378.71 |
Net profit attributable to shareholders of listed company | 239,380,556.42 | 188,805,147.61 | 137,288,117.55 | -509,539.40 |
Net profit attributable to shareholders of listed company after deducting non-recurring profit and loss | 153,267,330.93 | 166,447,189.51 | 130,866,684.30 | -18,542,985.86 |
Net cash flow from operating activities | -151,010,247.06 | -74,695,491.07 | 50,414,589.82 | -49,271,397.56 |
Whether the above financial indicators or their sums are materially different from the relevant financial indicatorsin the disclosed quarterly and semi-annual reports of the Company
□ Yes √ No
IX. Items and amount of non-recurring profit and loss
√applicable □ not applicable
Unit: Yuan
Items | Amount in 2021 | Amount in 2020 | Amount in 2019 | Description |
Profit and loss on disposal of non-current assets (including the write-off portion of the provision for asset impairment) | -789,236.29 | -2,162,674.03 | -2,689,991.66 | |
Government subsidies included in current profits and losses (except those that are closely related to the normal business of the Company, conform to national policies and regulations and are continuously enjoyed in a fixed or quantitative manner according to certain standards) | 16,456,682.22 | 27,326,933.85 | 40,716,240.12 | |
Gains and losses due to fair value changes arising from the holding of trading financial assets and liabilities, as well as the investment income from the disposal of trading financial assets and liabilities and available-for-sale financial assets, except for the effective hedging business related to the normal business of the Company | 133,466,036.23 | 147,775,030.77 | 109,833,096.66 | |
Other non-operating income and expenses other than those mentioned above | -1,787,714.37 | 43,836.85 | 4,385,194.03 | |
Other profit and loss items that meet the definition of non-recurring profit and loss | 9,914,763.48 | 5,602,702.63 | 4,847,353.13 | Financing income |
Minus: amount affected by income tax | 23,726,354.32 | 27,106,631.22 | 23,696,511.92 | |
Amount affected by minority shareholder’s interest (after tax) | 608,113.65 | 706,319.26 | 1,031,818.25 | |
Total | 132,926,063.30 | 150,772,879.59 | 132,363,562.11 | -- |
Details of other profit and loss items that conform to the definition of non-recurring profits and losses:
□ applicable √ not applicable
The company has no other profit or loss items that meet the definition of non-recurring profit or loss.Explanation of defining the non-recurring profit and loss items listed in the Explanatory Announcement No.1 onInformation Disclosure for Companies Offering Their Securities to the Public - Non-recurring Profits and Lossesas recurring profit and loss items
□ applicable √ not applicable
The items of non-recurring profit and loss listed in the Explanatory Announcement No. 1 on InformationDisclosure for Companies Offering Securities to the Public — Non-Recurring Profits and Losses are not definedas the recurring profit and loss by the Company.
Section III Discussion and Analysis of the ManagementI. Conditions of the industry of the Company during the reporting period
1. Basic information of the industry
Intelligent controllers are high-tech products developed by integration of sensing technology, microelectronictechnology and power electronic technology based on automatic control technology and computer technology,which serve as a "nerve center" and "brain". Their application covers all walks of life, mainly in the fields ofhousehold appliances, smart homes, intelligent buildings, power tools, industry and automation, automotiveelectronics, new energy and medical equipment. In recent years, intelligent control technology has beencontinuously integrated with new technologies such as 5G, Internet of Things, artificial intelligence and cloudcomputing, accompanied with accelerated iteration of all products, continuously improved intelligence,continuous emergence of new products, formats and models and a better development prospect of the intelligentcontroller industry.
2. Position in the industry
The Company is a global leading provider of intelligent control solutions, focusing on the field of intelligentcontrol, adhering to the value concept of "agile innovation partner" and driving its development withtechnological innovation. It has formed a comprehensive technical system of "electronic control, motor, battery,power supply and Internet of Things platform" to provide customized intelligent control solutions for downstreamcustomers in industries such as home appliances, tools, new energy, industry and intelligent solutions. Centeringon the three unique capabilities, i.e. "platform-based technological innovation capability, partnership customerservice capability and systematic quick response capability", the Company keeps forging ahead and hasestablished close cooperative relations with a large number of industry heading customers. It has now become aleader in intelligent control solutions in home appliance and tool industries and an innovation leader in new energy,industry and intelligent solutions.II. Main businesses during the reporting period
The Company mainly engages in R&D, production and sales of intelligent control system solutions, i.e.,providing diversified customized solutions for industries of home appliances, tools, new energy, industrial and
intelligent solutions, etc., with the “four electrics and one network” technology of electric control, motor, battery,power supply and IoT platform as its core. The Company is a global leading provider of intelligent controltechnology, a pioneer of intelligent control solutions for the home appliances and tool industries, and aninnovative leader in new energy, industrial and intelligent solutions.
1. Core technology of the Company: “four electrics and one network”: electric control, motor, battery,power supply technology and IoT platform.
1.1 Electric control technology. The electric control technology is a technology to achieve intelligentcontrol with the microcomputer as the core, including: sensing technology, power electronics, signal processingtechnology, communication technology, interactive technology, power and energy conversion technology,electromagnetic compatibility and so on. The Company has established hundreds of electric control technologyplatforms, which completely cover the demand range of products in four major industries.
1.2 Motor technology. The motor technology is a technology that converts electrical energy into kineticenergy. The Company has built dozens of advanced motor technology platforms around various types of motorssuch as brushless DC motors (BLDC), stepper motors, and servo motors. Among them, the Company takes thelead in the tool motor and motion control industries. Motion control refers to the real-time control of the position,speed and direction of mechanical moving parts, so that such mechanical moving parts move in accordance withthe expected trajectory and the specified motion parameters. The motion control system is generally composed ofman-machine interaction interface, controller, driver, motor and other components, which are the core componentsof intelligent manufacturing equipment, and is the premise and basis for the realization of intelligentmanufacturing.
IoT platformPower source
technology
Electric control technology | Motor technology | Battery technology | Power source technology |
Tool
ToolIntelligentsolutions
Intelligent
solutionsIndustry
Industry
New
energy
New
energy
Core technology
layout of "four
electrics and one
network"
Core technology
layout of "four
electrics and one
network"
Homeapplianc
es
Homeapplianc
es
Intelligent controlbusiness application
in "five industries"
1.3 Battery technology. The battery technology is a technology for energy storage and management. Its coretechnologies include battery material application technology, cell design and manufacturing technology andbattery system integration technology. Battery material application technology includes related applicationtechnologies of positive and negative electrode materials, electrolytes and diaphragm. Cell design andmanufacturing technology includes electrochemical architecture design, coating, lamination/winding, formationand other manufacturing technologies. Battery system integration technology includes a series of technologiessuch as battery assembly, thermal management, collision and leakage safety, accurate measurement ofvoltage/current/temperature signals, battery state estimation and cell balance. The technology spans many fieldssuch as material science, electrochemistry, electronics and control engineering. After years of accumulation, theCompany has developed complete technical capabilities of design, development, customization and productionranging from cell technology (CELL), battery management technology (BMS) to battery pack (PACK) system.
1.4 Power technology. Power technology is a kind of electric energy conversion technology, which cantransform the front-end input into the output required by the load safely, efficiently and intelligently. TheCompany has analog power, switching power and digital power technology platforms of different power levelsand various types, which can provide charging and inversion solutions and various customized power solutions.
1.5 Internet of Things platform. The IoT platform is a technology that integrates perception layer,connection layer and application layer, mainly including connection management, device management andapplication. The Company has formed a complete technical capability from IoT module, intelligent terminal toAPP, and PaaS IoT platform, and has developed solutions for more than ten business scenarios.
2. Main products of the Company: Customized system solutions for five industries, namely homeappliances, tools, new energy, industry and intelligent solutions.
2.1 Home appliances
The Company provides brand customers in the home appliance industry with customized product concepts,design, development, manufacturing and delivery services, including the master control, power control, motordrive and control and display control of home appliances.
2.2 Tool intelligent control
The tool industry mainly includes electric tools, garden tools and other professional tools. The Companyprovides its customers with customized product concepts, design, development, manufacturing and deliveryservices. The business scope covers electronic controls, motors and batteries, and product forms include
controllers, modules and complete machines.
2.3 New energy business
New energy business is mainly oriented to energy storage and green commuting, in which products andsystem solutions including inverters, battery cells, battery management systems, battery packs, battery swapcabinets, PACK and motor control are provided for fields such as energy storage of communication base stations,household energy storage, motorcycles and tricycles, other special vehicles, new energy vehicles and the Internetof Things.
2.4 Industry
In the industrial control industry, the Company’s main business includes research and development,production, sales of step and servo drives and control products with focus on special industrial intelligent controlsolutions. The Company mainly provides controllers, drivers and motors for downstream automation equipmentcustomers, which are widely used in 3C electronics, robotics, medical equipment, semiconductor equipment,textile machinery, packaging machinery, etc. We are committed to helping automation equipment manufacturersimprove equipment design performance, reduce equipment manufacturing costs, and speed up the development ofnew equipment.
2.5 Intelligent solutions
In the field of intelligent solutions, comprehensive solutions of "innovative products + AIoT platform +customized service" are provided for the subdivided scenes such as "food, clothing, housing and transportation"and "industry, restaurants, hotels and parks" based on the AloT (Artificial Internet of Things) technology platformand intelligent product innovation capability of the Company.III. Core competitiveness analysis
1. Platform-based technological innovation capability. With the technology as DNA and the innovation asthe gene of development, the Company has formed a unique innovation leading capability. The Company hasaccumulated and formed the most complete technology platform in the industry, with capabilities for in-depthunderstanding of various control mechanisms, independent implementation and industry leading, covering allaspects of core technologies of intelligent control integration solutions, such as: intelligent control algorithms,motor electric control, sensing, man-machine interaction, image recognition, power technology, Androidtechnology, temperature control technology, heating, cooling, etc. The Company has the most abundant product
lines in its industry, each of which has accumulated and formed a complete, mass-production-proven productplatform covering white home appliances, small home appliances, power tools, gardening tools, intelligenthardware, smart campus, consumer electronics and other fields, and can quickly provide customers with the bestand most guaranteed customized solutions. In addition, the Company has a unique overall solution capacity of“intelligent controller + high efficiency motor + lithium battery” in industry, further strengthening the capacity ofthe Company to lead the technology.
2. Partnership-based customer service capability. The Company takes “agile innovation partner” as itstechnology value proposition, and develops partnership with customers with the development concept of valueco-creation and value co-win. Relying on the advantage of leading technology capacity and based on the deepinsight of customer needs, the Company has formed the partnership-based customer service capacity with thefastest response and the most powerful value creation, established in-depth cooperation partnership with domesticand foreign excellent brand customers in various business fields, and formed a good reputation and brandreputation in the industry. The partnership-based customer service capacity is widely recognized and praised bycustomers.
3. Systematic rapid response capability. With the development of ICT technology and the acceleratedspeed of global innovation iteration, the services provided by the Company to customers increasingly need to bemore agile in terms of operation. Based on a deep understanding of the intelligent control business, the Companyhas created a strong platform system from the implementation of IPD concept of R&D and design process, ISCreform of core customers of supply chain system, laboratory and quality assurance system, and intelligentmanufacturing platform system, building a customer-centered process-oriented organization and internalizing thestrengths and capabilities of the Company into agile capabilities of operation, thus further strengthening thedifferentiated capabilities of rapid innovation and response, and guarantee sustainable and high-speed growth ofthe Company.IV. Main business analysis
1. Overview
The year 2021 is the beginning of the 14th five-year plan. Scientific and technological innovation, peakcarbon dioxide emissions and carbon neutralization will be the two important factors in the next stage ofeconomic growth. The Company's intelligent control and lithium battery application business complied with
national economic development and achieved rapid growth during the reporting period.In 2021, the epidemic at home and abroad still recurred, sometimes had a local rebound, and the impact isstill not eliminated. In the face of the complex and changeable business environment such as the rise in the priceof raw materials and the shortage of goods under the influence of the epidemic and inflation, the Company'smanagement actively responded, and seized the opportunity of intelligent upgrading, localization transfer anddemand concentration enhancement depending on its product power, technological innovation, systematicmanagement ability accumulated for many years. Faced with difficulties and challenges, we chose to share risksand benefits, conduct long-term cooperation with our customers and accomplish customers so as to achievemutual prosperity and development and boost the development of an intelligent and low-carbon world.
Thanks to the efforts of all Topband staff, operating revenues of the Company achieved a compound growthrate of over 30% in the past five years. The Company achieved operating revenues of 7.767 billion yuan duringthe reporting period, a year-on-year increase of 39.69%, net profits of 565 million yuan attributable toshareholders of listed companies, a year-on-year increase of 6.16%, and net profits of 432 million yuanattributable to shareholders of listed companies after deduction of non-recurring gains and losses, a year-on-yearincrease of 13.28%.Annual operating performance and core operating indicators in 2021:
(I) Revenues more than expected and achievement of annual sales targets
1. Expansion of intelligent scenarios, opening up the space for industry growth
With the accelerated arrival of the intelligent society, the industry development has entered the fast lane andwill be a long-term process, the application scenarios of intelligent controllers continue to expand, and thedownstream demand will still maintain a high degree of prosperity. External factors such as the epidemic andturbulence in the supply market may affect the rhythm of industry demands in the short term, but will not affectthe sustained growth of the industry brought about by intelligence, low carbon and multi-regional development.For mature business, we went to the front end to gain insight into market opportunities, deeply understandcustomer needs, seize new opportunities constantly and strive for more orders to ensure the scale advantage of theCompany. For growing business, we improved our ability continuously and gave full play to our existingadvantages to incubate and market innovative products constantly and achieve commercial success. At the sametime, we continued to expand new tracks and open up new growth points, and finally achieved long-term strategicgoals. Looking forward to the future, we are confident to grasp new opportunities in the market, continue to
deepen the intelligent control industry, lead the industry forward, and become a global leading and respectedintelligent control solution provider.
2. Achievement of annual sales targets beyond the expected and consolidation of the leading position ofthe CompanyThe epidemic in China and abroad had repeated outbreaks in 2021. Facing the complicated and volatilebusiness environment such as raw material price increase and shortage under the influence of the epidemic andinflation, the management of the Company responded positively, seized the opportunity of intelligent upgradingand demand concentration improvement according to the strategy of "supply guarantee" formulated at thebeginning of the year, and implemented the five core strategies unswervingly to seize market share rapidly. In2021, the five major sectors of the Company achieved good growth year on year, and the customer structurebecame healthier. The number of head customers exceeded 100, revenues from which accounted for more than80% of the Company's total operating revenues. We realized the growth of both the number and volume of headcustomers, laying a solid foundation for the subsequent sustained and steady growth.
3. Shoulder-to-shoulder and distinctive development of all business units
(1) Tool unit: becoming the first business unit of the Company. In 2021, the sales revenue was 2.994 billionyuan, a year-on-year increase of 43.36%.The downstream market of the tool unit is concentrated. With obviousadvantages in the unit, the Company has entered the supply system of several head customers. Its market shareincreased steadily. Product categories expanded horizontally. Except for electric tools, garden tools, utility lightsand floor care and cleaning products all achieved rapid growth during the reporting period. The main driving forcefor the growth of the unit is the continuous expansion of application scenarios, the opening of incremental market,the upgrading of technology in stock market, and the realization of lithium battery and cordless application. Thesustained growth of the industry will not be changed by short-term factors such as the epidemic.
(2) Home appliance unit: maintaining a strong growth trend with the growth rate higher than the average ofthe industry as the basic business of the Company. In 2021, the sales revenue was 2.959 billion yuan, ayear-on-year increase of 37.36%.The main reasons included the smooth development of big customers, theincrease of the number and volume of customers, and the constant emergence of innovative products, e.g. therapid growth of innovative intelligent devices, kitchen appliances, purification products and service robots whichopened up the growth space of the home appliance unit. For the traditional business, the Company will strengthenthe ability to gain insight into market opportunities, deeply understand customer needs, improve its resource
integration ability and internal operational efficiency, and strive for more orders to ensure its scale advantages. Forinnovative business, we will make use of the core advantages of technological innovation to incubate and marketinnovative products continuously so as to achieve both commercial success and rapid growth.
(3) New energy unit: In 2021, the sales revenue reached 1.241 billion yuan, up 38.86% year-on-year.Focusing on energy storage, green commuting and other fields, the unit has become the third growth curve of theCompany. Relying on years of technology accumulation and stable quality assurance, we can open the marketquickly with the advantages of customized solutions and continue the trend of high growth in the future.Energy storage: In 2021, the sales revenue was 881 million yuan, accounting for about 70% of the newenergy unit, a year-on-year growth of 37.74%.The main application fields of energy storage were householdenergy storage, portable energy storage, standby power for communication and industrial and commercial energystorage. The operating revenue of household energy storage and portable energy storage doubled during thereporting period. It is expected to continue the high growth trend in 2022.In terms of household energy storage,complete lithium battery products were provided for overseas household energy storage and electrical powersupply for RVs and yachts. In portable energy storage, inverter products were mainly provided for head customersin China. The proportion of standby power for communication decreased year on year due to the price increase ofupstream materials and the limitation of production capacity. Industrial and commercial energy storage accountedfor a low proportion. It is expected to build a new growth point in the future.Green travel. In 2021, the sales revenue reached 360 million yuan, accounting for about 30% of the newenergy unit, a year-on-year growth of 41.66%.The main application fields were new energy vehicles and lightpower. In the field of new energy vehicles, charging pile controllers, electronic water pumps and DC brushlessmotors were mainly provided. In 2021, the sales revenue was about 100 million yuan, a year-on-year growth of
157.30%.With the popularization of new energy vehicles, it is expected to continue the trend of high growth. Inthe field of light power, BMS or complete products were mainly provided for swap cabinets, electric motorcyclesand tricycles and mobile robots. The growth of the unit was lower than expected due to the influence of upstreammaterials.
(4) Industrial unit: In 2021, the sales revenue was 295 million yuan, a year-on-year increase of 14.41%. TheCompany mainly provides controllers, drivers and motors for downstream automation equipment customers,which are widely used in 3C electronics, robotics, medical equipment, semiconductor equipment, textilemachinery, packaging machinery, etc. We are committed to helping automation equipment manufacturers improve
equipment design performance, reduce equipment manufacturing costs, and speed up the development of newequipment. Benefiting from domestic substitutions and intelligent upgrading of factories, the unit will usher in anew boom cycle in the future.
(5) Intelligent solutions: In the field of intelligent solutions, comprehensive solutions of "innovativeproducts + AIoT platform + customized service" are provided for the subdivided scenes such as "food, clothing,housing and transportation" and "industry, restaurants, hotels and parks" based on the AloT (Artificial Internet ofThings) technology platform and intelligent product innovation capability of the Company. In 2021, the salesrevenue was 221 million yuan, a year-on-year increase of 60.40%, among which the revenue of networkedproducts doubled.(II) Supply side faced with severe challengesThe supply market was extremely turbulent in 2021. The extensive shortage of raw materials and thecontinuous sharp increase of prices aggravated the original complex supply and manufacturing pattern. Due to thevariety of upstream raw materials of the Company, the uncertainty of supply brought great challenges to itsprocurement, production and delivery. In comparison with the shortage of materials in 2018, the management ofthe Company anticipated the severe situation in advance and formulated important strategic measures of "supplyguarantee" in time at the beginning of the year. It guaranteed the timely delivery of customer orders to the greatestextent and reduced the impact of shortage and price increase on business delivery greatly by communication withcustomers in advance about demand plans, stocking in advance, domestic substitutions and stock allocation athigh prices. However, the Company failed to achieve the goals of material cost reduction and manufacturingefficiency improvement set at the beginning of the year due to the significant price rise of some raw materials andthe serious shortage of supply. Some orders experienced stock allocation at high prices in the second half of 2021,and the costs were not greatly transmitted to downstream and new products, which had a certain impact on theCompany's operating profits in the short term. With the gradual decline of raw material prices in the future, itsprofitability is expected to return to the normal level and the growth rate of profits will also recover gradually.
(3) Adhering to R&D investment and tapping the blue ocean market driven by innovation
The Company adheres to the concept of creating value for customers and society, always takes"technological innovation" as its engine, continuously deepens the technological leading ability and constructs anew driving force for enterprise development. In 2021, the Company continued to promote and deepen thetechnology accumulation and application of "electronic control, motor, battery, power supply and Internet of
Things platform" in five major industries, and accelerated the integration and application of new technologiessuch as AI, IOT and 5G and the implementation of more scenarios.The total R&D investment of the Company was 560 million yuan during the reporting period, up 41.02%year-on-year, accounting for 7.21% of operating revenues. There were nearly 1,600 R&D and technical servicepersonnel. The Company created an innovative cultural atmosphere internally and strengthened the protection ofindependent and controllable products and independent intellectual property rights externally. The Company andits subsidiaries applied for 2,346 patents, including 868 patents for invention, 1,209 utility models, 193 designpatents, 23 foreign patents and 53 PCTs, 85 software copyrights and 276 trademarks accumulatively at the end ofthe reporting period. The R&D investment of the Company accounted for about 7% of its operating revenues inthe past ten years. With a high proportion of continuous R&D investment, a lot of innovative products emerged,such as inverters, thermostats, cooking machines, lawn mowers and floor washers. The proportion of independentand controllable business increased rapidly in 2021, contributing a steady stream of power to the futuresustainable development. The Company also started a business model of long-term development driven byinnovation.
(IV) Multi-regional common development and accelerated process of internationalizationWe are an international company with customers all over the world. Focus on the strategy of “customerintimacy”, we serve customers closely and improve the service responsiveness and the service quality further. Weset up more than ten regional operation centers, manufacturing centers, R&D centers and representative offices inmany places around the world based on the needs of business development. In 2021, Vietnam Phase II went intoproduction quickly in spite of many difficulties, and overseas operation centers in Germany and North Americaand manufacturing centers in Romania and Mexico were newly established to accelerate the international layoutand realize agile delivery. The current main production capacity layout of the Company is as follows:
The Pearl River Delta: Include the Shenzhen headquarters and Huizhou. Huizhou Subsidiary is the mainsource of production capacity, with stable production capacity and quality. At the same time, some leased factorieshave been added to meet the fast-growing demand.Yangtze River Delta region: Ningbo Operation Base was completed at the end of 2021 and put into servicein 2022 and has now entered the capacity climbing period. It will gradually release the capacity. Nantong LithiumBattery Industrial Park is going through property rights delivery according to the agreement and is expected to beput into service in the second half of 2022.
Southeast Asia - Vietnam: Though Vietnam Binh Duong Company (Phase I) was affected by the epidemicin 2021, it overcame many difficulties, including personnel and materials, to help customers realize the agility andsafety of the supply chain and contributed an output value of 552 million yuan. Vietnam Dong Nai Company(Phase II) was put into production successfully during the reporting period, and will contribute new capacity in2022.
Southeast Asia - India: India experienced severe epidemic in 2021. The Company achieved the productioncapacity target set at the beginning of the year during the reporting period by telecommuting means such as videoand internet. During the reporting period, Indian Subsidiary also obtained the BIS product certification of inverterair conditioner controllers in India issued by the Bureau of Indian Standards (BIS for short), and became one ofthe first enterprises in the world to pass the certification.
(V) Cash flow from operating activities
In 2021, the net cash flow generated by the Company's operating activities was -225 million yuan, down by
134.66% year-on-year, mainly due to the epidemic in combination with the turbulent supply of raw materials andthe stocking in advance, stock allocation at high prices and advance payment for the purpose of ensuring thetimely delivery of customer products. It is expected that the operating cash flow will improve after stabilization ofthe supply.
(VI) Capital operation: non-public offering + acquisition + equity incentive
1. Non-public offering of shares, raising funds of 1.05 billion yuan successfully. During the reporting period,the Company privately issued 92,105,263 A-share stocks to 14 subscribers, raising 1.05 billion yuan in total, theprivately issued shares were listed on Shenzhen Stock Exchange on June 3, 2021, and the raised funds areintended to be used for the construction of Huizhou No. 2 Industrial Park and supplement the Company's workingcapital; To speed up the project, the implementation site and mode of some raised funds were changed uponreview and approval of the shareholders’ meeting of the Company in January 2022.
2. Acquisition of the equity of Ninghui Lithium Battery and expansion of the lithium battery product linewith self-owned fundsTopband Lithium Battery, a wholly-owned subsidiary of the Company, obtained 90.48% ofthe equity of Taixing Ninghui Lithium Battery Co., Ltd. through partial equity acquisition and capital increasewith its self-owned funds amounting to 33.4 million yuan. The lithium battery product line was expanded throughthis acquisition, and the cylindrical battery capacity of the Company was improved for use in the light power field.
3. Launch of a new equity incentive plan to enrich the medium- and long-term incentive mechanism of the
Company. During the reporting period, the Company launched a restricted stock incentive plan, granting a total of
33.54432 million restricted stocks to 1,224 employees, and practiced its philosophy of "value co-creation andsharing" with the continuous high growth of performance as the unlocking condition, allowing the core backboneof the Company to truly become its owner and stimulating the internal drive of employees to realize the commongrowth of individuals and organizations.(VII) Other factors influencing profits
1. Increase of fair value gains, increasing the Company's non-recurring operating profit. During the reportingperiod, the book value of the Company's equity investment in ORVIBO increased somewhat than at the end of2020, and the change in the fair value of the investment increased the Company's non-recurring operating profitby about 93.347 million yuan in 2021.
2. Provision for credit impairment, reducing the Company's current recurring operating profit. With theincreasing complexity of the global economic situation, the uncertainty faced by business entities has increased.Individual customers of the Company made overdue payment and had business risks. The Company fully accrued
69.2331 million yuan of provision for credit impairment reserve according to the requirements of accountingstandards.
2. Revenue and cost
(1) Composition of operating income
Unit: Yuan
2021 | 2020 | Year-on-year increase and decrease | |||
Amount | Proportion in operating income | Amount | Proportion in operating income | ||
Total operating income | 7,767,034,835.03 | 100% | 5,560,182,998.21 | 100% | 39.69% |
By industry | |||||
Intelligent control electronics industry | 7,767,034,835.03 | 100.00% | 5,560,182,998.21 | 100.00% | 39.69% |
By product | |||||
Tool | 2,994,451,368.50 | 38.55% | 2,088,701,558.30 | 37.57% | 43.36% |
Home appliances | 2,959,263,866.21 | 38.10% | 2,154,454,813.96 | 38.75% | 37.36% |
New energy | 1,241,478,904.30 | 15.98% | 894,062,480.43 | 16.08% | 38.86% |
Industry | 295,153,637.29 | 3.80% | 257,988,191.43 | 4.64% | 14.41% |
Intelligent solutions | 221,269,657.19 | 2.85% | 137,950,247.99 | 2.48% | 60.40% |
Other | 55,417,401.54 | 0.71% | 27,025,706.10 | 0.49% | 105.05% |
By region | |||||
Domestic | 3,427,652,622.28 | 44.13% | 2,495,663,711.95 | 44.88% | 37.34% |
Foreign | 4,339,382,212.75 | 55.87% | 3,064,519,286.26 | 55.12% | 41.60% |
By sales model | |||||
Basing production on sales prospects | 7,767,034,835.03 | 100.00% | 5,560,182,998.21 | 100.00% | 39.69% |
(2) The situation of industries, products, regions or sales models accounting for more than 10% of theCompany’s operating income or operating profit
√ applicable □ not applicable
Unit: Yuan
Operating income | Operating cost | Gross profit rate | Increase or decrease of operating income over the same period of last year | Increase or decrease of operating costs over the same period of last year | Increase or decrease of gross profit rate over the same period of last year | |
By industry | ||||||
Intelligent control electronics industry | 7,767,034,835.03 | 6,114,531,354.87 | 21.28% | 39.69% | 45.44% | -3.11% |
By product | ||||||
Tool | 2,994,451,368.50 | 2,322,704,928.43 | 22.43% | 43.36% | 53.21% | -4.99% |
Home appliances | 2,959,263,866.21 | 2,380,662,056.81 | 19.55% | 37.36% | 40.73% | -1.93% |
New energy | 1,241,478,904.30 | 971,706,470.22 | 21.73% | 38.86% | 41.45% | -1.44% |
By region | ||||||
Domestic | 3,427,652,622.28 | 2,696,541,712.06 | 21.33% | 37.34% | 42.10% | -2.63% |
Foreign | 4,339,382,212.75 | 3,417,989,642.81 | 21.23% | 41.60% | 48.18% | -3.50% |
By sales model | ||||||
Basing production on sales prospects | 7,767,034,835.03 | 6,114,531,354.87 | 21.28% | 39.69% | 45.44% | -3.11% |
When the statistical caliber of the Company's main business data is adjusted in the reporting period, theCompany's main business data for the most recent year shall be the data adjusted according to the caliber at theend of the reporting period
□ applicable √ not applicable
(3) Whether the Company’s income from physical sales greater than that from labor services
√ Yes □ No
Industry classification | Items | Unit | 2021 | 2020 | Year-on-year increase and decrease |
Intelligent control electronics industry | Sales volume | PCS | 174,889,510 | 138,520,341 | 26.26% |
Production output | PCS | 181,035,707 | 143,306,093 | 26.33% | |
Inventory | PCS | 16,559,826 | 10,413,629 | 59.02% |
Reasons for the change of more than 30% in relevant data
√ applicable □ not applicable
The sales volume of P>200 yuan was 4.1964 million PCS, and the sales revenue was 1.820 billion yuan;The sales volume of 100 yuan≤ P< 200 yuan was 13.7210 million PCS, and the sales revenue was 1.844 billionyuan;The sales volume of 50 yuan≤ P< 100 yuan was 24.0538 million PCS, and the sales revenue was 1.776 billionyuan;The sales volume of P< 50 yuan was 132.9184 million PCS, and the sales revenue was 2.327 billion yuan.During the reporting period, the sales volume increased by 26.26% year-on-year, mainly due to the increase ofcustomer orders and shipments during the reporting period.During the reporting period, the production increased by 26.33% year-on-year, mainly due to the increase ofcustomer orders and production capacity during the reporting period.During the reporting period, the inventory increased by 59.02% year-on-year, mainly due to the increase ofproduction capacity during the reporting period and Spring Festival stock.
(4) Performance of major sales contracts and major procurement contracts signed by the Company up tothe reporting period
□ applicable √ not applicable
(5) Composition of operating cost
Industry and product classification
Unit: Yuan
Industry classification | Items | 2021 | 2020 | Year-on-year increase and decrease | ||
Amount | Proportion in operating cost | Amount | Proportion in operating cost | |||
Intelligent control electronics industry | Operating cost | 6,114,531,354.87 | 100.00% | 4,204,293,830.77 | 100.00% | 45.44% |
Unit: Yuan
Product classification | Items | 2021 | 2020 | Year-on-year increase and decrease | ||
Amount | Proportion in operating cost | Amount | Proportion in operating cost | |||
Tool | Operating cost | 2,322,704,928.43 | 37.99% | 1,516,015,580.60 | 36.06% | 53.21% |
Home appliances | Operating cost | 2,380,662,056.81 | 38.93% | 1,691,624,876.57 | 40.24% | 40.73% |
New energy | Operating cost | 971,706,470.22 | 15.89% | 686,947,605.50 | 16.34% | 41.45% |
Industry | Operating cost | 203,688,366.55 | 3.33% | 172,445,418.80 | 4.10% | 18.12% |
Intelligent solutions | Operating cost | 188,848,535.84 | 3.09% | 114,016,149.82 | 2.71% | 65.63% |
Other | Operating cost | 46,920,997.03 | 0.77% | 23,244,199.48 | 0.55% | 101.86% |
DescriptionThe Company readjusted the statistical caliber of product classification and added the classification of intelligentsolutions during the reporting period.
(6) Whether the consolidation scope has changed during the reporting period
√ Yes □ No
Nine new companies were included in the scope of consolidation during the reporting period, of which 7 werenewly established subsidiaries or sub-subsidiaries and the other 2 were merged enterprises not under the samecontrol.
(7) Major changes or adjustments in the Company’s business, products or services during the reportingperiod
□ applicable √ not applicable
(8) Main sales customers and suppliers
Main sales customers of the Company
Total sales amount of top five customers (yuan) | 3,027,015,495.94 |
Proportion of total sales amount of top five customers in total annual sales | 38.97% |
Proportion of related party sales in the top five customers’ sales in the total annual sales | 0.00% |
Top 5 customers material of the Company
No. | Customer name | Sales amount (yuan) | Proportion of total annual sales |
1 | No.1 | 2,146,374,063.53 | 27.63% |
2 | No.2 | 256,155,125.44 | 3.30% |
3 | No.3 | 230,042,772.28 | 2.96% |
4 | No.4 | 200,175,407.21 | 2.58% |
5 | No.5 | 194,268,127.48 | 2.50% |
Total | -- | 3,027,015,495.94 | 38.97% |
Other information of main customers
□ applicable √ not applicable
Main suppliers of the Company
Total purchase amount of top five suppliers (yuan) | 1,771,252,023.14 |
Proportion of total purchase amount of top five suppliers in total annual purchase amount | 29.04% |
Proportion of purchase amount of related parties in total annual purchase amount of top five suppliers | 0.00% |
Top 5 suppliers materials of the Company
No. | Supplier name | Purchase amount (yuan) | Proportion of total annual procurement |
1 | No.1 | 1,372,501,493.15 | 22.50% |
2 | No.2 | 196,184,134.41 | 3.22% |
3 | No.3 | 73,476,265.45 | 1.20% |
4 | No.4 | 65,385,874.24 | 1.07% |
5 | No.5 | 63,704,255.89 | 1.04% |
Total | -- | 1,771,252,023.14 | 29.04% |
Other information of main suppliers
□ applicable √ not applicable
3. Expenses
Unit: Yuan
2021 | 2020 | Year-on-year increase and decrease | Description of major changes | |
Sales expenses | 208,562,819.10 | 132,898,433.70 | 56.93% | Sales expenses: The sales expenses in the reporting period increased by 75.66 million yuan compared with those in the same period of last year, with an increase rate of 56.93%,mainly due to the increase of salaries of staff, intermediary service fees and business entertainment expenses incurred to achieve income growth within the reporting period. |
Management expenses | 258,345,031.89 | 184,057,471.19 | 40.36% | Management expense: It increased by 74.29 million yuan during the reporting period than during the same period of last year, with an increase of 40.36%.The main reason is that during the reporting period, the Company adjusted its organizational structure to meet the needs of future strategic implementation, resulting in an increase in expenses due to the corresponding increase in the number of employees. |
Finance charges | 63,785,550.48 | 176,986,013.49 | -63.96% | Financial expenses: The financial expenses in the reporting period decreased by 113.2 million yuan compared with those in the same period of last year, with a reduction rate of 63.96%,mainly due to the reduction of exchange loss caused by the exchange rate change compared with that in the same period of last year and the income offset by cash discount according to the new income standard. |
Research and development expenses | 449,950,052.11 | 317,542,654.15 | 41.70% | R&D expenses: The R&D expenses in the reporting period increased by 132.41 million yuan compared with that in the same period of last year, with an increase rate of 41.70%, mainly due to the increase of R&D resources input by the Company during the reporting period. |
4. Research and development investment
√ applicable □ not applicable
Name of main R&D project | Project objective | Project progress | Intended goal | Expected impact on the future development of the Company |
Research and development of | Frequency conversion technology has been widely applied with the increasing | The development and verification of | Up to 20kw power section is supported. Energy | It can be widely used in the household and |
medium and high-power frequency conversion control technology | demand of intelligent and low-carbon society. The project aims to overcome the technical difficulties of high-power, high-efficiency and low-noise frequency conversion, enrich the serial product platforms of medium and high-power electrical appliances in the Company, and further expand the application of its frequency conversion technology. | technology and product platform technology have been completed, and the technology has been mass-produced in a number of products. | efficiency, vibration and noise suppression are at the leading level in the industry. The reliability of products in complex application environments such as high temperature and high humidity is at the leading level in the industry. | commercial electrical appliance solutions of the Company, and will accelerate its exploration and development in the high-end ODM market. |
Research and development of mobile robot chassis technology | With intelligent products, aging society and rising labor costs, mobile service robots have been applied rapidly in all walks of life. Mobile robot chassis is the core platform for synthesizing key technologies of various robots as well as the most difficult and valuable part of mobile robot product solutions. In the project, we will research and develop dozens of key technologies, such as robot mapping, positioning, planning, navigation, moving, obstacle avoidance, multi-sensor fusion, machine vision and AI, and an integrated robot chassis product platform, and realize mass production and application in multiple scenes. | Three generations of technology platforms have been developed and are under continuous research and development. The product platform has been applied in dozens of projects. | The mobile robot chassis platform technology of the third generation is at the leading level. The product platform has been applied in mass production in many scenes, such as home, garden and industry, with leading technical level and comprehensive competitiveness. | Through the project, the Company can keep the leading position in the core underlying technology of mobile robots, and further enhance its innovation ability and competitiveness in the development of mobile robot solutions. Some projects will be scaled up successively. |
Research and development of Hall-less motor drive and mechatronics technology | Various electric tools and garden tools have been applied widely and rapidly with the development of society in order to improve the work efficiency and reduce the labor intensity. Brushless DC motors and their control technology are the core technologies of electric and garden tools. The project focuses on the research of Hall-less motor control technology and mechatronics technology and the development and realization of high-reliability, low-cost and small-volume tool product solutions, further expanding the leading position of the Company in tool products. | Key technologies have been verified, and the results can be applied to the mass production of products, which are being marketed. | The Hall-less (sensorless) detection estimation algorithm leads the industry in the estimation accuracy of high, medium, low and even zero speed positions. The cost and reliability of the solution using Hall-less technology are improved comprehensively by more than 30%.The performance and cost of mechatronics design are improved comprehensively by more | The technology can be widely used in dozens of products of electric and garden tools, providing advantages in system reliability, cost, volume, weight and grip and further consolidating the leading position of the Company in the tool market. |
than 30%. | ||||
Research and development of control and switch integration technology | There are increasing market demands for product miniaturization, light weight, high reliability and low cost in the application of various hand-held electric and garden tools. The project aims to develop a solution platform of motor control and switch integration. Tool switches and drive controllers are highly integrated through innovative research on structure, circuit and assembly process, thus greatly improving the integration and reliability of the solution and further optimizing the product design, assembly process and comprehensive cost. | Technology and product modules have been tested and verified, and are being marketed. | The solution is optimized by more than 30% in reliability, volume and comprehensive cost. | The technology can be widely applied in electric tools, providing advantages in product reliability, volume and comprehensive cost and further consolidating the leading position of the Company in the tool market. |
Research and development of new permanent magnet motor technology | Permanent magnet motors are widely used. The project aims to improve the performance of permanent magnet motors, reduce their noise, and design and develop new permanent magnet motor technology. It intends to improve the stability of motor operation and greatly improve the vibration of motors through the research on the innovative application of permanent magnet structure, enhance the magnetism gathering ability and the magnetic energy product of permanent magnets and realize ultra-low magnetic leakage by optimizing the motor structure and the fixing of magnetic steel, thus achieving the goal of greatly reducing the performance requirements of magnetic steel under the same motor performance. | Technical verification has been completed in the research and development. | The performance and noise level of new permanent magnet motors are at the leading level in the industry. Permanent magnet motors with new structure can be used in mass production in high-efficiency DC brushless motors and other products. | The technology has a wide application prospect in DC brushless motor products of the Company, which can further enhance its competitiveness in the field of high-performance motors and strengthen its strength of application in tools and other fields. |
Research on technology platform of large-capacity single lithium iron battery cells | New energy is a revolution in the field of energy, and large-capacity single cells indicate an important development direction of power and energy storage lithium batteries. The project develops a high-capacity and high-energy density battery cell product platform of the Company at the 100Ah level by optimizing the packaging mode of battery cells, increasing their size and capacity | Mass production has been achieved. | The energy density, high and low temperature discharge performance and long cycle life of the product are at the leading level in the industry. | The technology enriches the battery cell and battery product lines of the Company and will help the Company to develop its business in the fields of energy storage and light power. |
and reducing redundant components, which can effectively improve the capacity and energy density of single battery cells, increase the integration efficiency of PACK and reduce the comprehensive cost of battery system. | ||||
Research on technology platform of new sodium ion secondary batteries | Sodium ion secondary batteries have unique advantages in safety, cost, low-temperature capacity retention and over-discharge resistance, and indicate an important future development direction of batteries because of their abundant sodium salt raw materials. The project studies and addresses difficult problems of new sodium cathode materials existing in cell design, application and manufacturing process, develops a technology platform and product platform of sodium ion secondary batteries, and makes a good reserve of new products for the further development of new energy business. | The technical principle has been verified, and the technology is under continuous research and development. | Energy density and cost level rank among the top in the industry. | The successful research and development of the technology platform and product platform will help the Company to launch a series of sodium ion battery products which will supplement the existing series of lithium iron phosphate battery products effectively. It is expected to improve the competitiveness of the Company in the large-scale energy storage application market and gain more market share. |
Research on parameter self-tuning technology of servo drivers | The application of servo system is becoming more and more popular with the development of automation and intelligence in the industrial field. The field parameter adjustment of servo motor drive system is a big difficulty in application. It is necessary to study automatic parameter calibration and setting technology so as to improve the debugging efficiency and obtain the best servo drive effect. The research provides convenience for the parameter adjustment of servo motor drive system and allows the debugger to deal with various debugging problems easily. | R&D and mass production have been completed, and the technology is under continuous optimization. | The driver can realize automatic identification and optimization of dozens of important parameters that affect the servo drive effect so that the servo system can achieve the best motion control performance. The products are leading the industry in terms of the ease of use and intelligence. | As one of the representative manufacturers of servo localization, the Company has developed several generations of servo drive, control and motor products. The implementation of the project will accelerate the promotion and application of servo products of the Company. |
Research on digital power technology | The social demand for green new energy and efficient power supply technology has risen sharply with the implementation of | A technology and product platform for mass | The technology is at the leading level in the industry in terms of the | The leading technology supports the business breakthrough of the |
platform | the national "double carbon" policy. Digital power supply technology is a revolutionary technology of high-power and high-efficiency power supply. The project studies the digital architecture under different power supply topologies, builds related DSP processors and all-digital feedback technology platforms and grasps the core digital power supply algorithm so as to improve the control, management, detection and intelligence level of power supply comprehensively and develop a technology and product platform of medium- and high- power digital power supply. | production has been formed, and the technology is under continuous research and development and upgrading. | high-power (from several kw to tens of kw) power conversion efficiency and reliability in complex application scenes. |
Company in the field ofhigh-end digital powersupply, and is widelyapplied in greencommuting, energystorage and other newenergy sources.
Research and development of embedded artificial intelligence technology | With the extensive application of artificial intelligence technology and the continuous development of product intelligence, how to apply artificial intelligence technology in embedded products such as smart home appliances and innovative hardware has become a hot spot. The project can realize more intelligent automatic recognition and interactive operation in place of users through the research of machine vision and speech recognition algorithm, thus reducing the complexity of use of products by users and greatly improving the user experience. The project will also build an algorithm and implementation platform for embedded AI, and develop innovative products for various application scenes. | Several prototype products have been marketed in the continuous development of the technology platform. | The AI algorithm and performance are at the leading level in the industry, and the embedded AI technology is leading in more than three product applications. | The embedded AI technology will further consolidate the leading position of the Company in the new generation of intelligent control technology, and support the Company in the innovation and creation of more new products and the development of more blue ocean markets. |
R&D personnel of the Company
2021 | 2020 | Change ratio | |
Number of research and development personnel (person) | 1,582 | 1,345 | 17.62% |
Proportion of research and development personnel | 18.73% | 21.59% | -2.86% |
Academic structure of R&D personnel | —— | —— | —— |
Undergraduate | 1,059 | 883 | 19.93% |
Master | 113 | 116 | -2.59% |
Doctor and above | 1 | 4 | -75.00% |
Junior college degree and below | 409 | 342 | 19.59% |
Age structure of R&D personnel | —— | —— | —— |
Below 30 | 707 | 483 | 46.38% |
30 ~ 40 | 735 | 716 | 2.65% |
Above 40 | 140 | 146 | -4.11% |
Research and development investment of the Company
2021 | 2020 | Change ratio | |
Research and development investment amount (yuan) | 559,857,194.43 | 397,002,480.37 | 41.02% |
Proportion of research and development investment in operating income | 7.21% | 7.14% | 0.07% |
Capitalization amount of research and development investment (yuan) | 109,907,142.32 | 79,459,826.22 | 38.32% |
Proportion of capitalized research and development investment in research and development investment | 19.63% | 20.01% | -0.38% |
Reasons for and influences of significant changes in the composition of R&D personnel in the Company
□ applicable √ not applicable
The reason why the proportion of total research and development investment in operating income changedsignificantly compared with that of the previous year
□ applicable √ not applicable
The reason and rationality of the great change of research and development investment capitalization rate
□ applicable √ not applicable
5. Cash flow
Unit: Yuan
Items | 2021 | 2020 | Year-on-year increase and decrease |
Subtotal of cash inflow from operating activities | 7,877,451,630.46 | 5,365,550,244.38 | 46.82% |
Subtotal of cash outflow from operating activities | 8,102,014,176.32 | 4,717,649,536.00 | 71.74% |
Net cash flow from operating activities | -224,562,545.86 | 647,900,708.38 | -134.66% |
Subtotal of cash inflow from investment activities | 591,071,911.81 | 829,117,841.78 | -28.71% |
Subtotal of cash outflow from investment activities | 1,339,243,115.38 | 1,210,840,008.02 | 10.60% |
Net cash flow from investment activities | -748,171,203.57 | -381,722,166.24 | -96.00% |
Subtotal of cash inflow from financing activities | 2,395,480,159.32 | 595,643,453.03 | 302.17% |
Subtotal of cash outflow from financing activities | 852,767,599.74 | 390,804,539.83 | 118.21% |
Net cash flow from financing activities | 1,542,712,559.58 | 204,838,913.20 | 653.13% |
Net increase in cash and cash equivalents | 539,269,123.28 | 434,990,514.43 | 23.97% |
Description of main influencing factors of significant changes in relevant data year-on-year
√ applicable □ not applicable
1. Net cash flow from operating activities: It decreased by 134.66% in the reporting period compared withthat in the same period of last yearmainly due to the increased purchase of materials in response to the rising priceand shortage of materials, and the cash outflow from operating activities greater than the inflow caused by theincrease of various expenses.
2. Net cash flow from investment activities: It decreased by 96.00% in the reporting period compared withthat in the same period of last year, mainly due to the successive construction of production bases and theinvestment in overseas bases and domestic equity investment expenditures leading to the outflow from investmentactivities exceeding the inflow.
3. Net cash flow from financing activities: It increased by 653.13% in the reporting period compared withthat in the same period of last year, mainly due to the receipt of funds raised by non-public offering of shares andequity incentives in the reporting period.Reasons for the significant difference between the net cash flow generated by the Company’s operating activitiesand the net profit of the current year in the reporting period
√ applicable □ not applicable
Net cash flow from operating activities: It was -224.56 million yuan in the reporting period, for the mainreasons that the Company greatly increased the stock amount and meanwhile supported suppliers by prepaymentand advance payment so as to ensure delivery due to the tight supply of raw materials and the rising prices of raw
materials such as chips in 2021, and that some period expenses were increased in order to achieve its strategicobjectives.
V. Analysis of non-main business
√ applicable □ not applicable
Unit: Yuan
Amount | Proportion in total profit | Explanation of formation reason | Whether it is sustainable | |
Income from investment | 54,827,083.25 | 8.84% | It mainly refers to the investment income and temporary idle capital financing income generated from the disposal of tradable financial assets of Dynanonic held during the reporting period | Not sustainable |
Profit and loss from changes in fair value | 85,670,316.15 | 13.81% | It is mainly caused by the changes in fair value of the shares held by ORVIBO during the reporting period and the profit and loss of fair value changes recognized in the early stage of the transfer out of tradable financial assets of Dynanonic held during the reporting period | Not sustainable |
Impairment of assets | -185,588,973.64 | -29.92% | The main reason is that the impairment loss of accounts receivable in the reporting period was greater than that in the same period of last year. | Not sustainable |
Non-operating income | 2,260,355.74 | 0.36% | ||
Non-operating expenses | 5,538,292.94 | 0.89% |
VI. Analysis of assets and liabilities
1. Major changes in asset composition
Unit: Yuan
End of 2021 | Beginning of year 2021 | Increase or decrease of proportion | Description of major changes | |||
Amount | Proportion in total assets | Amount | Proportion in total assets | |||
Monetary capital | 1,767,580,056.07 | 18.40% | 1,219,095,476.50 | 17.99% | 0.41% | |
Accounts receivable | 2,188,161,465.48 | 22.78% | 1,701,111,153.84 | 25.11% | -2.33% | Accounts receivable: The accounts receivable increased by about 487.05 million yuan in the reporting period compared with those at the beginning of the |
period, with an increase rate of 28.63%.The main reason is that the sales revenue in the reporting period increased greatly compared with that in the same period of last year, resulting in the increase of the corresponding accounts receivable at the end of the period. | ||||||
Inventory | 2,184,402,766.04 | 22.74% | 1,115,312,868.62 | 16.46% | 6.28% | Inventory: increase of 1,069,090,000 yuan than at the beginning of the period, with an increase of 95.86%.The main reason is that the Company increased raw material stock and in-process products and finished products to meet the order delivery in response to the impact of rising prices and shortage of supply of raw materials. |
Investment Property | 86,975,114.31 | 0.91% | 89,238,265.71 | 1.32% | -0.41% | |
Long-term equity investment | 26,119,127.82 | 0.27% | 6,502,528.13 | 0.10% | 0.17% | Long-term equity investment: The long-term equity investment increased by 19.62 million yuan in the reporting period compared with that at the beginning of the period, with an increase rate of 301.68%,mainly due to the increase of equity investment in the reporting period. |
Fixed assets | 1,299,517,887.54 | 13.53% | 1,096,875,640.94 | 16.19% | -2.66% | |
Construction in progress | 495,248,025.93 | 5.16% | 292,474,798.41 | 4.32% | 0.84% | Construction in progress: The cost increased by 202.77 million yuan in the reporting period compared with that at the beginning of the period, with an increase rate of 69.33%,mainly due to the great increase of the investment in project construction of operation centers in various places. |
Right-of-use assets | 58,168,151.88 | 0.61% | 30,939,385.41 | 0.00% | 0.61% | Right-of-use assets: The Company implemented the new lease standards during the reporting period. |
Short-term loans | 409,531,107.26 | 4.26% | 402,151,500.00 | 5.94% | -1.68% | |
Contractual liabilities | 93,328,006.70 | 0.97% | 72,576,117.56 | 1.07% | -0.10% | |
Long-term loans | 475,020,000.00 | 4.94% | 200,000,000.00 | 2.95% | 1.99% | Long-term loans: Long-term loans increased by 275.02 million yuan at the end of the reporting period compared with those at the beginning of the period, with an increase rate of 137.51%, mainly due to the increase of long-term loans from banks during the reporting period. |
Lease liabilities | 40,290,402.14 | 0.42% | 30,939,385.41 | 0.00% | 0.42% | Lease liabilities: The company implemented the new leasing criteria during the reporting period. |
High proportion of overseas assets
√ applicable □ not applicable
Asset details | Reasons for formation | Asset size | Location | Operation mode | Control measures to ensure the safety of assets | Earning position | Proportion of foreign assets to net assets of the Company | Whether there is a significant risk of impairment |
Operation Center in India | Investment and establishment | 285,430,219.92 | Pune, India | R&D, production and sales | Financial supervision, external audit | -902,626.68 | 5.68% | No |
Operation Center in Vietnam | Investment and establishment | 371,439,978.15 | Binh Duong, Vietnam | R&D, production and sales | Financial supervision, external audit | 123,337,066.73 | 7.39% | No |
2. Assets and liabilities measured at fair value
√ applicable □ not applicable
Unit: Yuan
Items | Opening balance | Profit and loss from changes in fair value in the current period | Changes in cumulative fair value included in equity | Impairment accrued in the current period | Purchase amount in the current period | Amount sold in the current period | Other changes | Closing balance |
Financial assets | ||||||||
1. Tradable financial assets (excluding derivative financial assets) | 226,491,482.10 | 85,670,316.15 | 138,514,207.31 | 440,000,000.00 | 537,162,461.51 | 214,999,336.74 | ||
Subtotal of financial assets | 226,491,482.10 | 85,670,316.15 | 138,514,207.31 | 440,000,000.00 | 537,162,461.51 | 214,999,336.74 | ||
Total of the above | 226,491,482.10 | 85,670,316.15 | 138,514,207.31 | 440,000,000.00 | 537,162,461.51 | 214,999,336.74 | ||
Financial liabilities | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
Contents of other changesWhether there are significant changes in the measurement attributes of the Company’s main assets during thereporting period
□ Yes √ No
3. Restricted asset rights by the end of the reporting period
See Sections X, VII and (LXXXI) of this report for details.VII. Investment analysis
1. General situation
√ applicable □ not applicable
Investment in the reporting period (yuan) | Investment amount in the same period of last year (yuan) | Range of change |
68,500,000.00 | 5,250,000.00 | 1,204.76% |
2. Major equity investment obtained during the reporting period
√ applicable □ not applicable
Unit: Yuan
Name of invested company | Main business | Investment mode | Investment amount | Shareholding proportion | Source of capitals | Partner | Term of investment | Product type | Progress as of the balance sheet date | Estimated income | Current investment profit and loss | Whether involved in litigation | Disclosure date (if any) | Disclosure index (if any) |
Taixing Ninghui Lithium Battery Co., Ltd. | R D, production and sales of lithium batteries | Acquisition | 33,400,000.00 | 83.50% | Own capitals | None | Not applicable | Not applicable | The industrial and commercial change was completed on February 5, 2021 and included in the scope of consolidation | 0.00 | -4,005,560.30 | No | 2021/1/16 | http://www.cninfo.com.cn/ |
Total | -- | -- | 33,400,000.00 | -- | -- | -- | -- | -- | -- | 0.00 | -4,005,560.30 | -- | -- | -- |
3. Major non-equity investment in progress during the reporting period
□ applicable √ not applicable
4. Investment of financial assets
(1) Securities investment
√ applicable □ not applicable
Unit: Yuan
Security type | Security code | Security abbreviation | Initial investment cost | Accounting measurement model | Book value at the beginning of the period | Profit and loss from changes in fair value in the current period | Changes in cumulative fair value included in equity | Purchase amount in the current period | Amount sold in the current period | Profit and loss in the reporting period | Book value at the end of the period | Accounting subjects | Source of capitals |
Domestic and foreign stocks | 300769 | Dynanonic | 10,000,000.00 | Fair value measurements | 31,033,991.99 | -30,241,530.48 | 792,461.51 | 7,979,584.91 | 0.00 | Tradable financial assets | Own capitals | ||
Other investment in securities held at the end of the period | 0.00 | -- | -- | -- | |||||||||
Total | 10,000,000.00 | -- | 31,033,991.99 | -30,241,530.48 | 0.00 | 0.00 | 792,461.51 | 7,979,584.91 | 0.00 | -- | -- | ||
Disclosure date of announcement of Board of Directors for approval of securities investment | |||||||||||||
Disclosure date of announcement of Shareholders’ Meeting for approval of securities investment (if any) |
(2) Derivatives investment
√ applicable □ not applicable
Unit: 1,0000 yuan
Name of derivatives investment operator | Relationship | Whether it is connected transaction | Types of derivatives investment | Initial investment amount of derivatives investment | Start date | Termination date | Initial investment amount | Purchase amount during the reporting period | Amount sold during the reporting period | Amount of provision for impairment (if any) | Investment amount at the end of the period | Proportion of investment amount at the end of the period | Actual profit and loss amount in the reporting |
in net assets of the Company at the end of the reporting period | period | ||||||||||||
Bank | Non-related party | No | Forward settlement and sale of foreign exchange | 33,155.5 | 2021/1/4 | 2021/12/31 | 0 | 33,155.5 | 33,155.5 | 0 | 0.00% | 819.3 | |
Bank | Non-related party | No | Forward settlement and sale of foreign exchange | 6,635.5 | 2021/3/8 | 2021/12/31 | 0 | 6,635.5 | 6,635.5 | 0 | 0.00% | 137.6 | |
Total | 39,791 | -- | -- | 0 | 39,791 | 39,791 | 0 | 0.00% | 956.9 | ||||
Capital sources of derivatives investment | Export collection | ||||||||||||
Litigation (if applicable) | Not applicable | ||||||||||||
Disclosure date of announcement of Board of Directors for approval of derivatives investment (if any) | January 14, 2021 | ||||||||||||
Disclosure date of Shareholders’ Meeting announcement for approval of derivatives investment (if any) | |||||||||||||
Risk analysis and control measures of derivatives positions in the reporting period (including but not limited to market risk, liquidity risk, credit risk, operational risk, legal risk, etc.) | 1. Market risk: changes in the domestic and international economic situation may cause substantial fluctuations in the exchange rate, and the forward foreign exchange trading business faces certain market risks. The purpose of the Company’s forward foreign exchange trading business is to lock in the price of foreign exchange settlement or sale and reduce the impact of exchange rate fluctuations on the Company’s profits. The Company will closely track the change of exchange rate. Based on the target exchange rate determined by the business, through the research and judgment of the trend of foreign exchange rate, combined with the Company’s forecast of foreign exchange receipt and payment and the bearing capacity of price change caused by exchange rate fluctuation, the Company will determine the plan of signing forward foreign exchange trading contract, and implement dynamic management of the business, so as to ensure the reasonable profit level of the Company. 2. Liquidity risk: All forward foreign exchange transactions of the Company are based on reasonable estimation of the Company’s future import and export business to meet the demand of trade authenticity.3. Bank default risk: If the cooperative bank fails during the term of the contract due to its bankruptcy, the Company will not be able to deliver the original foreign exchange contract at the contract price, and there is a |
risk of uncertain income. Therefore, the banks that the Company chooses to carry out foreign exchange trading business are large and medium-sized banks, and the risk of its bankruptcy may bring losses to the Company is very low.4. Operational risk: The Company may have relevant risks due to improper operation of the handling personnel in the forward foreign exchange transaction business. The Company has formulated a relevant management system, and has clarified the operation process and responsible person, which is conducive to preventing and controlling risks.5. Legal risk: The Company’s forward foreign exchange trading business may cause legal disputes due to the signing of relevant trading contracts with banks and unclear agreements. The Company will strengthen the legal review of relevant contracts, and select banks with good credit to carry out such business and control risks. | |
In the case of changes in the market price of the invested derivatives or the fair value of the products during the reporting period, the analysis of the fair value of derivatives should disclose the specific methods used and the setting of relevant assumptions and parameters | The Company carries out the confirmation and measurement in accordance with Chapter 7 Determination of Fair Value of Article 22 of the Accounting Standards for Business Enterprises-Recognition and Measurement of Financial Instruments, and the fair value is basically determined according to the price provided or obtained by pricing service institutions such as banks. The Company’s accounting for the fair value of derivatives is mainly the unexpired forward foreign exchange settlement and sale contract signed by the Company and the bank during the reporting period. According to the difference between the exchange rate agreed in the unexpired forward foreign exchange settlement and sale contract at the end of the period and the delivery exchange rate indicated in the forward contract signed by large and medium-sized banks on the balance sheet date with the same term as the remaining term of the forward contract, it is recognized as trading finance assets or liabilities. During the reporting period, the actual profit and loss of forward foreign exchange contracts of the Company was 9,569,000 yuan. |
Whether the accounting policies and accounting principles of the Company’s derivatives in the reporting period have changed significantly compared with those in the previous reporting period | None |
Special opinions of independent directors on derivatives investment and risk control of the Company | None |
5. Usage of raised capitals
□ applicable √ not applicable
(1) Overall usage of raised capitals
√ applicable □ not applicable
Unit: 1,0000 yuan
Year of raising capitals | Ways of raising capitals | Total amount of raised capitals | Total amount of raised capitals used in the current period | Total amount of raised capitals used | Total amount of raised capitals for change of purpose during the reporting period | Cumulative total amount of raised capitals with changed purposes | Cumulative proportion of total amount of raised capitals with changed purposes | Total amount of unused raised capitals | Purpose and destination of unused raised capitals | Amount of raised capitals which have been idle for more than two years |
2019 | Public offering of convertible bonds | 56,543.65 | 16,188.44 | 38,800.5 | 0 | 0 | 0.00% | 17,743.15 | Temporary replenishment and deposit in the special account for raised capitals | 0 |
2021 | Non-public offering of shares | 103,684.71 | 34,539.87 | 34,539.87 | 0 | 0 | 0.00% | 69,144.84 | Temporary replenishment and deposit in the special account for raised capitals | 0 |
Total | -- | 160,228.36 | 50,728.31 | 73,340.37 | 0 | 0 | 0.00% | 86,887.99 | -- | 0 |
General use of raised capitals | ||||||||||
1. Actual amount and time of arrival of funds raised (1) Public offering of convertible corporate bonds to raise funds in 2019 The Company publicly issued 5.73 million convertible corporate bonds on March 7, 2019, each with a par value of 100 yuan, with a total amount of 573 million yuan, through priority placement to original shareholders, offering of the balance after priority placement to original shareholders (including the part for which the original shareholders gave up priority placement) to public investors online through the trading system of Shenzhen Stock Exchange, and stand-by underwriting of the part with the subscription amount less than 573 million yuan by lead underwriters with the approval in the Reply of China Securities Regulatory Commission on the Approval of Public Offering of Convertible Corporate Bonds by Shenzhen Topband Co., Ltd. (ZJXK [2018] No.1842).Funds with a total amount of 573,000,000.00 yuan were raised, and the net funds raised were 565,436,509.42 yuan after deduction of all the issuance costs amounting to 7,563,490.58 yuan. The funds arrived on March 13, 2019. Ruihua Certified Public Accountants (Special General Partnership) verified the arrival and issued the Capital Verification Report (RHYZ [2019] No.48270001). (2) Non-public offering of shares to raise funds in 2021 Shenzhen Topband Co., Ltd. issued 92,105,263 RMB common stocks to specific targets in private at the price of 11.40 yuan per stock, with a par value of 1 yuan per stock, with the approval in the Reply of China Securities Regulatory Commission on the |
(2) Situation of projects committed when raising capitals
√ applicable □ not applicable
Unit: 1,0000 yuan
Approval of Non-public Offering of Shares by Shenzhen Topband Co., Ltd. (ZJXK [2020] No.1865). The total amount of fundsraised was 1,049,999,998.20 yuan, and the net funds actually available for use were 1,036,847,068.71 yuan after deduction of all theissuance costs amounting to 13,152,929.49 yuan (tax-exclusive).The funds arrived on May 10, 2021.Baker Tilly China Certified Public Accountants (Special General Partnership) verified the arrivaland issued the Capital Verification Report (TZYZ [2021] No. 29460).
2. Usage amount and balance of funds raised in 2021
(1) Use of capitals raised by public issuing of convertible bonds in 2019
As of December 31, 2021, the Company has invested 388,005,000 yuan in capital-raising projects. Among them, 361,770,100 yuanwas directly invested in the capital-raising projects, and 26,234,800 yuan was returned before the capitals were put in place. OnDecember 31, 2021, 150,000,000 yuan idle raised capitals have been used to temporarily supplement the working capital; as ofDecember 31, 2021, the balance of the raised capitals account is 33,976,600 yuan (including interest income).
(2) Non-public offering of shares to raise funds in 2021
As of December 31, 2021, the Company has invested 345,398,700 yuan in capital-raising projects. Among them, funds of 300million yuan were used for direct and permanent replenishment of the working capital of the Company, and 45.3987 million yuaninput before the arrival of the funds raised was returned. On December 31, 2021, 690,000,000 yuan idle raised capitals have beenused to temporarily supplement the working capital; as of December 31, 2021, the balance of the raised capitals account is 1,336,400yuan (including interest income).
Committed investmentprojects and investmentdirection of over raised
capitals
Committed investment projects and investment direction of over raised capitals | Whether the project has been changed (including some changes) | Total committed investment of raised capitals | Total investment after adjustment (1) | Investment amount in this reporting period | Accumulated investment by the end of the period (2) | Investment progress by the end of the period (3)=(2)/(1) | The date when the project is ready for use | Benefits achieved during the reporting period | Whether the expected benefits are achieved | Where there is any significant change in the feasibility of the project |
Committed investment projects | ||||||||||
Topband East China Operation Center | No | 56,543.65 | 56,543.65 | 16,188.44 | 38,800.5 | 68.62% | Not applicable | No | ||
Topband Huizhou No. 2 Industrial Park Project | No | 73,684.71 | 73,684.71 | 4,539.87 | 4,539.87 | 6.16% | Not applicable | No | ||
Replenish the Company’s working capital | No | 30,000 | 30,000 | 30,000 | 30,000 | 100.00% | Not applicable | No | ||
Subtotal of committed investment projects | -- | 160,228.36 | 160,228.36 | 50,728.31 | 73,340.37 | -- | -- | -- | -- | |
Investment direction of over raised capitals |
None | ||||||||||
Total | -- | 160,228.36 | 160,228.36 | 50,728.31 | 73,340.37 | -- | -- | 0 | -- | -- |
Situation and reason of failing to reach the planned progress or expected income (by specific project) | None | |||||||||
Description of major changes in project feasibility | None | |||||||||
Amount, use and progress of over raised capitals | Not applicable | |||||||||
Change of implementation location of investment projects with raised capitals | Not applicable | |||||||||
Adjustment of implementation mode of investment projects with raised capitals | Not applicable | |||||||||
Upfront investment and replacement of investment projects with raised capitals | Applicable | |||||||||
1. The Company invested 26,234,800 yuan in advance in the operation center project of Topband East China with self-raised capitals. Ruihua Certified Public Accountants (special general partnership) conducts a special audit on the above matters, and issues the Authentication Report on the Report of Shenzhen Topband Co., Ltd. on the Investment Projects with Self-raised Capitals in Advance (RHHZ [2019] No. 48250027). On July 25, 2019, the 25th Meeting of the 5th Board of Directors of the Company deliberated and passed the proposal on using raised capitals to replace self-raised capitals invested in advance. As of December 31, 2021, the Company has completed the replacement of self-raised capitals invested in advance. 2. The Company invested 45.3987 million yuan in Topband Huizhou No. 2 Industrial Park Project with self-raised funds in advance. Baker Tilly China Certified Public Accountants (Special General Partnership) conducted a special audit on the matter above, and issued the Authentication Report of Pre-investment of Shenzhen Topband Co., Ltd. in the Investment Project of Funds Raised with Self-raised Funds (TZYZ [2021] No.31911).The 10th meeting of the 7th Board of Directors was held to review and approve the Proposal on Replacement of Pre-invested Self-raised Funds with Funds Raised on June 8, 2021.The Board of Supervisors, independent directors and sponsors of the Company had all expressed their clear consent to the replacement of pre-invested self-raised funds completed by December 31, 2021. | ||||||||||
Temporary replenishment of working capital with idle capitals raised | Applicable | |||||||||
1. On June 8, 2021, the Company held the 10th Meeting of the 7th Board of Directors, deliberated and passed the Proposal on Temporarily Replenishing Working Capital with Some Idle Raised Capitals, and agreed that the Company should temporarily replenish working capital with no more than 950,000,000 yuan of idle capitals raised, |
with a period of not more than 12 months. As of December 31, 2021, 84,000 yuan of temporary supplementary current assets have been used. The Board of Supervisors, Independent Directors and Sponsor Institutions of the Company all expressed their clear consent on the matter. | |
Amount and reasons of the balance of raised capitals in project implementation | Not applicable |
Purpose and whereabouts of unused raised capitals | 1. On June 8, 2021, the Company held the 10th Meeting of the 7th Board of Directors, deliberated and passed the Proposal on Temporarily Replenishing Working Capital with Some Idle Raised Capitals, and agreed that the Company should temporarily replenish working capital with no more than 950,000,000 yuan of idle capitals raised, with a period of not more than 12 months. As of December 31, 2021, 84,000 yuan of temporary supplementary current assets have been used. 2. The 10th meeting of the 7th Board of Directors was held on June 8, 2021, at which the Proposal on Increasing the Amount of Idle Raised Funds to Buy Bank Financial Products was reviewed and approved. It was agreed to increase the amount of idle raised funds by no more than 850 million yuan to buy financial products. The accumulated amount of funds that can be used to buy bank financial products totaled 1.6 billion yuan after the increase, of which idle raised funds were not more than 1 billion yuan and idle self-owned funds not more than 0.6 billion yuan. The funds can be used on a rolling basis within the amount above. Funds of 350 million yuan for temporary replenishment of the working capital had been used to purchase large-amount certificates of deposit by December 31, 2021. |
Problems or other situations in the usage and disclosure of raised capitals | None |
(3) Change of projects with raised capitals
□ applicable √ not applicable
During the reporting period, there is no change for the project with raised capitals.
VIII. Sale of major assets and equity
1. Sale of major assets
□ applicable √ not applicable
The Company did not sell any major assets during the reporting period.
2. Sale of major equity
□ applicable √ not applicable
IX. Analysis of major holding and equity participating companies
√ applicable □ not applicable
Situation of major subsidiaries and equity participating companies with an impact of 10% or more on net profit ofthe Company
Unit: Yuan
Company name | Company type | Main business | Registered capital | Total assets | Net assets | Operating income | Operating profit | Net profit |
Shenzhen YAKO Automation Technology Co., Ltd. | Subsidiary | R&D, production, sales, import and export of electronic parts and components | 14.286 million yuan | 370,049,120.13 | 286,722,962.27 | 296,759,371.59 | 34,873,937.86 | 29,933,264.92 |
Huizhou Topband Electrical Technology Co., Ltd. | Subsidiary | R&D, production, sales, import and export of electronic parts and components | 300 million yuan | 3,901,127,952.63 | 1,412,363,549.26 | 5,202,426,420.34 | 124,342,463.12 | 120,745,030.05 |
Topband (Vietnam) Co.,ltd | Subsidiary | R&D, production, sales, import and export of electronic parts and components | USD 12.50 million | 371,439,978.15 | 267,782,559.04 | 552,234,399.01 | 123,561,320.20 | 123,337,066.73 |
Situation of acquisition and disposal of subsidiaries during the reporting period
√ applicable □ not applicable
Company name | Method of acquisition and disposal of subsidiaries during the reporting period | Impact on overall production and operations and results |
Topband (Qingdao) Intelligent Control Co., Ltd. | Newly established and acquired | No significant impact on the results of the Report |
Shenzhen Tengyi Industrial Co., Ltd. | Acquisition through M A | No significant impact on the results of the |
Report | ||
Shenzhen Zhongli Consulting Co., Ltd. | Newly established and acquired | No significant impact on the results of the Report |
Taixing Ninghui Lithium Battery Co., Ltd. | Acquisition through M A | No significant impact on the results of the Report |
Tulu Innovation (Hong Kong) Limited | Newly established and acquired | No significant impact on the results of the Report |
Shenzhen Topband Automotive Electronics Co., Ltd. | Newly established and acquired | No significant impact on the results of the Report |
Huizhou Yako Automation Technology Co., Ltd. | Newly established and acquired | No significant impact on the results of the Report |
Q.B.PTE.LTD | Newly established and acquired | No significant impact on the results of the Report |
TOPBAND MEXICO,S.DE R.L.DE C.V. | Newly established and acquired | No significant impact on the results of the Report |
TOPBAND SMART EUROPE COMPANY LIMITED S.R.L. | Newly established and acquired | No significant impact on the results of the Report |
TUNNU INNOVATION,INC | Newly established and acquired | No significant impact on the results of the Report |
Nantong Topband Youneng Technology Co., Ltd. | Newly established and acquired | No significant impact on the results of the Report |
Description of major shareholding companiesNoneX. Situation of structured entity controlled by the Company
□ applicable √ not applicable
XI. Prospects for the future development of the Company(I) Social development trend and 2030 vision
1. Intelligence
The development of IOT, 5G, AI and other new technologies and the expansion of application fields willopen up space for growth and accelerate the process of social intelligence continuously. It is estimated that theeconomic value of technological impact will exceed USD 60 trillion by 2030.We will continue to explore thefuture world with innovative technologies and expand new opportunities for industry intelligence in various
application scenes in medicine, food, housing, transportation, enterprises and cities.
2. Low carbon
The climate crisis caused by greenhouse gases is deepening year by year, accelerating energy conservationand carbon reduction in countries all over the world. It is estimated that China's accumulated investment in energyproduction, energy use and ecology will reach 300 trillion yuan by 2050.We will seize the market opportunitiesbrought by the double carbon policy and help the world to develop with low carbon based on intelligent controltechnology.
3. Multi-regional development
The global supply chain is going towards multi-regional development. It is required that R&D and productdelivery should be fast, and the quality should be reliable and stable as terminal products become more and morecomplicated, individualized and differentiated. The advantages of China's industrial clusters and engineerdividends have accelerated the trend of transfer. With the influence of international trade conflicts, the industryhas gradually shown the trend of development mainly in China and towards Vietnam, India, Indonesia and otherregions. The Company will actively expand new opportunities in many regions.
4. Short chain
The industrial chain is shortened in value and the products directly address the needs of users. The traditionalvalue chain is transformed into a new value chain. We will explore new opportunities with more partners andusers boldly.
Description of 2030 vision of the Company
"In 2030, the Company will provide intelligent solutions through insight into users, scenes and industry painpoints, making the world smarter and lower-carbon and greatly increasing the proportion of solution revenues.”
The future will be an intelligent society, and intelligentization will be a long-term, lasting and far-reachingchange having a wide influence, and will deeply affect modern life, and change product forms at the same time.We will seize the historical opportunity of intelligent, scene-based and green- and low-carbon development,innovate the business model actively, realize transformation from components to products to solutions, innovatehome appliance business around "electronic control, motor, battery, power supply, Internet of Things platform andfive industries", find the blue ocean market, maintain the dominant position of tool business and the leadingmarket share, accelerate the development of new energy and industrial business, and achieve scale growth.
(II) Development strategy of the Company
1. Focus on strategy and sustained and effective growth
A vision blueprint for the next ten years was formulated in 2021 based on the medium-term developmentgoal of the Company in 2025, in which the long-term development goal in 2030 was made clear. The Companywill continue to focus on scale growth, deepen the implementation of the four strategic policies - "customerintimacy, innovation drive, fine operation and organizational evolution", build a pyramid profit model, enhance itsleading position in global intelligent control solution providers, and achieve sustained and effective growth.
The Company will provide one-stop intelligent control solutions and services for the world’s leading brandcustomers with the advantage of the “four electrics and one network” technology, and focusing on five mainbusinesses of the “home appliances + tools + new energy + industry + intelligent solutions”, and make good useof the capital market platform to achieve high growth in operating income scale through a combination ofendogenous and extended methods.
2. Innovation drive and continuous enhancement of the competitiveness of technologies and products
The Company will adhere to innovation drive, maintain R&D investment continuously, strengthen basic andcutting-edge technology research, and set up technical control points; strengthen the construction of product linesand build more high-quality product platforms; promote the protection of intellectual assets such as patents andtrade secrets, and build technical barriers; cultivate the engine of innovation and growth, and strengthen thecultivation of innovative talents.
It will meanwhile seize the development opportunities such as "intelligence" and "low-carbon development",actively explore innovative services such as the Internet of Things and green commuting, consolidate and expandthe core technical capabilities of "electronic control, motor, battery, power supply and Internet of Thingsplatform", enhance the market and product development capabilities, and explore more high-value markets.
3. Fine operation and improvement of quality and efficiency
The Company will deepen the implementation of the fine operation strategy, optimize business processessuch as strategy, market, R&D, sales, procurement and after-sales service continuously, and improve theend-to-end efficiency.
4. Organizational reform and continuous evolution of process-oriented organization
The Company will implement the organizational evolution strategy, strengthen the construction of talentteams, increase the number of talents in key positions rapidly, strengthen the capacity building of middlegroundand background, better empower the Iron Triangle team, and build a customer-centered process-oriented
organization.
5. Acceleration of global layout and construction of global delivery capabilityThe Company will continue to strengthen the customer intimacy strategy. To meet customer demands for fastdelivery and delivery with proximity, the Company has established operation centers, manufacturing centers,R&D centers and representative offices in many places around the world based on business needs. During thereporting period, it completed the construction of Ningbo Industrial Park, realized the rapid commissioning of theplant in Binh Duong, Vietnam, and accelerated the construction of plants in Mexico and Romania. At the sametime, the Company has strengthened the integration of supply chain based on global layout advantages andenhanced the local purchasing ability.
(III) Business plan for 2022
1. Realization of scale growth: The Company will continue to implement the head customer strategy, givefull play to platform advantages and increase the share of overseas plants to achieve scale growth of variousindustries based on the core technology of "electronic control, motor, battery, power supply and Internet of Thingsplatform", and meanwhile increase the proportion of high-value products and independent and controllablebusinesses;
2. Improvement of profitability: The Company will improve its full-cost efficiency, increase efficiency andreduce costs to improve its profitability, and meanwhile improve the cash flow from operating activities through"three reductions and one optimization", process optimization and promotion of the level of digitalization andautomation;
3. Organizational evolution: The Company will incubate BUs on a large scale, build corporate culture of afearless organization, strengthen the sense of mission and internal drive of all Topband employees, stimulate theircreativity and release their potential to accomplish them.
(IV) Fund demand and utilization plan
Since the Company is in the stage of rapid development, it has a huge fund demand in equipment upgradingand capacity expansion. The Company has a good credit standing, so it is able to get strong support from the bankin a timely manner. In 2022, taking into account its own development situation and development strategy, theCompany has raised the funds required for its development through reasonable use of various ways.
(V) Risks faced by the Company and countermeasures
1. External risks such as the macro environment
The global epidemic will still make impact on economic activities before control, and trade frictions andgeopolitical tensions will also produce adverse influences on business confidence and investment. The Companymay continue to face an uncertain external environment, so we will further strengthen risk identification andcontrol for various businesses and regions and adjust strategies timely to minimize external influences.
2. Risk of technology upgrading
The intelligent controller industry technology, as the main business of the Company is developing rapidlywith fast product upgrading and short life cycle. Although the Company continues to invest in research anddevelopment and owns a number of invention and utility patents, there is still a risk that the technology will not beupdated in time to meet market demand, or lag behind competitors in launching new products, resulting in adecline in the market share and profitability of the Company.
3. Exchange rate risk
The Company's revenue from export sales accounts for more than half of total revenue. In order to cope withthe risk of exchange rate fluctuation, the Company will reduce and hedge foreign exchange risks by conductingRMB hedging business, international procurement and re-pricing of new product.
(4) Other risks
There are many uncertainties in the current macro environment at home and abroad, and there are somefactors that are unfavorable to the operation of the Company. For example, the Sino-US trade war, the recurrenceof COVID-19, the shortage of raw materials or the price rise, the lack of manpower and customer credit risk willincrease the uncertainty of the Company's operation.XII. Reception, investigation, communication, interview and other activities during thereporting period
√ applicable □ not applicable
Time of reception | Location of reception | Method of reception | Type of reception object | Reception object | Main contents of interview and materials provided | Index of basic information of investigation |
2021/1/19 2021/1/20 2021/1/21 | Conference room of the Company | Field survey | Organizations | Fuguo Fund Management Co., Ltd., Zhonggeng Fund Management Co., Ltd., Shenzhen Yitong Investment Co., Ltd., Wanhe Securities Co., Ltd. and Shenzhen Capital Fortune | Learn about the operation of the Company; no information provided. | http://www.cninfo.com.cn |
Investment Management Co., Ltd. | ||||||
2021/1/26 2021/1/27 2021/1/29 | Conference room of the Company | Telephone and field survey | Organizations | HTF Fund Management Co., Ltd., Xingquan Fund Management Co., Ltd., Sinosafe Fund Management Co., Ltd., Taiping Asset Management Co., Ltd., Huabao Fund Management Co., Ltd., Guotai Asset Management Co., Ltd., Changjiang Asset Management Co., Ltd., Shanghai Panjing Investment Management Co., Ltd., Dajia Asset Management Co., Ltd., Bank of Communications Co., Ltd., New China Asset Management Co., Ltd., Guosheng Securities Co., Ltd. and Tianfeng Securities Co., Ltd. | Learn about the operation, financial situation and strategic planning of the Company; No information provided. | http://www.cninfo.com.cn |
2021/3/9 | Conference room of the Company | Telephone survey | Organizations | Tianfeng Securities Co., Ltd., Great Wall Securities Co., Ltd., Zhongtai Securities Co., Ltd., Guotai Junan Securities Co., Ltd., China Merchants Fund Management Co., Ltd., Guohai Securities Asset Management Branch, Harvest Fund Management Co., Ltd., HSBC Jinxin Fund Management Co., Ltd., China Post Capital Fund Management Co., Ltd., Sinowise Investment Management Co., Ltd., Zhongrong Fund Management Co., Ltd., China CICC Wealth Management Securities Co., Ltd., GTS Fund Management Co., Ltd., Yinhua Fund Management Co., Ltd., Xingquan Fund Management Co., Ltd., Southwest Securities Investment Department, Tianzhi Fund Management Co., Ltd., Tianhong Fund Management Co., Ltd., Tianfeng International Securities Co., Ltd., Taixin Fund Management Co., Ltd., Shenzhen Qianhai Prudence Investment Asset Management Co., Ltd., Shenzhen Qianhai Guhe Asset Management | Learn about the operation and financial situation of the Company; no information provided. | http://www.cninfo.com.cn |
Investment Management Co., Ltd., Dacheng Fund Management Co., Ltd., Caitong Fund Management Co., Ltd., Bohai Huijin Securities Asset Management Co., Ltd., Beixin Ruifeng Fund Management Co., Ltd., Beijing Yuanlesheng Asset Management Co., Ltd., Beijing Jiashu Asset Management Co., Ltd., Beijing Fengpei Investment Management Co., Ltd., Anxin Fund Management Co., Ltd., Vontobel Asset Management Asia Pacific Limited, Point Poplar Management Co., Ltd., Shenzhen Qianhai Junjie Asset Management Co., Ltd. and Tongtai Fund Management Co., Ltd. | ||||||
2021/3/9 | Conference room of the Company | Telephone survey | Organizations | China Securities Co., Ltd., Zhongtai Securities Co., Ltd., Anxin Fund Management Co., Ltd., Beijing Zeming Investment Co., Ltd., Fuyun investment, TruValue Asset Management Co., Ltd., Chunhou Fund Management Co., Ltd., Topsperity Securities Co., Ltd., Soochow Securities Co., Ltd., Everbright Securities Co., Ltd., Guangdong Yuancheng Private Equity Securities Investment Fund Co., Ltd., Guokai Securities, China Life AMP Asset Management Co., Ltd., Guoxin Investment, HFT Fund Management Co., Ltd., Sequoia Capital, Sinosafe Property Insurance Asset Management Co., Ltd., Harvest Fund Management Co., Ltd., BOCOM Schroeder Fund Management Co., Ltd., Mingyu Assets, ABC-CA Fund Management Co., Ltd., Lion Fund Management Co., Ltd., ABC Wealth Management, Ping An Annuity Insurance Company of China, Ltd., | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
Ping An Asset Management Co., Ltd., Qianhai Life Insurance Co., Ltd., Rose Capital, Shanghai Tongyuan Investment Co., Ltd., Shanghai Xinlan Investment Management Co., Ltd., China International Fund Management Co., Ltd., Shenwan Hongyuan Securities Co., Ltd., Shenzhen Wangzheng Asset Management Co., Ltd., Taiping Fund Management Co., Ltd., Taixin Fund Management Co., Ltd., Tianhong Fund Management Co., Ltd., Western Leadbank Fund Management Co., Ltd., Western Securities Co., Ltd., Xingzheng Global Fund Management Co., Ltd., Sunshine Tianhong Fund, Yonghe Capital, Investment Department of Yuntong Automobile Group, Great Wall Wealth Asset Management Co., Ltd., Changjiang Endowment Insurance Co., Ltd., Changsheng Fund Management Co., Ltd., China Merchants Fund Management Co., Ltd., Zhejiang Chujiu Investment Management Co., Ltd., Zhonghai Fund Management Co., Ltd., Zhong Ou Asset Management Co., Ltd., CITIC Prudential Fund Management Co., Ltd., Bank of China Investment Management Co., Ltd. and China CITIC Bank. | ||||||
2021/3/10 2021/3/11 | Conference room of the Company | Field survey | Organizations | Proxim Hong Kong Co., Ltd., Haocheng Asset Management Co., Ltd., Wanlian Securities Co., Ltd., Guosen Securities Co., Ltd., Huatai Securities Co., Ltd., ZTF Securities Co., Ltd., Wenyuan Capital Management Co., Ltd. and Caitong Fund Management Co., Ltd. | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
2021/3/15 2021/3/16 2021/3/17 2021/3/18 | Conference room of the Company | Telephone and field survey | Organizations | Mondrian Asset Management Co., Ltd., New Thinking (Hong Kong) Investment Management Co., Ltd., Zongcai Investment Management Co., Ltd., Shanghai Jiuge Investment Management Co., Ltd., Shanghai Panjing Investment Management Center, Chunhou Fund Management Co., Ltd., Anxin Securities Co., Ltd., Huachuang Securities Co., Ltd., Ruiyuan Fund Management Co., Ltd. and Industrial Securities Co., Ltd. | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
2021/4/15 | Conference room of the Company | Telephone survey | Organizations | Tianfeng Securities Co., Ltd., SDIC UBS Fund Management Co., Ltd., First State Cinda Fund Management Co., Ltd., Penghua Fund Management Co., Ltd., Zhengyi Asset Management Co., Ltd., Zhonggeng Fund Management Co., Ltd., Yinhua Fund Management Co., Ltd., Fuguo Fund Management Co., Ltd., Shanghai Xitai Investment Management Co., Ltd., Kaifeng Investment Management Co., Ltd., Shenzhen Fengling Capital Management Co., Ltd., Wangzheng Investment Management Co., Ltd., Guangdong Huayin Tianxia Fund Management Co., Ltd., Shanghai Shengyu Equity Investment Fund Management Co., Ltd., Everbright PGIM Fund Management Co., Ltd., Guangzhou Yourong Equity Investment Management Co., Ltd., Honghua Capital Management (Shenzhen) Co., Ltd., Furong Fund Management Co., Ltd., Huabao Fund Management Co., Ltd., Beijing Dingsa Investment Co., Ltd., Yihe Jiufu Investment Management Co., Ltd., ICBC Credit Suisse Fund Management Co., Ltd., | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
Tianhong Fund Management Co., Ltd. and Jinxiu Zhonghe (Beijing) Capital Management Co., Ltd. | ||||||
2021/4/26 2021/4/27 | Conference room of the Company | Telephone survey | Organizations | Tianfeng Securities Co., Ltd., Great Wall Securities Co., Ltd., Tianfeng Securities Asset Management Branch, Xingquan Fund Management Co., Ltd., Junhe Capital, Harvest Fund Management Co., Ltd., Fuguo Fund Management Co., Ltd., China Life Asset Management Co., Ltd., China Merchants Fund Management Co., Ltd., Huatai Securities Asset Management Department, Ruiyuan Fund Management Co., Ltd., Shanghai Fosun High Technology (Group) Co., Ltd., Sinosafe Property Insurance Asset Management Co., Ltd., Taikang Asset Management Co., Ltd., Southern Asset Management Co., Ltd., Bank of China Investment Management Co., Ltd., Founder Fubon Fund Management Co., Ltd., Taiping Asset Management Co., Ltd., Hangzhou Guangtian Investment Management Co., Ltd., Shenzhen Fengling Capital Management Co., Ltd., GTS Fund Management Co., Ltd., Jiuyan Asset Management Co., Ltd., Shenzhen Qianhai Evolutionism Asset Management Co., Ltd., Beijing Xinhan Capital Management Co., Ltd., Hongshang Capital Equity Investment Co., Ltd., Shenzhen Hongding Wealth Management Co., Ltd., Shanghai Tuling Asset Management Co., Ltd., China Merchants Securities Asset Management Co., Ltd., Vontobel Asset Management Asia Pacific Limited, Pebble Capital | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
Ltd., Shanghai Loujiang Investment Management Center, Minsheng Royal Fund Management Co., Ltd., Beijing CUFE Long Ma Capital Investment Co., Ltd., Fuanda Fund Management Co., Ltd., BlackRock Asset Management North Asia Limited, Xingyin Fund Management Co., Ltd., Anxin Fund Management Co., Ltd., Teda Manulife Fund Management Co., Ltd., Guotai Yuanxin Asset Management Co., Ltd., Sinosafe Fund Management Co., Ltd., Orient Fund Management Co., Ltd., Panjing Investment Management Co., Ltd. and Tianzhi Fund Management Co., Ltd. | ||||||
2021/5/11 2021/5/12 2021/5/13 | Conference room of the Company | Telephone and field survey | Organizations | BlackRock Fund Management Co., Ltd., Kaiji Securities Co., Ltd., Harvest Fund Management Co., Ltd., Rongtong Fund Management Co., Ltd., Tianhong Fund Management Co., Ltd., EFund management Co., Ltd., GTS Fund Management Co., Ltd., Zhong Ou Fund Management Co., Ltd., Dajia Asset Management Co., Ltd., Fuguo Fund Management Co., Ltd., Shanghai Fusheng Asset Management Partnership, China Securities Co., Ltd., Guokai Securities Co., Ltd., Guangdong Hongchang Private Equity Securities Investment Management Co., Ltd., Hongta Hongtu Fund Management Co., Ltd., Huabao Fund Management Co., Ltd., Huaxia Wealth Management Co., Ltd., CCB Principal Asset Management Co., Ltd., Penghua Fund Management Co., Ltd., Ping An Asset Management Co., Ltd., Qianhai Kaiyuan Fund Management | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
Co., Ltd., Rixing Asset Management Co., Ltd., Zhuque Fund Management Co., Ltd., New China Asset Management Co., Ltd., First Beijing Investment Co., Ltd., Hezhong Asset Management Co., Ltd. and Highclere. | ||||||
2021/5/18 2021/5/19 2021/5/20 2021/5/21 | Conference room of the Company | Field Telephone survey | Organizations | BlackRock Fund Management Co., Ltd., HTF Fund Management Co., Ltd., Guosheng Securities Co., Ltd., HFT Fund Management Co., Ltd., First State Cinda Fund Management Co., Ltd., Huatai Baoxing Fund Management Co., Ltd., Shenzhen Jindou Investment Co., Ltd., Zhonghai Fund Management Co., Ltd., Shenzhen Qianhai Evolutionism Asset Management Co., Ltd., Anhui Zhongjue Investment Management Co., Ltd., Guotai Junan Securities Co., Ltd., Harvest Fund Management Co., Ltd. and Point72 Hong Kong Limited. | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
2021/6/4 | Conference room of the Company | Telephone survey | Organizations | Greenwoods Asset Management, Springs Capital (Beijing) Investment Management Co., Ltd., Harvest Fund Management Co., Ltd., Baichuan Wealth (Beijing) Investment Management Co., Ltd., Beijing Fengpei Investment Management Co., Ltd., BlackRock Institutional Trust Co., Ltd., Brilliance Capital Management Co., Ltd., Guangxi Junjing Ggarden Engineering Co., Ltd., Guangzhou Zhaoshi Investment Partnership (Limited Partnership), Guojin Fund Management Co., Ltd., Huabao Securities Co., Ltd., Huaneng Guicheng Trust Co., Ltd., Shenzhen Qianhai Huaqiang Financial Holding Co., Ltd., Huarong |
Management Co., Ltd., China Life Asset Management Co., Ltd., CITIC CLSA Securities Co., Ltd., BOC International Securities Co., Ltd., Zhuhai Hengqin Yuexin Asset Management Co., Ltd. and CITIC Securities Co., Ltd. | ||||||
2021/6/8 2021/6/9 | Conference room of the Company | Field and telephone survey | Organizations | Southern Asset Management Co., Ltd., Huachuang Securities Co., Ltd., HFT Fund Management Co., Ltd., Springs Capital (Beijing) Investment Management Co., Ltd., Manulife Asset Management Hong Kong Co., Ltd., Sinosafe Property Insurance Co., Ltd., Fuguo Fund Management Co., Ltd., Shenzhen Kaifeng Investment Management Co., Ltd., CITIC Prudential Life Insurance Co., Ltd., Maxwealth Fund Management Co., Ltd., Everbright Securities Co., Ltd., CPIC Fund Management Co., Ltd., Manulife Asset Management (Thailand) Co,Ltd, Point72 asset management, Ruiyuan Fund Management Co., Ltd., Founder Fubon Fund Management Co., Ltd., Taiping Fund Management Co., Ltd., Qunyi Securities Investment Trust Co., Ltd., Nuode Fund Management Co., Ltd., Taikang Asset Management Co., Ltd., Shanghai Fosun High Technology (Group) Co., Ltd., Tianchong Capital Management Co., Ltd. and Fuanda Fund Management Co., Ltd. | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
2021/6/24 2021/6/25 | Conference room of the Company | Telephone survey | Organizations | CITIC Asset Management Co., Ltd., Anhui Conch Venture Capital Co., Ltd., Anhui Mingze Investment Management Co., Ltd., Baoer Taiping Co., Ltd., PKU Founder Life Asset Management Center, | Learn about the operation, financial situation and strategic planning of the | http://www.cninfo.com.cn |
Beijing Fengpei Investment Management Co., Ltd., Beijing Hongcheng Investment Management Co., Ltd., Beijing Xingshi Investment Management Co., Ltd., Caitong Securities Asset Management Co., Ltd., Dajia Asset Management Co., Ltd., Topsperity Securities Co., Ltd., Northeast Securities Co., Ltd., Oriental Alpha Fund Management Co., Ltd., Orient Fund Management Co., Ltd., Orient Securities Co., Ltd., ICBC Credit Suisse Fund Management Co., Ltd., Everbright PGIM Fund Management Co., Ltd., Everbright Securities Asset Management Co., Ltd., GF Fund Management Co., Ltd., Guohai Franklin Fund Management Co., Ltd., CPIC Fund Management Co., Ltd., China Life AMP Asset Management Co., Ltd., HFT Fund Management Co., Ltd., Evergrande Life Insurance Co., Ltd., Sinosafe Fund Management Co., Ltd., Huachuang Securities Co., Ltd., Huafu Securities Co., Ltd., Huatai (Shanghai) Asset Management Co., Ltd., Harvest Fund Management Co., Ltd., CCB Principal Asset Management Co., Ltd., Nuode Fund Management Co., Ltd., Penghua Fund Management Co., Ltd., Ping An Fund Management Co., Ltd., Ping An Asset Management Co., Ltd., AXA SPDB Fund Management Co., Ltd., Qianhai Kaiyuan Fund Management Co., Ltd., Shanghai Aijian Trust Co., Ltd., Shanghai Chengzhou Asset Management Co., Ltd., Shanghai Fengchi Asset Management Co., Ltd., Shanghai | Company; no information provided. |
CITIC Prudential Fund Management Co., Ltd., CITIC Securities Co., Ltd., BOC International Securities Co., Ltd., BOC Fund Management Co., Ltd. and Rosefinch Fund Management Co., Ltd. | ||||||
2021/7/27 2021/7/28 2021/7/29 2021/7/30 | Conference room of the Company | Field and telephone survey | Organizations | Tianfeng Securities Co., Ltd., Fuguo Fund Management Co., Ltd., Xingquan Fund Management Co., Ltd., Harvest Fund Management Co., Ltd., Huatai-PineBridge Investments Management Co., Ltd., CITIC Securities Asset Management Department, Wealth Management Subsidiary of Agricultural Bank of China, Loyal Valley Capital Co., Ltd., China Merchants Securities Asset Management Co., Ltd., Changjiang Endowment Insurance Co., Ltd., Changan Funds Management Co., Ltd., GTS Fund Management Co., Ltd., Yinhua Fund Management Co., Ltd., Yihe Jiufu Investment Management Co., Ltd., Industrial Securities Co., Ltd., Southwest Securities Investment Department, Taiping Asset Management Co., Ltd., Taiping Fund Management Co., Ltd., Sichuan Jinduo Investment Co., Ltd., Simu Gongchang Siyuan No.1 Securities Investment Funds, Shenzhen Xishan Capital Management Co., Ltd., Shenzhen Wangzheng Asset Management Co., Ltd., Shenzhen Yitong Investment Management Co., Ltd., Shenzhen Jinzhihao Fund Management Co., Ltd., Shenzhen Guanghuiyuan Asset Management Co., Ltd., Shenzhen Fengling Capital Management Co., Ltd., SWS MU Fund Management Co., | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
Fund Management Co., Ltd., Yinhua Fund Management Co., Ltd., China Merchants Securities Co., Ltd., Shenzhen Wukong Investment Management Co., Ltd. | ||||||
2021/9/7 2021/9/9 | Conference room of the Company | Field and telephone survey | Organizations | China Asset Management Co., Ltd., China CICC Wealth Management Securities Co., Ltd., Credit Suisse (Hong Kong) Co., Ltd., Fuda Fund Management (China) Co., Ltd., BlackRock Fund Management Co., Ltd. | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
2021/9/21 2021/9/22 2021/9/23 | Conference room of the Company | Field and telephone survey | Organizations | Tianfeng Securities, Harvest Fund, Xingquan Fund, Zhonggeng Fund, BlackRock Fund Management, HFT Fund Management, SDIC UBS Fund, Bosera Funds, Taikang Asset Management, First State Cinda Fund, BOC Fund, Ping An Annuity Insurance, Hillhouse Investment, EFund, Southern Asset, BOCOM Schroders Fund, Deppon Self-operated, ABC Wealth Management, Ningbo Liansheng Investment, Rongtong Fund, Caitong Fund, Huaneng Guicheng Trust, Hengtou Securities, CITIC Securities, Haizhengsong Investment; PICC, Zhongshan Securities, Baixi Private Equity Fund Management, Shanghai Dazheng Investment, Nanjing Double-Safeguard Asset Management, AXA SPDB Fund, Shenzhen Wangzheng Asset Management, Orient Fund, Zhejiang Minong Investment, Anxin Fund, Shanghai Jinyin Investment, Founder Fubon Fund, China Life AMP Asset, New China Pension, Guotai Junan Securities, Shanghai Hehe, Changjun Capital, Orient | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
International Securities, Southern Asset, Sinosafe Fund, Shanghai Gaoyi Asset Management, Ningbo Huanfang Quantitative Investment Management, TruValue Asset Management, China Merchants Securities, Industrial Securities, Shanghai Securities, Beijing Zundao Asset Management, Taiping Asset Management, ABC Wealth Management, Shenwan Asset Management, Beijing Hongcheng Investment, Mingya Fund, Shanghai Fusheng Asset Management, CICC Fund, Bank of China Investment Management Co., Ltd., Guohai Securities, Generali China Asset Management, Yinhua Fund, China Life Endowment Insurance, PKU Founder Life Management, Beijing Zundao Asset Management, Universal Wisdom Investment, Huatai Baoxing, Shanghai Tongyuan Investment, Shenzhen Yujin Fund, Shanghai Panjing Investment, Dajia Asset Management, Shanda Capital, Efund, Hotland Innovation, Nuode Fund. Zheshang Securities: ICBC Credit Suisse Fund, Shenzhen Happy Time Fund. CITIC Securities: Neuberger Berman | ||||||
2021/9/27 2021/9/30 | Conference room of the Company | Field and telephone survey | Organizations | Citi Orient Securities: Harvest Fund, AIA Insurance, Guotai Securities Investment Trust Company, Fangying Yanjiuxing Investment, Houhua Investment Trust Asset Management, Green Court Capital Management, Matthews International Capital Management, Yingde Gases Group, Power Corporation of Canada. | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
Deppon Securities: Shanghai Fosun Technology. Guosen Securities: Fenghe Asia. | ||||||
2021/10/14 2021/10/15 | Conference room of the Company | Field survey | Organizations | Huachuang Securities, HTF Fund, Yinhua Fund, China Post Fund. | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
2021/10/27 2021/10/28 | Conference room of the Company | Field telephone survey | Organizations | Tianfeng Securities, Zhongtai Securities, Guosen Securities, CITIC Securities, Everbright Securities, CICC Securities, Huachuang Securities, Guotai Junan Securities, Shenwan Hongyuan Securities, Changjiang Securities, Guosheng Securities, CMB Wealth Management, BlackRock Fund, HTF Fund, Xingquan Fund, Harvest Fund, Harvest Fund, HFT Fund, Yinhua Fund, Ping An Fund, Baichuang Capital, Fuguo Fund, Chang An Fund, Southern Asset, Baoying Fund, Huatai-PineBridge, Guotai Asset Management, China International Fund, Hongta Hongtu Fund, Hotland Innovation Fund, Lion Fund, Greenwoods Asset, Maoding Asset, Vontobel Fund, Jinda Investment, Value Investment, Guhe Asset, Bosera Funds, Deppon Securities, Beixin Ruifeng, Rongtong Fund, Lubao Investment, Dacheng Fund, CCB Principal Asset, Fosun Asset Management, Qianhai Kaiyuan Fund, Shenzhen Fengling Capital, Shanghai Yongjian Asset Management, Tibet Yuancheng Asset Management, Xinyang Fund, Cigna CMB Asset | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
Management, Shenzhen Ruifu Asset Management, Shanghai Universal Wisdom Investment, Shouyuan Investment, Lingze Capital, Founder Fubon Fund, Panjing Investment, Cephei Capital, First State Cinda Fund, Jiangsu Ruihua Investment, Panhou Dynamic (Shanghai) Capital Management, DH Fund Management, Jiutai Fund, Foresight Fund, Tengyue Fund.China Securities, Ping An Annuity, Ping An Fund, Wanjia Asset, Springs Capital, Pacific Asset Management, BOCOM Schroders Fund, Huabao Fund, Oriental Alpha Fund, Xinyuan Asset Management, HFT Fund, GTS Fund, Rongtong Fund, CPIC Fund, Industrial Securities, Guotai Junan Securities, Shenwan Hongyuan Securities. | ||||||
2021/11/12 | Conference room of the Company | Field survey | Organizations | Yongan Guofu, Orient Securities Asset Management, Lead Wolf Fund, Ruiyuan Fund | Learn about the operation, financial situation and strategic planning of the Company; no information provided. | http://www.cninfo.com.cn |
Section IV Corporate GovernanceI. Basic situation of corporate governanceSince its listing, the Company has revised the Articles of association, the Rules of Procedure of the GeneralMeeting of Shareholders, the Rules of Procedure of the Board of Directors and the Rules of Procedure of theBoard of Supervisors and established a series of corporate governance systems such as the Management System ofRaised Funds and the Management System of Public Information Disclosure in strict accordance with therequirements of relevant laws and regulations such as the Company Law, the Securities Law, the Code on theGovernance of Listed Companies, the Guidelines for the Articles of Association of Listed Companies and theStock Listing Rules of Shenzhen Stock Exchange. During the reporting period, the corporate governance was inline with the requirements of the Code on the Governance of Listed Companies and other normative documents oncorporate governance issued by the CSRC.
1. About shareholders and the General Meeting of Shareholders: The Company has convened and held theGeneral Meeting of Shareholders in strict accordance with the provisions and requirements of the Rules ofProcedure of the General Meeting of shareholders and the Normative Opinions of the General Meeting ofShareholders of the Listed Company, so as to ensure that all shareholders, especially minority shareholders canenjoy equal status and fully exercise their rights.
2. The relationship between the controlling shareholder and the listed company: The controlling shareholderregulates his behavior in strict accordance with the Code on the Governance of Listed Companies and the Articlesof Association, and is able to exercise his rights and assume corresponding obligations according to law. Thecontrolling shareholder of the Company is an individual who does not have other investment projects and does notdirectly or indirectly interfere with the Company's decision-making and business activities beyond the GeneralMeeting of Shareholders. The Board of Directors, the Board of Supervisors and the corresponding departments ofthe Company can operate normally and have independence.
3. About directors and the Board of Directors: All the directors of the Company can carry out work inaccordance with the Rules of Procedure of the Board of Directors, the Independent Director System, and theGuidelines on the Conduct of Directors of Listed Companies in the SME Board, attend relevant meetings seriously,actively participate in training, and be familiar with relevant laws and regulations. The Company elects directors
in strict accordance with the recruitment procedures prescribed in the Articles of Association. At present, theCompany has 3 independent directors and 6 non-independent directors. The composition of the Board of Directorscomplies with the requirements of laws and regulations and the Articles of Association.
4. Supervisors and the Board of Supervisors: The Board of Supervisors is formed in strict accordance withrelevant provisions of the Company Law and the Articles of Association. The Company's supervisors can, inaccordance with the Rules of Procedure of the Board of Supervisors, conscientiously perform their duties,supervise the legality and compliance of the Company's financial status and major matters in good faith andresponsibly, and safeguard the legitimate rights and interests of the Company and its shareholders.
5. Performance evaluation and incentive and restraint mechanisms: The Company has established a series ofperformance evaluation and incentive and restraint mechanisms, and the appointment of senior executives is openand transparent and complies with the requirements of relevant laws and regulations.
6. Relevant stakeholders: The Company can fully respect and safeguard the legitimate rights and interests ofrelevant stakeholders, and actively cooperate with stakeholders to jointly promote the sustainable and healthydevelopment of the Company.
7. Information disclosure and transparency: The Company conscientiously performs the obligation ofinformation disclosure in accordance with relevant laws and regulations such as the Articles of Association, theStock Listing Rules of Shenzhen Stock Exchange, and the Company Information Disclosure System. The Companydesignates Securities Times and www.cninfo.com.cn as the newspaper and website for its information disclosure,and ensures the timeliness and accuracy of its information disclosure.Is there any significant difference between the actual situation of corporate governance and laws, administrativeregulations and the regulations on corporate governance of listed companies issued by China SecuritiesRegulatory Commission?
□ Yes √ No
No.II. The independence of the Company from the controlling shareholder and actual controllerin terms of ensuring the Company's assets, personnel, finance, organization, business, etc.
The controlling shareholder of the Company is a natural person, and the controlling shareholder has no otherinvestment. The Company and the controlling shareholder are completely separated in terms of business,
personnel, assets, finance, etc. The Company has stable production and operation, and can operate independentlyand normatively.
1. Independent business: The business of the Company is independent from the controlling shareholder, witha complete and independent production, supply and marketing system, and is not dependent on shareholders orany other related parties.
2. Personnel independence: The Company has an independent staff team, and has established a soundpersonnel management system. The Company's chairman, general manager, deputy general managers, boardsecretary, chief financial officer and other senior executives work full-time in the Company and receiveremuneration. They have not held any positions except directors and supervisors in the shareholder units holdingmore than 5% of the shares of the Company and their subordinate enterprises, or held any positions in otherenterprises with the same or similar business as the Company. Personnel management is independent.
3. Independent assets: The Company has independent production and operation sites, production systems,supporting facilities, land use rights and house ownership, which are not shared with the controlling shareholder.
4. Institutional independence: The Company has set up a sound organizational system and can operateindependently. There is no subordinate relationship with the controlling shareholder.
5. Financial independence: The Company has set up an independent financial accounting department andestablished an independent accounting system and financial management system, and carries out independentfinancial operations under the requirements of relevant accounting systems. The Company has separate bankaccounts, and conducts independent tax declaration and performs payment obligations according to law.III. Competition in the same industry
□ applicable √ not applicable
IV. Information on the annual and extraordinary general meetings of shareholders heldduring the reporting period
1. Information on the General Meeting of Shareholders during the reporting period
Meeting session | Meeting type | Investor participation ratio | Meeting date | Date of disclosure | Meeting resolution |
2020 Annual General Meeting of Shareholders | Annual General Meeting of Shareholders | 26.49% | March 30, 2021 | March 31, 2021 | 1. Reviewed and approved the Proposal on 2020 Annual Report and Summary; 2. Reviewed and approved the Proposal on 2020 Final Financial Report; 3. Reviewed and approved the Proposal on 2020 Profit Distribution Plan; 4. Reviewed and approved the Proposal on 2020 Work Report of the Board of Directors; 5. Reviewed and approved the Proposal on 2020 Work Report of the Board of Supervisors; 6. Reviewed and approved the Proposal on Remuneration of Company Directors in 2020; 7. Reviewed and approved the Proposal on Remuneration of Company Supervisors in 2020; 8. Reviewed and approved the Proposal on Application for Comprehensive Credit Line from Banks by the Company and Its Subsidiaries in 2021; 9. Reviewed and approved the Proposal on Renewing the Employment of Audit Institution in 2021; 10. Reviewed and approved the Proposal on Increasing the Registered Capital of the Company; 11. Reviewed and approved the Proposal on Changing Business Scope of the Company; 12. Reviewed and approved the Proposal on Amendment of the Articles of Association; 13. Reviewed and approved the Proposal on By-election of Independent Directors of the Company. |
First Extraordinary General Meeting of Shareholders in 2021 | Extraordinary General Meeting of Shareholders | 28.12% | May 10, 2021 | May 11, 2021 | 1. Reviewed and approved the Proposal on Extending the Validity Period of the Resolution of the Shareholders' Meeting for Non-public Offering of Stocks of the Company in 2020; 2. Reviewed and approved the Proposal on Requesting the Shareholders' Meeting to Extend the Validity Period of Authorization to the Board of Directors of the Company for Handling Matters Related to the 2020 Non-public |
Offering of Stocks. | |||||
Second Extraordinary General Meeting of Shareholders in 2021 | Extraordinary General Meeting of Shareholders | 37.85% | November 1, 2021 | November 2, 2021 | 1. Reviewed and approved the Proposal on the Company's 2021 Restricted Stock Incentive Plan (Draft) and Its Summary; 2. Reviewed and approved the Proposal on Administrative Measures for the Implementation and Evaluation of the Company's 2021 Restricted Stock Incentive Plan; 3. Reviewed and approved the Proposal on Requesting the Shareholders' Meeting to Authorize the Board of Directors to Handle Matters Related to the Company's 2021 Restricted Stock Incentive Plan; 4. Reviewed and approved the Proposal on Increasing the Registered Capital of the Company; 5. Reviewed and approved the Proposal on Amendment of the Articles of Association. |
Third Extraordinary General Meeting of Shareholders in 2021 | Extraordinary General Meeting of Shareholders | 31.92% | December 27, 2021 | December 28, 2021 | Reviewed and approved the Proposal on Foreign Investment of and Signing of Investment Agreement by Wholly Owned Subsidiaries |
2. The preferred shareholders with restored voting rights request to convene an Extraordinary GeneralMeeting of Shareholders
□ applicable √ not applicable
V. Information of directors, supervisors and senior management
1. Overview
Name | Position | Position status | Gender | Age | Commencement date of tenure | Termination date of tenure | Number of shares held at the beginning of the period (shares) | Stock option | Number of restricted shares granted (shares) | Number of additional shares held in the current period | Number of shares reduced in the current period | Other changes (shares) | Number of shares held at the end of the period (shares) | Reasons for increase or decrease of shares |
(shares) | (shares) | |||||||||||||
Wu Yongqiang | Chairman of the Board | Incumbent | Male | 57 | 2011/8/29 | 2023/9/13 | 212,008,715 | 0 | 0 | 0 | 0 | 0 | 212,008,715 | Not applicable |
Ji Shuhai | Director | Incumbent | Male | 60 | 2011/8/29 | 2023/9/13 | 27,318,642 | 0 | 0 | 0 | 0 | 0 | 27,318,642 | Not applicable |
Zheng Sibin | Director and deputy general manager | Incumbent | Male | 56 | 2011/8/29 | 2023/9/13 | 5,243,970 | 240,000 | 533,000 | 0 | 0 | 773,000 | 6,016,970 | The second exercise period of stock options in 2018 met the exercise conditions, and restricted shares were granted according to the restricted stock incentive plan in 2021. |
Ma Wei | Director and deputy general manager | Incumbent | Male | 47 | 2011/8/29 | 2023/9/13 | 7,634,934 | 300,000 | 616,000 | 0 | 0 | 916,000 | 8,550,934 | The second exercise period of stock options in 2018 met the exercise conditions, and restricted shares |
were granted according to the restricted stock incentive plan in 2021. | ||||||||||||||
Peng Ganquan | Director | Incumbent | Male | 50 | 2011/8/29 | 2023/9/13 | 3,896,900 | 360,000 | 400,000 | 0 | 0 | 760,000 | 4,656,900 | The second exercise period of stock options in 2018 met the exercise conditions, and restricted shares were granted according to the restricted stock incentive plan in 2021. |
Wu Hang | Director | Incumbent | Male | 38 | 2014/9/12 | 2023/9/13 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | Not applicable |
Huang Yuegang | Independent Director | Incumbent | Male | 64 | 2020/9/14 | 2023/9/13 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | Not applicable |
Hua Xiuping | Independent Director | Incumbent | Female | 44 | 2017/9/09 | 2023/9/13 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | Not applicable |
Li Xumeng | Independent | Incumbent | Male | 56 | 2021/3/31 | 2023/9/13 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | Not applicab |
Director | le | |||||||||||||
Shi Yun | Independent Director | Appointment and removal | Male | 44 | 2017/9/09 | 2021/3/31 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | Not applicable |
Wen Zhaohui | Deputy General Manager and Secretary of the Board of Directors | Incumbent | Female | 48 | 2011/8/29 | 2023/9/13 | 2,108,127 | 180,000 | 183,000 | 60,000 | 0 | 363,000 | 2,531,127 | The second exercise period of stock options in 2018 met the exercise conditions, and restricted shares were granted according to the restricted stock incentive plan in 2021. |
Xiang Wei | Finance Chief Director | Incumbent | Male | 45 | 2019/1/10 | 2023/9/13 | 301,500 | 120,000 | 183,000 | 0 | 0 | 303,000 | 604,500 | The second exercise period of stock options in 2018 met the exercise conditions, and restricted shares were granted according to the |
restricted stock incentive plan in 2021. | ||||||||||||||
Dai Huijuan | Supervisor | Incumbent | Female | 46 | 2011/8/29 | 2023/9/13 | 319,612 | 0 | 0 | 0 | 0 | 0 | 319,612 | Not applicable |
Kang Weiquan | Supervisor | Incumbent | Male | 38 | 2014/8/21 | 2023/9/13 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | Not applicable |
Chen Jinzhou | Supervisor | Incumbent | Male | 44 | 2017/2/15 | 2023/9/13 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | Not applicable |
Total | -- | -- | -- | -- | -- | -- | 258,832,400 | 1,200,000 | 1,915,000 | 60,000 | 0 | 3,115,000 | 262,007,400 | -- |
Whether there is any demission of directors and supervisors and dismissal of senior management during the termof office in the reporting period
√ Yes □ No
Mr. Shi Yun applied to resign as an independent director of the seventh Board of Directors of the Companyfor personal reasons on March 31, 2021. The Company has completed the by-election of independent directors.Changes in directors, supervisors and senior executives of the Company
√ applicable □ not applicable
Name | Position | Type | Date | Reason |
Shi Yun | Independent director | Outgoing | March 31, 2021 | Resignation |
Li Xumeng | Independent director | Be elected | March 31, 2021 | By-election of independent directors |
2. Employment status
Professional background and main work experience of the Company's current directors, supervisors and seniorexecutives and their main responsibilities in the Company
(1) Members of the Board of Directors
Wu Yongqiang, male, born in 1965, holds a master's degree and has no right of permanent residence abroad.He is a local leading talent recognized by Shenzhen City. He has won the titles "Shenzhen Young Science andTechnology Leader" awarded by Shenzhen Municipal Government and "Top Ten Outstanding Young People" in
Nanshan District, Shenzhen. He served successively as lecturer of Harbin Institute of Technology and vicechairman of the Company. Now he serves as chairman of the Board of Directors of the Company, chairman of theBoard of Directors of Shenzhen Topband Software Technology Co., Ltd., executive director of ShenzhenTopband Battery Co., Ltd., executive (managing) director of Shenzhen Hongru Investment Management Co., Ltd.,partner of Shenzhen Hongru Investment Enterprise (Limited Partnership), executive director of Shenzhen YankaiElectric Technology Co., Ltd., executive director and general manager of Ningbo Topband Intelligent Control Co.,Ltd., and director of Topband (Hong Kong) Co., Ltd.Zheng Sibin: Male, born in 1966, master's degree, certified public accountant. He has no right of permanentresidence abroad. He served successively as office director and deputy factory director of Zhejiang SongyangBrewery, financial supervisor of Nantai Electronics (Shenzhen) Co., Ltd., and manager and chief financial officerof the financial department of the Company. Now he serves as director, deputy general manager and generalmanager of the business unit of the Company, supervisor of Shenzhen Topband Software Technology Co., Ltd.and supervisor of Chongqing Topband Industrial Co., Ltd.Ma Wei: Male, born in 1974. He holds a bachelor's degree and has no right of permanent residence abroad.He served successively as technical development engineer of Shenzhen Huafa Electronics Co., Ltd., technicaldevelopment engineer and general manager of the Company. Now he serves as director, deputy general managerand general manager of the business unit of the Company.Ji Shuhai: Male, born in 1962, master's degree, senior engineer. He has no right of permanent residenceabroad. He served successively as engineer of Guangzhou Wanbao Electrical Appliance Group Company andchairman and general manager of the Company. Now he serves as director and general manager of ShenzhenShuofang Precision Machinery Co., Ltd.Peng Ganquan: Male, born in 1972, master's degree. He has no right of permanent residence abroad. Heserved successively as engineer of Hunan Instrument and Meter General Factory, development engineer, technicaldirector and deputy general manager of the electrical business unit of the Company. Now he serves as director ofthe Company, general manager and executive director of Shenzhen Allied Control System Co., Ltd., and directorof Topband India Private Limited.Wu Hang: Male, born in 1984, master's degree. He has no right of permanent residence abroad; He onceserves as design conversion engineer of Shenzhen Mindray Bio-Medical Electronics Co., Ltd. Now he serves asdirector of the Company.Huang Yuegang: Male, born in October 1958, graduated from Jilin University of Finance and Economics
with a bachelor's degree, senior accountant. He once served as deputy director of the office and deputy director ofthe Publicity Department of the Party Committee at Jilin University of Finance and Economics, chief financialofficer of Shenzhen Far East Hotel Co., Ltd., credit director of Shenzhen Branch of Guangfa Bank, president ofZhenhua Road Sub-branch, executive president of Shenzhen Golden Lighting (Group) Co., Ltd., chairman ofDalian Changxing Industrial Co., Ltd., deputy general manager of Tianjin Guangxia Real Estate Development Co.,Ltd., deputy general manager of Shenzhen Zhongnan Hotel (Group) Management Co., Ltd. and president ofShenzhen Binji Industrial Group Co., Ltd. He is currently an independent director of Guizhou Tyre Co., Ltd. andShenzhen Aoya Design Co., Ltd.Hua Xiuping: Female, born in 1978, Ph.D. She has no right of permanent residence abroad. She servedsuccessively as researcher of China Finance Forty Forum, visiting scholar of School of Oriental and AfricanStudies, University of London funded by British Academy of Sciences, guest editor of European Finance Journal,part-time vice president and partner of Junrun Capital. She is currently an independent director of the Company,professor of finance and doctoral supervisor in Nottingham University Business School (China), and anindependent director of the Bank of Dongguan Co., Ltd., Ningbo Fubang Jingyi Group Co., Ltd. and NingboYuyao Rural Commercial Bank Co., Ltd.
Li Xumeng: Male, born in 1966, Chinese nationality, no permanent residence abroad, Ph.D. in businessmanagement. He served as a consultant in Beijing Shangheng Zhiben Management Consulting Co., Ltd. andShanghai Danfu Business Consulting Center. He is currently a researcher at Zhuoyuehui Innovation Development(Shenzhen) Co., Ltd.
(2) Members of the Board of Supervisors
Dai Huijuan: Dai Huijuan, female, born in 1976. She holds a bachelor's degree and has no right ofpermanent residence abroad. She served successively as supervisor and manager of the Company's humanresources department. Now she serves as chairwoman of the Board of Supervisors and director of the humanresources center at the Company, director and general manager of Huizhou Topband Electrical Technology Co.,Ltd., partner of Shenzhen Hongru Investment Enterprise (Limited Partnership), and executive director andmanager of Huizhou Topband New Energy Co., Ltd.
Chen Jinzhou: Male, born in 1978, permanent resident of Hong Kong, China, and doctor of The ChineseUniversity of Hong Kong. He served successively as electronic engineer of Hong Kong Productivity Council,senior researcher of Beijing Noitom Technology Co., Ltd., and senior chief engineer of Johnson Electric. Now heserves as deputy general manager of the microelectronics business unit of the Company and supervisor of the
board of supervisors of the Company.Kang Weiquan, male, born in 1984, bachelor's degree. He has no right of permanent residence abroad. Heonce served as cost accountant of Shenzhen Yihe Precision Industry Holding Co., Ltd. Now he serves as costaccountant and employee representative supervisor at the Company.
(3) Senior executives
Wu Yongqiang, general manager. See the resumes of the members of the Board of Directors.Zheng Sibin, deputy general manager. See the resumes of the members of the Board of Directors.Ma Wei, deputy general manager. See the resumes of the members of the Board of Directors.Wen Zhaohui: Female, born in 1974, bachelor's degree, accountant. She has no right of permanentresidence abroad. She served successively as supervisor of the financial department and manager and chieffinancial officer of the financial department at Shenzhen Topband Co., Ltd., director of Shenzhen Dynanonic Co.,Ltd., and director of Shenzhen Zhongzhi Yingke Electric Technology Co., Ltd. Now she serves as deputy generalmanager, secretary of the Board of Directors of the Company and director of Shenzhen Yuchengxin PowerTechnology Co., Ltd.Ms. Wen Zhaohui has been honored as "New Fortune Golden Secretary" for five consecutiveyears. She won the titles of "Excellent Secretary" awarded by Shenzhen Securities Regulatory Bureau and"Securities Times Top 100 Board Secretaries" in 2015, 2016 and 2017, and was selected into "New Fortune Hallof Fame of Golden Secretaries in 2019".
Xiang Wei: male, born in 1977, bachelor's degree, senior management accountant and internationalaccountant. He has no right of permanent residence abroad. He served successively as chief accountant of NorthChina Aluminum Co., Ltd., accounting officer and subsidiary financial manager of Yiyang Jewelry Industry Co.,Ltd., and deputy financial manager and financial manager of Shenzhen Topband Co., Ltd. Now he serves as chieffinancial officer of the Company.Positions in the shareholders' units
□ applicable √ not applicable
Positions in other units
√ applicable □ not applicable
Name of staff | Names of other companies | Positions held in other companies | Commencement date of tenure | Termination date of tenure | Are remuneration and allowances received from other companies |
Wu Yongqiang | Shenzhen Topband Software Technology Co., Ltd. | Executive director | September 18, 2014 | No | |
Wu Yongqiang | Shenzhen Topband Battery Co., Ltd. | Executive director and general manager | April 29, 2009 | No | |
Wu Yongqiang | Shenzhen Hongru Investment Management Co. Ltd. | Executive (Managing) Director | August 20, 2015 | No | |
Wu Yongqiang | Shenzhen Hongru Investment Enterprise (Limited Partnership) | Partner | September 2, 2015 | No | |
Wu Yongqiang | Shenzhen Topband Suzhou Intelligent Technology Co., Ltd. | Executive director and general manager | February 7, 2017 | No | |
Wu Yongqiang | Shenzhen YAKO Automation Technology Co., Ltd. | Chairman of the Board | December 24, 2022 | No | |
Wu Yongqiang | Shenzhen Topband Automation Technology Co., Ltd. | Executive director | November 24, 2016 | No | |
Wu Yongqiang | Shenzhen Yankai Electrical Technology Co., Ltd. | Executive director and general manager | May 5, 2019 | No | |
Wu Yongqiang | Topband (Qingdao) Intelligent Control Co., Ltd. | Executive director and general manager | March 29, 2021 | No | |
Wu Yongqiang | Ningbo Topband Intelligent Control Co., Ltd. | Executive director and general manager | August 28, 2017 | No | |
Ji Shuhai | Shenzhen Shuofang Precision Machinery Co., Ltd. | Executive director and general manager | May 24, 2010 | Yes | |
Peng Ganquan | Shenzhen Allied Control System Co., Ltd. | Executive director and general manager | December 20, 2016 | No | |
Peng Ganquan | Shenzhen Topband Automotive Electronics | General | September 7, 2021 | No |
Co., Ltd. | Manager | ||||
Peng Ganquan | TOPBAND INDIA PRIVATE LIMITED | Director | December 11, 2015 | No | |
Zheng Sibin | Shenzhen Topband Software Technology Co., Ltd. | Supervisor | February 26, 2004 | No | |
Zheng Sibin | Chongqing Topband Industrial Co., Ltd. | Supervisor | March 12, 2008 | No | |
Hua Xiuping | Ningbo Fubang Jingye Group Co., Ltd. | Independent director | March 28, 2020 | Yes | |
Hua Xiuping | Ningbo Yuyao Rural Commercial Bank Co., Ltd. | Independent director | February 17, 2022 | Yes | |
Hua Xiuping | Bank of Dongguan Co. Ltd. | Independent director | June 1, 2020 | Yes | |
Hua Xiuping | Nottingham University Business School (China) | Associate Professor of Finance | July 1, 2016 | Yes | |
Li Xumeng | Zhuoyuehui Innovation Development (Shenzhen) Co., Ltd. | Researcher | June 1, 2018 | Yes | |
Huang Yuegang | Shenzhen Aoya Design Co., Ltd. | Independent director | July 6, 2021 | Yes | |
Huang Yuegang | Guizhou Tyre Co., Ltd. | Independent director | March 1, 2019 | Yes | |
Dai Huijuan | Huizhou Topband Electrical Technology Co., Ltd. | Executive director and general manager | November 14, 2011 | No | |
Dai Huijuan | Shenzhen Topband Automotive Electronics Co., Ltd. | Supervisor | September 7, 2021 | No | |
Description of employment in other units | None |
Punishments imposed by securities regulatory authorities on current and outgoing directors, supervisors and seniorexecutives of the company in recent three years
□ applicable √ not applicable
3. Remuneration of directors, supervisors and senior executives
The decision-making procedure, determination basis and actual payment of the remuneration for directors,supervisors and senior executives
1. Decision-making procedure and determination basis of the remuneration: According to the "SalaryManagement System for Directors, Supervisors and Senior Executives" approved by the resolution of the GeneralMeeting of Shareholders of the Company, salaries shall be paid to the directors, supervisors and senior executivesof the Company. After the salary and assessment committee formulates a salary scheme for directors, it shall besubmitted to the Board of Directors for deliberation and application shall be to the General Meeting ofShareholders for approval.
2. The "Salary Management System for Directors, Supervisors and Senior Executives of Shenzhen TopbandCo., Ltd.", revised at the 2011 Annual General Meeting of Shareholders held on April 17, 2012, stipulates that theallowance for independent directors of the Company is RMB 84,000 per year (before tax), which will be paidaccording to length of employment period and relevant regulations. The Company shall be responsible for thetravel expenses of the independent directors who attend the Board of Directors and the General Meeting ofShareholders and the expenses required for the exercise of their functions and powers according to the Articles ofAssociation of the Company.Remuneration of directors, supervisors and senior executives during the reporting period
Unit: 1,0000 yuan
Name | Position | Gender | Age | Position status | Total pre-tax remuneration received from the Company | Is remunerations received from related parties of the Company |
Wu Yongqiang | Chairman of the Board | Male | 57 | Incumbent | 157.7 | No |
Ji Shuhai | Director | Male | 60 | Incumbent | 8.4 | No |
Zheng Sibin | Director and deputy general manager | Male | 56 | Incumbent | 167.87 | No |
Ma Wei | Director and deputy general manager | Male | 48 | Incumbent | 166.9 | No |
Peng Ganquan | Director | Male | 50 | Incumbent | 160.15 | No |
Wu Hang | Director | Male | 38 | Incumbent | 8.4 | No |
Li Xumeng | Independent director | Male | 56 | Incumbent | 6.3 | No |
Hua Xiuping | Independent director | Female | 44 | Incumbent | 8.4 | No |
Shi Yun | Independent director | Male | 44 | Incumbent | 2.1 | No |
Wen Zhaohui | Deputy General Manager and Secretary of the Board of Directors | Female | 48 | Incumbent | 89.96 | No |
Xiang Wei | Chief financial officer | Male | 45 | Incumbent | 74.03 | No |
Dai Huijuan | Supervisor | Female | 46 | Incumbent | 96.12 | No |
Kang Weiquan | Supervisor | Male | 38 | Incumbent | 34.11 | No |
Chen Jinzhou | Supervisor | Male | 44 | Incumbent | 89.09 | No |
Huang Yuegang | Independent director | Male | 64 | Incumbent | 8.4 | No |
Total | -- | -- | -- | -- | 1,077.93 | -- |
VI. Performance of duties by directors during the reporting period
1. Conditions of the Board of Directors during the reporting period
Meeting session | Meeting date | Date of disclosure | Meeting resolution |
The Fifth Meeting of the Seventh Board of Directors | January 14, 2021 | January 16, 2021 | 1. Reviewed and approved the Proposal on the Acquisition of 83.5% Equity of Taixing Ninghui Lithium Battery Co., Ltd. by Subsidiaries through Equity Transfer and Capital Increase; 2. Reviewed and approved the Proposal on Developing Forward Foreign Exchange Trading Business; 3. Reviewed and approved the Proposal on Signing the Purchase Framework Agreement with Shenzhen Jizhiguang Electronics Co., Ltd.; 4. Reviewed and approved the Proposal on Cancelling the Awarded but Unexercised Stock Options of Ex-employees under the 2018 Stock Option Incentive Plan. |
The Sixth Meeting of the Seventh Board of Directors | March 5, 2021 | March 9, 2021 | 1. Reviewed and approved the Proposal on 2020 Annual Report and Summary; 2. Reviewed and approved the Proposal on 2020 Work Report of the Board of Directors; 3. Reviewed and approved the Proposal on 2020 Work Report of the General Manager; 4. Reviewed and approved the Proposal on 2020 Final Financial Report; 5. Reviewed and approved the Proposal on 2020 Profit Distribution Plan; 6. Reviewed and approved the Proposal on 2020 Annual Internal Control Evaluation Report; 7. Reviewed and approved the Proposal on Remuneration of Company Directors in 2020; 8. Reviewed and approved the |
Proposal on Remuneration of Senior Management of the Company in 2020; 9. Reviewed and approved the Proposal on Special Report on Deposit and Actual Use of Raised Funds in 2020; 10. Reviewed and approved the Proposal on the Second Exercise Period of 2018 Stock Option Incentive Plan Meeting the Exercise Conditions and Exercisable Rights; 11. Reviewed and approved the Proposal on Adjustment of the Incentive Objects and the Number of Stock Options of 2018 Stock Option Incentive Plan; 12. Reviewed and approved the Proposal on Adjusting the Exercise Price of the 2018 Stock Option Incentive Plan; 13. Reviewed and approved the Proposal on Using Part of Idle Raised Funds and Self-owned Funds to Purchase Bank Financial Products; 14. Reviewed and approved the Proposal on Application for Comprehensive Credit Line from Banks by the Company and Its Subsidiaries in 2021; 15. Reviewed and approved the Proposal on Renewing the Employment of Audit Institution in 2021; 16. Reviewed and approved the Proposal on Social Responsibility Report in 2020; 17. Reviewed and approved the Proposal on Provision for Asset Impairment in 2020; 18. Reviewed and approved the Proposal on Increasing the Registered Capital of the Company; 19. Reviewed and approved the Proposal on Changing Business Scope of the Company; 20. Reviewed and approved the Proposal on Amendment of the Articles of Association; 21. Reviewed and approved the Proposal on the Notice of Holding the 2020 Annual General Meeting of Shareholders | |||
The Seventh (Extraordinary) Meeting of the Seventh Board of Directors | March 18, 2021 | March 19, 2021 | 1. Reviewed and approved the Proposal on Adding Temporary Proposals at the 2020 Annual General Meeting of Shareholders of the Company; 2. Reviewed and approved the Proposal on By-election of Independent Directors of the Company |
The Eighth (Extraordinary) Meeting of the Seventh Board of Directors | April 21, 2021 | April 23, 2021 | 1. Reviewed and approved the Proposal on Requesting the Shareholders' Meeting to Extend the Validity Period of Authorization to the Board of Directors of the Company for Handling Matters Related to the 2020 Non-public Offering of Stocks; 2. Reviewed and approved the Proposal on Extending the Validity Period of the Resolution of the Shareholders' Meeting for Non-public Offering of Stocks of the Company in 2020; 3. Reviewed and approved the Proposal on Convening the First Extraordinary Shareholders' Meeting of the Company in 2021 |
The Ninth Meeting of the Seventh Board of Directors | April 26, 2021 | April 27, 2021 | 1. Reviewed and approved the Proposal on the Full Text and Main Body of the First Quarter Report of 2021; 2. Reviewed and approved the Proposal on Adjusting the Exercise Price of |
the 2018 Stock Option Incentive Plan; 3. Reviewed and approved the Proposal on Formulating the Management System of Subsidiaries; 4. Reviewed and approved the Proposal on Formulating the Internal Control Management System; 5. Reviewed and approved the Proposal on Amending the Management System of Public Information Disclosure; 6. Reviewed and approved the Proposal on the Company Opening a Special Account for Funds Raised from Non-public Offerings and Signing a Supervision Agreement for Raised Funds. | |||
The Tenth Meeting of the Seventh Board of Directors | June 8, 2021 | June 9, 2021 | 1. Reviewed and approved the Proposal on Increasing the Amount of Idle Raised Funds to Buy Bank Financial Products 2. Reviewed and approved the Proposal on Using Part of Idle Raised Funds for Temporary Supplementation of Working Capital 3. Reviewed and approved the Proposal on Replacement of Pre-invested Self-raised Funds with Raised Funds |
The Eleventh Meeting of the Seventh Board of Directors | July 26, 2021 | July 28, 2021 | 1. Reviewed and approved the Proposal on Semi-annual Report and Summary in 2021; 2. Reviewed and approved the Proposal on Semi-annual Special Report on Deposit and Use of Raised Funds in 2021; |
The Twelfth Meeting of the Seventh Board of Directors | August 17, 2021 | August 18, 2021 | 1. Reviewed and approved the Proposal on Increasing Investment in Wholly Owned Subsidiaries and Foreign Investment |
The Thirteenth (Extraordinary) Meeting of the Seventh Board of Directors | September 20, 2021 | September 22, 2021 | 1. Reviewed and approved the Proposal on the 2021 Restricted Stock Incentive Plan (Plan) of the Company |
The Fourteenth Meeting of the Seventh Board of Directors | October 13, 2021 | October 14, 2021 | 1. Reviewed and approved the Proposal on the Company's 2021 Restricted Stock Incentive Plan (Draft) and Its Summary; 2. Reviewed and approved the Proposal on Administrative Measures for the Implementation and Evaluation of the Company's 2021 Restricted Stock Incentive Plan; 3. Reviewed and approved the Proposal on Requesting the Shareholders' Meeting to Authorize the Board of Directors to Handle Matters Related to the Company's 2021 Restricted Stock Incentive Plan; 4. Reviewed and approved the Proposal on Increasing the Registered Capital of the Company; 5. Reviewed and approved the Proposal on Amendment of the Articles of Association; 6. Reviewed and approved the Proposal on Convening the Second Extraordinary Shareholders’ Meeting in 2021 |
The Fifteenth (Extraordinary) Meeting of | October 27, 2021 | 1. Reviewed and approved the Proposal on the Third Quarter Report of 2021 |
the Seventh Board of Directors | |||
The Sixteenth (Extraordinary) Meeting of the Seventh Board of Directors | November 2, 2021 | November 3, 2021 | 1. Reviewed and approved the Proposal on Adjusting the Number of Stock Options Granted under the 2021 Restricted Stock Incentive Plan and List of Incentive Objects; 2. Reviewed and approved the Proposal on Granting Restricted Shares to Incentive Objects |
The Seventeenth (Extraordinary) Meeting of the Seventh Board of Directors | December 7, 2021 | December 9, 2021 | 1. Reviewed and approved the Proposal on Foreign Investment of and Signing of Investment Agreement by Wholly Owned Subsidiaries; 2. Reviewed and approved the Proposal on Adjusting the Number of Stock Options Granted under the 2021 Restricted Stock Incentive Plan and List of Incentive Objects;3. Reviewed and approved the Proposal on Convening the Third Extraordinary Shareholders' Meeting in 2021 |
2. Attendance of directors at board meetings and the general meetings of shareholders
Attendance of directors at board meetings and the general meetings of shareholders | |||||||
Names of directors | Number of board meetings that shall be attended during this reporting period | Number of board meetings that shall be attended on the spot | Number of board meetings attended by means of communication | Number of times of entrusted attendance at board meetings | Number of times of absence from board meetings | Did any of them fail to attend board meetings in person for two consecutive times | Number of the general meetings of shareholders attended |
Wu Yongqiang | 13 | 13 | 0 | 0 | 0 | No | 4 |
Ji Shuhai | 13 | 0 | 13 | 0 | 0 | No | 4 |
Ma Wei | 13 | 13 | 0 | 0 | 0 | No | 4 |
Peng Ganquan | 13 | 13 | 0 | 0 | 0 | No | 4 |
Zheng Sibin | 13 | 13 | 0 | 0 | 0 | No | 4 |
Wu Hang | 13 | 0 | 13 | 0 | 0 | No | 4 |
Shi Yun | 3 | 0 | 3 | 0 | 0 | No | 1 |
Huang Yuegang | 13 | 1 | 12 | 0 | 0 | No | 4 |
Hua Xiuping | 13 | 0 | 13 | 0 | 0 | No | 4 |
Li Xumeng | 10 | 0 | 10 | 0 | 0 | No | 3 |
Description of absence from board meetings for two consecutive timesNot applicable
3. Objections raised by directors to relevant matters of the Company
Did any director raise any objection to relevant matters of the Company
□ Yes √ No
During the reporting period, no director raised any objection to relevant matters of the Company.
4. Other descriptions of directors' performance of duties
Were the relevant suggestions of directors to the Company adopted
√ Yes □ No
Description of the fact that the relevant suggestions of directors to the Company were or were not adoptedNot applicable
VII. Information of special committees under the Board of Directors during the reportingperiod
Names of committees | Information about members | Number of meetings held | Meeting date | Meeting content | Important opinions and suggestions put forward | Other performance of duties | Details of objections (if any) |
Audit Committee | Huang Yuegang, Hua Xiuping, Shi Yun | 2 | 2021/1/21 | Deliberation: 1. Proposal on the Work Report of the Audit Department in the Fourth Quarter of 2020 and the Work Plan for the First Quarter of 2021; 2. Proposal on the Work Summary of the Audit Department in 2020 and the Work Plan for the Next Year; 3. Proposal on the Audit Work Schedule of Topband's 2020 Annual Report; 4. Proposal on Financial Department Providing Preliminary Examination Opinions on Financial and Accounting Statements in 2020. | The Audit Committee audited the matters under consideration in strict accordance with the Working Rules of the Audit Committee under the Board of Directors and relevant laws and regulations, fully communicated with the Financial Department and the audit institution, and unanimously agreed to the relevant proposal. | Not applicable | Not applicable |
2021/3/5 | Deliberation: 1. Proposal on Opinions of 2020 Financial and Accounting Report of the Company; 2. Proposal on 2020 Internal Control Evaluation Report of the Company; 3. Proposal on Renewing the Employment of Baker Tilly China Certified Public Accountants as the Audit Institution in 2021; 4. Proposal on Provision for Asset Impairment in 2020 | Not applicable | Not applicable | ||||
Huang Yuegang, Hua Xiuping, Li Xumeng | 3 | 2021/4/26 | Deliberation: 1. Proposal on Opinions of Financial and Accounting Statements of the Company for the First Quarter of 2021; 2. Proposal on First Quarter Work Report and Second Quarter Work Plan of | Not applicable | Not applicable |
Audit Department in 2021 | |||||||
2021/7/27 | Deliberation: 1. Proposal on Opinions of Financial and Accounting Report of the Company for the Second Quarter of 2021; 2. Proposal on the Second Quarter Work Report and Third Quarter Work Plan of Audit Department in 2021. | Not applicable | Not applicable | ||||
2021/10/27 | Deliberation: 1. Proposal on Opinions of Financial and Accounting Report of the Company for the Third Quarter of 2021; 2. Proposal on the Third Quarter Work Report and Fourth Quarter Work Plan of the Audit Department in 2021 | Not applicable | Not applicable | ||||
Nomination committee | Shi Yun, Wu Yongqiang, Huang Yuegang | 1 | 2021/3/17 | Reviewed and approved the Proposal on By-election of Independent Directors of the Company | The Nominating Committee examined the qualifications of candidates carefully and unanimously agreed to the relevant proposal. | Not applicable | Not applicable |
Salary and Assessment Committee | Hua Xiuping, Wu Yongqiang, Huang Yuegang | 2 | 2021/3/5 | Deliberation: 1. Proposal on Remuneration of Company Directors in 2020 2. Proposal on Remuneration of Senior Management of the Company in 2020 | The Remuneration and Appraisal Committee under the Board of Directors reviewed the matters under consideration in strict accordance with the Working Rules of Remuneration and Appraisal Committee under the Board of Directors and relevant laws and regulations, and unanimously agreed to the relevant proposal. | Not applicable | Not applicable |
2021/10/13 | Deliberation: Proposal on the Company's 2021 Restricted Stock Incentive Plan (Draft) and Its Summary; 2. Proposal on Administrative Measures for the Implementation and Evaluation of the Company's 2021 Restricted Stock Incentive Plan; 3. Proposal on the List of Incentive Objects under the Company's 2021 Restricted Stock Incentive Plan; N/A | ||||||
Strategy Committee | Wu Yongqiang, | 0 | - | - | Not applicable | Not applicable | Not applicable |
Zheng Sibin, Peng Ganquan, Ma Wei, Li Xumeng | |||||||
Nomination committee | Li Xumeng, Wu Yongqiang, Huang Yuegang | 1 | 2021/3/17 | Proposal on By-election of Independent Directors of the Company | The Nominating Committee examined the qualifications of candidates carefully and unanimously agreed to the relevant proposal. | Not applicable | Not applicable |
VIII. Work of the Board of Supervisors
Did the Board of Supervisors find that the Company had any risk in the supervision activities during the reportingperiod
□ Yes √ No
The Board of Supervisors had no objection to the supervisory matters during the reporting period.IX. Information on the Company's employees
1. Number, professional composition and education level of employees
Number of on-the-job employees in the parent company at the end of the reporting period (persons) | 2,235 |
Number of on-the-job employees in major subsidiaries at the end of the reporting period (persons) | 6,210 |
Total number of on-the-job employees at the end of the reporting period (persons) | 8,445 |
Total number of salaried employees in the current period (persons) | 8,454 |
Number of retired employees paid by the parent company and major subsidiaries (persons) | 6 |
Professional composition | |
Major composition category | Number of persons of professional composition (persons) |
Production personnel | 5,001 |
Sales personnel | 546 |
Technical personnel | 1,582 |
Financial personnel | 84 |
Administrative personnel | 606 |
Logistics personnel | 626 |
Total | 8,445 |
Education level | |
Education level category | Number (persons) |
Bachelor's degree or above | 2,608 |
Junior college level | 1,205 |
Below junior college level | 4,632 |
Total | 8,445 |
2. Salary policy
According to the relevant national labor laws and policies and the actualities of the Company, the Company hasformulated salary management regulations, and the salary is assessed and paid in accordance with the salarymanagement regulations. The Company strictly abides by the Labor Law and relevant national and local laborlaws and regulations, signs labor contracts with employees, and pays various employee insurance premiumsaccording to the regulations. The overall salary of the Company consists of the following three parts: fixed salary,performance salary and welfare allowance. Fixed salary includes basic salary, post salary and confidential salary;performance salary includes a performance bonus, a year-end bonus and a special bonus; benefits includestatutory benefits, company benefits and allowances.
3. Training plan
The Company has established a talent training system combining professional competence and leadership,including routine training and professional module training. The Company develops different training courses fornew employees, R&D, purchasing, sales and middle and senior management personnel by stages, and implementsannual training plans from the perspective of corporate culture, professional skills, management improvement,professional quality and mental health. Through the combination of internal and external training, excellenthuman resources support is provided for the sustainable development of the Company.
In 2021, the talent development department of the Company and other relevant departments carried out aseries of training. In order to help new employees better adapt to the new work environment and operating posts,understand relevant systems of the Company and integrate themselves into the enterprise culture, the humanresource center of the Company has specially arranged a systemic training plan for "Topband New EmployeeTraining", and the training covers the company profile, welfare, corporate culture, information system, finance,
and intellectual property rights, legal basis, ISC core ideas and professional mental health, etc."TopbandNewcomer Training" has become a systematic newcomer training plan of the Company. In 2021, the Companyheld 14 sessions of new employee training and 94 sessions of employee training in Shenzhen and Huizhou.In addition to SAP system training and TC system training, the Company will also hold various professionaltraining for different positions from time to time, including financial, legal, patent, customs, procurement andsupply chain training, sales training, R&D training, manufacturing and quality training, as well as subjectexchange and sharing of various professional modules and technologies. The Company's training topics in 2021covered R&D modules, manufacturing and quality modularization, power IC technology, trademarks, customsknowledge, PCB design specifications, prevention and response of workplace-related psychological problems,project management, supply chain strategy and plan change, supplier negotiation and other topics. To meetemployees’ needs of self-competence improvement and make full use of the Company's internal wisdom, theCompany invited internal lecturers for development according to the needs of students during the reporting period,including skills such as PPT Production, management such as the Improvement of Team Cohesion, mental health such as
Mental Health Sandplay Experience, Flower Arrangement Experience, Learning Photography and other interest courses,
which won unanimous praise within the Company. The Company will also seek for external high-quality trainingand communication opportunities actively to improve the professional ability of employees effectively. In 2021,external communication topics of the Company covered innovative methodology (TRIZ), electromagneticcompatibility (EMC) design and test case analysis, electronic product reliability and DOE test design, etc.In terms of the training of leadership promotion, the Company designed and implemented training camps formanagement ability and leadership promotion at all levels in 2021, realizing the full coverage of training ofmanagement cadres at all levels from grass-roots reserve cadres, grass-roots team leaders to middle-levelsupervisors and managers, and then to managers of BUs of the Company, with an aim to improve thecomprehensive ability of its management and provide talent guarantee for its strategic implementation.During the reporting period, Topband adhered to the concept of mutual benefit, mutual trust, mutualassistance and common development with its supplier partners over the years, and started from five major areas,including supply chain, quality, management, HR and EAP, and set up a supplier communication platform initially,which was committed to the common growth of the Company and suppliers.The Company always pays more attention to the training plan. In order to improve the pertinence of trainingand enhance the professional ability of personnel in all departments of the Company, the module heads of all the
departments of the Company and the talent development department of the human resources center of theCompany have jointly formulated the 2022 annual training plan. In order to improve the internal implementationability of each department, the module heads of all departments and the corresponding lecturers ensure that thetraining plan will be carried out in an effective and orderly manner, and the talent development department of thehuman resources center will supervise and manage the implementation. The training plan for 2022 covers topicssuch as management, professional technical theory and practice, negotiation, customer development andmanagement. In terms of course design, teaching method, training system, instructor team and other resources, theCompany has effectively guaranteed the opportunities for employees to learn and grow, safeguarding the careerdevelopment of employees.
4. Information on labor outsourcing
□ applicable √ not applicable
X. Profit distribution of the Company and conversion of capital accumulation fund into share capitalProfit distribution policy during the reporting period, especially the formulation, implementation or adjustment ofthe cash dividend policy
√ applicable □ not applicable
During the reporting period, the Board of Directors of the Company formulated the profit distributionproposal in 2020 after detailed consultation and listening to the opinions of the shareholders of the Company incombination with the Company’s profit situation and investment situation in 2020 and the investment andexpenditure plans in 2021, which was deliberated and approved by the 6th Meeting of the 7th Board of Directorsand the Annual General Meeting of Shareholders in 2020. The profit distribution plan of the Company in 2020was based on the total share capital of 1,120,377,889 shares (excluding 14,838,920 shares of treasury stock thathave been repurchased) of the Company and the cash dividends of 0.5 yuan (including tax) for every 10 shareswas distributed to all shareholders. Besides, no share capital was converted from the accumulation fund and nobonus share was given. The profit distribution plan above was implemented on April 9, 2021.The 2020 annualprofit distribution plan complied with laws, regulations, the Articles of Association and the Company'sShareholders' Dividend Plan for the Next Three Years (2020-2022). The profit distribution decision-makingprocedure complied with relevant laws, regulations and rules.
Special explanation of cash dividend policy | |
Whether it met the requirements of the Articles of Association or the resolution of the General Meeting of Shareholders: | Yes |
Whether the dividend standard and proportion were definite and clear: | Yes |
Whether the relevant decision-making procedures and mechanisms were complete: | Yes |
Whether the Independent Director performed their duties and played their due roles: | Yes |
Whether the medium and small shareholders had the opportunity to fully express their opinions and demands and whether their legitimate rights and interests have been fully protected: | Yes |
If the cash dividend policy is adjusted or changed, whether the conditions and procedures were compliant and transparent: | Not applicable |
The Company made a profit during the reporting period and the profit of the parent company available forshareholders’ distribution was positive, but no cash dividend distribution proposal was proposed
□ applicable √ not applicable
Profit distribution and conversion of capital accumulation fund to share capital in the reporting period
√ applicable □ not applicable
Number of bonus shares send for every 10 shares (shares) | 0 |
Number of dividend paid for every 10 shares (yuan) (including tax) | 0.50 |
Number of conversion for every 10 shares (shares) | 0 |
Share capital base of the distribution proposal (shares) | 1,256,978,072 |
Cash dividend amount (yuan) (including tax) | 62,848,903.601 |
Cash dividend amount (yuan) by other means (such as share repurchase) | 0 |
Total cash dividends (including other means) (yuan) | 62,848,903.60 |
Distributable profit (yuan) | 1,064,111,338.27 |
Proportion of total cash dividends (including other means) in total profit distribution | 100% |
Cash dividend situation of this time | |
If the development stage of the Company is a growth period and there are major capital expenditure arrangements, the minimum proportion of cash dividends in this profit distribution should reach 20% during profit distribution |
Detailed description of the profit distribution or capital accumulation fund conversion proposal |
Profit distribution proposal in 2021: It was based on 1,256,978,072 shares of the Company’s total share capital and the cash dividends of 0.5 yuan (including tax) for every 10 shares were distributed to all shareholders. Besides, no share capital was converted from the accumulation fund and no bonus share was given. The accumulated undistributed profits remaining after the implementation of the profit distribution plan will be carried forward to subsequent years. If the total share capital of the Company changed due to the share repurchase, exercise of stock options and other reasons before the implementation of the profit distribution plan, the total amount of distribution should be adjusted accordingly in the principle that the distribution ratio per share remains unchanged. |
Note 1: The dividend amount is the estimated amount calculated based on the share capital and dividend ratio atthe end of the reporting period. The specific dividend amount is subject to the subsequent actual dividend.XI. Implementation of the Company’s equity incentive plan, employee stock ownership planor other employee incentive measures
√ applicable □ not applicable
1. Stock incentive
1. Implementation of the stock option incentive plan in 2018
On October 26, 2018, the 7th Meeting of the 6th Board of Directors and the 5th Meeting of the 6th Board ofSupervisors of the Company deliberated and approved the Proposal on the Company’s 2018 Stock OptionIncentive Plan (Draft) and Its Abstract, which was approved by the Company’s first Extraordinary GeneralMeeting of Shareholders in 2018. The grant registration was completed on January 4, 2019 and a total of 684incentive objects were granted 42.887 million stock options. Among them, 684 incentive objects were all directors,middle and senior executives and core technology (business) backbones of the Company. The grant price was 3.80yuan/share and the grant date was November 27, 2018. The stock option was locked within 12 months from thedate of grant. After meeting the exercise conditions, the incentive objects could apply for exercise in three phaseswithin 48 months after the date of grant.On July 26, 2019, the 15th Meeting of the 6th Board of Directors and the 12th Meeting of the 6th Board ofSupervisors of the Company deliberated and approved the Proposal on Adjustment of the Exercise Price of theStock Option Incentive Plan in 2018. As the Company implemented the equity distribution in 2018, the exerciseprice was adjusted from 3.80 yuan/share to 3.70 yuan/share.On March 30, 2020, the 22nd Meeting of the 6th Board of Directors of the Company deliberated andapproved the Proposal on the First Exercise Period of 2018 Stock Option Incentive Plan Meeting the ExerciseConditions and Exercisable Rights and the Proposal on Adjustment of the Incentive Objects and the Number of
Stock Options of 2018 Stock Option Incentive Plan". There were 606 incentive objects in the first exercise periodof the 2018 stock option incentive plan and a total of 12.0147 million stock options meeting the exerciseconditions could be exercised, and the Company planned to adopt the independent exercise mode. Since theannouncement on March 31 to the exercise date, the 7 incentive objects, such as Fang Dikui and Zhang Rong,resigned and left the Company due to personal reasons. 142,000 stock options granted but not exercised by themcould not be exercised and would be canceled by the Company. The review procedure for adjusting the number ofthese options would be performed in the future.
As of May 21, 2020, 606 incentive objects in the first exercise period have completed the exercise of 12.0147million stock options, increasing the Company’s share capital by 12,014,700 yuan.As of August 6, 2021, 567 incentive objects in the second exercise period have completed the exercise of
10.9506 million stock options, increasing the Company’s share capital by 10.9506 million yuan.
For details of the implementation of the stock option incentive plan in 2018, please refer to the Company’sannouncements disclosed in the Securities Times and CNINFO (http://www.cninfo.com.cn) on July 30, 2019,March 31, 2020, May 11, 2020 and March 22, 2021.
2. Implementation of the 2021 Restricted Stock Incentive Plan:
(1) The Company held the 13th (extraordinary) meeting of the 7th Board of Directors on September 20, 2021,which reviewed and approved the Proposal on the Company's 2021 Restricted Stock Incentive Plan and agreed togrant a total of no more than 34 million restricted shares to incentive objects. The stocks under the Plan came fromthe shares repurchased by the Company's special account and A-share common stocks offered directly to incentiveobjects by the Company, among which 14,838,920 shares in the Company's special securities account forrepurchase will be used as part of the stock source for the implementation of the Plan and the rest will be offereddirectly to incentive objects. The restricted sale period of the restricted shares granted is 12, 24 and 36 monthsfrom the date of their registration, and the restricted sale will be lifted in the proportion of 30%, 30% and 40%.
(2) The Company held the 14th meeting of the 7th Board of Directors and the 11th meeting of the 7th Boardof Supervisors on October 13, 2021, which reviewed and approved the Proposal on the Company's 2021Restricted Stock Incentive Plan (Draft) and Its Summary, the Proposal on Administrative Measures for theImplementation and Evaluation of the Company's 2021 Restricted Stock Incentive Plan, and the Proposal onRequesting the Shareholders' Meeting to Authorize the Board of Directors to Handle Matters Related to theCompany's 2021 Restricted Stock Incentive Plan and agreed to grant 34 million restricted shares to 1,250
incentive objects. The 11th meeting of the 7th Board of Supervisors of the Company reviewed and approved therelevant proposal and checked the list of incentive objects under the Incentive Plan. Independent directorsexpressed their independent opinions on this and lawyers issued legal opinions.
(3) The Company publicized the names and positions in the list of incentive objects under the Incentive Planin the Company's internal OA office system on October 15, 2021. The publicity period was from October 15, 2021to October 24, 2021.No organization or individual raised any objection to the list of incentive objects during thepublicity period. On October 26, 2021, the Company disclosed the Audit Opinions and Publicity Statement of theBoard of Supervisors on the List of Incentive Objects under the 2021 Restricted Stock Incentive Plan. The Boardof Supervisors of the Company believed that the proposed incentive objects under the Incentive Plan did not haveany situation making them incapable of being incentive objects according to relevant laws and regulations and metthe participation qualification conditions for the scope of incentive objects under the Incentive Plan of theCompany.
(4) On November 1, 2021, the Company held the second extraordinary shareholders’ meeting, whichreviewed and approved the Proposal on the Company's 2021 Restricted Stock Incentive Plan (Draft) and ItsSummary, the Proposal on Administrative Measures for the Implementation and Evaluation of the Company's2021 Restricted Stock Incentive Plan, and the Proposal on Requesting the Shareholders' Meeting to Authorize theBoard of Directors to Handle Matters Related to the Company's 2021 Restricted Stock Incentive Plan and otherrelevant proposals related to the Incentive Plan, and authorized the Board of Directors to determine the grant dateunder the Incentive Plan, grant restricted shares to incentive objects when they met the conditions and handle allmatters required for the grant of restricted shares.
(5) On November 2, 2021, the Company held the 16th (extraordinary) meeting of the 7th Board of Directorsand the 13th (extraordinary) meeting of the 7th Board of Supervisors, which reviewed and approved the Proposal
on Adjusting the Number of Stock Options Granted under the 2021 Restricted Stock Incentive Plan and List of Incentive Objects andthe Proposal on Granting Restricted Shares to Incentive Objects. In view of the demission of the incentive object Ou Lispecified in the Incentive Plan and the fact that Wang Cheng, Shen Zhiwen and Tian Conghui et al. voluntarilygave up the subscription of restricted shares to be granted by the Company for personal reasons, the Board ofDirectors of the Company decided to cancel the restricted shares to be granted to them. After the cancellation, thenumber of restricted shares to be granted under the Incentive Plan was reduced from 34 million to 33.951 million,and the number of incentive objects from 1,250 to 1,246. November 2, 2021 was determined as the grant date, and
33.951 million restricted shares were granted to 1,246 eligible incentive objects. The Board of Supervisors of theCompany reviewed the list of incentive objects, and independent directors expressed their independent opinionsand lawyers issued legal opinions.
(6) On December 7, 2021, the Company held the 17th (extraordinary) meeting of the 7th Board of Directorsand the 14th (extraordinary) meeting of the 7th Board of Supervisors, which reviewed and approved the Proposalon Adjusting the Number of Stock Options Granted under the 2021 Restricted Stock Incentive Plan and List of Incentive Objects. Inview of the fact that 22 incentive objects such as Li Xiang, Yu Dingguo and Lu Yuanshan specified in theIncentive Plan voluntarily gave up their subscription of all the restricted shares granted to them for personalreasons and ten incentive targets such as Liao Xinmeng, Wang Cao and Liu Xiaoshi voluntarily gave up theirsubscription of some of the restricted shares granted to them for personal reasons in the process of capital paymentbefore share registration after the Board of Directors of the Company confirmed November 2, 2021 as the grantdate under the 2021 Restricted Stock Incentive Plan, the Board of Directors of the Company adjusted the objectsand the number of shares granted under the 2021 Restricted Stock Incentive Plan according to the authorization ofthe second extraordinary shareholders’ meeting of the Company in 2021.After adjustment, the number ofincentive objects under the 2021 Restricted Stock Incentive Plan decreased from 1,246 to 1,224, and the numberof restricted shares granted decreased from 33.951 million to 33.54432 million. The Board of Supervisors of theCompany reviewed the list of incentive objects, and independent directors expressed their independent opinionsand lawyers issued legal opinions.
(7) On December 16, 2021, Shenzhen Stock Exchange and Shenzhen Branch of China Securities Depositoryand Clearing Co., Ltd. confirmed that the Company had completed the grant registration of 187.054 billionrestricted shares (new) and 14.83892 million restricted shares (repurchased) involved in the 2021 Restricted StockIncentive Plan. The shares above were listed on December 17, 2021.
For details of the implementation of the 2021 Restricted Stock Incentive Plan, please check the Company'sannouncements in Securities Times and Juchao Information Network (http://www.cninfo.com.cn) on September22, October 14, November 2, November 3, December 9, December 16 and December 20, 2021.Equity incentives obtained by directors and senior management of the Company
√ applicable □ not applicable
Unit: share
Name | Position | Number of stock | Number of new | Number of shares | Number of shares | Number of exercised | Number of stock | Market price at the | Number of | Number of | Number of new | Grant price of | Number of |
options held at the beginning of the year | stock options granted during the reporting period | exercisable during the reporting period | exercised during the reporting period | shares and exercise price during the reporting period (yuan/share) | options held at the end of the period | end of the reporting period (yuan/share) | restricted stocks held at the beginning of the period | shares unlocked in the current period | restricted stocks granted during the reporting period | restricted stocks (yuan/share) | restricted stocks held at the end of the period | ||
Zheng Sibin | Director, deputy general manager and BG general manager | 560,000 | 0 | 240,000 | 240,000 | 3.65 | 320,000 | 18.69 | 0 | 0 | 533,000 | 7.23 | 533,000 |
Ma Wei | Director, deputy general manager and BG general manager | 700,000 | 0 | 300,000 | 300,000 | 3.65 | 400,000 | 18.69 | 0 | 0 | 616,000 | 7.23 | 616,000 |
Peng Ganquan | Director and BG General Manager | 840,000 | 0 | 360,000 | 360,000 | 3.65 | 480,000 | 18.69 | 0 | 0 | 400,000 | 7.23 | 400,000 |
Wen Zhaohui | Deputy General Manager and Secretary of the Board of Directors | 420,000 | 0 | 180,000 | 180,000 | 3.65 | 240,000 | 18.69 | 0 | 0 | 183,000 | 7.23 | 183,000 |
Xiang Wei | Chief financia | 280,000 | 0 | 120,000 | 120,000 | 3.65 | 160,000 | 18.69 | 0 | 0 | 183,000 | 7.23 | 183,000 |
l officer | |||||||||||||
Total | -- | 2,800,000 | 0 | 1,200,000 | 1,200,000 | -- | 1,600,000 | -- | 0 | 0 | 1,915,000 | -- | 1,915,000 |
Remarks (if any) | During the reporting period, the exercise conditions corresponding to the second exercise period of the 2018 Stock Option Incentive Plan were met, and all the options of the directors and senior management above were exercised in the corresponding proportions. At the same time, the 2021 Restricted Stock Incentive Plan had not reached the unlocking period, and all stocks were restricted. |
Appraisal system and incentive methods of senior executivesThe performance appraisal of the key management of the Company based on its operating benefits andstrategic objectives was conducted according to the Company's annual production, operation and managementcapacity building, the achievement of objectives of managers' responsibilities and the principles of distribution onthe basis of labor, combination of responsibilities, rights and benefits, combination of the income level with theCompany's performance and objectives of the work in charge, equal attention to incentives and constraints, andcombination of result appraisal with process management. The salary distribution of senior management wasdetermined according to the appraisal results so as to promote the Company's long-term development andachievement of strategic objectives.The salary of senior management of the Company was subject to the annual salary system, which consistedof basic annual salary, annual performance salary and long-term equity incentive. The basic annual salary wasmainly determined according to the average salary level of senior management of the Company in the previousyear, with reference to the characteristics of the same industry, market salary and other factors. The annualperformance salary was submitted to the Board of Directors for consideration and distribution after assessmentaccording to the year-end management, operating efficiency and operating quality. Long-term equity incentivewas formulated by the Company's administrative measures for periodical equity incentive assessment.
2. Implementation of employee stock ownership plan
□ applicable √ not applicable
3. Other employee incentives
□ applicable √ not applicable
XII. Construction and implementation of internal control system during the reporting period
1. Construction and implementation of internal control
During the reporting period, the Company updated and improved the internal control system on the basis ofdaily supervision and special supervision of internal control and the actual situation of the Company according tothe Basic Standards for Enterprise Internal Control and its supporting guidelines in combination with its internalcontrol system and evaluation method, and revised and formulated the Administrative Measures for Seals,Certificates and Qualification Documents and the Management System for Conference Confidentiality. At the sametime, the Company set up an internal audit institution to supervise and inspect the implementation of relevantsystems in collaboration with the audit committee according to the management requirements, so as to ensure theimplementation of its rules and regulations effectively, reduce operational risks and strengthen internal control. Itcontinuously optimized the organizational structure, clarified the responsibilities of various departments andcorresponding posts, and controlled the implementation of internal control involved in the whole process ofoperation and management activities such as control decision-making, execution, supervision and feedbackeffectively to avoid internal control loopholes.The Company established a set of rigorous, scientific and effective internal control system appropriate for itspractical conditions, and formulated effective internal control evaluation standards. It prevented risks in operationand management effectively and promoted the realization of internal control objectives through the operation,analysis and evaluation of the internal control system.
2. Details of major defects in internal control found during the reporting period
□ Yes √ No
XIII. Management and control of subsidiaries by the Company during the reporting period
Company name | Integration plan | Integration progress | Problem encountered in integration | Measures taken to solve the problem | Progress of solving the problem | Subsequent plan for solving the problem |
Taixing Ninghui Lithium Battery Co., Ltd. | 1. Reorganization and adjustment of the organizational structure; 2. Check, | Completion of all work as planned | Employees needed a process of adaptation for full recognition of the corporate | Several all-staff meetings were held to publicize and provide training in | Employees have basically recognized Topband’s culture and can abide by | Active training and cultural integration |
confirmation and delivery of claims and debts; 3. Check of fixed assets and inventories to ensure the consistency between accounts and items; 4. Organization and improvement of the sales customer files. | culture. | Topband’s corporate culture, various rules and regulations and core values of the Company. | various systems consciously. The operation of the Company has gradually got on the right track. |
XIV. Internal control self-evaluation report or internal control audit report
1. Internal control self-evaluation report
Date of disclosure of the full text of the internal control evaluation report | March 22, 2022 | |
Index for disclosure of the full text of the internal control evaluation report | CNINFO (http://www.cninfo.com.cn) | |
The ratio of the total assets of the unit included in the evaluation scope to the total assets in the consolidated financial statement of the Company | 100.00% | |
The ratio of the operating income of the unit included in the evaluation scope to the operating income in the consolidated financial statements of the Company | 100.00% | |
Defect identification criteria | ||
Category | Financial report | Non-financial report |
Qualitative standard | Signs of major financial report defects include: (1) Fraud of directors, supervisors and senior management of the Company; (2) Correction of the published financial report by the Company; (3) Significant misstatements in the current financial report discovered by certified public accountants but not recognized by internal | Qualitative criteria for the evaluation of internal control defects of non-financial reports determined by the Company: Non-financial report defects are mainly identified based on the degree of their influence on the effectiveness of business processes and the possibility of their occurrence. Defects with small possibility of |
control of the Company; (4) Ineffective supervision of the audit committee and the audit department on external financial reports and internal control of financial reports of the Company. Signs of important financial report defects include: (1) Failure to select and apply accounting policies in accordance with generally accepted accounting standards; (2) Failure to establish anti-fraud procedures and control measures; (3) Failure to establish or implement the corresponding control mechanism for the accounting treatment of unconventional or special transactions and lack of corresponding compensatory control; (4) Existence of one or more defects in the control of the final financial reporting process and failure to reasonably guarantee the authenticity and completeness of the financial statement prepared. General defects refer to other control defects except the above-mentioned major defects and important defects. | occurrence, which will reduce the work efficiency or effect or increase the uncertainty of the effect or make it deviate from the expected goal, are general defects; Those with relatively high possibility of occurrence, which will greatly reduce the work efficiency or effect or greatly increase the uncertainty of the effect or make it deviate significantly from the expected goal, are important defects. Those with high possibility of occurrence, which will reduce the work efficiency or effect seriously or increase the uncertainty of the effect seriously or make it deviate seriously from the expected goal, are major defects. | |
Quantitative standard | In quantitative standards, the consolidated operating income and total assets are measurement indicators. Internal control defects with losses or possible losses incurred related to the income statement are measured by the consolidated operating income. Such a defect is identified as a general one if the financial report misstatement amount caused by it alone or together with other defects is less than 0.5% of the consolidated operating income, an important one if the same is more than 0.5% but less than 1% of the consolidated operating income, and a major one if the same is more than 1% of the consolidated operating income. Internal control defects with losses or possible losses incurred related to the asset management are measured by total | In quantitative standards, the operating income and total assets are measurement indicators. Internal control defects with losses or possible losses incurred related to the income statement are measured by the consolidated operating income. Such a defect is identified as a general one if the financial report misstatement amount caused by it alone or together with other defects is less than 0.5% of the consolidated operating income, an important one if the same is more than 0.5% but less than 1% of the consolidated operating income, and a major one if the same is more than 1% of the consolidated operating income. Internal control defects with losses or possible losses incurred related to the |
consolidated assets. Such a defect is identified as a general one if the financial report misstatement amount caused by it alone or together with other defects is less than 0.5% of total consolidated assets, an important one if the same is more than 0.5% but less than 1% of total consolidated assets, and a major one if the same is more than 1% of total consolidated assets. | asset management are measured by total consolidated assets. Such a defect is identified as a general one if the financial report misstatement amount caused by it alone or together with other defects is less than 0.5% of total consolidated assets, an important one if the same is more than 0.5% but less than 1% of total consolidated assets, and a major one if the same is more than 1% of total consolidated assets. | |
Number of major defects in financial reports (defects) | 0 | |
Number of major defects in non-financial reports (defects) | 0 | |
Number of major defects in financial reports (defects) | 0 | |
Number of major defects in non-financial reports (defects) | 0 |
2. Internal control audit report
√ applicable □ not applicable
The deliberation opinion paragraph in the internal control audit report | |
Baker Tilly International Accounting Firm (Special General Partnership) deems that as of December 31, 2021, the Company maintained effective internal control related to financial reports in all material aspects in accordance with the Basic Code of Internal Control of Enterprises and relevant norms. | |
Disclosure of internal control audit report | Disclosure |
Disclosure date of the full text of internal audit report | March 22, 2022 |
Index of full-text disclosure of internal audit report | CNINFO (http://www.cninfo.com.cn) |
Opinion type of internal control audit report | Standard and unqualified opinion |
Were there major defects in the non-financial report | No |
Did the accounting firm issue an internal control audit report with a non-standard opinion
□ Yes √ No
Is the internal control audit report issued by the accounting firm consistent with the self-evaluation report of the
Board of Directors
√ Yes □ No
XV. Rectification of self-examination problems in special actions of governance of listedcompaniesNot applicable
Section V Environmental and Social ResponsibilityI. Major environmental issues
Whether the listed companies and their subsidiaries were key pollutant discharging organizations announced bythe Environmental Protection Department
□ Yes √ No
Administrative punishment for environmental problems during the reporting period
Name of company or subsidiary | Reason for punishment | Violation | Punishment result | Influence on production and operation of listed companies | Rectification measures of the Company |
Not applicable | Not applicable | Not applicable | Not applicable | Not applicable | Not applicable |
Refer to other environmental information disclosed by key pollutant discharge companies
□ applicable √ not applicable
Measures and effects taken to reduce carbon emissions during the reporting period
□ applicable √ not applicable
Reasons for not disclosing other environmental informationNot applicableII. Social responsibilityThe full text of the Report on Environment, Social Responsibility and Corporate Governance in 2021 waspublished on CNINFO (http://www.cninfo.com.cn) on March 22, 2022.III. Consolidation and expansion of the achievements of poverty alleviation and ruralrevitalization
The Company has not carried out targeted poverty alleviation work in the reporting year and there was nofollow-up targeted poverty alleviation plan.
Section VI Important MattersI. Performance of commitments
1. Completed commitments in the reporting period and uncompleted commitments by the end of thereporting period by the Company’s actual controller, shareholders, related parties, acquirers, theCompany and other committed related parties
√ applicable □ not applicable
Reasons for commitments | Commitment Party | Commitment type | Commitment content | Commitment time | Commitment period | Performance |
Share reform commitments | ||||||
Commitments made in the acquisition report or the equity change report | ||||||
Commitments made in asset restructuring | ||||||
Commitments made during the initial public offering or refinancing | Wu Yongqiang | Commitments to horizontal competition | Mr. Wu Yongqiang, the actual controller of the Company, has promised that during the period of being the controlling shareholder and/or actual controller of the Company, he would not directly or indirectly engage in any business which was the same, similar or substantially competitive with the main business of the Company at present and in the future. | June 12, 2007 | Long-term effective | Fulfill the commitment strictly |
Ji Shuhai | Commitments to horizontal competition | Ji Shuhai, a director of the Company as a shareholder, has promised not to directly or indirectly engage in any business which was the same, similar or substantially competitive with the main business of the Company at present and in the future | June 12, 2007 | Long-term effective | Fulfill the commitment strictly |
in any way during his term of office. | |||||
All directors and senior executives of the Company | Other commitments | 1. I would not deliver benefits to other organizations or individuals free of charge or under unfair conditions and not damage the interests of the Company in other means. 2. I fully supported and cooperated with the Company in regulating the duty consumption behavior of directors and senior executives. Any duty consumption behaviors would occur within the scope necessary for fulfilling my duty to the Company. I strictly accepted the supervision and management of the Company to avoid extravagance or excessive consumption. 3. I would strictly abide by the relevant laws and regulations, the regulations and rules of the CSRC, the stock exchange and other regulatory institutions as well as the requirements of the Company’s rules and regulations on the code of conduct of directors and senior executives. Besides, I would not use the Company’s assets to engage in investment and consumption activities unrelated to the performance of my duties. 4. I would try my best to make the Company implement the compensation demand return measures.5. I would work hard to link the compensation system formulated by the Board of Directors or the Compensation Committee with the implementation of the Company’s compensation return measures. At the same time, I would vote in favor of the compensation system proposal when the Board of Directors and the General Meeting | April 29, 2020 | On-going | Fulfill the commitment strictly |
of Shareholders of the Company deliberated (if I have vote/voting right).6. If the Company would implement the employee equity incentive in the future, I would fully support the Company to link the arrangement of exercise conditions of the employee incentive with the implementation of the Company’s compensation return measures. At the same time, I would vote in favor of the employee equity incentive proposal when the Board of Directors and the General Meeting of Shareholders of the Company deliberated (if I have vote/voting right).7. If I violate the above commitments, I would make an explanation and apologize publicly at the General Meeting of Shareholders and the designated newspapers and magazines designated by the CSRC. I voluntarily accept the self-discipline supervision measures taken by the stock exchange and China Association for Public Companies. If my breach of the commitment causes losses to the Company or the shareholders, I shall be liable for compensation in accordance with the law. | |||||
Wu Yongqiang | Other commitments | 1. I would not abuse the position of the controlling shareholder/actual controller to interfere with the operation and management activities of the Company beyond my power and would not infringe the Company’s interests under any circumstances.2. I would try my best to make the Company implement the compensation return measures.3. I would work hard to link the compensation system formulated by | April 29, 2020 | On-going | Fulfill the commitment strictly |
the Board of Directors or the Compensation Committee with the implementation of the Company’s compensation return measures.4. I would work hard to link the exercise conditions (if any) of the corporate equity incentive to be published in the future with the implementation of the Company’s compensation return measures.5. I would support the relevant proposals related to the implementation of the Company’s compensation return measures and would vote for them (if I have voting right).6. After the issuance of this commitment, if there are other requirements in the relevant provisions of the regulatory institution on the compensation return measures and its commitment and the above commitments could not meet the relevant requirements of the regulatory institution, I promise that I would issue a supplementary commitment in accordance with the relevant provisions at that time.7. If I violate the above commitments, I would make an explanation and apologize publicly at the General Meeting of Shareholders and the designated newspapers and magazines designated by the CSRC. I voluntarily accept the self-discipline supervision measures taken by the stock exchange and China Association for Public Companies. If my breach of the commitment causes losses to the Company or the shareholders, I shall be liable for compensation in accordance with the law. | |||||
Wu Yongqiang | Other commitments | If Huizhou Topband, a wholly-owned subsidiary of | July 30, 2020 | On-going | Fulfill the commitment |
Shenzhen Topband Co., Ltd., failed to bid for the land usage right of the plot DN-02-16 at the southeast of the intersection of Dongxin Avenue and Xing’an Road of Dongjiang High-tech Industrial Park in HZZK Hi-tech Industrial Development Zone to be used by “Huizhou Topband No. 2 Industrial Park Project” and Huizhou Topband was required to purchase or lease other lands while the Company would suffer from heavy losses, I would compensate for such losses (such as overpayment of land-transferring fees, rents). | strictly | |||||
Equity incentive commitment | Peng Ganquan, Zheng Sibin, Ma Wei, Wen Zhaohui and Xiang Wei | Other commitments | I promise that I would not transfer all the Company’s shares (including the shares obtained from exercise and other shares) within six months after the exercise of the stock option incentive plan in 2018. | Six months after exercise | Fulfill the commitment strictly | |
Other commitments to medium and small shareholders of the Company | ||||||
Whether the commitment was fulfilled on schedule | Yes | |||||
If the commitment was not fulfilled within the time limit, the specific reasons for the failure and the next work plan shall be explained in detail | Not applicable |
2. If there is a profit forecast for the assets or projects of the Company and the reporting period is still inthe profit forecast period, the Company will explain why the assets or projects reached the original profitforecast
□ applicable √ not applicable
II. Non-operating capital occupation of listed companies by controlling shareholders and theirrelated parties
□ applicable √ not applicable
There was no non-operating capital occupation of listed companies by controlling shareholders and their relatedparties in the reporting period of the Company.
III. External guarantee in violation of regulations
□ applicable √ not applicable
The Company had no external guarantee in violation of regulations during the reporting period.IV. Explanation of the Board of Directors on the latest "non-standard audit report"
□ applicable √ not applicable
V. Description of the “non-standard audit report” of the Accounting Firm in the reportingperiod by the Board of Directors, the Board of Supervisors and the independent directors (ifany)
□ applicable √ not applicable
VI. Descriptions of changes in accounting policy and accounting estimate or corrections ofmajor accounting errors in comparison with the financial report of the previous year
√ applicable □ not applicable
1. Descriptions of corrections of accounting errors in the previous period
In view of the Company's plan to split its holding subsidiary Shenzhen Yako Automation Technology Co.,Ltd. (hereinafter referred to as Yakotec) for A-share listing, the Company found important early errors in the auditprocess of share reform of Yakotec and made the following adjustments to its accounting based on the principle ofprudence in order to maintain the consistency of IPO audits:
(1) Capitalization adjustment of research and development expenses
R&D projects of Yakotec are divided into research stage and development stage. Projects meeting R&Dcapitalization conditions were capitalized in previous years. We made retroactive adjustments and expensed theprojects capitalized in the previous period in this audit.
(2) Adjustment of share-based payment
Yakotec granted equity to key employees through the shareholding platform. However, it was not recognizedas share-based payment, and the corresponding expenses were not accrued. According to the definition in theAccounting Standards for Business Enterprises No.11 - Share-based Payment, share-based payment refers to thetransaction in which an enterprise grants equity instruments or undertakes liabilities determined on the basis ofequity instruments in order to obtain services from employees and other parties. Therefore, the equity granted toemployees by Yakotec was retroactively recognized as share-based payment, and the corresponding expenseswere adjusted and accrued. Corrections were made with the retroactive restatement method.
2. Influence of corrections of accounting errors in the previous period on the financial statement
(1) Specific impact on items in the consolidated balance sheet at the end of 2020:
Unit: Yuan
Items | December 31, 2020 | ||
Amount of the report item before adjustment | Adjustment amount | Amount of the report item after adjustment | |
Other current assets | 68,175,222.37 | 2,121,222.39 | 70,296,444.76 |
Intangible assets | 309,794,540.63 | -30,514,971.23 | 279,279,569.40 |
Development expenditure
Development expenditure | 68,518,375.79 | -5,656,596.57 | 62,861,779.22 |
Total assets | 6,808,735,037.28 | -34,050,345.41 | 6,774,684,691.87 |
Capital reserves | 956,734,039.75 | 12,636,853.09 | 969,370,892.84 |
Undistributed profit
Undistributed profit | 1,324,944,369.91 | -19,061,969.80 | 1,305,882,400.11 |
Minority equity | 84,992,151.43 | -27,625,228.70 | 57,366,922.73 |
Net profit attributable to the parent company | 533,516,814.04 | -1,355,690.40 | 532,161,123.64 |
Profits and losses of minority shareholders | 17,678,270.05 | -3,262,712.60 | 14,415,557.45 |
According to the table above, other current assets increased by 2,121,222.39 yuan, intangible assetsdecreased by 30,514,971.23 yuan, development expenditures decreased by 5,656,596.57 yuan, capital reserveincreased by 12,636,853.09 yuan, undistributed profits decreased by 19,061,969.80 yuan and interests in minorityshares decreased by 27,625,228.70 yuan in the consolidated balance sheet on December 31, 2020.
(2) Specific impact on items in the consolidated income statement in 2020:
Unit: Yuan
Items | 2020 | ||
Amount of the report item before adjustment | Adjustment amount | Amount of the report item after adjustment |
Management expenses
Management expenses | 181,296,178.33 | 2,761,292.86 | 184,057,471.19 |
Research and development expenses | 313,618,277.57 | 3,924,376.58 | 317,542,654.15 |
Operating profit | 628,132,789.53 | -6,685,669.44 | 621,447,120.09 |
Total profits
Total profits | 626,166,509.85 | -6,685,669.44 | 619,480,840.41 |
Income tax expenses | 74,971,425.76 | -2,067,266.44 | 72,904,159.32 |
Net profit | 551,195,084.09 | -4,618,403.00 | 546,576,681.09 |
Net profit attributable to the parent company | 533,516,814.04 | -1,355,690.40 | 532,161,123.64 |
Net profit attributable to minority shareholders | 17,678,270.05 | -3,262,712.60 | 14,415,557.45 |
According to the table above, management expenses increased by 2,761,292.86 yuan, research anddevelopment expenses increased by 3,924,376.58 yuan, operating profits decreased by 6,685,669.44 yuan, thetotal profit decreased by 6,685,669.44 yuan, income tax expenses decreased by 2,067,266.44 yuan, and net profitsdecreased by 4,618,403.00 yuan in the consolidated income statement in 2020.
(3) There was no impact on items in the balance sheet of the parent company at the end of 2020 and those inthe income statement of the parent company in 2020.VII. Description of changes in the consolidated statements compared with the financial report of theprevious year
√ applicable □ not applicable
35 subsidiaries and sub-subsidiaries were included in this consolidated statement. See Note VIII (I) fordetails. Nine new companies were included in the scope of consolidation during the reporting period, of whichseven were newly established subsidiaries or sub-subsidiaries and the other two were merged enterprises not underthe same control. See Note VII (III) for details.VIII. Appointment and dismissal of accounting firms
Accounting firms currently employed
Name of domestic accounting firms | BAKER TILLY International Accounting Firm (Special General Partnership) |
Remuneration of the domestic accounting firm (10,000 yuan) | 80 |
Continuous years of audit services of the domestic accounting firm | 3 |
Name of the certified public accountant of the domestic accounting firm | Chen Zhigang, Zhao Yang |
Continuous years of audit services of the certified public accountant of the domestic accounting firm | 3 |
Whether to change the current employment of the accounting firm
□ Yes √ No
Employment of internal control audit accounting firm, financial consultant or sponsor
□ applicable √ not applicable
IX. Delisting after disclosure of the annual report
□ applicable √ not applicable
X. Matters related to bankruptcy reorganization
□ applicable √ not applicable
There were no matter related to bankruptcy reorganization during the reporting period.
XI. Major litigation and arbitration matters
□ applicable √ not applicable
The Company had no major litigation and arbitration matters during the reporting period.XII. Punishment and rectification
□ applicable √ not applicable
The Company had no punishment or rectification during the reporting period.
XIII. Integrity condition of the Company, its controlling shareholders and actual controllers
□ applicable √ not applicable
XIV. Major related transactions
1. Related transactions connected with the daily operation
□ applicable √ not applicable
The Company had no related transactions connected with daily operations during the reporting period.
2. Related transactions arising from acquisition and sale of assets or equity
□ applicable √ not applicable
The Company had no related transaction of acquisition or sale of assets or equity during the reporting period.
3. Related transactions of joint foreign investment
□ applicable √ not applicable
The Company had no related transaction of joint foreign investment during the reporting period.
4. Related creditor’s right and debt transaction
□ applicable √ not applicable
The Company had no related creditor’s right and debt transaction during the reporting period.
5. Transactions with associated financial companies
□ applicable √ not applicable
There is no deposit, loan, credit extension or other financial business between the Company and its relatedfinancial companies or between the related parties.
6. Transactions between financial companies controlled by the Company and related parties
□ applicable √ not applicable
There was no deposit, loan, credit or other financial business between financial companies controlled by theCompany and related parties.
7. Other major related transactions
□ applicable √ not applicable
The Company had no other major related transactions during the reporting period.XV. Major contracts and their performance
1. Trusteeship, contracting and lease
(1) Trusteeship
□ applicable √ not applicable
The Company had no trusteeship during the reporting period.
(2) Contracting
□ applicable √ not applicable
The Company had no contracting during the reporting period.
(3) Lease
□ applicable √ not applicable
The Company had no lease during the reporting period.
2. Material guarantee
√ applicable □ not applicable
Unit: 1,0000 yuan
External guarantee of the Company and its subsidiaries (excluding guarantee for subsidiaries) | ||||||||||
Name of guarantee object | Date of disclosure of the relevant announcement of guarantee amount limit | Guarantee amount limit | Actual date of occurrence | Actual guarantee amount | Guarantee type | Collateral (if any) | Counter guarantee (if any) | Guarantee period | Whether it was completed | Whether the guarantee objects were related parties |
Guarantee of the Company to its subsidiaries | ||||||||||
Name of guarantee object | Date of disclosure of the relevant announcement | Guarantee amount limit | Actual date of occurrence | Actual guarantee amount | Guarantee type | Collateral (if any) | Counter guarantee (if any) | Guarantee period | Whether it was completed | Whether the guarantee objects |
of guarantee amount limit | were related parties | |||||||||
Topband Ningbo | January 12, 2019 | 19,000 | Joint liability guaranty | The tentative guarantee period shall not exceed 5 years from the date of signing the formal guarantee agreement | No | No | ||||
Topband Ningbo | October 20, 2020 | 22,000 | November 5, 2020 | 22,000 | Joint liability guaranty | The tentative guarantee period shall not exceed 5 years from the date of signing the formal guarantee agreement | No | No | ||
Total amount of approved guarantee for subsidiaries at the end of the reporting period (B3) | 41,000 | Total actual balance of guarantee for subsidiaries at the end of the reporting period (B4) | 22,000 | |||||||
Guarantee of the subsidiary to its subsidiary | ||||||||||
Name of guarantee object | Date of disclosure of the relevant announcement of guarantee amount limit | Guarantee amount limit | Actual date of occurrence | Actual guarantee amount | Guarantee type | Collateral (if any) | Counter guarantee (if any) | Guarantee period | Whether it was completed | Whether the guarantee objects were related parties |
Total amount of the corporate guarantee (i.e. the sum of the first three items) | |||
Total amount of guarantee approved at the end of the reporting period (A3+B3+C3) | 41,000 | Total actual balance of guarantee at the end of the reporting period (A4+B4+C4) | 22,000 |
The proportion of the total actual amount of guarantee (A4+B4+C4) in the Company’s net assets | 4.38% | ||
Including: |
Description of details of complex guarantee
3. Cash asset management entrusted by others
(1) Entrusted financial management
√ applicable □ not applicable
Overview of entrusted financial management during the reporting period
Unit: 1,0000 yuan
Specific types | Capital source of entrusted financing | Amount of entrusted financial management | Unexpired balance | Overdue amount not recovered | Accrued impairment amount of overdue and unrecovered wealth management |
Bank financial products | Other | 42,740 | 400 | 0 | 0 |
Total | 42,740 | 400 | 0 | 0 |
Specific situation of high-risk entrusted financial management with the significant single amount or low security,poor liquidity
□ applicable √ not applicable
Entrusted financial management was expected to be unable to recover the principal or there were other situationsthat may lead to impairment
□ applicable √ not applicable
(2) Entrusted loans
□ applicable √ not applicable
There was no entrusted loan during the reporting period.
4. Other major contracts
□ applicable √ not applicable
The Company had no other major contract during the reporting period.XVI. Description of other major matters
√ applicable □ not applicable
1. Matters of the private issuing of stock in 2020
(1) On April 28, 2020, the 23rd Meeting of the 6th Board of Directors of the Company deliberated andapproved the Proposal on the Plan of the Company’s Private Issuing of Stock and other relevant proposals. It wasproposed to approve the private issuing of stock to raise funds of not more than 1.05 billion yuan, which would beused for the Topband Huizhou No. 2 Industrial Park Project and the supplementary working capital.
(2) On May 20, 2020, the Company held the Annual General Meeting of Shareholders in 2019 to review andapprove the matter.
(3) On June 17, 2020, the Company issued "the announcement on Receiving the Acceptance Form ofAdministrative License Application of the CSRC" and the CSRC accepted the Company’s application for theprivate issuing of stock.
(4) On July 9, 2020, the Company issued “the announcement on receiving the Notice of the First Batches ofFeedbacks on the Review of the Administrative License Project of the CSRC”.
(5) On July 14, 2020, the Company replied to the feedback and announced the Reply to the Feedback of theApplication Document regarding the Private Issuing of Stock.
(6) On August 25, 2020, the Company issued the Announcement on the Approval and Reply of the CSRC forthe Private Issuing of Stock, and the application for this private issuing was approved with a reply by the CSRC.
(7) On April 29, 2021, the Company privately issued 92,105,263 A-share stocks to 14 subscribers at an issueprice of 11.40 yuan/share, and the total amount of the funds raised was 1,049,999,998.20 yuan. On May 11, 2021,BAKER TILLY International Accounting Firm (Special General Partnership) verified that the funds raised in thisoffering reached the issuer's account and issued the Capital Verification Report of Shenzhen Topband Co., Ltd.(TZYZ [2021] No. 29460).
(8) On June 1, 2021, the Company issued the Report of Shenzhen Topband Co., Ltd. on the Issuance of
Privately Issued A-Share Stocks and the Listing Announcement, and 92,105,263 new shares were issued in thisnon-public offering and listed on Shenzhen Stock Exchange on June 3, 2021, with a sales restriction period of 6months.
(9) The Company issued the Suggestive Announcement on the Listing and Circulation of Restricted SharesOffered Non-publicly on December 1, 2021. 92,105,263 restricted shares were offered non-publicly and listed andcirculated on December 3, 2021.
For details, please check the announcements disclosed by the Company in the Securities Times and CNINFO(http://www.cninfo.com.cn) on April 29, 2020, May 21, 2020, June 17, 2020, July 9, 2020, July 14, 2020, August25, 2020, June 1, 2021, and December 3, 2021.
2. Restricted stock incentives in 2021
(1) The Company held the 13th (extraordinary) meeting of the 7th Board of Directors on September 20, 2021,which reviewed and approved the Proposal on the Company's 2021 Restricted Stock Incentive Plan and agreed togrant a total of no more than 34 million restricted shares to incentive objects.
(2) The Company held the 14th meeting of the 7th Board of Directors on October 13, 2021, which reviewedand approved the Proposal on the Company's 2021 Restricted Stock Incentive Plan (Draft) and Its Abstract, theProposal on Administrative Measures for the Implementation and Evaluation of the Company's 2021 RestrictedStock Incentive Plan, and the Proposal on Requesting the Shareholders' Meeting to Authorize the Board ofDirectors to Handle Matters Related to the Company's 2021 Restricted Stock Incentive Plan and agreed to grant34 million restricted shares to 1,250 incentive objects. The 11th meeting of the 7th Board of Supervisors of theCompany reviewed and approved the relevant proposal and checked the list of incentive objects under theIncentive Plan. Independent directors expressed their independent opinions on this and lawyers issued legalopinions.
(3) The Company publicized the names and positions in the list of incentive objects under the Incentive Planin the Company's internal OA office system on October 15, 2021. The publicity period was from October 15, 2021to October 24, 2021.No organization or individual raised any objection to the list of incentive objects during thepublicity period. On October 26, 2021, the Company disclosed the Audit Opinions and Publicity Statement of theBoard of Supervisors on the List of Incentive Objects under the 2021 Restricted Stock Incentive Plan. The Boardof Supervisors of the Company believed that the proposed incentive objects under the Incentive Plan did not haveany situation making them incapable of being incentive objects according to relevant laws and regulations and met
the participation qualification conditions for the scope of incentive objects under the Incentive Plan of theCompany.
(4) On November 1, 2021, the Company held the second extraordinary shareholders’ meeting, whichreviewed and approved the Proposal on the Company's 2021 Restricted Stock Incentive Plan (Draft) and ItsAbstract, the Proposal on Administrative Measures for the Implementation and Evaluation of the Company's 2021Restricted Stock Incentive Plan, and the Proposal on Requesting the Shareholders' Meeting to Authorize the Boardof Directors to Handle Matters Related to the Company's 2021 Restricted Stock Incentive Plan and other relevantproposals related to the Incentive Plan, and authorized the Board of Directors to determine the grant date underthe Incentive Plan, grant restricted shares to incentive objects when they met the conditions and handle all mattersrequired for the grant of restricted shares.
(5) On November 2, 2021, the Company held the 16th (extraordinary) meeting of the 7th Board of Directors,which reviewed and approved the Proposal on Adjusting the Number of Stock Options Granted under the 2021Restricted Stock Incentive Plan and List of Incentive Objects and the Proposal on Granting Restricted Shares toIncentive Objects. In view of the demission of the incentive object Ou Li specified in the Incentive Plan and thefact that Wang Cheng, Shen Zhiwen and Tian Conghui et al. voluntarily gave up the subscription of restrictedshares to be granted by the Company for personal reasons, the Board of Directors of the Company decided tocancel the restricted shares to be granted to them. After the cancellation, the number of restricted shares to begranted under the Incentive Plan was reduced from 34 million to 33.951 million, and the number of incentiveobjects decreased from 1,250 to 1,246. November 2, 2021 was determined as the grant date, and 33.951 millionrestricted shares were granted to 1,246 eligible incentive objects. The Board of Supervisors of the Companyreviewed the list of incentive objects, and independent directors expressed their independent opinions and lawyersissued legal opinions.
(6) On December 7, 2021, the Company held the 17th (extraordinary) meeting of the 7th Board of Directors,which reviewed and approved the Proposal on Adjusting the Number of Stock Options Granted under the 2021Restricted Stock Incentive Plan and List of Incentive Objects. In view of the fact that 22 incentive objects such asLi Xiang, Yu Dingguo and Lu Yuanshan specified in the Incentive Plan voluntarily gave up their subscription ofall the restricted shares granted to them for personal reasons and ten incentive targets such as Liao Xinmeng,Wang Cao and Liu Xiaoshi voluntarily gave up their subscription of some of the restricted shares granted to themfor personal reasons in the process of capital payment before share registration after the Board of Directors of the
Company confirmed November 2, 2021 as the grant date under the 2021 Restricted Stock Incentive Plan, theBoard of Directors of the Company adjusted the objects and the number of shares granted under the 2021Restricted Stock Incentive Plan according to the authorization of the second extraordinary shareholders’ meetingof the Company in 2021.After adjustment, the number of incentive objects under the 2021 Restricted StockIncentive Plan decreased from 1,246 to 1,224, and the number of restricted shares granted decreased from 33.951million to 33.54432 million. The Board of Supervisors of the Company reviewed the list of incentive objects, andindependent directors expressed their independent opinions and lawyers issued legal opinions.
(7) On December 16, 2021, Shenzhen Stock Exchange and Shenzhen Branch of China Securities Depositoryand Clearing Co., Ltd. confirmed that the Company had completed the grant registration of restricted shares (newand repurchased) involved in the 2021 Restricted Stock Incentive Plan, which were listed on December 17, 2021.XVII. Major matters of subsidiaries of the Company
√ applicable □ not applicable
1. On January 14, 2021, the 5th Meeting of the 7th Board of Directors deliberated and approved the Proposalon the Subsidiary's Acquisition of 83.5% of the equity in Taixing Ninghui Lithium Battery Co., Ltd. through EquityTransfer and Capital Increase, agreeing that the wholly-owned subsidiary of the Company, Topband LithiumBattery, will use its own or self-raised funds of 15.40 million yuan to acquire 70% of the equity in TaixingNinghui Lithium Battery Co., Ltd. (hereinafter referred to as "Ninghui Lithium") and increase the capital of theTarget Company by 18 million yuan, and the registered capital of the Ninghui Lithium will increase from 22million yuan to 40 million yuan. After the completion of this transaction, Topband Lithium Battery will hold
83.5% of the equity in Ninghui Lithium Battery. This matter has finished the industrial and commercial change onFebruary 5, 2021 and included in the scope of the Company's consolidated statements.
2. The plots numbered DX-41-02-01 and DX-41-02-02 with a total area of 49,674 square meters in HuizhouZhongkai High-Tech Zone, which was acquired by Huizhou Topband, the Company's subsidiary, in March 2021,will be used for the construction of Huizhou No. 2 Industrial Park.
3. On September 7, 2021, the Company invested in the establishment of a wholly-owned subsidiary,Shenzhen Topband Automotive Electronics Co., Ltd. with a registered capital of 10 million yuan, which wasincluded in the scope of consolidated statements from the date of establishment.
4. On September 24, 2021, the Company increased the capital of Hong Kong Topband and set up Topband
Intelligent Europe Company by investing abroad in Romania, and obtained the registration document issued byRomania's National Business Registration Office. The wholly-owned sub-subsidiary in Romania has nowcompleted the registration.
5. On November 11, 2021, the Company increased the capital of Hong Kong Topband and set up TopbandMexico Co., Ltd. by investing abroad in Mexico, and obtained the registration document issued by Mexico'sPublic Business Registration Office. The wholly-owned sub-subsidiary in Mexico has now completed theregistration.
6. Shenzhen Topband Battery Co., Ltd. (hereinafter referred to as "Topband Lithium Battery"), awholly-owned subsidiary of the Company, signed an Investment Agreement and a Supplementary Agreement witheffective conditions with the Management Committee of Nantong Economic and Technological DevelopmentZone on December 7, 2021. The Company planned to set up a new company in Nantong, invest in theconstruction of lithium battery projects with its own funds or self-raised funds, and purchase the plant asset atNo.69 Zhongyang Road, Nantong Economic and Technological Development Zone with the basic constructioncompleted for the construction of square aluminum shell cells, pouch cells, large cylindrical cells and batteryPACK production lines.
Section VII Share Change and ShareholdersI. Share change
1. Share change
Unit: share
Before this change | Increase and decrease of change this time (+, -) | After this change | |||||||
Quantity | Proportion | Issuance of new shares | Stock dividend | Conversion of accumulation fund into shares | Other | Subtotal | Quantity | Proportion | |
I. Shares with non-tradable conditions | 198,249,297 | 17.46% | 18,705,400 | 11,658,920 | 30,364,320 | 228,613,617 | 18.19% | ||
1. Shares held by the state | 0.00% | 0.00% | |||||||
2. Shares held by state-owned legal persons | 0.00% | 0.00% | |||||||
3. Shares held by other domestic capital | 198,249,297 | 17.46% | 18,705,400 | 11,658,920 | 30,364,320 | 228,613,617 | 18.19% | ||
Including: shares held by domestic legal persons | 0.00% | 0.00% | |||||||
Shares held by domestic natural persons | 198,249,297 | 17.46% | 18,705,400 | 11,658,920 | 30,364,320 | 228,613,617 | 18.19% | ||
4. Shares held by foreign investment | 0.00% | 0.00% | |||||||
Including: shares held by overseas legal persons | 0.00% | 0.00% | |||||||
Shares held by overseas natural persons | 0.00% | 0.00% |
II. Shares without non-tradable conditions | 936,967,512 | 82.54% | 92,105,263 | -708,320 | 91,396,943 | 1,028,364,455 | 81.81% | ||
1. RMB ordinary share | 936,967,512 | 82.54% | 92,105,263 | -708,320 | 91,396,943 | 1,028,364,455 | 81.81% | ||
2. Domestic listed foreign shares | 0.00% | 0.00% | |||||||
3. Overseas listed foreign shares | 0.00% | 0.00% | |||||||
4. Other | 0.00% | 0.00% | |||||||
III. Total number of shares | 1,135,216,809 | 100.00% | 110,810,663 | 10,950,600 | 121,761,263 | 1,256,978,072 | 100.00% |
Reasons for share change
√ applicable □ not applicable
The change in the company's share capital during the reporting period was due to the joint effect of thefollowing: the second exercising period of the stock option incentive plan in 2018 met the relevant conditions, andthe incentive objects increased by 10,950,600 shares through independent exercise; non-publicly issued sharesincreased by 92,105,263 shares; according to the restricted stock incentive plan in 2021, 18,705,400 shares wasprivately issued to some incentive objects.Approval of share change
√ applicable □ not applicable
1. During the second exercising period of the company's stock option incentive plan in 2018, thefollowing decision-making procedures have been executed:
On March 5, 2021, the 6th Meeting of the 7th Board of Directors and the 6th Meeting of the 7th Board ofSupervisors of the Company deliberated and approved the Proposal on the Second Exercise Period of the SecondPhase Stock Option Incentive Plan Meeting with the Exercise Conditions and Exercisable Rights, the Proposal onAdjusting the Incentive Objects and the Number of Stock Options in the 2018 Stock Option Incentive Plan, andthe Proposal on Adjusting the Exercise Price of the 2018 Stock Option Incentive Plan, the board of supervisors ofthe Company expressed verification opinions on the adjustment of the exercise price of the 2018 stock optionincentive plan and the list and number of incentive objects involved in the second exercise period of grantingstock options, and the independent directors expressed their independent opinions, agreeing that 569 incentiveobjects would exercise their rights independently in the second exercise period, and the total number of
exercisable stock options was 10,985,100. As of August 6, 2021, 10,950,600 stock options involving 567incentive objects that meet the exercising conditions has been exercised, increasing the number of shares.
2. The Company has performed the following decision-making procedures for this non-public offering:
(1) On April 28, 2020 and May 20, 2020, the Company held the 23rd Meeting of the 6th Board of Directorsand the 2019 Annual General Meeting of Shareholders respectively, which deliberated and approved the Proposalon the Scheme for the Company's Non-Public Offering of Shares, the Proposal on Requesting the GeneralMeeting of Shareholders to Authorize the Board of Directors to Handle Matters Related to the Company'sNon-Public Offering of Shares and other proposals related to the non-public offering of shares.
(2) On April 21, 2021 and May 10, 2021, the company held the eighth (extraordinary) meeting of the seventhboard of directors, the seventh (extraordinary) meeting of the seventh board of supervisors, and the firstextraordinary general meeting in 2021, reviewing and approving the Proposal on Requesting the General Meetingof Shareholders to Extend the Validity Period of Authorizing the Company's Board of Directors to Handle MattersRelated to the Non-public Issuance of Shares in 2020, the Proposal on Extending the Validity Period of theResolutions of the General Meeting of Shareholders on the Non-public Issuance of Shares in 2020, and otherproposals related to the non-public offering of shares.
(3) On August 10, 2020, the Company's application for non-public offering of shares was approved by theissuance examination committee of the CSRC. On August 18, 2020, the Company received the Reply onApproving the Non-Public Offering of Shares by Shenzhen Topbang Co., Ltd. (ZJXK [2020] No. 1865) as issuedby the China Securities Regulatory Commission. On April 29, 2021, the Company privately issued 92,105,263ordinary shares (A shares) in RMB to 14 specific investors. On May 20, 2021, the Company obtained theConfirmation of Acceptance of Share Registration Application as issued by Shenzhen Branch of China SecuritiesDepository and Clearing Company Limited, and the relevant shares were officially included in the register ofshareholders of the Company after they were registered in the account.
3. According to the restricted stock incentive plan in 2021, the company has executed the followingdecision-making procedures:
For details, please refer to "Section 6 Important Matters XVI: Explanation of Other Important Matters".
Transfer of share change
√ applicable □ not applicable
1. For the second exercise period of the 2018 stock option incentive plan, the exercise of 10,985,100 stock
options was approved. As of the end of the reporting period, 10,950,600 additional shares for stock optionexercise had been registered under the names of incentive objects respectively.
2. The securities registration formalities for the Company's non-public offering of 92,105,263 shares (RMBordinary shares) were completed in Shenzhen Branch of China Securities Depository and Clearing CompanyLimited, and such shares were listed on Shenzhen Stock Exchange on June 3, 2021.
3. According to the restricted stock incentive plan in 2021, it was approved to issue 18,705,400 shares to1,026 incentive objects. As of the end of the reporting period, 18,705,400 new restricted shares had beenregistered in the names of each incentive object.
4. According to the restricted stock incentive plan in 2021, it was approved to grant 14,838,920 shares in thecompany's special securities account for repurchase to 198 incentive objects. As of the end of the reporting period,the 14,838,920 shares in the restricted stock repurchase portion had been registered in the names of each incentiveobject.The impact of share changes on financial indicators such as basic earnings per share and diluted earnings per sharein the latest year and the latest period, net assets per share attributable to common shareholders of the Company,etc.
√ applicable □ not applicable
For the impact of changes in shareholding on financial indicators such as the basic earnings per share, dilutedearnings per share, and net assets per share attributable to ordinary shareholders of the company in the last yearand the most recent period, please refer to Section X Financial Report XVIII: Supplementary Information 2.Return on net assets and earnings per share in this Announcement.Other contents deemed necessary by the Company or required to be disclosed by the securities regulatoryinstitution
□ applicable √ not applicable
2. Changes in non-tradable shares
√ applicable □ not applicable
Unit: share
Name of shareholder | Number of non-tradable shares at the | Increase number of non-tradable shares in the | Desterilization number of non-tradable | Number of non-tradable shares at the end | Reasons for non-trading | Date of lifting sales restriction |
beginning of the period | current period | shares in the current period | of the period | |||
Wu Yongqiang | 159,006,536 | 0 | 0 | 159,006,536 | Executives lock-in shares | Not applicable |
Ji Shuhai | 24,613,981 | 0 | 4,125,000 | 20,488,981 | Executives lock-in shares | Not applicable |
Ma Wei | 5,726,200 | 841,000 | 0 | 6,567,200 | Executive lock-up shares and restricted shares of restricted stock | Released from trading restrictions according to the stock incentive plan |
Peng Ganquan | 2,922,674 | 670,000 | 0 | 3,592,674 | Executive lock-up shares and restricted shares of restricted stock | Released from trading restrictions according to the stock incentive plan |
Zheng Sibin | 3,932,977 | 713,000 | 0 | 4,645,977 | Executive lock-up shares and restricted shares of restricted stock | Released from trading restrictions according to the stock incentive plan |
Wen Zhaohui | 1,581,095 | 363,000 | 0 | 1,944,095 | Executive lock-up shares and restricted shares of restricted stock | Released from trading restrictions according to the stock incentive plan |
Dai Huijuan | 239,709 | 0 | 0 | 239,709 | Executive lock-up shares and restricted shares of restricted stock | Released from trading restrictions according to the stock incentive plan |
Xiang Wei | 226,125 | 273,000 | 0 | 499,125 | Executive lock-up shares and restricted shares of restricted stock | Released from trading restrictions according to the stock incentive plan |
Incentive objects of restricted stock incentive plan | 0 | 31,629,320 | 0 | 31,629,320 | Stock-option-incentive restricted shares | Released from trading restrictions according to the stock incentive plan |
Total | 198,249,297 | 34,489,320 | 4,125,000 | 228,613,617 | -- | -- |
II. Issuance and listing of securities
1. Issuance of securities (excluding preferred shares) during the reporting period
√ applicable □ not applicable
Names of stocks and their derivative securities | Issuing date | Issue price (or interest rate) | Issued quantity | Listing date | Number of shares approved for listing and trading | Transaction termination date | Disclosure index | Date of disclosure |
Stock category | ||||||||
Topband | 2021/4/29 | 11.4 | 92,105,263 | 2021/06/03 | 92,105,263 | http://www.cninfo.com.cn | 2021/6/1 | |
Topband | 2021/12/16 | 7.23 | 18,705,400 | 2021/12/17 | 0 | http://www.cninfo.com.cn | 2021/12/16 | |
Convertible bonds, separate-bargaining convertible bonds and corporation bonds | ||||||||
Other derivative securities |
Explanation on the issuance of securities (excluding preferred shares) during the reporting period
1. Matters of the private issuing of stock in 2021
(1) Matters related to the company's non-public offering of shares in 2021 have been reviewed and approvedby the 23rd meeting of the 6th Board of Directors, the 8th (extraordinary) meeting of the 7th Board of Directors,the 7th (extraordinary) meeting of the 7th Board of Supervisors, and the annual general meeting in 2019 and thefirst extraordinary general meeting in 2021.
(2) On August 18, 2020, with the approval of the Reply on the Non-public Issuance of Shares by ShenzhenTopband Co., Ltd. (ZJXK [2020] No. 186) issued by the China Securities Regulatory Commission, the companyadopted an inquiry method to privately issue 92,105,263 RMB common stocks (A-shares) to 14 investors.
(3) On June 3, 2021, with the approval of the Shenzhen Stock Exchange, the company's non-public issuanceof 92,105,263 new shares was listed on the Stock Exchange with a 6-month restricted stock trade period.
(4) On December 3, 2021, the restricted stock trade period of the company’s non-public offering of stocks
expired, and the company applied to the Shenzhen Stock Exchange and China Securities Depository and ClearingCorporation Limited in November 2021 for the lifting of the sales restriction. The application was approved byShenzhen Stock Exchange and China Securities Depository and Clearing Corporation Limited, releasing a total of92,105,263 shares from trading restrictions.
2. New stocks in the restricted stock incentive plan in 2021
(1) The restricted stock incentive plan in 2021 was reviewed and approved by the thirteenth (extraordinary)meeting of the seventh board of directors, the fourteenth meeting of the seventh board of directors, the secondextraordinary general meeting of shareholders in 2021, the 16th (extraordinary) meeting of the seventh board ofdirectors, the 17th (extraordinary) meeting of the seventh board of directors, allowing to grant a total of33,544,320 restricted shares to 1,224 incentive objects. Among them, 14,838,920 shares in the company's specialaccount for repurchase were issued to 198 incentive objects; 187,054 million new shares were issued to 1,026incentive objects.
(2) On December 16, 2021, upon review and confirmation by the Shenzhen Stock Exchange and theShenzhen Branch of China Securities Depository and Clearing Corporation Limited, the company granted andregistered the 187,054 million restricted (new) shares involved in the restricted stock incentive plan in 2021, and14,838,920 restricted (repurchased) shares. Those shares were listed on December 17, 2021.The restricted sharesgranted by the incentive plan were locked up after the grant registration, and 30%, 30% and 40% were unlockedfrom the first trading day after 12 months, 24 months, and 36 months since the grant date to the last trading daywithin 24 months, 36 months, and 48 months since the grant date, respectively.
2. Description of changes in the total number of shares and shareholder structure of the Company andchanges in the structure of assets and liabilities of the Company
√ applicable □ not applicable
1. Changes in the total number of shares and shareholder structure:
During the reporting period, the stock option incentive in 2018 was exercised in the second period, addingthe capital stock of 10,950,600 shares and 92,105,263 non-publicly issued shares; according to the restricted stockincentive plan in 2021, additional 18,705,400 shares was issued to incentive objects, jointly resulting in theincrease of the company’s general capital by 121,761,263 shares, namely, changing from 1,135,216,809 shares to1,256,978,072 shares.
2. Changes in the structure of assets and liabilities of the Company
As of the end of the period, the company's general capital was 1,256,978,072 shares, and the total assetsincreased to 9,607,792,402.39 yuan, with the asset-liability ratio of 46.74%. At the end of 2020, the company'stotal assets were 6,803,891,928.56 yuan, with the asset-liability ratio of 48.12%.
3. Existing situation of internal staff shares
□ applicable √ not applicable
III. Shareholders and actual controllers
1. Number of shareholders and shareholding situation of the Company
Unit: share
Total number of common shareholders at the end of the reporting period | 63,350 | Total number of common shareholders at the end of the previous month before the disclosure date of the annual report | 89,748 | Total number of preferred shareholders with voting rights restored at the end of the reporting period (if any) (see Note 8) | 0 | The total number of preferred shareholders whose voting rights were restored at the end of the previous month before the disclosure date of the annual report (if any) (see Note 8) | 0 | |||||||
Shareholding situation of shareholders holding more than 5% or top 10 shareholders | ||||||||||||||
Name of shareholder | Nature of shareholders | Shareholding proportion | Number of shares held at the end of the reporting period | Increase and decrease in the reporting period | Number of shares without non-tradable conditions | Number of shares without non-tradable conditions | Pledge, marking or freezing | |||||||
Share status | Quantity | |||||||||||||
Wu Yongqiang | Domestic natural person | 16.87% | 212,008,715 | 0 | 159,006,536 | 53,002,179 | Pledge | 36,010,000 | ||||||
Hong Kong Securities Clearing Company Ltd. | Overseas legal person | 7.77% | 97,714,150 | 83,440,590 | 0 | 97,714,150 | ||||||||
Ji Shuhai | Domestic natural person | 2.17% | 27,318,642 | 0 | 20,488,981 | 6,829,661 | ||||||||
Xie Renguo | Domestic | 1.68% | 21,149,588 | 4,543,788 | 0 | 21,149,588 |
natural person | ||||||||
Agricultural Bank of China Limited - Cathay Pacific Smart Car Equity Securities Investment Fund | Other | 1.48% | 18,657,912 | 18,657,912 | 0 | 18,657,912 | ||
First State Investment Management (UK) Limited - First State Global Umbrella Fund: First State Greater China Growth Fund | Overseas legal person | 1.43% | 17,948,155 | -9,508,200 | 0 | 17,948,155 | ||
Industrial and Commercial Bank of China Limited - China Europe Times Pioneer Stock Initiated Securities Investment Fund | Other | 1.26% | 15,899,200 | 15,899,200 | 0 | 15,899,200 | ||
China Construction Bank Corporation - China Europe Mingrui New Normal Hybrid Securities Investment Fund | Other | 0.94% | 11,805,300 | 11,805,300 | 0 | 11,805,300 | ||
Bank of China Limited - Cathay Pacific Intelligent Equipment Equity Securities Investment Fund | Other | 0.85% | 10,692,650 | 10,692,650 | 0 | 10,692,650 | ||
Basic Endowment Insurance Fund 1206 Portfolio | Other | 0.84% | 10,576,756 | 10,576,756 | 0 | 10,576,756 | ||
The top 10 shareholders of strategic investors or general legal persons due to placement of new shares (if any) (see Note 3) | Not applicable | |||||||
Description of the above shareholders’ relationship or concerted action | Except for Agricultural Bank of China Limited - Cathay Pacific Smart Car Equity Securities Investment Fund and Bank of China Limited - Cathay Pacific Intelligent Equipment Equity Securities Investment Fund, which are managed by the same fund manager, and Industrial and Commercial Bank of China Limited - China Europe Times Pioneer Stock Initiated Securities Investment Fund and China Construction Bank Corporation - China Europe Mingrui New Normal Hybrid Securities Investment |
Fund, which are managed by the same fund manager, the company does not know whether there is an associated relationship between other shareholders or whether it falls under the “persons acting in concert” specified in the Measures for the Administration on Acquisition of Listed Companies. | |||
Description of the above shareholders' entrusting / entrusted voting rights and waiver of voting rights | Not applicable | ||
Special explanations for the existence of special repurchase accounts among the top 10 shareholders (if any) (see Note 11) | Not applicable | ||
Shareholding of the top 10 shareholders without non-tradable conditions | |||
Name of shareholder | Number of shares held without non-tradable conditions at the end of the reporting period | Types of shares | |
Types of shares | Quantity | ||
Hong Kong Securities Clearing Company Ltd. | 97,714,150 | RMB ordinary share | 97,714,150 |
Wu Yongqiang | 53,002,179 | RMB ordinary share | 53,002,179 |
Xie Renguo | 21,149,588 | RMB ordinary share | 21,149,588 |
Agricultural Bank of China Limited - Cathay Pacific Smart Car Equity Securities Investment Fund | 18,657,912 | RMB ordinary share | 18,657,912 |
First State Investment Management (UK) Limited - First State Global Umbrella Fund: First State Greater China Growth Fund | 17,948,155 | RMB ordinary share | 17,948,155 |
Industrial and Commercial Bank of China Limited - China Europe Times Pioneer Stock Initiated Securities Investment Fund | 15,899,200 | RMB ordinary share | 15,899,200 |
China Construction Bank Corporation - China Europe Mingrui New Normal Hybrid Securities Investment Fund | 11,805,300 | RMB ordinary share | 11,805,300 |
Bank of China Limited - Cathay Pacific Intelligent Equipment Equity Securities Investment Fund | 10,692,650 | RMB ordinary share | 10,692,650 |
Basic Endowment Insurance Fund 1206 Portfolio | 10,576,756 | RMB ordinary share | 10,576,756 |
Shanghai Pudong Development Bank Co., Ltd. - China Europe Innovation 18-month Closed Operation Hybrid Securities Investment Fund | 9,623,700 | RMB ordinary share | 9,623,700 |
Description of the relationship or | Except for Agricultural Bank of China Limited - Cathay Pacific Smart Car Equity Securities Investment |
concerted action between the top 10 shareholders with unlimited tradable shares and between the top 10 shareholders with unlimited tradable shares and the top 10 shareholders | Fund and Bank of China Limited - Cathay Pacific Intelligent Equipment Equity Securities Investment Fund, which are managed by the same fund manager, and Industrial and Commercial Bank of China Limited - China Europe Times Pioneer Stock Initiated Securities Investment Fund, China Construction Bank Corporation - China Europe Mingrui New Normal Hybrid Securities Investment Fund and Shanghai Pudong Development Bank Co., Ltd. - China Europe Innovation 18-month Closed Operation Hybrid Securities Investment Fund, which are managed by the same fund manager, the company does not know whether there is an associated relationship between other shareholders or whether it falls under the “persons acting in concert” specified in the Measures for the Administration on Acquisition of Listed Companies. |
Description of the participation of the top 10 common shareholders in securities margin trading (if any) (see Note 4) | Not applicable |
Whether the top 10 ordinary shareholders and the top 10 ordinary shareholders with unlimited sales conditionshave conducted the agreed repurchase transactions during the reporting period
□ Yes √ No
The top 10 ordinary shareholders and the top 10 ordinary shareholders with unlimited sales conditions did notcarry out the agreed repurchase transaction during the reporting period.
2. Controlling shareholders of the Company
Nature of controlling shareholder: controlling by natural personType of controlling shareholder: natural person
Name of controlling shareholder | Nationality | Whether the right of residence in other countries or regions was obtained |
Wu Yongqiang | China | No |
Main position and occupation | Since 2009, holding the post of the Chairman and General Manager of Shenzhen Topband Co., Ltd. | |
Equity of other domestic and foreign listed companies holding shares or participating in shares during the reporting period | None |
Change of controlling shareholders during the reporting period
□ applicable √ not applicable
The controlling shareholder of the Company did not change during the reporting period.
3. The actual controller of the Company and the person acting in concert
Nature of actual controller: foreign natural person
Type of actual controller: natural person
Name of actual controller | Relationship with actual controller | Nationality | Whether the right of residence in other countries or regions was obtained |
Wu Yongqiang | Oneself | China | No |
Main position and occupation | Since 2009, holding the post of the Chairman and General Manager of Shenzhen Topband Co., Ltd. | ||
Situation of listed companies both at home and abroad that have been held in the past 10 years | None |
Change of actual controller during the reporting period
□ applicable √ not applicable
The actual controller of the Company did not change during the reporting period.Block Diagram of Property Rights and Control Relationship between the Company and the Actual Controller
The actual controller controlled the Company through trust or other asset management methods
□ applicable √ not applicable
4. The accumulative pledged shares of the company's controlling shareholder or the first majorityshareholder and its persons acting in concert account for 80% of the total shares.
□ applicable √ not applicable
5. Other corporate shareholders holding more than 10% shares
□ applicable √ not applicable
6. Limited reduction of shares of controlling shareholders, actual controllers, reorganizers and othercommitted entities
□ applicable √ not applicable
Shenzhen Topband Co., Ltd.Wu Yongqiang
IV. The specific implementation of targeted share repurchase during the reporting period
Implementation progress of share repurchase
□ applicable √ not applicable
Progress in the implementation of the reduction of share repurchase through centralized bidding
□ applicable √ not applicable
Section VIII Information on Preferred Shares
□ applicable √ not applicable
The Company did not have preferred shares during the reporting period.
Section IX Relevant Information of Bonds
□ applicable √ not applicable
Section X Financial ReportI. Audit report
Type of audit opinion | Standard unqualified opinion |
Date of signing of audit report | March 18, 2022 |
Name of audit Institution | BAKER TILLY International Accounting Firm (Special General Partnership) |
Document number of audit report | TZYZ [2022] No. 12262 |
Name of certified public accountant | Chen Zhigang, Zhao Yang |
Text of audit report
TZYZ [2022] No. 12262All shareholders of Shenzhen Topband Co., Ltd.:
I. Audit OpinionWe have audited the financial statements of Shenzhen Topband Co., Ltd. (hereinafter referred to as "TopbandCompany"), including the consolidated and parent company's balance sheets as of December 31, 2021, theconsolidated and parent company's income statements, the consolidated and parent company's cash flowstatements and the consolidated and parent company's statements of changes in shareholders' equity for 2021, andthe relevant notes to the financial statements.In our opinion, the attached financial statements prepared in all material respects in accordance with theAccounting Standards for Business Enterprises fairly reflect the consolidated and parent company's financialposition as of December 31, 2021, and the consolidated and parent company's operating results and cash flows for2021.II. Basis for the Formation of the Audit OpinionWe have carried out the audit according to the Audit Standards for Chinese Certified Public Accountants.Our responsibility under these standards is further described in “Certified Public Accountants’ Responsibility forthe Financial Statements” in the audit report. According to the Code of Professional Ethics of Chinese CertifiedPublic Accountants, we are independent from Topband Company and have performed other responsibilities interms of professional ethics. We believe that the audit evidence obtained by us is sufficient and appropriate and
has provided a basis for the expression of our audit opinion.III. Key Audit MattersKey audit matters are those which, in our professional judgment, we deem to be the most important for theaudit of the financial statements for the current period. These matters shall be handled in the context of the auditof the financial statements as a whole and the formation of an audit opinion, and we do not separately express anopinion on these matters.
Key Audit Matters | How are the matter handled in the audit |
1. Revenue recognition
1. Revenue recognition | |
In 2021, the operating income of Topband Company is 7,767,034,800 yuan. Considering that operating income is a key operating indicator of the Topband Company, whether the sales revenue of products is included in the appropriate accounting period may be potentially misstated, so we regard the recognition of operating income as a key audit matter. Please refer to the accounting policies described in "(28) Income" in "III. Important Accounting Policies and Accounting Estimates", "(41) Operating Income and Operating Cost" in "VI. Notes to Items in the Consolidated Financial Statements" and "(4) Operating Income and Operating Cost" in "XVII. Annotations to Major Items in the Parent Company's Financial Statements" in the notes to the financial statements. | The main audit procedures we have carried out for revenue recognition include, but are not limited to the following: (1) Understand, evaluate and test the effectiveness of the design and operation of internal control related to the sales and collection of Topband Company; (2) Understand revenue recognition policies through interviews with the management, check relevant terms of major customer contracts, analyze and evaluate whether the revenue recognition policies actually implemented are appropriate, and recheck whether relevant accounting policies are consistently used; (3) Inquire and understand the background information of major customers or new customers through open channels, such as industrial and commercial registration information, and confirm whether there is any potential unidentified related party relationship between major customers and Topband Company and its related parties; (4) Analyze the rationality of changes in the sales structure of major products, compare with the gross profit rate in the same period in history and in the same industry, analyze changes in the gross profit rate of major products and major customers, and recheck the rationality of sales revenue; (5) Verify the balance of accounts receivable of major customers in combination with the audit of accounts receivable, and perform substitution tests for customers who did not reply; (6) Take samples to check the relevant documents of |
Audit Report (Continued)
TZYZ [2022] No. 12262
sales revenue transactions, such as sales contracts (orders),delivery notes, receipts (warehouse receipts), customsdeclarations, statements of account and sales invoices, so as toverify whether the confirmed sales revenue is true;
(7) Spot-check sales revenue transactions recorded before
and after the balance sheet date to check the supportingvouchers of revenue recognition under each mode, so as toevaluate whether sales revenue is recorded in the appropriateaccounting period.
Key Audit Matters
Key Audit Matters | How are the matter handled in the audit |
2. Impairment of accounts receivable | |
At the end of 2021, the book value of accounts receivable of Topband Co., Ltd. was 2,188,161,500 yuan. Due to the large book value of accounts receivable, the assessment of bad-debt provision involved significant accounting estimates and judgments of the management. Therefore, the bad-debt provision for accounts receivable was regarded as a key audit item. Please refer to the accounting policies described in "(11) Receivables" in "III. Important Accounting Policies and Accounting Estimates", "(4) Accounts Receivable "in "VI. Notes to Items in the Consolidated Financial Statements" and "(1) Receivables" in "XVII. Notes to Major Items in the Parent Company's Financial Statements" in the notes to the financial statements. | The main audit procedures we have carried out for the impairment of accounts receivable include, but are not limited to the following: (1) Understand, evaluate and test the effectiveness of the design and operation of internal control related to the credit policy and accounts receivable management of Topband Company; (2) Analyze the rationality of the accounting policies for the bad debt provision of accounts receivable, including the basis for determining the combination of accounts receivable, the expected credit loss rate, the judgment of a single item with a significant amount, the judgment of a single item with bad debt provision, and check whether it conforms to relevant accounting policies; (3) Obtain the aging analysis table and bad debt provision table of accounts receivable, analyze and check the rationality and accuracy of the aging division and bad debt provision of accounts receivable; (4) Analyze and calculate the ratio between the amount of bad debt provision and the balance of accounts receivable on the balance sheet date, compare the amount of previous bad debt provision and the actual amount incurred, and analyze whether the amount of bad debt provision of accounts receivable is sufficient; (5) Analyze the rationality of the scale of accounts receivable of major customers in combination with the credit period of accounts receivable. At the same time, understand the reasonable cause for the accounts receivable beyond the |
IV. Other Information
The management of Topband Company (hereinafter referred to as the "Management") is responsible for otherinformation. Other information includes information covered in the 2021 Annual Report, but does not include thefinancial statements and our audit report.Our audit opinion on the financial statements does not cover other information, nor do we issue any form ofauthentication conclusions on other information.In conjunction with our audit of the financial statements, it is our responsibility to read other information and,in doing so, consider whether other information is materially inconsistent or appears to be materially misstatedwith the financial statements or what we have learned in the course of our audit. Based on the work we haveperformed, if we determine that there is a material misstatement of other information, we shall report that fact. Inthis regard, we have nothing to report.V. Responsibilities of the Management and the Governance Body for FinancialStatements
The Management is responsible for preparing the financial statements in accordance with the AccountingStandards for Business Enterprises, causing them to realize fair presentation and designing, implementing andmaintaining necessary internal control so that the financial statements contain no misstatement caused by fraud orerrors.
When the financial statements were prepared, the Management was responsible for assessing TopbandCompany’s ability to continue as a going concern, disclosing the matters related to the going concern (ifapplicable) and applying the going concern assumption unless the Management planned to conduct liquidation,terminated operation or had no other practical option.
The Governance Body is responsible for overseeing the financial reporting process of Topband Company.V. Responsibilities of Certified Public Accountants for Auditing the Financial Statements
Our objective is to obtain reasonable assurance as to whether the financial statements contain nomisstatement caused by fraud or errors on the whole and to issue an audit report including an audit opinion.
Reasonable assurance is a high level of assurance, but cannot guarantee that a certain material misstatement canalways be detected in an audit carried out according to audit standards. A misstatement may be caused by fraud orerrors. Misstatements are generally deemed to be material if it is reasonably expected that they may, individuallyor collectively, influence the economic decisions made by the users of the financial statements according to thefinancial statements.
We have exercised our professional judgment and maintained our professional skepticism in carrying out theaudit according to audit standards. At the same, we have carried out the following work:
(1) We have identified and assessed the risks of material misstatements caused by fraud or errors in thefinancial statements; have designed and implemented audit procedures to cope with such risks; and have obtainedsufficient and appropriate audit evidence as a basis for the expression of the audit opinion. Because fraud mayinvolve collusion, falsification, intentional omission, misrepresentation or precedence over internal control, therisk of failure to detect material misstatements caused by fraud is higher than the risk of failure to detect materialmisstatements caused by errors.
(2) We have understood the internal control related to the audit to design appropriate audit procedures, butour purpose is not to express our opinion on the effectiveness of internal control.
(3) We have evaluated the appropriateness of the accounting polices chosen by the Management and thereasonableness of the accounting estimates and relevant disclosure made by it.
(4) We have reached a conclusion on the appropriateness of the use of the going concern assumption. At thesame time, according to the received audit evidence, we have reached a conclusion on the existence ornon-existence of material uncertainty about any matter or situation that may cast considerable doubt on TopbandCompany's ability to continue as a going concern. If our conclusion is that material uncertainty exists, the auditstandards require us to bring relevant disclosure in the financial statements to the attention of the users of thestatements in the audit report; if such disclosure is inadequate, we shall express a non-unqualified opinion. Ourconclusion is based on the information that was available as of the date of the audit report. However, futurematters or situations may cause Topband Company to lose the ability to continue as a going concern.
(5) We have evaluated the overall presentation, structure and content of the financial statements and haveevaluated whether the financial statements fairly present relevant transactions and matters.
(6) We have obtained sufficient and appropriate audit evidence for the financial information on the entity orbusiness activities of Topband Company to express our audit opinion on the financial statements. We are
responsible for guiding, supervising and implementing the group’s audit and bear full responsibility for the auditopinion.We have communicated with the Governance Body about the planned audit scope, timing and significantaudit discovery, including internal control defects identified by us in the audit and deserving attention.We have also provided the Governance Body with a statement that we have complied with the professionalethics requirements relating to our independence and have communicated with the Governance Body about allrelationships and other matters that may reasonably be believed to affect our independence, as well as relevantprecautions.From the issues we have communicated with the Governance Body, we have determined which issues are themost important to the audit of the financial statements for the current period and thus constitute key audit matters.We describe these matters in our audit report, unless laws and regulations prohibit public disclosure of suchmatters or, in rare circumstances, we determine that we shall not communicate a certain matter in our audit reportif it is reasonably expected that the negative consequences of communicating such matter in our audit report willexceed the benefits derived in the public interest.
Beijing, China March 18, 2022 | Chinese Certified Public Accountants: (Project Partners) | |
Chinese Certified Public Accountants: |
II. Financial StatementsThe unit of statements in the financial notes is: Yuan (RMB)
1. Consolidated balance sheet
Prepared by: Shenzhen Topband Co., Ltd.
December 31, 2021
Unit: Yuan
Items | December 31, 2021 | December 31, 2020 |
Current assets: | ||
Monetary capital | 1,767,580,056.07 | 1,219,095,476.50 |
Settlement of provisions |
Loans to other banks | ||
Tradable financial assets | 214,999,336.74 | 226,491,482.10 |
Derivative financial assets | ||
Notes receivable | 161,659,470.21 | 39,477,930.63 |
Accounts receivable | 2,188,161,465.48 | 1,701,111,153.84 |
Receivables financing | 36,902,507.85 | 246,656,027.27 |
Prepayments | 41,320,285.02 | 17,735,229.99 |
Premiums receivable | ||
Reinsurance accounts receivable | ||
Reinsurance contract reserves receivable | ||
Other receivables | 50,156,221.82 | 40,728,126.64 |
Including: interest receivable | ||
Dividends receivable | ||
Repurchase of financial assets for resale | ||
Inventory | 2,184,402,766.04 | 1,115,312,868.62 |
Contractual assets | ||
Assets held for sale | ||
Non-current assets due within one year | ||
Other current assets | 113,071,619.93 | 70,296,444.76 |
Total current assets | 6,758,253,729.16 | 4,676,904,740.35 |
Non-current assets: | ||
Loans and advances granted | ||
Debt investment | 0.00 | |
Other debt investment | ||
Long-term receivables | ||
Long-term equity investment | 26,119,127.82 | 6,502,528.13 |
Other equity instrument investment | ||
Other non-current financial assets | ||
Investment property | 86,975,114.31 | 89,238,265.71 |
Fixed assets | 1,299,517,887.54 | 1,096,875,640.94 |
Construction in progress | 495,248,025.93 | 292,474,798.41 |
Productive biological assets | ||
Oil and gas assets |
Right-of-use assets | 58,168,151.88 | |
Intangible assets | 435,639,773.29 | 279,279,569.40 |
Development expenditure | 66,358,407.48 | 62,861,779.22 |
Goodwill | 110,732,042.84 | 108,637,368.48 |
Long-term deferred expenses | 95,151,616.38 | 72,077,671.09 |
Deferred tax assets | 102,787,097.36 | 55,192,974.75 |
Other non-current assets | 72,041,428.40 | 34,639,355.39 |
Total non-current assets | 2,848,738,673.23 | 2,097,779,951.52 |
Total assets | 9,606,992,402.39 | 6,774,684,691.87 |
Current liabilities: | ||
Short-term loans | 409,531,107.26 | 402,151,500.00 |
Borrowing money from the central bank | ||
Borrowed funds | ||
Trading financial liabilities | ||
Derivative financial liabilities | ||
Notes payable | 1,231,106,148.24 | 715,574,653.91 |
Accounts payable | 1,511,284,996.56 | 1,549,906,339.72 |
Advance receipt | 353,895.16 | 487,267.17 |
Contractual liabilities | 93,328,006.70 | 72,576,117.56 |
Financial assets sold for repurchase | ||
Deposit absorption and interbank deposit | ||
Acting trading securities | ||
Acting underwriting securities | ||
Employee compensation payable | 198,863,796.02 | 175,503,764.12 |
Taxes payable | 16,254,542.45 | 60,256,015.60 |
Other payables | 318,632,275.66 | 57,160,615.93 |
Including: Interest payable | ||
Dividends payable | ||
Service charges and commissions payable | ||
Reinsurance accounts payable | ||
Liabilities held for sale | ||
Non-current liabilities due within one | 47,721,695.74 |
year | ||
Other current liabilities | 107,064,543.82 | |
Total current liabilities | 3,934,141,007.61 | 3,033,616,274.01 |
Non-current liabilities | ||
Insurance contract reserve | ||
Long-term loans | 475,020,000.00 | 200,000,000.00 |
Bonds payable | ||
Including: Preferred shares | ||
Perpetual bonds | ||
Lease liabilities | 40,290,402.14 | |
Long-term payables | ||
Long-term employee compensation payable | ||
Estimated liabilities | ||
Deferred income | 14,385,200.00 | 14,624,770.00 |
Deferred tax liabilities | 26,280,456.34 | 11,819,861.30 |
Other non-current liabilities | ||
Total non-current liabilities | 555,976,058.48 | 226,444,631.30 |
Total liabilities | 4,490,117,066.09 | 3,260,060,905.31 |
Owner's equity: | ||
Share capital | 1,256,978,072.00 | 1,135,216,809.00 |
Other equity instruments | ||
Including: Preferred shares | ||
Perpetual bonds | ||
Capital reserves | 2,140,053,149.74 | 969,370,892.84 |
Minus: treasury shares | 242,525,433.60 | 80,017,965.68 |
Other comprehensive income | -91,831,496.88 | -24,555,229.97 |
Special reserve | ||
Surplus reserves | 186,397,631.76 | 151,359,957.53 |
General risk provision | ||
Retained Earnings | 1,779,243,483.61 | 1,305,882,400.11 |
Total owner's equity attributable to the parent company | 5,028,315,406.63 | 3,457,256,863.83 |
Minority equity | 88,559,929.67 | 57,366,922.73 |
Total owners' equity | 5,116,875,336.30 | 3,514,623,786.56 |
Total liabilities and owners' equity | 9,606,992,402.39 | 6,774,684,691.87 |
Legal Representative: Wu Yongqiang | Accounting Head: Xiang Wei | Accounting Department Head: Luo Muchen |
2. Balance sheet of the parent company
Unit: Yuan
Items | December 31, 2021 | December 31, 2020 |
Current assets: | ||
Monetary capital | 1,110,855,192.86 | 705,163,083.52 |
Tradable financial assets | 187,011,836.74 | 102,133,982.10 |
Derivative financial assets | ||
Notes receivable | 50,356,382.14 | 6,939,021.98 |
Accounts receivable | 1,496,921,254.34 | 896,265,475.70 |
Receivables financing | 13,909,195.16 | 217,543,679.19 |
Prepayments | 11,308,739.07 | 6,953,106.28 |
Other receivables | 141,619,648.22 | 41,159,647.12 |
Including: interest receivable | ||
Dividends receivable | ||
Inventory | 343,548,795.39 | 209,965,269.91 |
Contractual assets | ||
Assets held for sale | ||
Non-current assets due within one year | ||
Other current assets | 14,074,292.52 | 12,054,327.33 |
Total current assets | 3,369,605,336.44 | 2,198,177,593.13 |
Non-current assets: | ||
Debt investment | 0.00 | |
Other debt investment | ||
Long-term receivables | ||
Long-term equity investment | 2,947,556,465.89 | 2,200,934,231.94 |
Other equity instrument investment | ||
Other non-current financial assets | ||
Investment property | ||
Fixed assets | 145,229,190.35 | 120,829,877.70 |
Construction in progress | 6,486,761.99 | 2,392,458.84 |
Productive biological assets | ||
Oil and gas assets | ||
Right-of-use assets | 554,157.99 | |
Intangible assets | 161,311,708.12 | 132,732,792.93 |
Development expenditure | 43,638,980.21 | 44,248,718.56 |
Goodwill | ||
Long-term deferred expenses | 20,573,462.40 | 27,739,322.93 |
Deferred tax assets | 55,938,073.37 | 27,692,977.98 |
Other non-current assets | 8,160,527.96 | 6,997,597.90 |
Total non-current assets | 3,389,449,328.28 | 2,563,567,978.78 |
Total assets | 6,759,054,664.72 | 4,761,745,571.91 |
Current liabilities: | ||
Short-term loans | 153,591,779.50 | 102,151,500.00 |
Trading financial liabilities | ||
Derivative financial liabilities | ||
Notes payable | 990,389,640.00 | 696,684,142.33 |
Accounts payable | 368,537,246.64 | 471,203,775.42 |
Advance receipt | ||
Contractual liabilities | 37,061,438.92 | 29,103,190.50 |
Employee compensation payable | 105,820,526.01 | 91,953,399.79 |
Taxes payable | 10,652,318.75 | 28,211,920.73 |
Other payables | 568,675,865.75 | 299,042,515.61 |
Including: Interest payable | ||
Dividends payable | ||
Liabilities held for sale | ||
Non-current liabilities due within one year | 326,602.76 | |
Other current liabilities | 38,799,661.21 | |
Total current liabilities | 2,273,855,079.54 | 1,718,350,444.38 |
Non-current liabilities | ||
Long-term loans | ||
Bonds payable | ||
Including: Preferred shares | ||
Perpetual bonds |
Lease liabilities | 221,776.58 | |
Long-term payables | ||
Long-term employee compensation payable | ||
Estimated liabilities | ||
Deferred income | 9,053,500.00 | 10,535,500.00 |
Deferred tax liabilities | 20,935,893.00 | 8,106,676.00 |
Other non-current liabilities | ||
Total non-current liabilities | 30,211,169.58 | 18,642,176.00 |
Total liabilities | 2,304,066,249.12 | 1,736,992,620.38 |
Owner's equity: | ||
Share capital | 1,256,978,072.00 | 1,135,216,809.00 |
Other equity instruments | ||
Including: Preferred shares | ||
Perpetual bonds | ||
Capital reserves | 2,189,685,216.22 | 1,007,315,299.41 |
Minus: treasury shares | 242,525,433.60 | 80,017,965.68 |
Other comprehensive income | 370,109.41 | 5,569,575.04 |
Special reserve | ||
Surplus reserves | 186,369,113.30 | 151,331,439.07 |
Undistributed profit | 1,064,111,338.27 | 805,337,794.69 |
Total owners' equity | 4,454,988,415.60 | 3,024,752,951.53 |
Total liabilities and owners' equity | 6,759,054,664.72 | 4,761,745,571.91 |
3. Consolidated income statement
Unit: Yuan
Items | 2021 | 2020 |
I. Total operating income | 7,767,034,835.03 | 5,560,182,998.21 |
Including: operating income | 7,767,034,835.03 | 5,560,182,998.21 |
Interest income | ||
Premium earned | ||
Service charge and commission income | ||
II. Total operating costs | 7,124,228,676.16 | 5,037,468,985.99 |
Including: Operating cost | 6,114,531,354.87 | 4,204,293,830.77 |
Interest expense | ||
Service charge and commission payment | ||
Surrender value | ||
Net compensation expenditure | ||
Net reserve amount set aside for insurance liability contracts | ||
Policy dividend payment | ||
Reinsurance expenses | ||
Taxes and surcharges | 29,053,867.71 | 21,690,582.69 |
Sales expenses | 208,562,819.10 | 132,898,433.70 |
Management expenses | 258,345,031.89 | 184,057,471.19 |
Research and development expenses | 449,950,052.11 | 317,542,654.15 |
Finance charges | 63,785,550.48 | 176,986,013.49 |
Including: Interest expenses | 24,677,917.47 | 41,611,921.13 |
Interest income | 8,722,530.08 | 7,457,090.20 |
Plus: other income | 26,208,046.69 | 35,265,593.47 |
Return on investment (loss marked with "-") | 54,827,083.25 | 258,578,241.24 |
Including: income from investment in associated enterprises and joint ventures | -2883,400.31 | -360,946.80 |
Income from derecognition of financial assets measured at amortized cost | ||
Exchange gains (loss marked with "-") | ||
Net exposure hedge gain (loss marked with "-") | ||
Loss from fair value change (income marked with “-”) | 85,670,316.15 | -105,561,454.64 |
Credit impairment loss (loss marked with "-") | -85,593,629.08 | 10,647,224.22 |
Asset impairment loss (loss marked with "-") | -99,995,344.56 | -99,263,678.59 |
Income from disposal of assets (loss marked with "-") | -404,389.75 | -932,817.83 |
III. Operating profit (loss marked with "-") | 623,518,241.57 | 621,447,120.09 |
Plus: non-operating income | 2,260,355.74 | 3,091,552.14 |
Minus: non-operating expenses | 5,538,292.94 | 5,057,831.82 |
IV. Total profit (total loss marked with "-") | 620,240,304.37 | 619,480,840.41 |
Minus: income tax expense | 48,127,689.76 | 72,904,159.32 |
V. Net profit (net loss marked with "-") | 572,112,614.61 | 546,576,681.09 |
(I) Classification according to business continuity | ||
1. Net profit from continuing operation (net loss marked with "-") | 572,112,614.61 | 546,576,681.09 |
2. Net profit from termination of operation (net loss marked with "-") | ||
(II) Classification according to ownership | ||
1. Net profit attributable to the shareholders of the parent company | 564,964,282.18 | 532,161,123.64 |
2. Profits and losses of minority shareholders | 7,148,332.43 | 14,415,557.45 |
VI. Net after-tax amount of other comprehensive income | -67,276,266.91 | -21,495,467.91 |
Net after-tax amount of other comprehensive income attributable to the owner of the parent company | -67,276,266.91 | -21,495,467.91 |
(I) Other comprehensive income that cannot be reclassified into profits or losses | ||
1. Remeasurement of changes in defined benefit plans | ||
2. Other comprehensive income that cannot be transferred to profits and losses under the equity method | ||
3. Changes in the fair value of other equity instrument investments |
4. Changes in fair value of the enterprise's own credit risk | ||
5. Others | ||
(II) Other comprehensive income that is reclassified into profits and losses | -67,276,266.91 | -21,495,467.91 |
1. Other comprehensive income transferable to profits and losses under the equity method | ||
2. Changes in the fair value of other debt investments | ||
3. Amount of financial assets reclassified into other comprehensive income | ||
4. Provision for credit impairment of other debt investment | ||
5. Cash flow hedge reserve | ||
6. Difference in translation of foreign-currency financial statements | -62,076,801.28 | -27,065,042.95 |
7. Others | -5,199,465.63 | 5,569,575.04 |
Net after-tax amount of other comprehensive income attributable to minority shareholders | ||
VII. Total comprehensive income | 504,836,347.70 | 525,081,213.18 |
Total consolidated income attributable to the owners of the parent company | 497,688,015.27 | 510,665,655.73 |
Total consolidated income attributable to minority shareholders | 7,148,332.43 | 14,415,557.45 |
VIII. Earnings per share: | ||
(I) Basic earnings per share | 0.47 | 0.51 |
(II) Diluted earnings per share | 0.47 | 0.51 |
In case of merger of enterprises under the same control in the current period, the net profit realized by thecombined party before the merger is 0.00 yuan, and the net profit realized by the combined party in the previousperiod is 0.00 yuan.
Legal Representative: Wu Yongqiang | Accounting Head: Xiang Wei | Accounting Department Head: Luo Muchen |
4. Income statement of the parent company
Unit: Yuan
Items | 2021 | 2020 |
I. Operating income | 4,564,044,890.75 | 3,382,368,020.38 |
Minus: operating cost | 3,792,141,796.05 | 2,795,048,150.10 |
Taxes and surcharges | 12,625,707.59 | 9,802,314.00 |
Sales expenses | 130,293,799.46 | 85,887,555.58 |
Management expenses | 151,795,451.87 | 116,464,465.35 |
Research and development expenses | 186,514,426.05 | 139,910,160.61 |
Finance charges | 37,274,271.38 | 137,498,249.51 |
Including: Interest expenses | 12,147,542.62 | 34,251,784.01 |
Interest income | 5,763,930.72 | 5,563,022.74 |
Plus: other income | 8,563,323.92 | 19,920,775.54 |
Return on investment (loss marked with "-") | 69,299,464.03 | 260,450,508.23 |
Including: income from investment in associated enterprises and joint ventures | -527,468.28 | -360,946.80 |
Income from derecognition of financial assets measured at amortized cost (loss marked with "-") | 0.00 | 0.00 |
Net exposure hedge gain (loss marked with "-") | 0.00 | 0.00 |
Loss from fair value change (income marked with “-”) | 85,670,316.15 | -105,561,454.64 |
Credit impairment loss (loss marked with "-") | -12,263,755.40 | 12,890,980.63 |
Asset impairment loss (loss marked with "-") | -8,393,828.43 | -6,126,212.74 |
Income from disposal of assets (loss marked with "-") | 870,158.85 | -286,627.68 |
II. Operating profit (loss marked with "-") | 397,145,117.47 | 279,045,094.57 |
Plus: non-operating income | 406,354.97 | 2,033,271.44 |
Minus: non-operating expenses | 3,621,199.53 | 2,747,958.93 |
III. Total profit (total loss marked with "-") | 393,930,272.91 | 278,330,407.08 |
Minus: income tax expense | 43,553,530.65 | 37,572,949.14 |
IV. Net profit (net loss marked with "-") | 350,376,742.26 | 240,757,457.94 |
(I) Net profit from continuing operation (net loss marked with "-") | 350,376,742.26 | 240,757,457.94 |
(II) Net profit from termination of operation (net loss marked with "-") | ||
V. Net after-tax amount of other comprehensive income | -5,199,465.63 | 5,569,575.04 |
(I) Other comprehensive income that cannot be reclassified into profits or losses | 0.00 | 0.00 |
1. Remeasurement of changes in defined benefit plans | 0.00 | 0.00 |
2. Other comprehensive income that cannot be transferred to profits and losses under the equity method | 0.00 | 0.00 |
3. Changes in the fair value of other equity instrument investments | 0.00 | 0.00 |
4. Changes in fair value of the enterprise's own credit risk | 0.00 | 0.00 |
5. Others | 0.00 | 0.00 |
(II) Other comprehensive income that is reclassified into profits and losses | -5,199,465.63 | 5,569,575.04 |
1. Other comprehensive income transferable to profits and losses under the equity method | 0.00 | 0.00 |
2. Changes in the fair value of other debt investments | 0.00 | 0.00 |
3. Amount of financial assets | 0.00 | 0.00 |
reclassified into other comprehensive income | ||
4. Provision for credit impairment of other debt investment | 0.00 | 0.00 |
5. Cash flow hedge reserve | 0.00 | 0.00 |
6. Difference in translation of foreign-currency financial statements | 0.00 | 0.00 |
7. Others | -5,199,465.63 | 5,569,575.04 |
VI. Total comprehensive income | 345,177,276.63 | 246,327,032.98 |
VII. Earnings per share: | ||
(I) Basic earnings per share | 0.28 | 0.23 |
(II) Diluted earnings per share | 0.28 | 0.23 |
5. Consolidated cash flow statement
Unit: Yuan
Items | 2021 | 2020 |
I. Cash flow from operating activities: | ||
Cash received from selling goods and providing services | 7,379,366,133.60 | 5,029,358,595.65 |
Net increase in customer deposits and interbank deposits | ||
Net increase in borrowing from the central bank | ||
Net increase in funds borrowed from other financial institutions | ||
Cash from receipt of original insurance contract premiums | ||
Receipt of net cash for reinsurance operations | ||
Net increase in savings and investment funds of the insured | ||
Cash from receipt of interest, service charges and commissions | ||
Net increase in borrowed funds | ||
Net increase in funds from |
repurchase operations | ||
Net cash received for acting trading securities | ||
Tax rebates received | 408,342,014.70 | 236,631,627.27 |
Receipt of other cash related to operating activities | 89,743,482.16 | 99,560,021.46 |
Subtotal of cash inflow from operating activities | 7,877,451,630.46 | 5,365,550,244.38 |
Cash paid for purchasing goods and accepting services | 6,328,279,127.11 | 3,505,711,340.07 |
Net increase in customer loans and advances | ||
Net increase in deposits with central banks and interbanks | ||
Cash for payment of claims under original insurance contracts | ||
Net increase in lending funds | ||
Cash for payment of interest, service charges and commissions | ||
Cash for payment of policy dividends | ||
Cash paid to and for employees | 1,315,339,474.82 | 915,077,720.87 |
Various taxes paid | 156,592,618.79 | 113,556,882.14 |
Other cash paid in connection with operating activities | 301,802,955.60 | 183,303,592.92 |
Subtotal of cash outflow from operating activities | 8,102,014,176.32 | 4,717,649,536.00 |
Net cash flow from operating activities | -224,562,545.86 | 647,900,708.38 |
II. Cash flow from investing activities: | ||
Cash received from investment recovery | 526,447,603.26 | 591,409,909.06 |
Cash received as return on an investment | 57,710,483.56 | 235,969,188.04 |
Net cash recovered from the disposal of fixed assets, intangible assets and other long-term assets | 6,913,824.99 | 1,738,744.68 |
Net cash recovered from the disposal of subsidiaries and other |
business units | ||
Other cash received relating to investment activities | 0.00 | |
Subtotal of cash inflow from investment activities | 591,071,911.81 | 829,117,841.78 |
Cash paid for the purchase and construction of fixed assets, intangible assets and other long-term assets | 854,193,345.35 | 573,790,008.02 |
Cash paid for investment | 470,500,000.00 | 617,034,000.00 |
Net increase in pledged loans | ||
Net cash paid for acquiring subsidiaries and other business units | 14,549,770.03 | 0.00 |
Other cash paid in connection with investment activities | 20,016,000.00 | |
Subtotal of cash outflow from investment activities | 1,339,243,115.38 | 1,210,840,008.02 |
Net cash flow from investment activities | -748,171,203.57 | -381,722,166.24 |
III. Cash flow from financing activities: | ||
Cash received from absorbing investment | 1,341,854,327.60 | 44,442,375.30 |
Including: cash received by subsidiaries' absorption of minority shareholders' investment | 21,246,898.25 | |
Cash received from loans | 1,026,376,959.97 | 499,724,833.34 |
Other cash received in connection with financing activities | 27,248,871.75 | 51,476,244.39 |
Subtotal of cash inflow from financing activities | 2,395,480,159.32 | 595,643,453.03 |
Cash paid to repay debts | 726,099,200.02 | 274,767,315.35 |
Cash paid to distribute dividends, profits or pay interest | 86,470,656.52 | 77,989,846.88 |
Including: dividends and profits paid by subsidiaries to minority shareholders | 5,197,835.08 | 4,061,400.15 |
Other cash paid in connection with financing activities | 40,197,743.20 | 38,047,377.60 |
Subtotal of cash outflow from financing activities | 852,767,599.74 | 390,804,539.83 |
Net cash flow from financing activities | 1,542,712,559.58 | 204,838,913.20 |
IV. Impact of exchange rate fluctuations on cash and cash equivalents | -30,709,686.87 | -36,026,940.91 |
V. Net increase in cash and cash equivalents | 539,269,123.28 | 434,990,514.43 |
Plus: balance of cash and cash equivalents at the beginning of the period | 1,196,835,834.92 | 761,845,320.49 |
VI. Balance of cash and cash equivalents at the end of the period | 1,736,104,958.20 | 1,196,835,834.92 |
6. Cash flow statement of the parent company
Unit: Yuan
Items | 2021 | 2020 |
I. Cash flow from operating activities: | ||
Cash received from selling goods and providing services | 4,281,179,459.86 | 3,371,191,145.42 |
Tax rebates received | 257,161,861.26 | 156,974,447.43 |
Receipt of other cash related to operating activities | 686,667,031.96 | 981,628,989.96 |
Subtotal of cash inflow from operating activities | 5,225,008,353.08 | 4,509,794,582.81 |
Cash paid for purchasing goods and accepting services | 3,729,736,400.30 | 2,594,237,500.42 |
Cash paid to and for employees | 456,452,513.20 | 401,882,971.23 |
Various taxes paid | 74,299,409.46 | 42,011,867.61 |
Other cash paid in connection with operating activities | 1,073,422,053.80 | 823,048,596.85 |
Subtotal of cash outflow from operating activities | 5,333,910,376.76 | 3,861,180,936.11 |
Net cash flow from operating activities | -108,902,023.68 | 648,613,646.70 |
II. Cash flow from investing activities: | ||
Cash received from investment recovery | 50,792,461.51 | 171,209,909.06 |
Cash received as return on an | 69,826,932.31 | 237,841,455.03 |
investment | ||
Net cash recovered from the disposal of fixed assets, intangible assets and other long-term assets | 3,706,391.67 | 9,857,495.16 |
Net cash recovered from the disposal of subsidiaries and other business units | 0.00 | 0.00 |
Other cash received relating to investment activities | 0.00 | 0.00 |
Subtotal of cash inflow from investment activities | 124,325,785.49 | 418,908,859.25 |
Cash paid for the purchase and construction of fixed assets, intangible assets and other long-term assets | 132,018,239.35 | 101,947,971.74 |
Cash paid for investment | 465,477,642.93 | 503,777,500.00 |
Net cash paid for acquiring subsidiaries and other business units | 0.00 | 0.00 |
Other cash paid in connection with investment activities | 0.00 | 20,016,000.00 |
Subtotal of cash outflow from investment activities | 597,495,882.28 | 625,741,471.74 |
Net cash flow from investment activities | -473,170,096.79 | -206,832,612.49 |
III. Cash flow from financing activities: | ||
Cash received from absorbing investment | 1,320,607,429.35 | 44,442,375.30 |
Cash received from loans | 371,000,000.00 | 102,151,500.00 |
Other cash received in connection with financing activities | 12,264,121.98 | 18,199,609.19 |
Subtotal of cash inflow from financing activities | 1,703,871,551.33 | 164,793,484.49 |
Cash paid to repay debts | 623,151,500.00 | 166,767,315.35 |
Cash paid to distribute dividends, profits or pay interest | 68,705,946.59 | 67,753,957.44 |
Other cash paid in connection with financing activities | 27,128,147.14 | 28,680,695.64 |
Subtotal of cash outflow from financing activities | 718,985,593.73 | 263,201,968.43 |
Net cash flow from financing activities | 984,885,957.60 | -98,408,483.94 |
IV. Impact of exchange rate fluctuations on cash and cash equivalents | -14,047,341.55 | -14,118,735.18 |
V. Net increase in cash and cash equivalents | 388,766,495.58 | 329,253,815.09 |
Plus: balance of cash and cash equivalents at the beginning of the period | 696,490,741.04 | 367,236,925.95 |
VI. Balance of cash and cash equivalents at the end of the period | 1,085,257,236.62 | 696,490,741.04 |
7. Consolidated statement of changes in owner's equity
Current amount
Unit: Yuan
Items | 2021 | ||||||||||||||
Owner's equity attributable to the parent company | Minority equity | Total owners' equity | |||||||||||||
Share capital | Other equity instruments | Capital reserves | Minus: treasury shares | Other comprehensive income | Special reserve | Surplus reserves | General risk provision | Undistributed profit | Other | Subtotal | |||||
Preferred shares | Perpetual bonds | Other | |||||||||||||
I. Ending balance of last year | 1,135,216,809.00 | 956,734,039.75 | 80,017,965.68 | -24,555,229.97 | 0.00 | 151,359,957.53 | 0.00 | 1,324,944,369.91 | 0.00 | 3,463,681,980.54 | 84,992,151.43 | 3,548,674,131.97 | |||
Plus: Changes in accounting policies | |||||||||||||||
Early error correction | 12,636,853.09 | -19,061,969.80 | -6,425,116.71 | -27,625,228.70 | -34,050,345.41 | ||||||||||
Merger of enterprises under the same control | |||||||||||||||
Other | |||||||||||||||
II. Balance at the beginning of the current year | 1,135,216,809.00 | 969,370,892.84 | 80,017,965.68 | -24,555,229.97 | 0.00 | 151,359,957.53 | 0.00 | 1,305,882,400.11 | 3,457,256,863.83 | 57,366,922.73 | 3,514,623,786.56 | ||||
III. Amount of increase or decrease in the current period | 121,761,263.00 | 1,170,682,256.90 | 162,507,467.92 | -67,276,266.91 | 0.00 | 35,037,674.23 | 0.00 | 473,361,083.50 | 1,571,058,542.80 | 31,193,006.94 | 1,602,251,549.74 |
(decrease marked with "-") | |||||||||||||||
(I) Total comprehensive income | -67,276,266.91 | 564,964,282.18 | 497,688,015.27 | 7,148,332.43 | 504,836,347.70 | ||||||||||
(II) Capital invested and reduced by owners | 121,761,263.00 | 1,182,369,916.81 | 162,507,467.92 | 1,141,623,711.89 | 1,141,623,711.89 | ||||||||||
1.Ordinary shares invested by owners | 121,761,263.00 | 1,130,665,320.69 | 1,252,426,583.69 | 1,252,426,583.69 | |||||||||||
2.Capital contributed by holders of other equity instruments | 0.00 | ||||||||||||||
3.Amount of share-based payment included in owner's equity | 51,704,596.12 | 242,525,433.60 | -190,820,837.48 | -190,820,837.48 | |||||||||||
4.Other | -80,017,965.68 | 80,017,965.68 | 80,017,965.68 | ||||||||||||
(III) Profit distribution | 35,037,674.23 | -91,603,198.68 | -56,565,524.45 | -5,197,835.08 | -61,763,359.53 | ||||||||||
1.Withdrawal of surplus reserve | 35,037,674.23 | -35,037,674.23 | |||||||||||||
2.Withdrawal of general risk provision | |||||||||||||||
3.Distribution to | -56,565,524.45 | -56,565,524.45 | -5,197,835.08 | -61,763,359.53 |
owners (or shareholders) | |||||||||||||||
4.Other | |||||||||||||||
(IV) Internal carryover of owner's equity | |||||||||||||||
1.Conversion of surplus reserves to additional capital (or share capital) | |||||||||||||||
2.Conversion of surplus reserves to additional capital (or share capital) | |||||||||||||||
3.Losses covered with surplus reserve | |||||||||||||||
4.Change of defined benefit plans carried forward to retained earnings | |||||||||||||||
5.Other comprehensive income carried forward to retained earnings | |||||||||||||||
6.Other |
(V) Special reserve | |||||||||||||||
1.Withdrawal in the current period | |||||||||||||||
2.Use in the current period | |||||||||||||||
(VI) Others | -11,687,659.91 | -11,687,659.91 | 29,242,509.59 | 17,554,849.68 | |||||||||||
IV. Ending balance of the current period | 1,256,978,072.00 | 2,140,053,149.74 | 242,525,433.60 | -91,831,496.88 | 186,397,631.76 | 1,779,243,483.61 | 5,028,315,406.63 | 88,559,929.67 | 5,116,875,336.30 |
Amount of the previous period
Unit: Yuan
Items | 2020 | ||||||||||||||
Owner's equity attributable to the parent company | Minority equity | Total owners' equity | |||||||||||||
Share capital | Other equity instruments | Capital reserves | Minus: treasury shares | Other comprehensive income | Special reserve | Surplus reserves | General risk provision | Undistributed profit | Other | Subtotal | |||||
Preferred shares | Perpetual bonds | Other | |||||||||||||
I. Ending balance of last year | 1,018,775,769.00 | 104,535,879.24 | 456,556,282.32 | 60,009,612.52 | -3,059,762.06 | 127,284,211.74 | 866,301,932.11 | 2,510,384,699.83 | 124,782,540.90 | 2,635,167,240.73 | |||||
Plus: Changes in accounting policies | |||||||||||||||
Early error correction | 12,636,853.09 | -17,706,279.40 | -5,069,426.31 | -24,362,516.10 | -29,431,942.41 | ||||||||||
Merger of |
enterprises under the same control | |||||||||||||||
Other | |||||||||||||||
II. Balance at the beginning of the current year | 1,018,775,769.00 | 104,535,879.24 | 469,193,135.41 | 60,009,612.52 | -3,059,762.06 | 127,284,211.74 | 848,595,652.71 | 2,505,315,273.52 | 100,420,024.80 | 2,605,735,298.32 | |||||
III. Amount of increase or decrease in the current period (decrease marked with "-") | 116,441,040.00 | -104,535,879.24 | 500,177,757.43 | 20,008,353.16 | -21,495,467.91 | 24,075,745.79 | 457,286,747.40 | 951,941,590.31 | -43,053,102.07 | 908,888,488.24 | |||||
(I) Total comprehensive income | -21,495,467.91 | 532,161,123.64 | 510,665,655.73 | 14,415,557.45 | 525,081,213.18 | ||||||||||
(II) Capital invested and reduced by owners | 116,441,040.00 | -104,426,340.00 | 540,143,546.42 | 20,008,353.16 | 532,149,893.26 | 532,149,893.26 | |||||||||
1.Ordinary shares invested by owners | 12,014,700.00 | 32,428,355.38 | 44,443,055.38 | 44,443,055.38 | |||||||||||
2.Capital contributed by | 104,426,340.00 | -104,426,340.00 | 498,506,425.85 | 498,506,425.85 | 498,506,425.85 |
holders of other equity instruments | |||||||||||||||
3.Amount of share-based payment included in owner's equity | 9,208,765.19 | 9,208,765.19 | 9,208,765.19 | ||||||||||||
4.Other | 20,008,353.16 | -20,008,353.16 | -20,008,353.16 | ||||||||||||
(III) Profit distribution | 24,075,745.79 | -74,874,376.24 | -50,798,630.45 | -4,061,400.15 | -54,860,030.60 | ||||||||||
1.Withdrawal of surplus reserve | 24,075,745.79 | -24,075,745.79 | |||||||||||||
2.Withdrawal of general risk provision | |||||||||||||||
3.Distribution to owners (or shareholders) | -50,798,630.45 | -50,798,630.45 | -4,061,400.15 | -54,860,030.60 | |||||||||||
4.Other | |||||||||||||||
(IV) Internal carryover of owner's equity | |||||||||||||||
1.Conversion of surplus reserves to additional |
capital (or share capital) | |||||||||||||||
2.Conversion of surplus reserves to additional capital (or share capital) | |||||||||||||||
3.Losses covered with surplus reserve | |||||||||||||||
4.Change of defined benefit plans carried forward to retained earnings | |||||||||||||||
5.Other comprehensive income carried forward to retained earnings | |||||||||||||||
6.Other | |||||||||||||||
(V) Special reserve | |||||||||||||||
1.Withdrawal in the current |
period | |||||||||||||||
2.Use in the current period | |||||||||||||||
(VI) Others | -109,539.24 | -39,965,788.99 | -40,075,328.23 | -53,407,259.37 | -93,482,587.60 | ||||||||||
IV. Ending balance of the current period | 1,135,216,809.00 | 969,370,892.84 | 80,017,965.68 | -24,555,229.97 | 151,359,957.53 | 1,305,882,400.11 | 3,457,256,863.83 | 57,366,922.73 | 3,514,623,786.56 |
8. Parent company's statement of changes in owner's equity
Current amount
Unit: Yuan
Items | 2021 | |||||||||||
Share capital | Other equity instruments | Capital reserves | Minus: treasury shares | Other comprehensive income | Special reserve | Surplus reserves | Undistributed profit | Other | Total owners' equity | |||
Preferred shares | Perpetual bonds | Other | ||||||||||
I. Ending balance of last year | 1,135,216,809.00 | 1,007,315,299.41 | 80,017,965.68 | 5,569,575.04 | 151,331,439.07 | 805,337,794.69 | 3,024,752,951.53 | |||||
Plus: Changes in accounting policies | ||||||||||||
Early error correction | ||||||||||||
Other | ||||||||||||
II. Balance at the beginning of the current year | 1,135,216,809.00 | 1,007,315,299.41 | 80,017,965.68 | 5,569,575.04 | 151,331,439.07 | 805,337,794.69 | 3,024,752,951.53 | |||||
III. Amount of | 121,761,263.00 | 1,182,369,916.81 | 162,507,467.92 | -5,199,465.63 | 35,037,674.23 | 258,773,543.58 | 1,430,235,464.07 |
increase or decrease in the current period (decrease marked with "-") | ||||||||||||
(I) Total comprehensive income | -5,199,465.63 | 350,376,742.26 | 345,177,276.63 | |||||||||
(II) Capital invested and reduced by owners | 121,761,263.00 | 1,182,369,916.81 | 162,507,467.92 | 1,141,623,711.89 | ||||||||
1.Ordinary shares invested by owners | 121,761,263.00 | 1,130,665,320.69 | 1,252,426,583.69 | |||||||||
2.Capital contributed by holders of other equity instruments | ||||||||||||
3.Amount of share-based payment included in owner's equity | 51,704,596.12 | 242,525,433.6 | -190,820,837.48 | |||||||||
4.Other | -80,017,965.68 | 80,017,965.68 | ||||||||||
(III) Profit distribution | 35,037,674.23 | -91,603,198.68 | -56,565,524.45 | |||||||||
1.Withdrawal of surplus reserve | 35,037,674.23 | -35,037,674.23 | ||||||||||
2.Distribution to owners (or shareholders) | -56,565,524.45 | -56,565,524.45 | ||||||||||
3.Other |
(IV) Internal carryover of owner's equity | ||||||||||||
1.Conversion of surplus reserves to additional capital (or share capital) | ||||||||||||
2.Conversion of surplus reserves to additional capital (or share capital) | ||||||||||||
3.Losses covered with surplus reserve | ||||||||||||
4.Change of defined benefit plans carried forward to retained earnings | ||||||||||||
5.Other comprehensive income carried forward to retained earnings | ||||||||||||
6.Other | ||||||||||||
(V) Special reserve | ||||||||||||
1.Withdrawal in the current period | ||||||||||||
2.Use in the current |
period | ||||||||||||
(VI) Others | ||||||||||||
IV. Ending balance of the current period | 1,256,978,072.00 | 2,189,685,216.22 | 242,525,433.60 | 370,109.41 | 186,369,113.30 | 1,064,111,338.27 | 4,454,988,415.60 |
Amount of the previous period
Unit: Yuan
Items | 2020 | |||||||||||
Share capital | Other equity instruments | Capital reserves | Minus: treasury shares | Other comprehensive income | Special reserve | Surplus reserves | Undistributed profit | Other | Total owners' equity | |||
Preferred shares | Perpetual bonds | Other | ||||||||||
I. Ending balance of last year | 1,018,775,769.00 | 104,535,879.24 | 457,944,801.38 | 60,009,612.52 | 127,255,693.28 | 639,454,712.99 | 2,287,957,243.37 | |||||
Plus: Changes in accounting policies | ||||||||||||
Early error correction | ||||||||||||
Other | ||||||||||||
II. Balance at the beginning of the current year | 1,018,775,769.00 | 104,535,879.24 | 457,944,801.38 | 60,009,612.52 | 127,255,693.28 | 639,454,712.99 | 2,287,957,243.37 | |||||
III. Amount of increase or decrease in the current period (decrease marked | 116,441,040.00 | -104,535,879.24 | 549,370,498.03 | 20,008,353.16 | 5,569,575.04 | 24,075,745.79 | 165,883,081.70 | 736,795,708.16 |
with "-") | ||||||||||||
(I) Total comprehensive income | 5,569,575.04 | 240,757,457.94 | 246,327,032.98 | |||||||||
(II) Capital invested and reduced by owners | 116,441,040.00 | -104,426,340.00 | 540,143,546.42 | 20,008,353.16 | 532,149,893.26 | |||||||
1.Ordinary shares invested by owners | 12,014,700.00 | 32,428,355.38 | 44,443,055.38 | |||||||||
2.Capital contributed by holders of other equity instruments | 104,426,340.00 | -104,426,340.00 | 498,506,425.85 | 498,506,425.85 | ||||||||
3.Amount of share-based payment included in owner's equity | 9,208,765.19 | 9,208,765.19 | ||||||||||
4.Other | 20,008,353.16 | -20,008,353.16 | ||||||||||
(III) Profit distribution | 24,075,745.79 | -74,874,376.24 | -50,798,630.45 | |||||||||
1.Withdrawal of surplus reserve | 24,075,745.79 | -24,075,745.79 | ||||||||||
2.Distribution to owners (or shareholders) | -50,798,630.45 | -50,798,630.45 | ||||||||||
3.Other |
(IV) Internal carryover of owner's equity | ||||||||||||
1.Conversion of surplus reserves to additional capital (or share capital) | ||||||||||||
2.Conversion of surplus reserves to additional capital (or share capital) | ||||||||||||
3.Losses covered with surplus reserve | ||||||||||||
4.Change of defined benefit plans carried forward to retained earnings | ||||||||||||
5.Other comprehensive income carried forward to retained earnings | ||||||||||||
6.Other | ||||||||||||
(V) Special reserve | ||||||||||||
1.Withdrawal in |
the current period | ||||||||||||
2.Use in the current period | ||||||||||||
(VI) Others | -109,539.24 | 9,226,951.61 | 9,117,412.37 | |||||||||
IV. Ending balance of the current period | 1,135,216,809.00 | 1,007,315,299.41 | 80,017,965.68 | 5,569,575.04 | 151,331,439.07 | 805,337,794.69 | 3,024,752,951.53 |
III. Basic information of the Company(I) Basic information of the CompanyRegistered Chinese name of the Company: 深圳拓邦股份有限公司Address: Room 413, Area B, Tsinghua University Research Institute, High-tech Industrial Park, Yuehai Street,Nanshan District, ShenzhenLegal representative: Wu YongqiangRegistered capital: CNY 1,256,978,072.00 yuanCapital stock: CNY 1,256,978,072.00 yuanCompany type: company limited by shares (listing)Business scope: intelligent control of electrical products, intelligent power supply and control, highefficiency lighting products and its control, high efficiency precision motor and control research and development,production and sales.Business term: sustainable operation(II) Historical development of the CompanyShenzhen Topband Co., Ltd. (hereinafter referred to as “the Company” or “Company”) formerly known asShenzhen Topband Electronic Equipment Co., Ltd., is a limited liability company approved by ShenzhenAdministration for Industry and Commerce on February 9, 1996. It has obtained the business license of enterpriselegal person with the registration number of 19241377-3 and the registered capital of 2 million yuan.On May 19, 1997, the registered capital of Shenzhen Topband Electronic Equipment Co., Ltd. was increasedto 3.2 million yuan after the resolution of the Shareholders’ Meeting of Shenzhen Topband Electronic EquipmentCo., Ltd. and approved by Shenzhen Administration for Industry and commerce.On January 10, 2001, with the resolution of the Shareholders’ Meeting of Shenzhen Topband ElectronicEquipment Co., Ltd. and the approval of Shenzhen Administration for Industry and Commerce (Shenzhen) namechange NZ [2001] No. 0154224 Enterprise Name Change Approval Notice, it was agreed to change the name ofShenzhen Topband Electronic Equipment Co., Ltd. to Shenzhen Topband Electronic Technology Co., Ltd.
On July 15, 2002, with the approval of SFG (2002) No. 24 issued by Shenzhen Municipal People’sGovernment, it was agreed that Shenzhen Topband Electronic Technology Co., Ltd. would be reorganized into ajoint stock limited company jointly by five shareholders, namely Wu Yongqiang, Ji Shuhai, Zhuhai Tsinghua
Science and Technology Park Venture Capital Co., Ltd., Qi Hongwei and Li Xianqian. After the reorganization,the total share capital of the Company is 21 million yuan. Shenzhen Pengcheng Accounting Firm issued theCapital Verification Report (SPSYZ (2002) No. 67) to verify the share capital of the Company. On August 16,2002, the Company was approved by Shenzhen Administration for Industry and Commerce to register the changeof industry and commerce, in exchange for the business license of enterprise legal person with Registration No.4403012049338. The business period is from February 9, 1996 to February 9, 2046.
On November 23, 2004, the registered capital of the Company was increased to 22.8 million yuan upon theresolution of the Shareholders’ Meeting and the document of Shenzhen Municipal People’s Government “SFG[2004] No. 38” and approved by Shenzhen Administration for Industry and Commerce.On March 15, 2006, the registered capital of the Company was increased to 31.92 million yuan upon theresolution of the Shareholders’ Meeting of the Company, and change in the industrial and commercial registrationwas handled on July 24, 2006.
On June 26, 2007, the Company issued 18.08 million yuan ordinary shares (face value of each share is 1yuan) to the public with an increase of registered capital of 18.08 million yuan, and the registered capital after thechange is 50 million yuan by the approval of “ZJH No. 2007135” Notice on Approving the Initial Public Offeringof Shenzhen Topband Electronic Technology Co., Ltd. by China Securities Regulatory Commission. Theinvestment business has been verified by Shenzhen Pengcheng Accounting Firm Co., Ltd. and the capitalverification report SPSYZ [2007] No. 059 has been issued.
On August 29, 2008, according to the resolution of the Annual General Meeting of Shareholders in 2008, theCompany increased the registered capital by 50 million yuan with capital reserve, and the registered capital afterthe change was 100 million yuan. The capital increase has been verified by Shenzhen Pengcheng Accounting FirmCo., Ltd., and the capital verification report SPSYZ [2008] No. 179 has been issued.
The 3rd Board of Directors of the Company deliberated and approved the Plan on the Distribution ofMid-term Profits in 2009 at the 6th meeting in 2009: Based on the total share capital of the Company at the end ofthe reporting period of 100 million shares, 4 shares were added in share capitals per 10 shares for all shareholdersregarding the capital reserves, and the total share capital increased by 40 million shares. After the increase byconversion, the total share capital of the Company increased from 100 million shares to 140 million shares.
On April 7, 2010, the Company held a meeting of the Board of Directors to deliberate and approve the profitdistribution plan for 2009: Based on the total share capital of 140 million shares as of December 31, 2009, the
Company will pay cash dividends of 1.50 yuan (tax included) per 10 shares, and based on the total share capital of140 million shares as of December 31, 2009, 2 shares will be added per 10 shares. After the increase byconversion, the total share capital of the Company increased from 140 million shares to 168 million shares.
The Company held the 2nd meeting of the 4th Board of Directors in 2012 on March 26, 2012, deliberatedand approved the profit distribution plan for 2011: Based on the total share capital 168 million shares of theCompany on December 31, 2011, 2 shares were additionally given to all shareholders for every 10 shares, andcash dividend of 2 yuan (tax included) was distributed. 1 share was added per 10 shares for all shareholdersregarding the capital reserves. The equity distribution was completed on May 4, 2012. After the increase byconversion, the total share capital of the Company increased from 168 million shares to 218.4 million shares.According to the resolutions of 1st Extraordinary General Meeting of Shareholders of the Company in 2014,after the approval of ZJXK [2014] No. 1425 of China Securities Regulatory Commission, the Company’snon-public offering did not exceed 36,935,679 new shares. On February 5, 2015, the Company privately issued23,521,768 ordinary shares (A shares) in RMB to specific investors at the price of 13.63 yuan per share. After theissuance, the registered capital of the Company was increased to 241,921,768.00 yuan.According to the Revised Draft of the Second Option Incentive Plan (Draft) of Shenzhen Topband Co., Ltd.reviewed and approved by the Company in 2012 Annual General Meeting of Shareholders and the Proposal on theSecond Exercise Period of the Second Phase Stock Option Incentive Plan Meeting with the Exercise Conditionsand Exercisable Rights, which was deliberated and approved by the 9th Meeting of the 5th Board of Directors ofthe Company, the total exercise was 3,101,700 stock options in 2015, exercise price was 5.72 yuan each. Afterexercise, the registered capital of the Company was increased to 245,023,468.00 yuan.According to the Restricted Stock Incentive Plan (Draft) of Shenzhen Topband Co., Ltd. in 2015 approved bythe 2nd Extraordinary General Meeting of Shareholders in 2015 and the Proposal on Adjusting the Number ofRestricted Stock Incentive Plans Granted and List of Incentive Objects approved at the 18th Meeting of the 5thBoard of Directors, the Company granted 359 incentive objects restricted shares 17.633 million shares. Theregistered capital of the Company was increased to 262,656,468.00 yuan after the issuance.
According to the resolution of the 3rd Extraordinary General Meeting of Shareholders of the Company in2015, and approved by the Reply to the Approval of Non-public Development of Shares of Shenzhen Topband Co.,Ltd. issued by China Securities Regulatory Commission (ZJXK [2016] No. 205), the Company non-publiclyissued 35,864,345 ordinary shares (A shares) in RMB to specific investors on March 28, 2016, with the issuance
price of 16.66 yuan per share. The registered capital of the Company was increased to 298,520,813.00 yuan afterthe issuance.According to the Revised Draft of the Second Phase Stock Option Incentive Plan (Draft) of ShenzhenTopband Co., Ltd. deliberated and approved by the 2012 Annual General Meeting of Shareholders of theCompany and the Proposal on the Third Exercise Period of the Second Phase Stock Option Incentive PlanMeeting Exercise Conditions and Exercisable Rights deliberated and approved by the 23rd Meeting of the 5thBoard of Directors of the Company, a total of 4,594,000 shares were exercised in 2016. After exercise, theregistered capital of the Company was increased to 303,114,813.00 yuan.
According to the Proposal on Repurchase and Cancellation of Some Restricted Stocks deliberated andapproved by the 24th meeting of the 5th Board of Directors of the Company held on April 26, 2016, as for theincentive object who resigned due to personal reasons and no longer met the conditions of becoming the incentiveobject, those 72,000 restricted stocks that have not been unlocked held by the incentive object were repurchasedand cancelled. After cancellation, the registered capital of the Company was reduced to 303,042,813.00 yuan.The Company held the 2015 Annual General Meeting of Shareholders on May 11, 2016 and approved the2015 annual equity distribution plan. Based on the Company’s current total share capital of 301,520,013 shares,the Company distributed 1.50 yuan to all shareholders for every 10 shares. At the same time, the Companyincreased 5 shares to all shareholders for every 10 shares with the capital accumulation fund, and the capitalincreased by 150,760,006 yuan. After the capital was increased, the Company’s registered capital was increased to453,802,819.00 yuan.
According to the Proposal on Repurchase and Cancellation of Some Restricted Stocks deliberated andapproved by the 28th Meeting of the 5th Board of Directors of the Company held on October 26, 2016, as for theincentive object who resigned due to personal reasons and no longer met the conditions of becoming the incentiveobject, those 331,500 shares of restricted stocks that have not been unlocked held by the incentive object wererepurchased and cancelled. After cancellation, the registered capital of the Company was reduced to453,471,319.00 yuan.
The 2016 Annual General Meeting of Shareholders of the Company was held on April 11, 2017, and the2016 annual equity distribution plan was approved. Based on the Company’s existing total share capital of453,471,319 shares, the Company distributed 1.50 yuan in cash to all shareholders for every 10 shares. At thesame time, the Company increased 5 shares to all shareholders for every 10 shares with the capital accumulation
fund, and the capital increased by 226,735,659 yuan. After the capital increased, the registered capital of theCompany was increased to 680,206,978.00 yuan.According to the Proposal on Repurchase and Cancellation of Some Restricted Stocks deliberated andapproved by the 32nd meeting of the 5th Board of Directors of the Company held on June 13, 2017, as for theincentive object who resigned due to personal reasons and no longer met the conditions of becoming the incentiveobject, the 346,500 restricted stocks that have not been unlocked held by the incentive object were repurchasedand cancelled. After cancellation, the registered capital of the Company was reduced to 679,860,478.00 yuan.The Company held the 2017 Annual General Meeting of Shareholders on April 17, 2018 to review andapprove the 2017 equity distribution plan. Based on the existing total capital of 679,860,478 shares, the Companysent 1.0 yuan in cash to all shareholders every 10 shares, and transferred 5 shares to all shareholders with thecapital accumulation fund, and the capital increased by 339,930,239.00 yuan. After the capital conversion, theregistered capital of the Company was increased to 1,019,790,717.00 yuan.According to the Proposal on Repurchase and Cancellation of Some Restricted Stocks deliberated andapproved by the 6th Meeting of the 6th Board of Directors of the Company held on July 27, 2018, as for theincentive object who resigned due to personal reasons and no longer met the conditions of becoming the incentiveobject, the 744,186 restricted stocks that have not been unlocked held by the incentive object were repurchasedand cancelled. After cancellation, the registered capital of the Company was reduced to 1,019,046,531.00 yuan.
According to the Proposal on Repurchase and Cancellation of Some Restricted Stocks deliberated andapproved by the 6th Meeting of the 6th Board of Directors of the Company held on July 27, 2018, as for theincentive object who resigned due to personal reasons and no longer met the conditions of becoming the incentiveobject, the 744,186 restricted stocks that have not been unlocked held by the incentive object were repurchasedand cancelled. After cancellation, the registered capital of the Company was reduced to 1,019,046,531.00 yuan.According to the Proposal on Repurchase and Cancellation of Some Restricted Stocks deliberated andapproved by the 15th Meeting of the 6th Board of Directors of the Company held on July 26, 2019, as for theincentive object who resigned due to personal reasons and no longer met the conditions of becoming the incentiveobject, the 310,800 restricted stocks that have not been unlocked held by the incentive object were repurchasedand cancelled. After cancellation, the registered capital of the Company was reduced to 1,018,735,692 yuan. Withthe approval of “SZS [2019] No. 164 Document” issued by Shenzhen Stock Exchange, the Company’s 573million yuan convertible corporate bonds will be listed and traded in Shenzhen Stock Exchange from April 8,
2019. Since September 16, 2019, bondholders can exercise the right to transfer shares. As of December 31, 2019,the Company has transferred 2,223.00 shares of bonds and increased the share capital by 40,077.00 yuan. Afterthe share transfer, the registered capital of the Company will increase to 1,018,775,769.00 yuan.The 22nd Meeting of the 6th Board of Directors deliberated and approved the Proposal on the First ExercisePeriod of 2018 Stock Option Incentive Plan Meeting the Exercise Conditions and Exercisable Rights and Proposalon Adjustment of the Incentive Objects and the Number of Stock Options of 2018 Stock Option Incentive Plan:
there are 606 incentive objects in the first exercise period of the 2018 stock option incentive plan in the Company,in total of 12,014,700 shares of stock options, that meet the exercise conditions and can be exercised. TheCompany plans to adopt the independent exercise mode. As of December 31, 2020, 606 incentive objects in thefirst exercise period had completed the exercise of 12,014,700 stock options, increased the Company’s sharecapital by 12,014,700 yuan, and the share capital increased to 1,030,790,469.00 yuan after the exercise of thestock options.
According to the “SZS [2019] No. 164 Document” by the Shenzhen Stock Exchange, the Company’sconvertible corporate bonds of 573 million yuan are listed and traded on Shenzhen Stock Exchange from April 8,2019. Since September 16, 2019, the bondholders can exercise the equity transfer. In 2020, a total of 5,712,224.00bonds were converted into shares, increasing the share capital by 104,426,340.00 yuan. After the conversion, theregistered capital of the Company was increased to 1,135,216,809.00 yuan.On August 18, 2020, the China Securities Regulatory Commission issued the Reply on Approving theNon-Public Offering of Shares by Shenzhen Topbang Co., Ltd. (ZJXK [2020] No. 1865), and approved theCompany's non-public offering of no more than 309,243,655 new shares. In June 2021, the non-public issuance of92,105,263 new shares was listed on the Stock Exchange, with the registered capital increased by 92,105,263 yuan,and the company's registered capital increased to 1,238,254,672.00 yuan after the change.
The company granted 33,544,320 restricted shares to 1,224 eligible incentive objects on November 2, 2021,the grant date, at a grant price of 7.23 yuan per share. The restricted stocks are set with a restricted period. In thethree fiscal years from 2022 to 2024, the performance assessment will be carried out on an annual basis and therestricted shares will be lifted at a ratio of 30%, 30% and 40%, respectively. The 14,838,920 shares granted comefrom the repurchase shares, and 18,705,400 shares come from private placement. By granting the restricted shares,the registered capital of the company increases by 18,705,400 shares, and the registered capital increases to1,256,978,072.00 yuan after the change.
(III) The financial report is approved and submitted by the Board of Directors of the Company on March 18,2022.(IV) Scope of the Consolidated Financial StatementsThere are a total of 35 subsidiary companies included in the scope of the consolidated statement this time, asshown in Note VIII (1); during the reporting period, nine companies were newly included in the scope ofconsolidation, of which seven were newly-established subsidiaries or grandson companies, and two companieswere merged not under the same control, as described in Note VII (3).IV. Preparation basis of the financial report
1. Preparation basis
The financial statements are based on the assumption of continuation of the Company, according to the actualtransactions, in accordance with the relevant provisions of the accounting standards for business enterprises, andbased on the following important accounting policies and accounting estimates.
2. Continuation
The Company has no major doubt on the ability of continuation and other influencing factors for 12 monthssince the end of the reporting period.V. Significant accounting policies and accounting estimates
Specific accounting policies and accounting estimates reminders:
None
1. Statement on compliance with accounting standards for business enterprises
The financial statements prepared on the basis of above compiling foundation give a true and full view of thefinancial position, operating results, cash flow and other relevant information of the Company, conforming to therequirements of the latest accounting standards for business enterprises and its application guidelines,interpretations as well as other relevant provisions (collectively referred to as “accounting standards for businessenterprises”) issued by the Ministry of Finance.
Additionally, the presentation and disclosure requirements of the No. 15 Rules for the Preparation and
Presentation of Information Disclosure of Companies Offering Securities to the Public - General Provisions onFinancial Reporting (revised in 2014) (hereinafter referred to as “No. 15 Document (revised in 2014)”) and theNotice on Matters Related to the Implementation of the New Accounting Standards for Business Enterprises byListed Companies (No. 453 letter from Accounting Department [2018]) were taken as reference in these financialstatements.
2. Accounting period
The accounting period of the Company is divided into an annual period and an interim period, and an interimperiod refers to the reporting period shorter than a complete accounting year. The financial year of the Companyadopts the Gregorian calendar year, that is, from January 1 to December 31 every year.
3. Operating cycle
The operating cycle of the Company is from January 1 to December 31 of the Gregorian calendar.
4. Recording currency
RMB is the currency of the main economic environment in which the Company and its domestic subsidiariesoperate, so the Company and its domestic subsidiaries use RMB as the recording currency. The recordingcurrency for the foreign subsidiaries of the Company shall be determined in accordance with the currency of themain economic environment in which they operate. These financial statements of the Company are stated inRMB.
5. Accounting treatment for business combination under and not under common control
The Company, at the date of acquisition, recognizes the difference of the combination cost greater than thefair value share of the Acquiree’s net identifiable assets obtained in the combination as goodwill; if thecombination cost is less than the fair value share of the Acquiree’s net identifiable assets obtained in thecombination, the Company first re-checks the fair value of the Acquiree’s identifiable assets, liabilities andcontingent liabilities as well as the measurement of combination cost. The difference shall be included in thecurrent profits and losses, if the combination cost is still less than the fair value share of the Acquiree’s netidentifiable assets obtained in the combination.
The business combination under different control realized step by step through multiple transactions shall be
treated as follows:
1. Adjusting the initial investment cost of long-term equity investment. If the equity held before theacquisition date is calculated with the equity method, it shall be re-measured as per the fair value of the equity atthe date of acquisition, and the difference between the fair value and its book value shall be included in the currentinvestment income; if the equity of the Acquiree held before the acquisition date involves changes in othercomprehensive income and other equity accounted under the equity method, it shall be transferred to the currentincome on the acquisition date, excluding other comprehensive income arising from changes in net liabilities ornet assets of the defined benefit plan re-measured by the investee.
2. Recognizing goodwill (or amount included in the current profits and losses).The initial investment cost oflong-term equity investment after the first step adjustment is compared with the fair value share of net identifiableassets of subsidiaries at the date of acquisition. If the former is greater than the latter, the difference is recognizedas goodwill, otherwise, it is included in the current profits and losses.
The situation of disposing equity step by step through multiple transactions to losing control oversubsidiaries:
1. Judging whether the transactions in the process of disposing equity step by step to losing control oversubsidiaries belong to the principle of “package transaction”
The terms, conditions and economic impact of transactions relating to disposal of equity investment insubsidiaries meet one or more of the following circumstances, which generally indicates that multiple transactionsshould be accounted for as a package transaction:
(1) These transactions were concluded simultaneously or with consideration of mutual influence;
(2) These transactions as a whole can achieve a complete business outcome;
(3) The occurrence of a transaction depends on the occurrence of at least one other transaction;
(4) A transaction is not economical by itself, but it is economical when considered in conjunction with othertransactions.
2. Accounting treatment for transactions in the process of disposing equity step by step to losing control oversubsidiaries belonging to “package transaction”
If the transactions relating to disposal of equity investment in subsidiaries to losing control over subsidiariesbelong to “package transaction”, these shall be treated as a transaction for disposing the subsidiary and losingcontrol; however, the difference between the price of every disposal and the net assets share held in the subsidiary
corresponding to the disposal of investment before losing control shall be recognized as other consolidatedincome in the consolidated financial statements, which shall be transferred to the current profits and losses at thetime of losing control.In the consolidated financial statements, the remaining equity shall be re-measured according to its fair valueon the date of losing control. The difference between the sum of consideration obtained from equity disposal andfair value of remaining equity less the net assets share held in original subsidiary and continuously calculatedfrom the date of acquisition as per the original shareholding proportion shall be included in the investment incomeof the current period of loss of control. Other comprehensive income related to the equity investment in originalsubsidiary shall be transferred to the current investment income at the time of losing control.
3. Accounting treatment for transactions in the process of disposing equity step by step to losing control oversubsidiaries not belonging to “package transaction”If no loss of control occurs in the disposal of the investment in the subsidiary, the difference between thedisposal price and the net assets share held in the subsidiary corresponding to the disposal of investment in theconsolidated financial statements shall be included in the capital reserve (capital premium or share premium). Ifthe capital premium is insufficient to offset, the retained earnings shall be adjusted.In case of losing control over the investment in a subsidiary, the remaining equity shall be re-measuredaccording to its fair value on the date of loss of control in the consolidated financial statements. The differencebetween the sum of consideration obtained from equity disposal and fair value of remaining equity less the netassets share held in original subsidiary and continuously calculated from the date of acquisition as per the originalshareholding proportion shall be included in the investment income of the current period of loss of control. Othercomprehensive income related to the equity investment in original subsidiary shall be transferred to the currentinvestment income at the time of losing control.
6. Compiling method of consolidated financial statements
The consolidated financial statements, based on the financial statements of the parent company and itssubsidiaries, are prepared by the Company in accordance with the Accounting Standards for Business EnterprisesNo.33-Consolidated Financial Statements and with reference to other relevant information.
During the combination, the internal equity investment and the owner’s equity of the subsidiaries, the internalinvestment income and the profit distribution of the subsidiaries, the internal transactions, the internal claims and
debts are offset. The accounting policies adopted by the subsidiaries shall be consistent with those adopted by theparent company.
7. Classification of joint venture arrangements and accounting treatment for joint operation
1. Identification and classification of joint venture arrangements
Joint venture arrangement refers to an arrangement under joint control by two or more parties. The jointventure arrangement has the following features: 1) all parties are bound by the arrangement; 2) two or moreparties jointly control the arrangement. No single party can control the arrangement solely, and any party withjoint control over the arrangement can prevent other parties or a combination of party alliance from controlling thearrangement alone.
Joint control refers to the common control of an arrangement in accordance with relevant agreements, andthe activities related to the arrangement must be agreed upon by the parties holding control right before thedecision can be made.
Joint venture arrangement includes joint operation and joint venture. Joint operation is the joint venturearrangement in which the joint venture party holds the relevant assets of the arrangement and assumes the relevantliabilities. Joint venture refers to a joint venture arrangement in which the joint venture party has rights only to thenet assets of the arrangement.
2. Accounting treatment for joint venture arrangement
Parties in joint operation shall recognize the following items related to their share of interests in jointoperation, and perform accounting treatment in accordance with applicable accounting standards for businessenterprises: 1) recognize the assets held separately and those held jointly as per their share; 2) recognize theliabilities assumed separately and those assumed jointly as per their share; 3) recognize the income generated fromthe sale of its share of joint operation output; 4) recognize the income from the sale of the output of the jointoperation as per its share; (5) recognize the expenses incurred separately and those incurred in the joint operationas per its share.
The parties of a joint venture shall make accounting treatment for the investment in the joint venture inaccordance with the Accounting Standards for Business Enterprises No.2 - Long-Term Equity Investment.
8. Standards for determining cash and cash equivalents
Cash in the cash flow statement refers to cash on hand and deposits that are available for payment at any time.Cash equivalents refer to investments with short term (generally due within three months from the date ofpurchase), strong liquidity, easy to convert into known amount of cash and low risk of value change.
9. Foreign currency transaction and foreign currency statement translation
1. Foreign currency transaction conversion
When foreign currency transactions are initially recognized, they are converted into RMB at the spotexchange rate on the transaction date. On the balance sheet date, foreign currency monetary items are translated atthe spot exchange rate on the balance sheet date. The exchange difference arising from different exchange ratesshall be included in the current profits and losses, except for the exchange difference of the principal and interestof foreign currency special borrowings related to the acquisition and construction of assets that meet thecapitalization conditions; foreign currency non-monetary items measured at historical cost shall be translated atthe spot exchange rate on the transaction date, with the amount in RMB maintaining unchanged; foreign currencynon-monetary items measured at fair value shall be translated at the spot exchange rate on the date of determiningfair value, with the difference included in the current profits and losses or other comprehensive income.
2. Translation of foreign currency financial statements
The assets and liabilities in balance sheet shall be translated at the spot exchange rate on the balance sheetdate; except for the “undistributed profit”, other items in the owner’s equity shall be converted at the spotexchange rate on the transaction date; the income and expense in the income statement shall be converted at thespot exchange rate on the transaction date. The difference in translation of foreign currency financial statementsgenerated from the above conversion is recognized as other comprehensive income.
10. Financial instruments
1. Recognition and de-recognition of financial instruments
The Company recognizes a financial asset or financial liability when it becomes a party to a financialinstrument contract.
The trading of financial assets in a conventional manner shall be recognized and derecognized according tothe accounting of the trading day. Conventional trading of financial assets refers to the collection or delivery of
financial assets within the time limit specified by laws and regulations or common practice in accordance with theterms of the contract. Trading day refers to the date when the Company promises to buy or sell financial assets.If the following conditions are met, the financial assets (or a part of financial assets, or a part of a set ofsimilar financial assets) shall be derecognized, i.e., they shall be written off from its accounts and balance sheets:
(1) The right to receive cash flow of financial assets has expired;
(2) The right to receive cash flow of financial assets has been transferred, or the Company has assumed theobligation to timely pay the full amount of the cash flow received to a third party under the “transfer agreement”;and (a) has transferred substantially all the risks and rewards from the ownership of financial assets, or (b)abandoned the control of the financial asset, though almost all risks and rewards from the ownership of thefinancial asset are neither transferred nor retained.
2. Classification and measurement of financial assets
At the time of initial recognition, the financial assets of the Company are classified according to theCompany’s business model for the management of financial assets and the contractual cash flow characteristics offinancial assets as follows: financial assets measured at amortized cost, financial assets measured at fair valuethrough other comprehensive income, and financial assets measured at fair value through current profits andlosses. The subsequent measurement of financial assets depends on its classification.
The classification of financial assets is based on the Company’s business model for the management offinancial assets and the cash flow characteristics of financial assets.
(1) Financial assets measured at amortized cost
Financial assets satisfying the following conditions at the same time are classified as financial assetsmeasured at amortized cost: The business model for managing such financial assets by the Company is to collectcontractual cash flows as the goal; the contract terms of the financial assets stipulate that the cash flow generatedon a specific date is only the payment of the principal and the interest based on the outstanding principal amount.For such financial assets, the effective interest rate method is adopted, and subsequent measurement is made atamortized cost, and the gains or losses arising from amortization or impairment are included in the current profitsand losses.
(2) Debt instruments investment measured at fair value with changes included in other comprehensiveincome
Financial assets that meet the following conditions at the same time are classified as financial assets
measured at fair value through other comprehensive income: The business model for managing the financial assetsby the Company is to collect contractual cash flows and to sell financial assets; The contract terms of the financialasset stipulate that the cash flow generated on a specific date is only the payment of the principal and the interestbased on the outstanding principal amount. For such financial assets, fair value is adopted for subsequentmeasurement. The discount or premium is amortized using the effective interest rate method and recognized asinterest income or expense. Except the impairment loss and the exchange difference of foreign currency monetaryfinancial assets are recognized as the current profits and losses, the changes in the fair value of such financialassets are recognized as other comprehensive income until their accumulated gains or losses are transferred intothe current profits and losses when the financial asset is derecognized. Interest income related to such financialassets is included in the current profits and losses.
(3) Equity instrument investment measured at fair value with changes included in other comprehensiveincomeThe Company irrevocably chooses to designate part of the non-tradable equity instrument investment asfinancial assets measured at fair value through other comprehensive income. Only the relevant dividend income isincluded in the current profits and losses, and the changes in fair value are recognized as other comprehensiveincome, until their accumulated gains or losses are transferred into retained earnings when the financial asset isderecognized.
(4) Financial assets measured at fair value with changes included in the current profits and losses
The financial assets other than the above financial assets measured at amortized cost and those at fair valuethrough other comprehensive income are classified as financial assets measured at fair value with changesincluded in the current profits and losses. At the time of initial recognition, for the purpose of elimination orsignificant reduction of accounting mismatch, financial assets can be designated as those measured at fair valuewith changes included in the current profits and losses. For such financial assets, fair value is used for subsequentmeasurement, and all changes in fair value are included in the current profits and losses.
If and only when the Company changes the business model for managing financial assets, it will reclassify allthe affected financial assets.
For the financial assets measured at fair value and whose changes are included in the current profits andlosses, the relevant transaction costs are directly included in the current profits and losses, and such costs of othertypes of financial assets are included in the initial recognition amount.
3. Classification and measurement of financial liabilities
The financial liabilities of the Company are classified at the initial recognition as follows: financial liabilitiesmeasured at amortized cost and financial liabilities measured at fair value through current profits and losses.
Financial liabilities that meet one of the following conditions can be designated as financial liabilitiesmeasured at fair value through current profits and losses at the time of initial measurement: (1) such designationcan eliminate or significantly reduce accounting mismatch; (2) according to the company risk management orinvestment strategy stated in formal written documents, the management and performance evaluation for thefinancial liabilities portfolio or portfolio of financial assets and financial liabilities is conducted on the basis of fairvalue, which is reported to key management personnel within the Company on this basis; (3) the financialliabilities include embedded derivatives that need to be split separately.
The Company determines the classification of financial liabilities at the time of the initial recognition. Forthe financial liabilities measured at fair value with changes included in the current profits and losses, the relevanttransaction costs are directly included in the current profits and losses, and such costs of other financial liabilitiesare included in the initial recognition amount.
The subsequent measurement of financial liabilities depends on its classification
(1) Financial liabilities measured at amortized cost
For such financial liabilities, the effective interest rate method is adopted and the subsequent measurement isconducted as per the amortized cost.
(2) Financial liabilities measured at fair value with changes included in the current profits and losses
Financial liabilities measured at fair value through current profits and losses include trading financialliabilities (including derivatives belonging to financial liabilities) and financial liabilities designated at initialrecognition as measured at fair value with changes included in the current profits and losses.
4. Set off of financial instruments
If the following conditions are met at the same time, financial assets and financial liabilities are presented inthe balance sheet at the net amount after offsetting each other: the Company has the legal right to offset therecognized amount, which is currently enforceable; they plan to settle at the net amount, or realize the financialassets and pay off the financial liabilities at the same time.
5. Impairment of financial assets
The Company recognizes the loss provision based on the expected credit loss for the financial assets
measured at the amortized cost, the debt instrument investment and financial guarantee contract measured at thefair value and whose changes are included in other comprehensive income. The term “credit loss” refers to thedifference between all the contractual cash flows that the Company discounted at the original effective interestrate and received according to the contract and all the expected cash flows, i.e., the present value of all the cashshortage.The Company, taking into account all reasonable and well founded information (including forward-lookinginformation) estimates the expected credit losses of financial assets measured at amortized cost and financialassets (debt instruments) measured at fair value with changes included in other comprehensive income in a singleor combined way.
(1) Measurement of expected credit loss
If the credit risk of the financial instrument has increased significantly since the initial recognition, theCompany measures its loss provision according to the amount equivalent to the expected credit loss of thefinancial instrument in the whole duration; if the credit risk of the financial instrument has not increasedsignificantly since the initial recognition, the Company measures its loss provision according to the amountequivalent to the expected credit loss of the financial instrument in the next twelve months. The increased orreversed amount of the loss provisions arising therefrom shall be included in the current profits and losses asimpairment losses or gains. The specific assessment of credit risk by the Company is detailed in the Note “9.Risks Associated with Financial Instruments”.Generally, if it is overdue for more than 30 days, the Company considers that the credit risk of the financialinstrument has increased significantly, unless there is conclusive evidence to prove that the credit risk of thefinancial instrument has not increased significantly since the initial recognition.To be specific, the Company divides the credit impairment process of financial instruments that have notbeen impaired at the time of purchase or origination into three stages, with different accounting treatment for theimpairment of financial instruments at different stagesFirst stage: credit risk has not increased significantly since initial recognitionFor the financial instrument at this stage, the enterprise shall measure the loss provision according to theexpected credit loss in the next 12 months, and calculate the interest income as per its book balance (i.e. withoutdeducting the impairment provision) and the actual interest rate (if the instrument is a financial asset, the samebelow).
Second stage: the credit risk has increased significantly since the initial recognition, but the creditimpairment has not occurredFor the financial instrument at this stage, the enterprise shall measure the loss provision according to theexpected credit loss of the instrument thought the whole duration, and calculate the interest income as per its bookbalance and the actual interest rate.Third stage: credit impairment occurs after initial recognitionFor the financial instrument at this stage, the enterprise should measure the loss provision according to theexpected credit loss of the instrument thought the whole duration, but the calculation of interest income isdifferent from the financial assets at the first two stages. For the financial assets with credit impairment, theenterprise shall calculate the interest income according to its amortized cost (book balance minus accruedprovision for impairment, i.e. book value) and the actual interest rate.For the financial assets with credit impairment at the time of purchase or origination, the enterprise shall onlyrecognize the change of expected credit loss in the whole duration after initial recognition as loss provision, andcalculate the interest income as per its amortized cost and the effective interest rate adjusted by credit.
(2) For financial instruments with low credit risk on the balance sheet date, the Company directly assumesthat the credit risk of such instruments has not increased significantly since the initial recognition, while notcomparing them with the credit risk at the time of initial recognition.
A financial instrument may be considered to have a lower credit risk if the enterprise recognizes that thefinancial instruments feature low default risk, the borrower is able to fulfill its obligations to pay the contractualcash flow in the short term, and that even if there are adverse changes in economic situation and operatingenvironment over a longer period of time, it does not necessarily reduce the borrower’s ability to fulfill itsobligations to pay the contractual cash flow.
(3) Receivables and lease receivables
The Company measures the loss provisions as per the amount of expected credit losses throughout the wholeduration by the use of simplified model for expected credit loss for receivables specified in Accounting Standardsfor Business Enterprises No.14 - Income, excluding significant financing components (including cases in whichfinancing components in contracts not exceeding one year are not taken into account in accordance with thestandards).
The Company makes accounting policy choices to adopt a simplified model for expected credit loss, i.e.,
measuring the loss provisions as per the amount equivalent to the expected credit loss throughout the wholeduration for receivables including significant financing components and lease receivables regulated by AccountingStandards for Business Enterprises No.21 - Leasing.
6. Transfer of financial assets
If the Company has transferred almost all risks and rewards in the ownership of financial assets to thetransferee, it shall terminate the recognition of the financial assets, and if it retains almost all risks and rewards inthe ownership of the financial assets, it shall not terminate the recognition of the financial assets.If the Company neither transfers nor retains almost all the risks and rewards in the ownership of the financialasset, the following conditions shall be referred to: if it gives up the control over the financial asset, it shallterminate the recognition of the financial asset and recognize the assets and liabilities generated; if it does notabandon the control over the financial asset, the relevant financial assets shall be recognized according to theextent to which it continues to be involved in the transferred financial asset, and the relevant liabilities shall berecognized accordingly.
If the financial guarantee is provided to the transferred financial assets to continue to be involved, the assetsgenerated from the continued involvement shall be recognized according to the lower of the book value of thefinancial assets and the amount of financial guarantee. Financial guarantee amount refers to the maximum amountthat will be required to be repaid out of consideration received.
11. Notes receivable
The Company divides notes receivable into two portfolios of bank acceptance bills and commercialacceptance bills by type of financial instrument. With respect to bank acceptance bills, the Company considers itsoverdue default risk to be 0 for it has low overdue credit loss which has not significantly increased since the initialrecognition, because the acceptance bank pays the payee or holder a certain amount unconditionally when the billis due. In respect of commercial acceptance bills, the Company believes that the probability of default iscorrelated with the aging, and the transfer provision shall be accrued according to the accounting estimate policyof expected credit loss of above accounts receivable.
12. Accounts receivable
The Company measures the loss provisions as per the amount of expected credit losses throughout the whole
duration by the use of simplified model for expected credit loss for receivables specified in Accounting Standardsfor Business Enterprises No.14 - Income, excluding significant financing components (including cases in whichfinancing components in contracts not exceeding one year are not taken into account in accordance with thestandards). The increased or reversed amount of loss provisions generated therefrom shall be included in thecurrent profits and losses as impairment losses or gains.The Company has implemented Accounting Standard No.22 - Recognition and Measurement of FinancialInstruments (CK [2017] No.7) since January 1, 2019. The Company believes that the probability of default isrelated to the aging, which is still a mark of whether the credit risk of the Company’s accounts receivableincreases significantly, after it has reviewed the appropriateness of the provision for bad debts receivable inprevious years based on the Company’s historical bad debt losses. Therefore, credit risk loss of the Company’saccounts receivable is still estimated on the basis of aging according to the original loss ratio of previous years.The accounting policies for measuring overdue credit loss of accounts receivable adopted by the Company are asfollows:
1. Receivables with significant individual amount and individual provision for bad debtsSignificant individual amount refers to the amount of which the ending balance of individual receivables ismore than 1 million yuan.At the end of the period, a separate impairment test will be carried out on the individual receivables withsignificant amount. If there is objective evidence that it is impaired, the impairment loss shall be recognized withprovision for bad debts according to the difference between the present value of future cash flow and the bookvalue.
2. Receivables with provision for bad debts by portfolio
The individual receivables with not significant amount at the end of the period, together with the receivablesthat have not been impaired after separate test, are divided into several portfolios according to the aging as thecredit risk characteristics, and the impairment loss is calculated and determined according to a certain proportionof the ending balance of these receivables portfolio (the impairment test can be conducted separately), withprovision for bad debts.
Except for the receivables for which impairment provision has been made separately, the Companydetermines the proportion for following bad debt provision based on the actual loss rate of the portfolio of thesame or similar receivables in previous years with the aging of receivables as the credit risk feature and in
combination with the current situation:
Aging | Estimated loss of accounts receivable (note) | Estimated loss of other receivables |
Less than 1 year (including 1 year) | 3.10% | 5.00% |
1-2 years (including 2 years) | 9.04% | 10.00% |
2-3 years (including 3 years) | 22.11% | 30.00% |
3-4 years (including 4 years) | 47.51% | 50.00% |
4-5 years (including 5 years) | 84.26% | 80.00% |
Over 5 years | 100.00% | 100.00% |
Among which: those that have been determined to be irrecoverable | Write off | Write off |
Note: when measuring the expected credit loss of receivables, the Group has referred to the historicalexperience of credit loss and adjusted it based on forward-looking estimates.
3. Receivables with not significant amount but with individual provision for bad debts
Reasons for individual provision for bad debts: the Company conducts a separate impairment test for thereceivables with the following characteristics, although its amount is not significant. If there is objective evidencethat the receivables are impaired, the impairment loss shall be recognized with provision for bad debts accordingto the difference between the present value of future cash flow and the book value; receivables that are in disputewith the other party or involved in litigation or arbitration; receivables that have obvious indications that thedebtor is likely to be unable to perform the repayment obligation, etc.
Method for bad debt provision: the impairment test shall be conducted separately. If there is objectiveevidence that it has been impaired, the impairment loss shall be recognized with provision for bad debts accordingto the difference between the present value of future cash flow and its book value.
13. Receivables financing
Financial assets that meet the following conditions at the same time are classified as financial assetsmeasured at fair value through other comprehensive income: The business model for managing the financial assetsby the Company is to collect contractual cash flows and to sell financial assets; The contract terms of the financialasset stipulate that the cash flow generated on a specific date is only the payment of the principal and the interestbased on the outstanding principal amount.
If the Company transfers the receivables held by it in the form of discount or endorsement, which is frequentand involves a large amount, and its management business mode is essentially the collection and sale of the
contractual cash flow, it is classified into financial assets whose changes are measured at fair value and included inother comprehensive income in accordance with the accounting standards of financial instruments.
14. Other receivables
Recognition method and accounting treatment for expected credit loss of other receivablesThe Company measures the impairment loss by an amount equivalent to the expected credit loss within the next12 months or over the entire duration, depending on whether the credit risk of other receivables has increasedsignificantly since the initial recognition. In addition to other receivables with individual credit risk assessment,they are divided into different portfolios based on their credit risk characteristics:
Items | Basis for determining the portfolios |
Risk-free portfolio | This portfolio is a risk-free account receivable. |
Aging portfolio | The credit risk of the portfolio is characterized by the aging of receivables. |
15. Inventories
1. Classification of inventories
Inventories refer to the finished products or commodities held by a company for sale, the unfinished productsin the process of production and outsourced processing, and the materials and supplies consumed for productionor rendering of labor service in daily activities of the company.The Company’s inventories mainly include raw materials (including auxiliary materials and wrappage),outside processing materials, unfinished products, self-made semi-finished products, goods on hand and low valueconsumables.
2. Valuation method of delivered inventories
The delivered inventories are subject to the weighted-average system.
3. The basis for determination of net realizable value of inventories and the method for calculation ofinventory revaluation reserves
On the balance sheet date, the inventories are measured at the lower of cost and net realizable value, and theinventory revaluation reserves are calculated at the difference between the cost of inventory category and the netrealizable value. The net realizable value of the inventories ready for sale is determined at the estimated sale price
of such inventories minus the estimated sales expenses and relevant taxes during normal production and operation,and that of the inventories to be processed is determined at the estimated sale price of the finished products minusthe costs, sales expenses and relevant taxes estimated to be incurred up to completion during normal productionand operation. On the balance sheet date, the net realizable values are determined separately and compared withthe corresponding costs to determine the amount of withdrawal or reversal of inventory revaluation reserve if apart of inventory is subject to the contractual price agreement and the rest is not.Net realizable value refers to the amount of the estimated sale price of the inventories minus the costs, salesexpenses and relevant taxes estimated to be incurred up to completion in daily activities. For the provision ofinventory revaluation reserve, it is made based on a single inventory item for various inventories and in acombined manner for the inventories which are related to the product line produced and sold in the same region,difficult to be measured separately from other items and for the same or similar end use or purpose.
4. Inventory system
Perpetual inventory system is applied for the inventories.
5. Amortization method of low value consumables and wrappage
Both low value consumables and wrappage are amortized with one-off amortization method when they arereceived.
1. Classification of inventories
Inventories refer to the finished products or commodities held by a company for sale, the unfinished productsin the process of production and outsourced processing, and the materials and supplies consumed for productionor rendering of labor service in daily activities of the company.
The Company’s inventories mainly include raw materials (including auxiliary materials and wrappage),outside processing materials, unfinished products, self-made semi-finished products, goods on hand and low valueconsumables.
2. Valuation method of delivered inventories
The delivered inventories are subject to the weighted-average system.
3. The basis for determination of net realizable value of inventories and the method for calculation ofinventory revaluation reserves
On the balance sheet date, the inventories are measured at the lower of cost and net realizable value, and theinventory revaluation reserves are calculated at the difference between the cost of inventory category and the net
realizable value. The net realizable value of the inventories ready for sale is determined at the estimated sale priceof such inventories minus the estimated sales expenses and relevant taxes during normal production and operation,and that of the inventories to be processed is determined at the estimated sale price of the finished products minusthe costs, sales expenses and relevant taxes estimated to be incurred up to completion during normal productionand operation. On the balance sheet date, the net realizable values are determined separately and compared withthe corresponding costs to determine the amount of withdrawal or reversal of inventory revaluation reserve if apart of inventory is subject to the contractual price agreement and the rest is not.Net realizable value refers to the amount of the estimated sale price of the inventories minus the costs, salesexpenses and relevant taxes estimated to be incurred up to completion in daily activities. For the provision ofinventory revaluation reserve, it is made based on a single inventory item for various inventories and in acombined manner for the inventories which are related to the product line produced and sold in the same region,difficult to be measured separately from other items and for the same or similar end use or purpose.
16. Contractual assets
NoneNone
17. Contract costs
None
18. Assets held for sale
The Company classifies corporate components (or non-current assets) that meet the following conditions asthe assets held for sale: (1) The corporate components can be sold immediately under current background inaccordance with the practice of sales of such assets or disposal portfolio in similar transactions; (2) The sale isvery likely to take place and expected to be completed within one year since a resolution has been made on a saleplan and a definite purchase commitment has been obtained (definite purchase commitment refers to a legallybinding purchase agreement that is signed by a company with other parties and indicates the important clauseswith respect to the transaction price, time and severe penalties for breach of contract to minimize the possibility ofmajor adjustment or revocation of the agreement.).It has been approved by the relevant authority or regulators inaccordance with relevant regulations.
The Company adjusted the estimated net residual value of the asset held for sale to the net amount (not morethan the original book value of such asset held for sale) reflecting its fair value minus the sales expenses. If theoriginal book value is higher than the adjusted estimated net residual value, the difference between the two wasdeemed as the asset impairment loss and included in the current profits and losses, and the provision forimpairment of assets held for sale shall be made. For the amount of asset impairment loss recognized for thedisposal portfolio held for sale, it is necessary to offset the book value of goodwill in the disposal portfolio andthen offset the book value of the specified non-current assets in the disposal portfolio applicable for beingmeasured in accordance with the Standard in proportion.
If the net amount of the fair value of the non-current assets held for sale minus the sales expenses increaseson the subsequent balance sheet date, the amount written-down previously shall be recovered and reversed withinthe amount of asset impairment loss recognized after such non-current assets are classified as the assets held forsale. The reversed amount shall be included in the current profits and losses. The asset impairment loss recognizedbefore such non-current assets are classified as the assets held for sale shall not be reversed. If the net amount ofthe fair value of the disposal portfolio held for sale minus the sales expenses increases on the subsequent balancesheet date, the amount written-down previously shall be recovered and reversed within the amount of impairmentloss recognized for the non-current assets applicable for being measured in accordance with the Standard aftersuch disposal portfolio is classified as the assets held for sale. The reversed amount shall be included in thecurrent profits and losses. It is not allowed to reverse the book value of the goodwill that has been written downand the impairment loss recognized for the non-current assets applicable for being measured in accordance withthe Standard before such assets are classified as the assets held for sale. The book value of the subsequentlyreversed amount of the asset impairment loss recognized for the disposal portfolio held for sale shall be increasedaccording to the proportion of the book value of non-current assets applicable for being measured in accordancewith the Standard except for the goodwill in the disposal portfolio.
If the Company loses control over its subsidiary for some reasons such as the sale of its investment into itssubsidiary, it shall classify the entire investment into its subsidiary as the assets held for sale in the individualfinancial statement of the parent company and classify all assets and liabilities of the subsidiary as the assets heldfor sale in the consolidated financial statements provided that the investment into its subsidiary to be sold meetsthe conditions for classification of assets held for sale.
19. Debt investment
None
20. Other debt investment
None
21. Long-term receivables
None
22. Long-term equity investment
1. Determination of investment cost
(1) If the investment cost is incurred in business combination under the same control in which case thecombining party pays the combination consideration in cash, by transferring the non-cash assets, undertaking thedebts or issuing the equity securities, the initial investment cost shall be determined on the basis of the share of theowner's equity of the combined party in the book value of the ultimate controlling party's consolidated financialstatements on the combination date. For the difference between the initial investment cost of long-term equityinvestment and the book value of the consideration paid for combination or the total face value of the issuedshares, the capital reserve (capital premium or share premium shall be adjusted). If the capital reserve isinsufficient to be offset, the retained earnings shall be adjusted.If a business combination under the same control is realized step by step, the initial investment cost shall bedetermined on the basis of the share of the owner's equity of the combining party in book that is obtained from thecombined party on the combination date and calculated at shareholding ratio. For the difference between the initialinvestment cost and the sum of the book value of the original long-term equity investment plus the book value ofthe consideration newly paid for acquiring further shares on the combination date, the capital reserve (capitalpremium or share premium shall be adjusted). If the capital reserve is insufficient to be offset, the retainedearnings shall be adjusted.
(2) If the investment cost is incurred in the business combination under different control, the initialinvestment cost shall be determined as the fair value of the consideration paid for combination on the purchasedate.
(3) Investment costs other than those incurred in business combination: The initial investment cost shall be
the purchase price paid actually if the investment is obtained by paying cash, the fair value of the issued equitysecurities if by issuing the equity securities, and the value specified in the investment contract or agreement incase of investment from an investor (unless the unfair value is specified in the contract or agreement).
2. Subsequent measurement and recognition methods for profit and loss
The long-term equity investment that the Company has the control over the investee shall be calculated withcost method in its individual financial statement; those under the same control or significant influence shall becalculated with equity method.If the cost method is applied, the long-term equity investments shall be priced at the initial investment cost.The cash dividends or profits declared to be distributed by the investee other than those that have been declaredbut not distributed and included in the price or consideration paid actually when the investment is obtained shallbe recognized as the current investment profit, and it is necessary to consider whether the long-term investment isimpaired in accordance with the relevant policy of asset impairment.When the equity method is applied, if the initial investment cost of a long-term equity investment is greaterthan the share of fair value of identifiable net assets entitled from the investee at the time of investment, it shall beincluded in the initial investment cost of the long-term equity investment; otherwise, the difference shall beincluded in the current profits and losses and the cost of long-term equity investment shall be adjusted.When the equity method is applied, the profit and loss on investment shall be recognized and the book valueof the long-term equity investment shall be adjusted according to share of the net profit and loss that should beentitled or shared and have been realized by the investee after the long-term equity investment is obtained. Whenthe share of the net profit and loss entitled from the investee is recognized, the proportion attributable to theinvestor shall be calculated at the shareholding ratio after offsetting the profits and losses of internal transactionswith associated enterprises and joint ventures (full amount shall be recognized if the losses of internal transactionsare the asset impairment losses) in light of the accounting policies and period of the Company on the basis of thefair value of the identifiable assets of the investee when the investment is obtained, and the net profit of theinvestee shall be recognized after adjustment. The portion to be distributed shall be calculated with reference tothe profits or cash dividends declared to be distributed by the investee, and the book value of the long-term equityinvestment shall be reduced accordingly. The Company recognizes the net loss incurred by the investee to theextent that the book value of the long-term equity investment and other long-term equity substantially constitutingthe net investment into the investee are written down to zero, unless the Company is liable for extra losses. The
book value of the long-term equity investment was adjusted and included in the owner's equity for other changesin the owner's equity other than the net profit and loss of the investee.
3. Basis for determination of control over and significant influence on the investeeControl refers to having the power over the investee, being entitled to variable returns by participating in therelevant activities of the investee and able to influence the amount of return by exercising the power over theinvestee. Significant influence refers to that the investor has the right to participate in decision-making in terms ofthe financial and operating policies of the investee but has no right to control or jointly control the formulation ofthese policies with other parties.
4. Disposal of long-term equity investment
(1) Partial disposal of long-term equity investments into subsidiaries without loss of controlThe difference between the disposal price and the corresponding book value of the disposed investment shallbe recognized as the current investment profit in case of partial disposal of long-term equity investments intosubsidiaries without loss of control.
(2) Loss of control over subsidiaries due to partial disposal of long-term equity investments or other reasonsIf the control over the subsidiaries is lost due to partial disposal of long-term equity investments or otherreasons, the book value of the long-term equity investment corresponding to the sold equity shall be carriedforward for the disposed equity, and the difference between the sales price and the book value of the disposedlong-term equity investment shall be recognized as investment profit (loss). In addition, the remaining equity shallbe recognized as long-term equity investment or other related financial assets at its book value. The remainingequity after disposal that has joint control or significant influence on the subsidiaries shall be subject to theaccounting treatment in accordance with the relevant regulations on the conversion from the cost method to theequity method.
5. Methods for impairment test and provision of impairment reserve
If there is any objective evidence showing that the investments into subsidiaries, associated enterprises andjoint ventures are impaired on the balance sheet date, the provision of impairment reserve shall be madeaccordingly based on the difference between the book value and the recoverable amount.
23. Investment property
Measurement model of investment property
Measurement with cost methodDepreciation or amortization method
1. Investment property includes leased land use rights, land use rights held and ready to be assigned afterappreciation, and leased buildings.
2. Investment property is measured initially at cost and subsequently with cost model. The provision fordepreciation and amortization of the investment property are made in the way as used for fixed assets andintangible assets. If there is any sign showing that the investment property is impaired on the balance sheet date,the provision of impairment reserve shall be made accordingly based on the difference between the book valueand the recoverable amount.
The Company applied the cost model to subsequent measurement of investment property, and depreciated oramortized it in accordance with the policy as used for the buildings or land use rights.
See Note V (23) "Long-term Assets Impairment" for details of the methods for impairment test and provisionof impairment reserve applicable to investment property.
If the real estate for private use or inventory is converted to an investment property or the investmentproperty is converted to a real estate for private use, the book value before such conversion shall be deemed as theentry value after the conversion.
If the purpose of an investment property is changed to private use, this investment property shall beconverted into a fixed or intangible asset from the date of change. If the purpose of a real estate is changed to rentgains or capital appreciation from private use, the fixed asset or intangible asset shall be converted into aninvestment property from the date of change. If any asset is converted into an investment property measured withthe cost model, the book value before the conversion shall be deemed as the entry value after the conversion. Ifany asset is converted into an investment property measured with the fair value model, the fair value on theconversion date shall be deemed as the entry value after the conversion.
An investment property shall be de-recognized if this investment property is disposed of or permanentlyretired, and it is expected that no economic benefits can be obtained from its disposal. The disposal income fromthe sale, transfer, scrapping or damage of an investment property shall be included in the current profits and lossesafter deducting its book value and relevant taxes and dues.
24. Fixed assets
(1) Conditions for recognition
1. Recognition conditions, classification and pricing of fixed assets
The fixed assets of the company refer to the tangible assets that are held for production of goods, renderingof labor services, and leasing or operating management and have a useful life of more than one fiscal year.Fixed assets shall be recorded at the actual cost upon the acquisition and subject to the provision forstraight-line depreciation from the next month following the date when they are ready for use as intended.
(2) Depreciation method
Category | Depreciation method | Depreciable life | Residual rate | Yearly depreciation |
Houses and buildings | Straight-line method | 20-40 years | 5.00% | 2.375%-4.75% |
Machinery and equipment | Straight-line method | 10 years | 5.00% | 9.50% |
Transportation equipment | Straight-line method | 5 years | 5.00% | 19.00% |
Molds | Straight-line method | 5 years | 5.00% | 19.00% |
Electronic equipment and other equipment | Straight-line method | 5 years | 5.00% | 19.00% |
(3) Basis for recognition, valuation and depreciation method of fixed assets under financing lease
Financing lease will be recognized if one or more of following criteria is or are met: ① The ownership ofthe leased asset is transferred to the lessee at the expiration of the lease term; ② It can be reasonably determinedthat the lessee will exercise the option at the start of the lease since the lessee has such option to purchase theleased asset and the agreed purchase price is expected to be much lower than the fair value of the leased assetwhen the option is exercised; ③ The lease term accounts for most of the useful life of the leased asset [generally,it accounts for more than 75% (including 75%) of the useful life of the leased asset] even if the ownership of theasset will not be transferred; ④ The present value of the minimum lease payment made by the lessee on the startdate of lease is almost equivalent to the fair value [90% and above (including 90%) of the leased asset on the startdate of lease]; the present value of the minimum lease payment received by the lessor on the start date of lease isalmost equivalent to the fair value [90% and above (including 90%) of the leased asset on the start date of lease];
⑤ The leased asset is of a special nature and will be only used by the lessee if no major transformation is made.
The fixed assets under financing lease shall be recorded at the lower of the fair value of the leased assets onthe start date of lease and the present value of the minimum lease payment and shall be subject to provision fordepreciation in accordance with the depreciation policy of self-owned fixed assets.
25. Construction in progress:
1. The construction in progress shall be transferred to fixed assets at the actual cost of the project when it isready for use as intended. If a product under construction has been ready for use as intended but has notundergone final settlement of account, this project shall be transferred to fixed assets at the estimated value first.After final settlement of account is made, the original temporary estimated value shall be adjusted according to theactual cost without adjustment of depreciation previously accrued.
2. If there is any sign showing that a project under construction is impaired on the balance sheet date, theprovision for impairment shall be made accordingly at the difference between the book value and the recoverableamount.
26. Borrowing costs
1. Recognition principle for capitalization of borrowing costs
The borrowing costs of the company that can be directly attributable to the acquisition, construction orproduction of assets that meet the conditions for capitalization shall be capitalized and included in the cost of therelevant assets, and other borrowing costs shall be recognized as expenses at the time of occurrence and includedin the current profits and losses.
2. Period of capitalization of borrowing costs
(1) The borrowing costs shall be capitalized if they meet the following conditions: 1) Asset expenditures havebeen incurred; 2) Borrowing costs have been incurred; 3) Acquisition, construction or production activitiesnecessary for the assets to reach the usable or marketable state as intended have begun.
(2) The capitalization of borrowing costs shall be discontinued if the acquisition, construction or productionof an asset that meets the conditions for capitalization is abnormally interrupted for more than 3 successivemonths. The borrowing costs incurred during the period of interruption shall be recognized as current expensesuntil the acquisition, construction or production of assets is resumed.
(3) The capitalization of borrowing costs shall cease when the purchased, constructed or produced assets that
meet the conditions for capitalization reaches the intended usable or marketable state.
3. Capitalized amount of borrowing costs
If special borrowings are for the purpose of purchase, construction or production of assets that meet theconditions for capitalization, the amount of interest to be capitalized shall be determined as the interest expensesactually incurred (including the amortization of discounts or premiums determined with the effective interest ratemethod) in the current period of the special borrowing minus the interest income from the unused borrowings thathave been deposited in the bank or the profit from temporary investment by the unused borrowings. If generalborrowings are used for the purpose of purchase, construction or production of assets that meet the conditions forcapitalization, the amount of interest to be capitalized shall be determined as the weighted average of assetexpenditure with accumulated asset expenditure exceeding special borrowing multiplied by capitalization rate ofthe general borrowing occupied.
27. Biological assets
None
28. Oil and gas assets
None
29. Right-of-use assets
On the start date of lease, the Company recognizes right-of-use assets and lease liabilities for leases, exceptfor short-term leases and leases of low-value assets for which the application of the standard provides simplifiedtreatment.
The right-of-use assets shall be initially measured by the Company at the cost,The cost includes:
1. The initial measurement amount of the lease liability;
2. For lease payments paid on or before the starting date of the lease term, if there are lease incentives, theamount of lease incentives already enjoyed shall be deducted;
3. The initial direct expenses incurred by the Company;
4. Estimated costs to dismantle and remove the leased asset, restore the site where the leased asset is located,or restore the leased asset to the state agreed upon in the lease terms.The aforementioned costs are incurred for the
make-to-stock production, and the Accounting Standards for Business Enterprises No. 1 - Inventories shall apply.
The company recognizes and measures the costs mentioned in Item 4 above in accordance with theAccounting Standards for Business Enterprises No. 13 - Contingencies.
Initial direct costs are the incremental costs incurred to achieve the lease. Incremental costs are the costs thatwould not have been incurred if the enterprise did not complete the lease.
The provision for the depreciation of the right-of-use assets shall be made with reference to the relevantdepreciation provisions of the Accounting Standards for Business Enterprises No. 4 - Fixed Assets. If there isreasonable certainty that the lessee will obtain ownership of the leased assets when the lease term expires, theCompany shall make depreciation of leased assets over their remaining service life. If it is not reasonable to becertain that the lessee will obtain the ownership of the leased assets at the expiry of the lease term, the leasedassets should be calculated and withdrawn as depreciation over the shorter one of the lease term or the remainingservice life.
The Company determines whether the right-of-use assets are impaired in accordance with the AccountingStandards for Business Enterprises No. 8 - Asset Impairment, and carries out accounting treatment for theidentified impairment losses.
30. Intangible assets
(1) Valuation method, service life and impairment test
1. Intangible assets include land usage right and software, and shall be initially measured at cost.
2. Intangible assets with limited service life shall be systematically and reasonably amortized according tothe expected realization mode of economic benefits related within the service life, and in case the expectedrealization mode cannot be reliably determined, the straight-line method shall be adopted for amortization.
The land usage right shall be averagely amortized within the remaining service life (generally 50 years), andthe software shall be averagely amortized within 3-5 years.
3. In case of evidence of impairment of intangible assets with defined service life on the balance sheet date,corresponding provision for impairment shall be made according to the difference between the book value and therecoverable amount; For intangible assets with uncertain service life and intangible assets that have not reachedthe serviceable state, the impairment tests shall be carried out every year, whether there are signs of impairment ornot. Currently, the Company has no intangible assets with uncertain service life.
(2) Accounting policy of internal R&D expenditure
Research stage expenditures of internal R&D projects shall be included in the current profits and losses at thetime of occurrence. In case following conditions have been met at the same time, expenditure of internal R&Dprojects in development stage shall be recognized as intangible assets: (1) It is technically feasible to complete theintangible assets for adoption and sale; (2) There is the intention to complete the intangible assets for adoption andsale; (3) There exist ways for intangible assets to generate economic benefits, including the evidence that there is amarket for products produced by using the intangible assets or for the intangible assets. If the intangible assetswill be used internally, it can be proved that they are useful; (4) There are sufficient technical, financial and otherresources to support the development of the intangible assets and to use or sell the intangible assets; (5)Expenditure of the intangible assets in development stage can be measured reliably.
31. Long-term assets impairment
The enterprise shall judge whether there is any sign of possible assets impairment on the balance sheet date.
Goodwill arising from business combination and intangible assets with uncertain service life shall be testedfor impairment every year, no matter whether there is any sign of impairment.
In case of following signs, the assets may be impaired:
(1) Market price of assets falls sharply in the current period, which is significantly higher than the expecteddecline due to time or normal use; (2) There are significant changes in current and future economic, technologicalor legal environment in which the enterprise operates and the market where assets are located, bringing adverseeffects on the enterprise; (3) The market interest rate or other market return on investment has been increased inthe current period, affecting the discount rate of the enterprise to calculate the present value of the expected futurecash flow of the assets and resulting in a significant decrease in the recoverable amount of the assets; (4) Thereexists evidence showing that the assets have become obsolete or the entity has been damaged; (5) Assets havebeen or will be idle, terminated or planned to be disposed in advance; (6) Evidence in the internal report of theenterprise shows that economic performance of assets has been or will be lower than the expected, for instance,the net cash flow arising from assets or the realized operating profit (or loss) is far lower (or higher) than theexpected amount, etc. (7) Other indications showing that assets may have been impaired.
In case of signs of assets impairment, corresponding recoverable amount shall be estimated.
Recoverable amount shall be determined based on the higher of the net amount of fair value of assets minus
the disposal expenses and the present value of expected future cash flow of assets.
Disposal expenses include legal expenses, relevant taxes and handling fees related to disposal of assets aswell as direct expenses incurred to make the assets marketable.
Present value of expected future cash flow of assets shall be determined by selecting an appropriate discountrate based on the expected future cash flow generated during continuous use and final disposal of the assets. Toestimate present value of future cash flow of assets, measures shall be taken to comprehensively consider factorsas the expected future cash flow, service life and discount rate of the assets.
In case of measurement result of recoverable amount showing that recoverable amount of the asset is lowerthan its book value, the book value shall be written down to the recoverable amount, and the written down amountshall be recognized as the loss of asset impairment and included in the current profits and losses; besides,corresponding provision for asset impairment shall be made at the same time.
32. Long-term deferred expenses
Long-term deferred expenses shall be recorded according to the actual amount, and shall be averagelyamortized in the benefit period or the specified period. In case future accounting period cannot benefit fromlong-term deferred expenses, all unamortized value of the item shall be transferred into the current profits andlosses.
33. Contractual liabilities
The Company shall list contractual assets or liabilities in the balance sheet based on the relationship betweenthe performance of obligations and customer payment. Obligation of the Company to transfer commodities orprovide services to customers for consideration received or receivable from customers shall be listed ascontractual liabilities.
34. Employee compensation
(1) Accounting treatment of short-term compensation
Employee compensation refers to various forms of remuneration or compensation provided by the Companyfor obtaining services provided by employees or dissolving labor relations. Employee compensation includesshort-term compensation, post-employment benefits, dismissal benefits and other long-term employee benefits.
Benefits provided by the Company to employees’ spouses, children and dependants, family members of deceasedemployees as well as other beneficiaries shall also be included in employee compensation.
Share-based payments issued by the enterprise to its employees shall also be included in employeecompensation, and shall be handled in accordance with relevant provisions of Accounting Standards for BusinessEnterprises No.11- Share-based Payments.The Company shall recognize actual short-term compensation as liabilities and include it in the currentprofits and losses or related asset costs during the accounting period when employees provide services. Where,non-monetary welfare shall be measured at fair value.
(2) Accounting treatment of post-employment benefits
(3) Accounting treatment of dismissal benefits
In case the Company terminates labor relationship with employees prior to the expiration of employee’s laborcontract, or offers compensation to encourage employees to accept the layoff voluntarily, it shall confirm thecompensation for termination of labor relationship with employees and include the compensation amount in thecurrent profits and losses at the earlier time when it fails to unilaterally withdraw labor relationship terminationplan or layoff proposal and confirms costs related to reorganization involving the payment of dismissal benefits.
(4) Accounting treatment of other long-term employee benefits.
Employees of the Company have accepted the social basic endowment insurance organized and implementedby the local labor and social security departments. The Company shall pay endowment insurance premium to thelocal agency handling with social basic endowment insurance on a monthly basis based on the payment base andproportion of the local social basic endowment insurance. After employee retirement, the local labor and socialsecurity department shall pay basic social pension to retired employees. The Company shall recognize amount tobe paid according to the above social security provisions as liabilities and include it into the current profits andlosses or related asset cost during the accounting period when employees provide services.
35. Lease liabilities
On the beginning date of the lease term, the Company recognizes the present value of the unpaid leasepayments as lease liabilities (except for short-term leases and low-value asset leases).When calculating the present
value of lease payments, the Company adopts the interest rate implicit in the lease as the discount rate; if theinterest rate implicit in the lease cannot be determined, the lessee's incremental loan interest rate shall be used asthe discount rate. The Company calculates the interest expense of the lease liability in each period of the leaseterm according to the fixed periodic interest rate and includes it in the current profit and loss, unless it is otherwisespecified that it shall be included in the relevant asset cost. The amount of variable lease payments not included inthe measurement of lease liabilities shall be included in the current profit and loss when they actually occur,unless it is otherwise specified that they shall be included in the relevant asset cost. After the beginning date of thelease term, when the substantial fixed payment amount changes, the expected amount payable for the guaranteedresidual value changes, the index or ratio used to determine the lease payment amount changes, or the evaluationresult or actual exercise of the purchase option, renewal option or termination option changes, the Company shallremeasure the lease liabilities according to the present value of the changed lease payments.
36. Estimated liabilities
None
37. Share-based payment
1. Types of share-based payment
It includes equity-settled share-based payment and cash-settled share-based payment
2. Determination method of fair value of equity instrument
(1) In case of active market, it shall be determined according to the quoted price in the active market.
(2) In case of no active market, it shall be determined by adopting valuation technologies, including referringto prices used in recent market transactions by parties familiar with the situation and willing to trade, current fairvalue of other financial instruments that are essentially the same, discounted cash flow method and option pricingmodel.
3. Basis for confirming the best estimate of vesting equity instruments
Estimation shall be based on the latest available changes on vesting employee number and other subsequentinformation.
4. Accounting treatment of implementing, modifying and terminating share-based payment plan
(1) Equity-settled share-based payment
Equity-settled share-based payment in exchange for employee services that can be exercised immediatelyafter the grant shall be included in the relevant costs or expenses according to the fair value of equity instrumentson the grant date, and the capital reserve shall be adjusted accordingly. For equity-settled share-based payment inexchange for employee services only after completing service within the waiting period or reaching the specifiedperformance conditions, it is required to include the services obtained in the current period into relevant costs orexpenses according to the best estimate of number of vesting equity instruments and the fair value on the grantdate of equity instruments on each balance sheet date within the waiting period, and the capital reserve shall beadjusted accordingly.
For equity-settled share-based payment in exchange for other party’s services, if the fair value of otherparty’s services can be reliably measured, it shall be measured based on the fair value of other party’s services onthe acquisition date; In case the fair value of other party’s services cannot be reliably measured, but the fair valueof equity instruments can be reliably measured, it shall be measured based on the fair value of equity instrumentson the acquisition date and shall be included in relevant costs or expenses; besides, the owner’s equity shall beincreased accordingly.
(2) Cash-settled share-based payment
Cash-settled share-based payment in exchange for employee services that can be exercised immediately afterthe grant shall be included in relevant costs or expenses according to the fair value of the liabilities undertaken bythe Company on the grant date, and the liabilities shall be increased accordingly. For cash-settled share-basedpayment in exchange for employee services only after completing service within the waiting period or reachingthe specified performance conditions, it is required to include the services obtained in the current period intorelevant costs, expenses and corresponding liabilities according to the best estimate of vesting rights and the fairvalue of the liabilities undertaken by the Company on each balance sheet date within the waiting period.
(3) Modification and termination of share-based payment plan
In case of increase of fair value of the equity instruments granted due to modification, the Company shallrecognize the increase of services obtained based on the increase of fair value of equity instruments; In case ofincrease of the number of equity instruments granted due to modification, the Company shall recognize the fairvalue of the increased equity instruments as the increase of services obtained accordingly; Besides, if theCompany modifies vesting conditions in a way beneficial to employees, it shall consider all modified vestingconditions when dealing with the vesting conditions.
In case of decrease of fair value of the equity instruments granted due to modification, the Company shallcontinue to recognize the amount of services obtained based on the fair value of equity instruments on the grantdate without considering the decrease of fair value of equity instruments; In case of decrease of the number ofequity instruments granted due to modification, the Company shall recognize the decreased part as thecancellation of granted equity instruments; Besides, if the Company modifies vesting conditions in a way notbeneficial to employees, it shall not consider the modified vesting conditions when dealing with vestingconditions.
In case the Company cancels or settles the granted equity instruments within the waiting period (except thosecancelled due to failure to meet the vesting conditions), the cancellation or settlement shall be accelerated forvesting, and the amount originally confirmed in the remaining waiting period shall be recognized immediately.
Share-based payment refers to the transaction of granting equity instruments or undertaking liabilitiesdetermined on the basis of equity instruments to obtain services provided by employees and other parties.Share-based payment can be divided into equity-settled share-based payment and cash-settled share-basedpayment
Equity-settled share-based payment in exchange for employee services shall be measured at the fair value ofequity instruments granted to employees. Cash-settled share-based payment shall be measured at the fair value ofthe Company’s liabilities calculated and determined on the basis of shares or other equity instruments.
38. Preferred shares, perpetual bonds and other financial instruments
None
39. Revenue
Accounting policies adopted for revenue recognition and measurement
1. Revenue recognition
The Company’s revenue mainly includes sales revenue of intelligent controller, lithium battery, motor andcontrol system.
The Company has fulfilled performance obligation in the Contract, that is, recognizing revenue when thecustomer obtains the control right of relevant commodities. Obtaining of the control right of relevant commoditiesmeans to be able to dominate the use of the commodities and obtain almost all economic benefits arising
therefrom.
2. The Company shall judge the nature of relevant performance obligations as “performance obligationsfulfilled in a certain period” or “performance obligations fulfilled at a certain time point” based on relevantprovisions of revenue standards, and shall confirm revenue according to the following principles respectively.
(1) In case the Company meets one of the following conditions, it shall fulfill the performance obligationswithin a certain period of time:
① Customers obtain and consume economic benefits arising from performance of the Company during theCompany’s performance of the Contract.
② Customers can control the assets under construction during the Company’s performance of the Contract.
③ Assets of the Company during the performance of the Contract are irreplaceable, and the Company shallbe entitled to collect money for the performance part completed so far in the whole contract period.
For performance obligations fulfilled within a certain period of time, the Company shall recognize revenueaccording to the performance progress within that period, except that the performance progress cannot bereasonably determined. The Company shall consider the nature of commodities, and shall determine the properperformance progress by adopting the output method or the input method.
(2) For performance obligations fulfilled at a certain time point rather than in a certain period, the Companyshall recognize revenue at the time when customers obtain the control right of relevant commodities.
When judging whether customers have obtained the control right of relevant commodities, the Companyconsider the following signs:
① The Company shall be entitled to immediately collect revenues from commodities, which means thatcustomers have the obligation to pay for commodities immediately.
② The Company has transferred the legal ownership of commodities to customers, which means thatcustomers have obtained the legal ownership of commodities.
③ The Company has transferred commodities in kind to customers, which means that customers havepossessed commodities in kind.
④ The Company has transferred main risks and rewards related to the ownership of commodities tocustomers, which means that customers have obtained main risks and rewards related to the ownership ofcommodities.
⑤ Customers have accepted the commodities.
⑥ Other indications that customers have obtained the control right of commodities.
3. The specific method of revenue recognition of the group
In case the sales contract between the Company and customers has been deemed as a performance obligationfulfilled at a certain time point, the specific revenue recognition method shall be formulated according to theactual situation of the Company’s product sales as follows:
Domestic sales: ① The customer picks up the goods in cash. After the payment and delivery, it isconsidered that the customer has obtained the control of the relevant goods, and the company has recognized thesales revenue; ② If the advance payment is used for settlement, and the other party's customer confirmationreceipt is obtained after the delivery, it is considered that the customer has obtained the control of the relevantcommodities, and the company has recognized the sales revenue; ③ If the credit sale is adopted according to acertain payment period, within which the customer settles, and after the delivery, the other party's customerconfirmation receipt is obtained, it is considered that the customer has obtained the control of the relevant goods,and the company has recognized the sales revenue.
Foreign sales: the Company shall deliver commodities according to the signed order, hold special exportinvoice, delivery note and other original documents for customs clearance and export, pass customs audit,complete export declaration procedures, obtain the customs declaration documents as the point of transfer ofcontrol of the relevant goods, and recognize the sales revenue by recording the revenue based on the deliveryorder, special export invoice and customs declaration form.
4. Measurement of revenue
The Company shall measure revenue according to the transaction price allocated to each individualperformance obligation. In determining the transaction price, the Company shall consider the influence of variableconsideration, significant financing components in the Contract, non-cash consideration, consideration payable tocustomers as well as other factors.
(1) Variable consideration
The Company shall determine the best estimate of variable consideration according to the expected value orthe most likely amount, but the transaction price including the variable consideration shall not exceed theaccumulated recognized revenue that will not be significantly reversed when relevant uncertainty is eliminated.When evaluating whether the accumulative recognized revenue is unlikely to be significantly reversed, the
enterprise shall further consider the possibility and proportion of revenue reversal.
(2) Significant financing components
In case of significant financing components in the Contract, the Company shall determine the transactionprice according to the amount payable in cash when assuming that customers obtain the control right ofcommodities. Difference between the transaction price and the contract consideration shall be amortized byadopting the effective interest rate method during the contract period.
(3) Non-cash consideration
In case customers pay non-cash consideration, the Company shall determine the transaction price accordingto the fair value of the non-cash consideration. In case the fair value of non-cash consideration cannot bereasonably estimated, the Company shall indirectly determine the transaction price by referring to the separateselling price of commodities for transferring commodities to customers that it promises.
(4) Consideration payable to customers
Consideration payable to customers shall be written down against the transaction price, and the currentincome shall be offset at the later of confirming relevant income or paying (or promising to pay) customer’sconsideration, except that the consideration payable to customers is to obtain other clearly distinguishablecommodities from customers.
In case the consideration payable by an enterprise to customers is to obtain other clearly distinguishablecommodities from customers, the purchased commodities shall be confirmed in a way consistent with otherpurchases of the enterprise. In case the consideration payable by an enterprise to customers exceeds the fair valueof a clearly distinguishable commodity obtained from the customer, the excess amount shall be used to offset thetransaction price. In case the fair value of clearly distinguishable commodities obtained from customers cannot bereasonably estimated, the enterprise shall offset the transaction price with the consideration payable to customersin full.Differences in revenue recognition accounting policies caused by different business models of similar businesses
40. Government subsidies
1. Government subsidies include government subsidies related to assets and government subsidies related toincome.
2. In case the government subsidies can be included in monetary assets, they shall be measured according to
the amount received or receivable; In case the government subsidies can be classified as non-monetary assets,they shall be measured at fair value, and once the fair value cannot be obtained reliably, they shall be measured innominal amount.
3. Government subsidies calculated by adopting the gross method
(1) Government subsidies related to assets shall be recognized as deferred income and included in profits andlosses by stages in a reasonable and systematic way within the service life of relevant assets. In case relevantassets are sold, transferred, scrapped or damaged prior to the end of their service life, the balance of relevantdeferred income that has not been allocated shall be transferred to the profits and losses of the current period ofasset disposal.
(2) Government subsidies related to income and used to compensate related expenses or losses in the laterperiod shall be recognized as deferred income, and shall be included in the current profits and losses during theperiod when related expenses are recognized; subsidies used to compensate relevant expenses or losses incurredshall be directly included in the current profits and losses.
4. Government subsidies calculated by adopting the net method
(1) Government subsidies related to assets shall be used to offset the book value of relevant assets;
(2) Government subsidies related to income and used to compensate related expenses or losses in the laterperiod shall be recognized as deferred income, and shall be used to offset related costs when related expenses arerecognized; subsidies used to compensate relevant expenses or losses incurred shall be directly used to offsetrelated costs.
5. The Company shall adopt the gross method to calculate the government subsidies received.
6. For government subsidies including asset-related part and income-related part, measures shall be taken todistinguish different parts and carry out accounting treatment separately; Part difficult to distinguish shall beclassified as government subsidies related to income.
7. The Company shall include the government subsidies related to its daily activities in other incomeaccording to the essence of economic business, and shall include the government subsidies unrelated to its dailyactivities in non-operating income and expenditure.
8. For discount interest of preferential policy loans to be obtained by the Company, two measures shall beadopted, including that the Ministry of Finance allocates the discount funds to the lending banks and that theMinistry of Finance allocates the discount funds to the Company:
(1) In case the Ministry of Finance allocates the discount funds to the lending banks, and the lending bankprovides loans to the Company at preferential policy interest rate, the Company shall choose the followingmethods for accounting treatment:
a. Taking the loan amount actually received as the entry value of the loan, and calculating relevant borrowingcosts based on the loan principal and the preferential policy interest rate.
b. Taking the fair value of loan as the entry value, calculate the borrowing costs by adopting the effectiveinterest rate method, and recognizing the difference between the actual received amount and the fair value of theloan as deferred income. Deferred income shall be amortized by adopted the effective interest rate method withinthe duration of loan to offset relevant borrowing costs.
(2) In case the Ministry of Finance allocates the discount funds to the Company, the Company will writedown the corresponding discount interest against relevant borrowing costs.
41. Deferred tax assets / Deferred tax liabilities
1. It is required to calculate and recognize the deferred tax assets or liabilities according to the differencebetween the book value of the assets and liabilities and corresponding tax base (in case the tax base of items notrecognized as assets and liabilities can be determined according to the provisions of the tax law, the differencebetween the tax base and their book amount shall be adopted) as well as the applicable tax rate during the periodof expected recovery of the assets or settlement of the liabilities.
2. Recognition of deferred tax assets shall be limited to the taxable income that is likely to be obtained tooffset temporary deductible differences. In case of conclusive evidence showing that sufficient taxable income islikely to be obtained in the future to offset temporary deductible differences, the deferred tax assets not recognizedin the previous accounting period shall be recognized on the balance sheet date.
3. The book value of deferred tax assets shall be reviewed on the balance sheet date. In case it is impossibleto obtain enough taxable income to offset the benefits of the deferred tax assets in the future, the book value of thedeferred tax assets shall be written down. If it is likely to obtain enough taxable income, the write down amountshall be reversed.
4. The current income tax and deferred tax of the Company shall be recognized as income tax expense orincome, and shall be included in the current profits and losses, except for income tax arising from the followingcircumstances: (1) business combination; (2) transactions or matters directly recognized in the owner’s equity.
42. Lease
(1) Accounting treatment of operating lease
(1) Operating lease business recorded by the Company as the lessee
Rental expenditure of operating lease shall be included in relevant asset cost or current profits and losses byadopting the straight-line method in each period of the lease term. Initial direct expenses shall be included in thecurrent profits and losses. Contingent rents shall be included in the current profits and losses at the time ofoccurrence.
(2) Operating lease business recorded by the Company as the lessor
Rental income of operating lease shall be recognized as the current profits and losses by adopting thestraight-line method in each period of the lease term. Initial direct expenses with large amount shall be capitalizedat the time of occurrence, and shall be included in the current profits and losses by stages on the same basis as therental revenue during the whole lease term; Other initial direct expenses with small amount shall be included inthe current profits and losses at the time of occurrence. Contingent rents shall be included in the current profitsand losses at the time of occurrence.
(2) Accounting treatment of financing lease
(1) Financial lease business recorded by the Company as the lessee
The lower of the fair value of the leased asset and the present value of the minimum lease payment on thebeginning date of lease term shall be taken as the entry value of the leased asset, the minimum lease payment shallbe taken as the entry value of the long-term accounts payable, and the difference of the above two shall be takenas the unrecognized financing expense at the beginning of the lease term. In addition, initial direct expenses thatcan be attributed to the leased item in the process of lease negotiation and signing the lease contract shall also beincluded in leased assets. Balance of the minimum lease payment after deducting the unrecognized financingexpenses shall be listed as long-term liabilities or long-term liabilities due within one year.
During the lease term, the unrecognized financing expenses shall be calculated and recognized by adoptingthe effective interest rate method. Contingent rents shall be included in the current profits and losses at the time ofoccurrence.
(2) Financial lease business recorded by the Company as the lessor
The sum of the minimum lease receipts and the initial direct expenses on the beginning date of lease termshall be taken as the entry value of the financing lease receivables, and the unguaranteed residual value shall berecorded at the same time at the beginning of the lease term; and the sum of minimum lease collection, initialdirect cost and difference between unguaranteed residual value and its present value shall be recognized asunrealized financing income. Balance of financing lease receivables after deducting the unrealized financingincome shall be listed as long-term creditor’s right or long-term creditor’s right due within one year.
During the lease term, the unrealized financing income shall be calculated and recognized by adopting theeffective interest rate method. Contingent rents shall be included in the current profits and losses at the time ofoccurrence.
43. Other important accounting policies and accounting estimation
Hedge accounting
The hedge means the risk management activity where the enterprise designates the financial instruments asthe hedge instruments for the risk exposure due to the management of the specific risks such as foreign exchangerisk, interest rate risk, price risk, credit risk so that the fair value or the cash flow changes, which is expected tocountervail all or part of the fair value or cash flow change of the hedged projects.
1. In the hedge accounting, the hedge is divided into fair value hedge, cash flow hedge, and net investmenthedge for overseas operation.
2. Only when the fair value hedge, cash flow hedge, or net investment hedge for overseas operation meet thefollowing conditions at the same time can the hedge accounting method stipulated by the Code for handling.
(1) The hedge relationship is only composed of the hedge instruments and hedged projects that meet theconditions; (2) When the hedge begins, the enterprise officially designates the hedge instruments and hedgedprojects and prepares the written documents about hedge relationship and the risk management strategies and riskmanagement objectives related to the hedge for the enterprise. These documents at least describe the hedgeinstrument, hedged projects, nature of the hedged risks, and evaluation methods on hedge effectiveness (includingthe forming reason analysis for invalid part of the hedge and the confirmation methods of the hedge ratio) etc. (3)The hedge relationship conforms to the requirements of hedge effectiveness.
If the hedge meets the following conditions at the same time, the enterprise shall identify that the hedgerelationship conforms to the requirements of hedge effectiveness:
(a) There is the economic relationship between the hedged projects and hedge instruments. The economicrelationship makes the value of the hedge instruments and hedged projects change in the reverse direction due tothe same hedged risks.
(b) In the value change generated for the hedged projects and hedge instruments, the effect of the credit riskis not dominant.
(c) The hedge ratio of the hedge relationship shall be equal to the ratio between the hedged project quantityof the actual hedge for the enterprise and the actual quantity of the hedge instruments and shall not reflect theunbalance of the relative weight between the hedged projects and hedge instruments, which will cause the hedgeinvalidation and may generate the accounting results not consistent with the hedge accounting objectives.
The enterprise shall continuously evaluate whether the hedge relationship conforms to the hedgeeffectiveness requirements when the hedge begins and during the sequent periods, especially for the analysis ofthe forming reasons why it is expected to affect the hedge relationship due to the invalid part of the hedge duringthe residual periods of the hedge. The enterprise shall at least evaluate the hedge relationship on the day ofbalance sheet and when the major changes will happen for relevant situations affecting the hedge effectivenessrequirements.
If the hedge relationship does not conform to the hedge effectiveness requirements any more due to the hedgeratio, but the risk management objective to designate the hedge relationship does not change, the enterprise shallre-balance the hedge relationship.
3. Accounting handling of the hedge.
(1) Fair value hedge
If the fair value hedge meets the conditions of the hedge accounting methods, it shall be handled inaccordance with the provisions below:
(a) The profit or loss generated by the hedge instrument shall be incorporated into the profits and losses. Ifthe hedge instrument is used to hedge the non-tradable equity instrument investment (or its components) which ismeasured at fair value with the changes including in other comprehensive income, the profit or loss generated bythe hedge instruments shall be incorporated into other comprehensive income.
(b) The profit or loss generated by the hedged projects due to the hedge risk exposure shall be incorporatedinto the current profit or loss. At the same time, the account value shall be adjusted for the confirmed hedgedprojects measured at the fair value.
(2) Cash flow hedge
If the cash flow value hedge meets the conditions to apply the hedge accounting methods, it shall be handledin accordance with the provisions below:
(a) If the profit or loss generated by the hedge instrument belongs to the valid part of the hedge as the cashflow hedge reserve, it shall be incorporated into other comprehensive income. The amount of cash flow hedgereserve included in other comprehensive income in each period shall be the change amount of cash flow hedgereserve in the current period.
(b) If the profit or loss generated by the hedge instrument belongs to the invalid part of the hedge (that is,other profit or loss after deducting other comprehensive income), it shall be incorporated into the current profitsand losses.
(3) Net investment hedge for overseas operation
As for the net investment hedge for overseas operation, including the hedge of monetary items accounting aspart of net investment, it shall be handled in accordance with the provisions similar to the cash flow hedgeaccounting:
(a) If the profit or loss generated by the hedge instrument belongs to the valid part of the hedge, it shall beincorporated into other comprehensive income.
When all or part of the overseas business is disposed, the above profit or loss of hedge instruments includedin other comprehensive income shall be transferred out and incorporated into the current profits and losses.
(b) If the profit or loss generated by the hedge instrument belongs to the invalid part of the hedge, it shall beincorporated into the current profits and losses.
Repurchase shares
If the Company or its subsidiaries shares are acquired due to the reduction of registered capital or reward ofemployees, the amount actually paid shall be treated as the treasury share, and the record shall be made forreference. If the repurchase shares are cancelled, the capital reserve will be offset by the difference between thetotal par value of the cancelled shares and the number of cancelled shares and the amount paid for the actualrepurchase. If the capital reserve is insufficient to be offset, the retained earnings shall be offset; If the repurchaseshares are awarded to the employees of the Company as equity-settled share-based payment, when the employeesexercise the right to purchase the shares of the Company or its subsidiaries and receive the price, the cost oftreasury shares delivered to the employees and the accumulated amount of capital reserve (other capital reserves)
during the waiting period shall be resold, and the capital reserve (capital premium or share premium) shall beadjusted according to the difference.
44. Important accounting policy and accounting estimation changes
(1) Important accounting policy changes
√ applicable □ not applicable
Contents and reasons of the accounting policy change | Approval procedures | Remarks |
On December 7, 2018, the Ministry of Finance revised and issued the Accounting Standards for Business Enterprises No. 21 - Lease (CK [2018] No. 35), requiring domestic listed enterprises to implement the new lease standards as of January 1, 2021.According to the revised accounting standards, the Company was required to make corresponding changes to the original accounting policies. | Not applicable |
Impact of changes in new lease standards on the Company:
1. Under the new lease standards, except for short-term leases and low-value asset leases, the lessee will nolonger distinguish between financing leases and operating leases, and for all leases, the same accounting treatmentwill be adopted, and right-of-use assets and lease liabilities must be recognized;
2. For the right-of-use assets, if the lessee can reasonably determine that it will obtain the ownership of theleased assets upon the expiration of the lease term, provision for depreciation shall be made within the remainingservice life of the leased assets. If it is not reasonable to be certain that the lessee will obtain the ownership of theleased assets at the expiry of the lease term, the leased assets should be calculated and withdrawn as depreciationover the shorter one of the lease term or the remaining service life. At the same time, the lessee shall determinewhether the right-of-use assets are impaired and carry out accounting treatment for the identified impairmentlosses;
3. For lease liabilities, the lessee shall calculate the interest expenses of the lease liabilities during eachperiod of the lease term and include them in the current profit and loss;
4. For short-term leases and low-value asset leases, the lessee may choose not to recognize right-of-use assetsand lease liabilities, and shall include them in the relevant asset cost or current profit and loss according to thestraight-line method or other systematic and reasonable methods during each period of the lease term.
Specifically, the implementation of the new lease standards resulted in an increase of 30.94 million yuan inthe Company's right-of-use assets and 30.94 million yuan in lease liabilities than at the beginning of the period.Except that, they had no other impact on the data of the statements at the beginning of the period.
(2) Important accounting estimation changes
□ applicable √ not applicable
(3) Related items in financial statements at the beginning of the year when the new lease standards areimplemented from 2021 at the first time
√ applicable □ not applicable
Whether it is needed to adjust the balance sheet account at the beginning of the year
√ Yes □ No
Consolidated Balance Sheet
Unit: Yuan
Items | December 31, 2020 | January 1, 2021 | Adjustment quantity |
Current assets: | |||
Monetary capital | 1,219,095,476.50 | 1,219,095,476.50 | |
Settlement of provisions | |||
Loans to other banks | |||
Tradable financial assets | 226,491,482.10 | 226,491,482.10 | |
Derivative financial assets | |||
Notes receivable | 39,477,930.63 | 39,477,930.63 | |
Accounts receivable | 1,701,111,153.84 | 1,701,111,153.84 | |
Receivables financing | 246,656,027.27 | 246,656,027.27 | |
Prepayments | 17,735,229.99 | 17,735,229.99 | |
Premiums receivable | |||
Reinsurance accounts receivable | |||
Reinsurance contract reserves receivable | |||
Other receivables | 40,728,126.64 | 40,728,126.64 | |
Including: interest receivable | |||
Dividends receivable | |||
Repurchase of financial assets for resale |
Inventory | 1,115,312,868.62 | 1,115,312,868.62 | |
Contractual assets | |||
Assets held for sale | |||
Non-current assets due within one year | |||
Other current assets | 70,296,444.76 | 70,296,444.76 | |
Total current assets | 4,676,904,740.35 | 4,676,904,740.35 | |
Non-current assets: | |||
Loans and advances granted | |||
Debt investment | |||
Other debt investment | |||
Long-term receivables | |||
Long-term equity investment | 6,502,528.13 | 6,502,528.13 | |
Other equity instrument investment | |||
Other non-current financial assets | |||
Investment property | 89,238,265.71 | 89,238,265.71 | |
Fixed assets | 1,096,875,640.94 | 1,096,875,640.94 | |
Construction in progress | 292,474,798.41 | 292,474,798.41 | |
Productive biological assets | |||
Oil and gas assets | |||
Right-of-use assets | 30,939,385.41 | 30,939,385.41 | |
Intangible assets | 279,279,569.40 | 279,279,569.40 | |
Development expenditure | 62,861,779.22 | 62,861,779.22 | |
Goodwill | 108,637,368.48 | 108,637,368.48 | |
Long-term deferred expenses | 72,077,671.09 | 72,077,671.09 | |
Deferred tax assets | 55,192,974.75 | 55,192,974.75 | |
Other non-current assets | 34,639,355.39 | 34,639,355.39 | |
Total non-current assets | 2,097,779,951.52 | 2,128,719,336.93 | 30,939,385.41 |
Total assets | 6,774,684,691.87 | 6,805,624,077.28 | 30,939,385.41 |
Current liabilities: | |||
Short-term loans | 402,151,500.00 | 402,151,500.00 | |
Borrowing money from the central bank | |||
Borrowed funds | |||
Trading financial liabilities | |||
Derivative financial liabilities |
Notes payable | 715,574,653.91 | 715,574,653.91 | |
Accounts payable | 1,549,906,339.72 | 1,549,906,339.72 | |
Advance receipt | 487,267.17 | 487,267.17 | |
Contractual liabilities | 72,576,117.56 | 72,576,117.56 | |
Financial assets sold for repurchase | |||
Deposit absorption and interbank deposit | |||
Acting trading securities | |||
Acting underwriting securities | |||
Employee compensation payable | 175,503,764.12 | 175,503,764.12 | |
Taxes payable | 60,256,015.60 | 60,256,015.60 | |
Other payables | 57,160,615.93 | 57,160,615.93 | |
Including: Interest payable | |||
Dividends payable | |||
Service charges and commissions payable | |||
Reinsurance accounts payable | |||
Liabilities held for sale | |||
Non-current liabilities due within one year | |||
Other current liabilities | |||
Total current liabilities | 3,033,616,274.01 | 3,033,616,274.01 | |
Non-current liabilities | |||
Insurance contract reserve | |||
Long-term loans | 200,000,000.00 | 200,000,000.00 | |
Bonds payable | |||
Including: Preferred shares | |||
Perpetual bonds | |||
Lease liabilities | 30,939,385.41 | 30,939,385.41 | |
Long-term payables | |||
Long-term employee compensation payable | |||
Estimated liabilities | |||
Deferred income | 14,624,770.00 | 14,624,770.00 | |
Deferred tax liabilities | 11,819,861.30 | 11,819,861.30 | |
Other non-current liabilities |
Total non-current liabilities | 226,444,631.30 | 257,384,016.71 | 30,939,385.41 |
Total liabilities | 3,260,060,905.31 | 3,291,000,290.72 | 30,939,385.41 |
Owner's equity: | |||
Share capital | 1,135,216,809.00 | 1,135,216,809.00 | |
Other equity instruments | |||
Including: Preferred shares | |||
Perpetual bonds | |||
Capital reserves | 969,370,892.84 | 969,370,892.84 | |
Minus: treasury shares | 80,017,965.68 | 80,017,965.68 | |
Other comprehensive income | -24,555,229.97 | -24,555,229.97 | |
Special reserve | |||
Surplus reserves | 151,359,957.53 | 151,359,957.53 | |
General risk provision | |||
Undistributed profit | 1,305,882,400.11 | 1,305,882,400.11 | |
Total owner's equity attributable to the parent company | 3,457,256,863.83 | 3,457,256,863.83 | |
Minority equity | 57,366,922.73 | 57,366,922.73 | |
Total owners' equity | 3,514,623,786.56 | 3,514,623,786.56 | |
Total liabilities and owners' equity | 6,774,684,691.87 | 6,805,624,077.28 | 30,939,385.41 |
Adjustment details
In accordance with the requirements of the Accounting Standards for Business Enterprises No. 21 - Lease asissued by the Accounting Department of the Ministry of Finance on December 7, 2018, the new standards shall beimplemented for enterprises listed at home and abroad as of January 1, 2021. The standards require that any lesseeshall choose one of the following methods to conduct bridging accounting treatment for leases, which shall beuniformly applied to all leases in which it is a lessee: (I) The retroactive adjustment method shall be adopted inaccordance with the Accounting Standards for Business Enterprises No. 28 - Changes in Accounting Policies,Accounting Estimates and Error Correction.(II) The amounts of retained earnings and other relevant items in thefinancial statements at the beginning of the year in which the standards are first implemented shall be adjustedaccording to the cumulative impact of the first implementation of the standards, and the information ofcomparable periods shall not be adjusted. In light of with the actualities, the Company chooses the following:
"The amounts of retained earnings and other relevant items in the financial statements at the beginning of the yearin which the standards are first implemented shall be adjusted according to the cumulative impact of the first
implementation of the standards, and the information of comparable periods shall not be adjusted." Therefore, theCompany measures lease liabilities and right-of-use assets at the present value discounted at the lessee'sincremental loan interest rate on the first implementation date according to the remaining lease payments of alllease contracts.Balance Sheet of Parent Company
Unit: Yuan
Items | December 31, 2020 | January 1, 2021 | Adjustment quantity |
Current assets: | |||
Monetary capital | 705,163,083.52 | 705,163,083.52 | |
Tradable financial assets | 102,133,982.10 | 102,133,982.10 | |
Derivative financial assets | |||
Notes receivable | 6,939,021.98 | 6,939,021.98 | |
Accounts receivable | 896,265,475.70 | 896,265,475.70 | |
Receivables financing | 217,543,679.19 | 217,543,679.19 | |
Prepayments | 6,953,106.28 | 6,953,106.28 | |
Other receivables | 41,159,647.12 | 41,159,647.12 | |
Including: interest receivable | |||
Dividends receivable | |||
Inventory | 209,965,269.91 | 209,965,269.91 | |
Contractual assets | |||
Assets held for sale | |||
Non-current assets due within one year | |||
Other current assets | 12,054,327.33 | 12,054,327.33 | |
Total current assets | 2,198,177,593.13 | 2,198,177,593.13 | |
Non-current assets: | |||
Debt investment | |||
Other debt investment | |||
Long-term receivables | |||
Long-term equity investment | 2,200,934,231.94 | 2,200,934,231.94 | |
Other equity instrument investment | |||
Other non-current financial assets | |||
Investment property | |||
Fixed assets | 120,829,877.70 | 120,829,877.70 |
Construction in progress | 2,392,458.84 | 2,392,458.84 | |
Productive biological assets | |||
Oil and gas assets | |||
Right-of-use assets | |||
Intangible assets | 132,732,792.93 | 132,732,792.93 | |
Development expenditure | 44,248,718.56 | 44,248,718.56 | |
Goodwill | |||
Long-term deferred expenses | 27,739,322.93 | 27,739,322.93 | |
Deferred tax assets | 27,692,977.98 | 27,692,977.98 | |
Other non-current assets | 6,997,597.90 | 6,997,597.90 | |
Total non-current assets | 2,563,567,978.78 | 2,563,567,978.78 | |
Total assets | 4,761,745,571.91 | 4,761,745,571.91 | |
Current liabilities: | |||
Short-term loans | 102,151,500.00 | 102,151,500.00 | |
Trading financial liabilities | |||
Derivative financial liabilities | |||
Notes payable | 696,684,142.33 | 696,684,142.33 | |
Accounts payable | 471,203,775.42 | 471,203,775.42 | |
Advance receipt | |||
Contractual liabilities | 29,103,190.50 | 29,103,190.50 | |
Employee compensation payable | 91,953,399.79 | 91,953,399.79 | |
Taxes payable | 28,211,920.73 | 28,211,920.73 | |
Other payables | 299,042,515.61 | 299,042,515.61 | |
Including: Interest payable | |||
Dividends payable | |||
Liabilities held for sale | |||
Non-current liabilities due within one year | |||
Other current liabilities | |||
Total current liabilities | 1,718,350,444.38 | 1,718,350,444.38 | |
Non-current liabilities | |||
Long-term loans | |||
Bonds payable | |||
Including: Preferred shares |
Perpetual bonds | |||
Lease liabilities | |||
Long-term payables | |||
Long-term employee compensation payable | |||
Estimated liabilities | |||
Deferred income | 10,535,500.00 | 10,535,500.00 | |
Deferred tax liabilities | 8,106,676.00 | 8,106,676.00 | |
Other non-current liabilities | |||
Total non-current liabilities | 18,642,176.00 | 18,642,176.00 | |
Total liabilities | 1,736,992,620.38 | 1,736,992,620.38 | |
Owner's equity: | |||
Share capital | 1,135,216,809.00 | 1,135,216,809.00 | |
Other equity instruments | |||
Including: Preferred shares | |||
Perpetual bonds | |||
Capital reserves | 1,007,315,299.41 | 1,007,315,299.41 | |
Minus: treasury shares | 80,017,965.68 | 80,017,965.68 | |
Other comprehensive income | 5,569,575.04 | 5,569,575.04 | |
Special reserve | |||
Surplus reserves | 151,331,439.07 | 151,331,439.07 | |
Undistributed profit | 805,337,794.69 | 805,337,794.69 | |
Total owners' equity | 3,024,752,951.53 | 3,024,752,951.53 | |
Total liabilities and owners' equity | 4,761,745,571.91 | 4,761,745,571.91 |
Adjustment detailsNot applicable
(4) Comparison data declaration at the early stage for the traceability and adjustment for new leasestandards implemented from 2021 at the first time
□ applicable √ not applicable
45. Others
VI. Tax
1. Main tax type and rate
Tax type | Taxation basis | Tax rate |
VAT (value-added tax) | Revenue from sales of goods | 13%、9%、6%、3% |
Consumption tax | Paid turnover tax amount | 7% |
City maintenance and construction tax | Paid turnover tax amount | 3% |
Corporate income tax | Taxable income | 15%、25%、16.5%、25.17%、20%、15.825%、22.46% |
Education surcharge | Actually paid goods turnover tax | 3% |
Local education surcharge | Actually paid goods turnover tax | 2% |
Explanation shall be made by means of disclosure where there is any taxpayer with different corporate income taxrates
Name of taxpayer | Income tax rate |
Shenzhen Topband Co., Ltd. | 15.00% |
Shenzhen Topband Software Technology Co., Ltd. | 15.00% |
Shenzhen Topband Automation Technology Co., Ltd. | 25.00% |
Shenzhen Topband Battery Co., Ltd. | 15.00% |
Chongqing Topband Industrial Co., Ltd. | 25.00% |
Topband (Hong Kong) Co., Ltd. | 16.50% |
Huizhou Topband Electrical Technology Co., Ltd. | 15.00% |
TOPBAND INDIA PRIVATE LIMITED | 25.17% |
Shenzhen YAKO Automation Technology Co., Ltd. | 15.00% |
Shenzhen Allied Control System Co., Ltd. | 15.00% |
Shenzhen Yansheng Software Co., Ltd. | 12.5% |
Ningbo Topband Intelligent Control Co., Ltd. | 25.00% |
Shenzhen Meanstone Intelligent Technology Co., Ltd. | 20.00% |
Hangzhou Zhidong Motor Technology Co., Ltd. | 25.00% |
Taixing Ninghui Lithium Battery Co., Ltd. | 15.00% |
Shenzhen Topband Supply Chain Services Co., Ltd. | 25.00% |
Shenzhen Topband Investment Co., Ltd. | 25.00% |
Shenzhen Spark IOT Technology Co., Ltd. | 20.00% |
Shenzhen Zhongli Consulting Co., Ltd. | 20.00% |
Shenzhen Tulu Innovation Co., Ltd. | 20.00% |
TUNNU INNOVATION,INC | 29.84% |
Shenzhen Senxuan Technology Co., Ltd. | 20.00% |
Shenzhen Tengyi Industrial Co., Ltd. | 20.00% |
Topband (Qingdao) Intelligent Control Co., Ltd. | 20.00% |
Shenzhen Topband Automotive Electronics Co., Ltd. | 20.00% |
TOPBAND JAPAN Co., Ltd. | 22.46% |
Tulu Innovation (Hong Kong) Limited | 16.50% |
Topband (Vietnam) Co.,ltd | 20.00% |
TOPBAND SMART DONGNAI(VIETNAM) Co.,ltd | 20.00% |
Topband Germany GmbH | 15.825% |
Huizhou Topband Lithium Battery Co., Ltd. | 20.00% |
2. Tax preference
On October 31, 2017, the Company obtained the Certificate for High-tech Enterprise that is numberedGR201744204652 and issued by Shenzhen Science and Technology Innovation Commission, Shenzhen FinanceCommission, Shenzhen Municipal Office, SAT and Shenzhen Local Taxation Administration. This Certificate isvalid within 3 years from the date of issuance. On February 5, 2021, the Company has received the Certificate forHigh-tech Enterprise jointly issued by Shenzhen Science and Technology Innovation Commission, ShenzhenFinance Bureau, and Shenzhen Tax Service, State Taxation Administration, and passed the re-certification ofhigh-tech enterprises. This certification is a renewal of the original certificate that has been expired. According torelevant regulations, the Company will be entitled to the preferential policies stated by China for the high-techenterprise income tax for three consecutive years after passing the re-certification of high-tech enterprises. That is,the company shall pay its corporate income tax at 15% of corporate income tax rate from 2021 to 2023.On December 9, 2019, Shenzhen Topband Software Technology Co., Ltd. obtained the Certificate forHigh-tech Enterprise that is numbered GR201944201381 and issued by Shenzhen Science and TechnologyInnovation Commission, Shenzhen Finance Commission, Shenzhen Municipal Office, SAT and Shenzhen LocalTaxation Administration. This Certificate is valid within 3 years from the date of issuance. The corporate incometax rate applicable for the Company from 2019 to 2021 is 15% in accordance with relevant provisions of the Lawof the People's Republic of China on Enterprise Income Tax, Regulations of the People's Republic of China on theImplementation of Enterprise Income Tax and the Management Measures for the Certification of High-tech
Enterprises.
On December 23, 2021, Shenzhen Allied Control System Co., Ltd. obtained the Certificate for High-techEnterprise that is numbered GR202144206368 and issued by Shenzhen Science and Technology InnovationCommission, Shenzhen Finance Commission, Shenzhen Municipal Office, SAT and Shenzhen Local TaxationAdministration. This Certificate is valid within 3 years from the date of issuance. The corporate income tax rateapplicable for the Company from 2021 to 2023 is 15% in accordance with relevant provisions of the Law of thePeople's Republic of China on Enterprise Income Tax, the Regulations of the People's Republic of China on theImplementation of Enterprise Income Tax and the Management Measures for the Certification of High-techEnterprises.
On December 23, 2021, Shenzhen YAKO Automation Technology Co., Ltd. obtained the Certificate forHigh-tech Enterprise that is numbered GR202144205479 and issued by Shenzhen Science and TechnologyInnovation Commission, Shenzhen Finance Commission, Shenzhen Municipal Office, SAT and Shenzhen LocalTaxation Administration. This Certificate is valid within 3 years from the date of issuance. The corporate incometax rate applicable for the Company from 2021 to 2023 is 15% in accordance with relevant provisions of the Lawof the People's Republic of China on Enterprise Income Tax, the Regulations of the People's Republic of China onthe Implementation of Enterprise Income Tax and the Management Measures for the Certification of High-techEnterprises.
On December 23, 2021, Shenzhen Topband Battery Co., Ltd. obtained the Certificate for High-techEnterprise that is numbered GR202144203102 and issued by Shenzhen Science and Technology InnovationCommission, Shenzhen Finance Commission and Shenzhen Tax Service, State Taxation Administration. ThisCertificate is valid within 3 years from the date of issuance. The corporate income tax rate applicable for theCompany from 2021 to 2023 is 15% in accordance with relevant provisions of the Law of the People's Republic ofChina on Enterprise Income Tax, the Regulations of the People's Republic of China on the Implementation ofEnterprise Income Tax and the Management Measures for the Certification of High-tech Enterprises.
On December 20, 2021, Huizhou Topband Electrical Technology Co., Ltd. obtained the Certificate forHigh-tech Enterprise that is numbered GR202144003640 and issued by the Department of Science andTechnology of Guangdong Province, the Department of Finance of Guangdong Province, and GuangdongProvincial Tax Service, State Taxation Administration. This Certificate is valid within 3 years from the date ofissuance. The corporate income tax rate applicable for the Company from 2021 to 2023 is 15% in accordance with
relevant provisions of the Law of the People's Republic of China on Enterprise Income Tax, the Regulations of thePeople's Republic of China on the Implementation of Enterprise Income Tax and the Management Measures forthe Certification of High-tech Enterprises.
On December 23, 2021, Shenzhen Yansheng Software Co., Ltd. obtained the Certificate for High-techEnterprise that is numbered GR202144207744 and issued by Shenzhen Science and Technology InnovationCommission, Shenzhen Finance Commission and Shenzhen Tax Service, State Taxation Administration. ThisCertificate is valid within 3 years from the date of issuance. The corporate income tax rate applicable for theCompany from 2021 to 2023 is 15% in accordance with relevant provisions of the Law of the People's Republic ofChina on Enterprise Income Tax, the Regulations of the People's Republic of China on the Implementation ofEnterprise Income Tax and the Management Measures for the Certification of High-tech Enterprises.On September 15, 2020, Shenzhen Yansheng Software Co., Ltd. passed the verification carried out by theIndustry and Information Technology Bureau of Shenzhen Municipality on the preferential income tax conditionsfor the enterprises engaged in software and integrated circuit design in Shenzhen. According to the provisions ofNo. 68 Announcement of Ministry of Finance and State Taxation Administration on Corporate Income TaxPolicies for Integrated Circuit Design and Software Industry issued by the Ministry of Finance and State TaxationAdministration in 2019, Shenzhen Yansheng Software Co., Ltd. shall be entitled to the preferential tax policy ofexemptions in two years and reduction in three years, that is, its corporate income tax shall be exempted from thefirst to the second year and reduced by 50% at 25% of statutory tax rate from the third to the fifth year until theexpiration of the preferential period provided that the preferential period shall be calculated from theprofit-making year before December 31, 2018.The company's corporate income tax rate from 2019 to 2021 was
12.5%.
On November 25, 2021, the Taizhou Science & Technology Bureau issued the Announcement on theEnterprises to be Included in the National High-tech Enterprise Cultivation Library of Taizhou in 2021,recognizing Ninghui Lithium Battery Co., Ltd. as a high-tech enterprise. On November 30, 2022, at the workingnet of High-tech Enterprise Identification Management, the Third Batch of High-tech Enterprises forIdentification and Filing in 2021 in Jiangsu Province was published. The company's applicable corporate incometax rate from 2021 to 2023 is 15%.
According to CS [2019] No. 13 Notice on the Implementation of Inclusive Tax Relief Policies for Small andMicro Businesses, the small and micro businesses shall pay their corporate income taxes at 20% of tax rate, and
reduce the portion of not more than 1 million yuan in their annual taxable incomes by 25% and that of more than 1million yuan but not more than 3 million yuan in their annual taxable incomes by 50% before including suchportion into their taxable incomes. According to Announcement of the State Taxation Administration on MattersConcerning the Implementation of Preferential Income Tax Policies Supporting the Development of SmallLow-Profit Enterprises and Individual Industrial and Commercial Households (CS [2021] No. 12), the annualtaxable income of small and low-profit enterprises shall not exceed 1 million yuan. On the basis of the preferentialpolicies stipulated in Article 2 of the Notice of the Ministry of Finance and the State Administration ofTaxation on Implementing the Inclusive Tax Deduction and Exemption Policies for Micro and Small Enterprises(CS [2019] No. 13), the corporate income tax will be halved. The provisions of this Policy apply to ShenzhenTopband Investment Co., Ltd., Shenzhen Senxuan Technology Co., Ltd., Shenzhen Spark IOT Technology Co.,Ltd., Shenzhen Tulu Innovation Co., Ltd., Huizhou Topband Lithium Battery Co., Ltd., Shenzhen MeanstoneIntelligent Technology Co., Ltd., Shenzhen Zhongli Consulting Co., Ltd., Shenzhen Tengyi Industrial Co., Ltd.,and Shenzhen Topband Automotive Electronics Co., Ltd. that are subsidiaries and sub-subsidiaries.
3. Other
VII. Notes to Items of Consolidated Financial Statements
1. Monetary capital
Unit: Yuan
Items | Ending balance | Beginning balance |
Cash on hand | 1,015,081.13 | 604,492.12 |
Bank deposit | 1,337,414,181.07 | 1,196,226,680.89 |
Other monetary capital | 429,150,793.87 | 22,264,303.49 |
Total | 1,767,580,056.07 | 1,219,095,476.50 |
Including: total amount deposited abroad | 177,157,407.24 | 153,809,647.09 |
Other description:
Other monetary capital mainly includes the large-denomination certificates of deposit of CNY330,000,000.00 yuan and the fixed-time deposit of CNY 50,000,000.00 yuan.At the end of the period, the otherrestricted monetary capital amounts to CNY 31,475,097.87. For details, please refer to Note “VI (57)” in thisfinancial report.At the end of the period, there is no amount deposited overseas and with the repatriation restricted.
2. Tradable financial assets
Unit: Yuan
Items | Ending balance | Beginning balance |
Financial assets measured at fair value with changes included in the current profits and losses | 214,999,336.74 | 226,491,482.10 |
Including: | ||
Financial products | 4,000,000.00 | 112,970,000.00 |
Investment in equity instruments | 210,999,336.74 | 113,521,482.10 |
Including: | ||
Total | 214,999,336.74 | 226,491,482.10 |
Other description:
3. Derivative financial assets
Unit: Yuan
Items | Ending balance | Beginning balance |
Other description:
4. Notes receivable
(1) Notes receivable listed by category
Unit: Yuan
Items | Ending balance | Beginning balance |
Bank acceptance bill | 141,695,340.12 | 33,560,579.23 |
Commercial acceptance bill | 19,964,130.09 | 5,917,351.40 |
Total | 161,659,470.21 | 39,477,930.63 |
Unit: Yuan
Category | Ending balance | Beginning balance | ||||||||
Book balance | Provision for bad debts | Book value | Book balance | Provision for bad debts | Book value | |||||
Amount | Proportion | Amount | Proportion of provision | Amount | Proportion | Amount | Proportion of provision | |||
Notes receivable with single provision for bad debts | 150,816,667.92 | 93.09% | 0.00% | 150,816,667.92 | 33,560,579.23 | 84.61% | 33,560,579.23 |
Including: | ||||||||||
Bank acceptance bill | 141,695,340.12 | 87.46% | 0.00% | 141,695,340.12 | 33,560,579.23 | 84.61% | 33,560,579.23 | |||
Commercial acceptance bill | 9,121,327.80 | 5.63% | 0.00% | 9,121,327.80 | ||||||
Notes receivable with provision for bad debts by portfolio | 11,189,682.44 | 6.91% | 346,880.15 | 3.10% | 10,842,802.29 | 6,106,657.79 | 15.39% | 189,306.39 | 3.10% | 5,917,351.40 |
Including: | ||||||||||
Commercial acceptance bill | 11,189,682.44 | 6.91% | 346,880.15 | 3.10% | 10,842,802.29 | 6,106,657.79 | 15.39% | 189,306.39 | 3.10% | 5,917,351.40 |
Total | 162,006,350.36 | 100.00% | 346,880.15 | 0.21% | 161,659,470.21 | 39,667,237.02 | 100.00% | 189,306.39 | 0.48% | 39,477,930.63 |
Single provision for bad debts: 0
Unit: Yuan
Name | Ending balance | |||
Book balance | Provision for bad debts | Proportion of provision | Reasons for provision | |
Bank acceptance bill | 141,695,340.12 | 0.00 | 0.00% | No risk of cashing bank acceptance bill |
Commercial acceptance bill | 9,121,327.80 | 0.00 | 0.00% | Discounted or endorsed notes receivable |
Total | 150,816,667.92 | 0.00 | -- | -- |
Single provision for bad debts:
Unit: Yuan
Name | Ending balance | |||
Book balance | Provision for bad debts | Proportion of provision | Reasons for provision |
Provision for bad debts by portfolio: 346,880.15
Unit: Yuan
Name | Ending balance | ||
Book balance | Provision for bad debts | Proportion of provision | |
Commercial acceptance bill | 11,189,682.44 | 346,880.15 | 3.10% |
Description of the basis for determining the portfolio:
Provision for bad debts by portfolio:
Unit: Yuan
Name | Ending balance | ||
Book balance | Provision for bad debts | Proportion of provision |
Description of the basis for determining the portfolio:
If the provision for bad debts on notes receivable is based on the general model of expected credit loss, theinformation about the provision for bad debts shall be disclosed by referring to the disclosure method of otherreceivables:
□ applicable √ not applicable
(2) Provision for bad debts withdrawn, recovered or reversed in current periodProvision for bad debts in current period:
Unit: Yuan
Category | Beginning balance | Amount changed in current period | Ending balance | |||
Provision | Recover or reversal | Write-off | Other | |||
Provision for bad debts - notes receivable | 189,306.39 | 157,573.76 | 346,880.15 | |||
Total | 189,306.39 | 157,573.76 | 346,880.15 |
Of which the amount of provision for bad debts reversed or recovered in current period is significant:
□ applicable √ not applicable
(3) Notes receivable pledged by the Company at the end of the period
Unit: Yuan
Items | Amount pledged at the end of the period |
Bank acceptance bill | 2,040,042.80 |
Commercial acceptance bill | 10,000.00 |
Total | 2,050,042.80 |
(4) Notes receivable endorsed or discounted by the Company at the end of the period but not yet due at thebalance sheet date
Unit: Yuan
Items | Amount derecognized at the end of the period | Amount not derecognized at the end of the period |
Bank acceptance bill | 104,278,163.47 |
Commercial acceptance bill | 9,121,327.80 | |
Total | 113,399,491.27 |
(5) Notes that the Company transferred to accounts receivable at the end of the period due tonon-performance by drawer
□ applicable √ not applicable
(6) Notes receivable actually written off in current period
□ applicable √ not applicable
5. Accounts receivable
(1) Disclosure of accounts receivable by category
Unit: Yuan
Category | Ending balance | Beginning balance | ||||||||
Book balance | Provision for bad debts | Book value | Book balance | Provision for bad debts | Book value | |||||
Amount | Proportion | Amount | Proportion of provision | Amount | Proportion | Amount | Proportion of provision | |||
Accounts receivable with provision for bad debts by single item | 84,081,324.25 | 3.60% | 70,915,243.12 | 84.34% | 13,166,081.13 | 3,787,463.00 | 0.21% | 3,787,463.00 | 100.00% | |
Including: | ||||||||||
Accounts receivable with a single significant amount and single bad debt provision | 82,399,228.55 | 3.53% | 69,233,147.42 | 84.02% | 13,166,081.13 | |||||
Accounts receivable with insignificant single amount but single provision made for bad debts | 1,682,095.70 | 0.07% | 1,682,095.70 | 100.00% | 3,787,463.00 | 0.21% | 3,787,463.00 | 100.00% | ||
Accounts | 2,247,009,076 | 96.40% | 72,013,691.92 | 3.20% | 2,174,995,384.35 | 1,758,425,18 | 99.79% | 57,314,031.63 | 3.26% | 1,701,111,153.84 |
receivable with provision for bad debts by portfolio | .27 | 5.47 | ||||||||
Including: | ||||||||||
Accounts receivable with provision for bad debts by aging combination | 2,247,009,076.27 | 96.40% | 72,013,691.92 | 3.20% | 2,174,995,384.35 | 1,758,425,185.47 | 99.79% | 57,314,031.63 | 3.26% | 1,701,111,153.84 |
Total | 2,331,090,400.52 | 100.00% | 142,928,935.04 | 6.13% | 2,188,161,465.48 | 1,762,212,648.47 | 100.00% | 61,101,494.63 | 3.47% | 1,701,111,153.84 |
Single provision for bad debts: 70,915,243.12
Unit: Yuan
Name | Ending balance | |||
Book balance | Provision for bad debts | Proportion of provision | Reasons for provision | |
Accounts receivable with a single significant amount and single bad debt provision | 82,399,228.55 | 69,233,147.42 | 84.02% | It is difficult to recover |
Accounts receivable with insignificant single amount but single provision made for bad debts | 1,682,095.70 | 1,682,095.70 | 100.00% | It is difficult to recover |
Total | 84,081,324.25 | 70,915,243.12 | -- | -- |
Single provision for bad debts:
Unit: Yuan
Name | Ending balance | |||
Book balance | Provision for bad debts | Proportion of provision | Reasons for provision |
Provision for bad debts by portfolio: 72,013,691.92
Unit: Yuan
Name | Ending balance | ||
Book balance | Provision for bad debts | Proportion of provision | |
Accounts receivable with provision for bad debts by aging combination | 2,247,009,076.27 | 72,013,691.92 | 3.20% |
Total | 2,247,009,076.27 | 72,013,691.92 | -- |
Description of the basis for determining the portfolio:
Provision for bad debts by portfolio:
□ applicable √ not applicable
Description of the basis for determining the portfolio:
If the provision for bad debts on notes receivable is based on the general model of expected credit loss, theinformation about the provision for bad debts shall be disclosed by referring to the disclosure method of otherreceivables:
□ applicable √ not applicable
Disclosure by aging
Unit: Yuan
Aging | Book balance |
Less than 1 year (including 1 year) | 2,268,073,021.54 |
1 to 2 years | 55,023,639.35 |
2 to 3 years | 3,892,587.98 |
Above 3 years | 4,101,151.65 |
3 to 4 years | 3,379,186.52 |
4 to 5 years | 72,198.33 |
Above 5 years | 649,766.80 |
Total | 2,331,090,400.52 |
(2) Provision for bad debts withdrawn, recovered or reversed in current periodProvision for bad debts in current period:
Unit: Yuan
Category | Beginning balance | Amount changed in current period | Ending balance | |||
Provision | Recover or reversal | Write-off | Other | |||
Provision for bad debts | 61,101,494.63 | 86,416,341.20 | 4,588,900.79 | 142,928,935.04 | ||
Total | 61,101,494.63 | 86,416,341.20 | 4,588,900.79 | 142,928,935.04 |
Of which the amount of provision for bad debts reversed or recovered in current period is significant: None
(3) Accounts receivable actually written off in current period
Unit: Yuan
Items | Write-off amount |
Accounts receivable actually written off | 4,588,900.79 |
Of which the significant write-offs of accounts receivable: None
(4) Accounts receivable of top five ending balances grouped by debtors
Unit: Yuan
Name of Entity | Ending balance of accounts receivable | Proportion to total ending balances of accounts receivable | Ending balance of provision for bad debts |
No.1 | 629,407,436.86 | 27.00% | 19,511,630.53 |
No.2 | 86,449,968.60 | 3.71% | 2,679,949.03 |
No.3 | 65,830,405.66 | 2.82% | 52,664,324.53 |
No.4 | 56,820,453.86 | 2.44% | 1,761,434.07 |
No.5 | 46,483,916.71 | 1.99% | 1,441,001.42 |
Total | 884,992,181.69 | 37.96% |
(5) Amount of assets and liabilities formed by transferring accounts receivable and continuing to beinvolvedOther description:
(6) Accounts receivable derecognized due to transfer of financial assets
6. Receivables financing
Unit: Yuan
Items | Ending balance | Beginning balance |
Bank acceptance bill | 26,520,757.05 | 90,426,713.39 |
Accounts receivable | 10,381,750.80 | 156,229,313.88 |
Total | 36,902,507.85 | 246,656,027.27 |
Changes in increase/decrease in receivables financing and changes in fair value in current period
□ applicable √ not applicable
If the provision for bad debts on receivables financing is based on the general model of expected credit loss, theinformation about the provision for bad debts shall be disclosed by referring to the disclosure method of otherreceivables:
√ applicable □ not applicable
Provision for bad debts | Phase 1 | Phase 2 | Phase 3 | Total |
Expected credit loss in | Expected credit loss for the | Expected credit loss for |
the next 12 months | entire duration (no credit impairment) | the entire duration (credit impairment occurred) | ||
Balance as of January 1, 2021 | 4,843,108.73 | 4,843,108.73 | ||
Reversal in current period | 4,521,274.46 | 4,521,274.46 | ||
Balance as of December 31, 2021 | 321,834.27 | - | - | 321,834.27 |
Other description:
7. Prepayments
(1) Prepayments are listed by aging
Unit: Yuan
Aging | Ending balance | Beginning balance | ||
Amount | Proportion | Amount | Proportion | |
Within 1 year | 40,538,366.14 | 98.11% | 16,968,264.14 | 95.68% |
1 to 2 years | 666,816.83 | 1.61% | 627,825.07 | 3.54% |
2 to 3 years | 94,392.13 | 0.23% | 113,188.10 | 0.64% |
Above 3 years | 20,709.92 | 0.05% | 25,952.68 | 0.15% |
Total | 41,320,285.02 | -- | 17,735,229.99 | -- |
Explanation of the cause for untimely settlement of advance payments aging more than one year with importantamounts
(2) Prepayment of top five ending balance grouped by prepaid object
The total amount of prepayments of top five ending balances grouped by debtors in the year was19,648,064.39 yuan, accounting for 47.55% of the total ending balances of prepayments.Other description:
None
8. Other receivables
Unit: Yuan
Items | Ending balance | Beginning balance |
Other receivables | 50,156,221.82 | 40,728,126.64 |
Total | 50,156,221.82 | 40,728,126.64 |
(1) Interest receivable
1) Classification of interest receivable
□ applicable √ not applicable
2) Significant overdue interest
□ applicable √ not applicable
3) Provision for bad debts
□ applicable √ not applicable
(2) Dividends receivable
1) Classification of interest receivable
□ applicable √ not applicable
2) Important dividends receivable aged over 1 year
□ applicable √ not applicable
3) Provision for bad debts
□ applicable √ not applicable
Other description:
(3) Other receivables
1) Classification of other receivables by nature of amount
Unit: Yuan
Nature of payment | Book balance at the end of the period | Book balance at the beginning of the period |
Margin, deposit | 28,560,062.74 | 11,276,827.12 |
Employee personal loan | 11,891,648.41 | 7,886,380.07 |
Export rebate amount | 14,317,249.26 | 23,817,036.82 |
Other | 638,217.83 | 187,249.47 |
Total | 55,407,178.24 | 43,167,493.48 |
2) Provision for bad debts
Unit: Yuan
Provision for bad debts | Phase 1 | Phase 2 | Phase 3 | Total |
Expected credit loss in the next 12 months | Expected credit loss for the entire duration (no credit impairment) | Expected credit loss for the entire duration (credit impairment occurred) | ||
Balance as of January 1, 2021 | 2,439,366.84 | |||
Balance as of January 1, 2021 in the current period | —— | —— | —— | —— |
Accrued in current period | 3,478,279.55 | |||
Cancel after verification in the current period | 666,689.97 | |||
Balance as of December 31, 2021 | 5,250,956.42 |
Changes in book balance with significant changes in loss reserves in current period
□ applicable √ not applicable
Disclosure by aging
Unit: Yuan
Aging | Book balance |
Less than 1 year (including 1 year) | 43,323,546.41 |
1 to 2 years | 2,561,108.59 |
2 to 3 years | 6,626,239.26 |
Above 3 years | 2,896,283.98 |
3 to 4 years | 1,734,261.72 |
4 to 5 years | 1,121,468.00 |
Above 5 years | 40,554.26 |
Total | 55,407,178.24 |
3) Provision for bad debts withdrawn, recovered or reversed in current periodProvision for bad debts in current period:
Unit: Yuan
Category | Beginning balance | Amount changed in current period | Ending balance | |||
Provision | Recover or reversal | Write-off | Other | |||
Bad-debt provision for other accounts receivable | 2,439,366.84 | 3,478,279.55 | 666,689.97 | 5,250,956.42 | ||
Total | 2,439,366.84 | 3,478,279.55 | 666,689.97 | 5,250,956.42 |
Of which the amount of provision for bad debts reversed or recovered in current period is significant: None
4) Other receivables actually written off in current period
Unit: Yuan
Items | Write-off amount |
Other accounts receivable cancelled after verification | 666,689.97 |
Of which the significant write-offs of other receivables: NoneDescription of other receivable written off: None
5) Other receivables of top five ending balances grouped by debtors
Unit: Yuan
Name of Entity | Nature of payment | Ending balance | Aging | Proportion to total ending balances of other receivables | Ending balance of provision for bad debts |
No.1 | Export rebate amount | 14,317,249.26 | Within 1 year | 25.84% | |
No.2 | Investment margin | 5,000,000.00 | Within 1 year | 9.02% | |
No.3 | Margin, deposit | 3,500,000.00 | Within 1 year | 6.32% | 175,000.00 |
No.4 | Margin, deposit | 3,203,622.59 | Within 1 year | 5.78% | 160,181.13 |
No.5 | Margin, deposit | 2,030,629.92 | Within 1 year | 3.66% | 101,531.50 |
Total | -- | 28,051,501.77 | -- | 50.62% | 436,712.63 |
6) Receivables involving government subsidies
□ applicable √ not applicable
7) Other receivables derecognized due to transfer of financial assets
□ applicable √ not applicable
8) Amount of assets and liabilities formed by transferring other receivables and continuing to be involvedOther description:
9. Inventory
Whether the Company is required to comply with the disclosure requirements of the real estate industryNo
(1) Inventory classification
Unit: Yuan
Items | Ending balance | Beginning balance | ||||
Book balance | Provision for decline in value of inventories or provision for impairment of contract performance cost | Book value | Book balance | Provision for decline in value of inventories or provision for impairment of contract performance cost | Book value | |
Raw materials | 1,373,010,350.15 | 87,214,891.71 | 1,285,795,458.44 | 669,357,860.89 | 56,781,506.42 | 612,576,354.47 |
Products in process | 108,042,400.38 | 14,608.82 | 108,027,791.56 | 65,058,584.18 | 65,058,584.18 | |
Goods on hand | 601,322,955.25 | 15,911,446.54 | 585,411,508.71 | 340,321,032.11 | 9,669,035.83 | 330,651,996.28 |
Goods shipped in transit | 122,939,046.46 | 3,114,595.53 | 119,824,450.93 | 48,921,114.18 | 3,963,402.85 | 44,957,711.33 |
Self-manufactured semi-finished product | 80,789,830.12 | 3,169,232.84 | 77,620,597.28 | 60,865,430.27 | 3,717,115.68 | 57,148,314.59 |
Low-value consumables | 97,460.86 | 97,460.86 | 84,986.73 | 84,986.73 | ||
Materials entrusted for processing | 7,625,498.26 | 7,625,498.26 | 4,834,921.04 | 4,834,921.04 | ||
Total | 2,293,827,541.48 | 109,424,775.44 | 2,184,402,766.04 | 1,189,443,929.40 | 74,131,060.78 | 1,115,312,868.62 |
(2) Provision for decline in value of inventories and provision for impairment of contract performance cost
Unit: Yuan
Items | Beginning balance | Increase in current period | Decrease in current period | Ending balance | ||
Provision | Other | Reversal or write-off | Other | |||
Raw materials | 56,781,506.42 | 71,134,786.86 | 40,701,401.57 | 87,214,891.71 | ||
Products in process | 14,608.82 | 14,608.82 | ||||
Goods on hand | 9,669,035.83 | 28,074,800.18 | 21,832,389.47 | 15,911,446.54 | ||
Goods shipped in transit | 3,963,402.85 | -835,710.32 | 13,097.00 | 3,114,595.53 | ||
Self-manufactured semi-finished product | 3,717,115.68 | 1,606,859.02 | 2,154,741.86 | 3,169,232.84 | ||
Total | 74,131,060.78 | 99,995,344.56 | 64,701,629.90 | 109,424,775.44 |
(3) Description of capitalized amount of borrowing costs included in ending balance of inventory
□ applicable √ not applicable
(4) Description of current amortization amount of contract performance cost
□ applicable √ not applicable
10. Contract assets
□ applicable √ not applicable
11. Assets held for sale
□ applicable √ not applicable
12. Non-current assets due within one year
□ applicable √ not applicable
13. Other current assets
Unit: Yuan
Items | Ending balance | Beginning balance |
Input tax of VAT | 92,861,498.25 | 66,429,956.99 |
Other taxes paid in advance | 19,851,631.11 | 3,837,535.73 |
Upfront IPO-related fees | 358,490.57 | |
Prepaid and amortized expenses | 28,952.04 | |
Total | 113,071,619.93 | 70,296,444.76 |
Other description:
14. Debt investment
□ applicable √ not applicable
15. Other debt investment
□ applicable √ not applicable
16. Long-term receivables
(1) Situation of long-term receivables
□ applicable √ not applicable
(2) Long-term receivables derecognized due to transfer of financial assets
(3) Amount of assets and liabilities formed by transferring long-term receivables and continuing to beinvolvedOther description:
17. Long-term equity investment
Unit: Yuan
Investee | Beginning balance (book value) | Changes in increase/decrease in current period | Ending balance (book value) | Ending balance of provision for impairment | |||||||
Additional investment | Decrease in investment | Profit and loss on investment recognized under equity method | Adjustment to other comprehensive income | Other changes in equity | Declaration of distribution for cash dividends or profits | Provision for impairment | Other |
I. Joint venture | |||||||||||
II. Associates enterprises | |||||||||||
Shenzhen Yuchengxin Power Technology Co., Ltd. | 9,764,719.19 | 9,764,719.19 | |||||||||
Shenzhen Daka Optoelectronics Co., Ltd. | 6,502,528.13 | -527,468.28 | 5,975,059.85 | ||||||||
Pas Electronic Technology (Nanjing) Co., Ltd. | 10,000,000.00 | -2,032,566.01 | 7,967,433.99 | ||||||||
Shanghai Yidong Power Technology Co., Ltd. | 12,500,000.00 | -323,366.02 | 12,176,633.98 | ||||||||
Subtotal | 6,502,528.13 | 22,500,000.00 | -2,883,400.31 | 35,883,847.01 | 9,764,719.19 | ||||||
Total | 6,502,528.13 | 22,500,000.00 | -2,883,400.31 | 35,883,847.01 | 9,764,719.19 |
Other description:
18. Investment in other equity instruments
□ applicable √ not applicable
19. Other non-current financial assets
□ applicable √ not applicable
20. Investment property
(1) Investment property with cost measurement model
√ applicable □ not applicable
Unit: Yuan
Items | Houses and buildings | Land usage right | Construction in progress | Total |
I. Original book value | ||||
1. Beginning | 94,945,556.51 | 94,945,556.51 |
balance | ||||
2. Increase in current period | ||||
(1) Outsourcing | ||||
(2) Transfer in of inventory, fixed assets and construction in progress | ||||
(3) Increase in business merger | ||||
3. Decrease in current period | ||||
(1) Disposal | ||||
(2) Other transfer out | ||||
4. Ending balance | 94,945,556.51 | 94,945,556.51 | ||
II. Accumulated depreciation and accumulated amortization | ||||
1. Beginning balance | 5,707,290.80 | 5,707,290.80 | ||
2. Increase in current period | 2,263,151.40 | 2,263,151.40 | ||
(1) Provision or amortization | 2,263,151.40 | 2,263,151.40 | ||
3. Decrease in current period | ||||
(1) Disposal | ||||
(2) Other transfer out | ||||
4. Ending balance | 7,970,442.20 | 7,970,442.20 | ||
III. Provision for impairment |
1. Beginning balance | ||||
2. Increase in current period | ||||
(1) Provision | ||||
3. Decrease in current period | ||||
(1) Disposal | ||||
(2) Other transfer out | ||||
4. Ending balance | ||||
IV. Book value | ||||
1. Ending book value | 86,975,114.31 | 86,975,114.31 | ||
2. Beginning book value | 89,238,265.71 | 89,238,265.71 |
(2) Investment property with fair value measurement model
□ applicable √ not applicable
(3) Investment property without property certificate of title
□ applicable √ not applicable
21. Fixed assets
Unit: Yuan
Items | Ending balance | Beginning balance |
Fixed assets | 1,299,517,887.54 | 1,096,875,640.94 |
Total | 1,299,517,887.54 | 1,096,875,640.94 |
(1) Fixed assets
Unit: Yuan
Items | Houses and buildings | Machinery and equipment | Transportation equipment | Office equipment and others | Total |
I. Original book value | |||||
1. Beginning balance | 752,994,459.37 | 525,970,142.85 | 2,365,946.85 | 162,218,225.49 | 1,443,548,774.56 |
2. Increase in current period | 63,665,845.71 | 192,044,577.70 | 311,834.38 | 73,177,944.57 | 329,200,202.36 |
(1) Acquisition | 1,057,156.18 | 171,692,846.26 | 248,060.05 | 49,732,248.89 | 222,730,311.38 |
(2) Transfer in of construction in progress | 62,608,689.53 | 19,865,971.04 | 354,007.87 | 82,828,668.44 | |
(3) Increase in business merger | 63,774.33 | 22,320,173.21 | 22,383,947.54 | ||
(4) Other | 485,760.40 | 771,514.60 | 1,257,275.00 | ||
3. Decrease in current period | 22,822,527.32 | 110,521.70 | 8,303,605.56 | 31,236,654.58 | |
(1) Disposal or scrap | 21,033,077.07 | 106,452.48 | 8,146,785.50 | 29,286,315.05 | |
(2) Other | 253,576.96 | 253,576.96 | |||
(3) Impact of exchange rate changes | 1,535,873.29 | 4,069.22 | 156,820.06 | 1,696,762.57 | |
4. Ending balance | 816,660,305.08 | 695,192,193.23 | 2,567,259.53 | 227,092,564.50 | 1,741,512,322.34 |
II. Accumulated depreciation | |||||
1. Beginning balance | 100,672,188.32 | 168,725,723.97 | 1,905,112.82 | 75,370,108.51 | 346,673,133.62 |
2. Increase in current period | 18,166,677.70 | 57,564,573.12 | 344,533.32 | 31,473,025.96 | 107,548,810.10 |
(1) Provision | 18,047,211.98 | 57,564,573.12 | 319,099.85 | 30,091,013.16 | 106,021,898.11 |
(2) Increment from enterprises merged | 25,433.47 | 1,113,847.68 | 1,139,281.15 | ||
(3) Other | 119,465.72 | 268,165.12 | 387,630.84 | ||
3. Decrease in current period | 5,827,634.57 | 50,352.86 | 6,349,521.49 | 12,227,508.92 | |
(1) Disposal or scrap | 5,665,179.07 | 50,352.86 | 6,239,457.04 | 11,954,988.97 | |
(2) Other | 162,455.50 | 110,064.45 | 272,519.95 | ||
4. Ending balance | 118,838,866.02 | 220,462,662.52 | 2,199,293.28 | 100,493,612.98 | 441,994,434.80 |
III. Provision for impairment | |||||
1. Beginning balance | |||||
2. Increase in current period |
(1) Provision | |||||
3. Decrease in current period | |||||
(1) Disposal or scrap | |||||
4. Ending balance | |||||
IV. Book value | |||||
1. Ending book value | 697,821,439.06 | 474,729,530.71 | 367,966.25 | 126,598,951.52 | 1,299,517,887.54 |
2. Beginning book value | 652,322,271.05 | 357,244,418.88 | 460,834.03 | 86,848,116.98 | 1,096,875,640.94 |
(2) Temporary idle fixed assets
□ applicable √ not applicable
(3) Fixed assets leased out through operating lease
□ applicable √ not applicable
(4) Fixed assets without certificate of title
□ applicable √ not applicable
(5) Disposal of fixed assets
□ applicable √ not applicable
22. Construction in progress
Unit: Yuan
Items | Ending balance | Beginning balance |
Construction in progress | 495,248,025.93 | 292,474,798.41 |
Total | 495,248,025.93 | 292,474,798.41 |
(1) Situation of construction in progress
Unit: Yuan
Items | Ending balance | Beginning balance |
Book balance | Provision for impairment | Book value | Book balance | Provision for impairment | Book value | |
Chongqing Yiyuan | 16,356,912.92 | 16,356,912.92 | 1,950,161.78 | 1,950,161.78 | ||
Decoration of Huizhou Plant | 2,966,677.50 | 2,966,677.50 | 19,675,613.36 | 19,675,613.36 | ||
Topband (India) Plant | 15,671,909.07 | 15,671,909.07 | 12,113,644.13 | 12,113,644.13 | ||
Ningbo Topband Industrial Park | 342,090,917.50 | 342,090,917.50 | 208,173,673.86 | 208,173,673.86 | ||
Decoration project | 189,761.68 | 189,761.68 | ||||
Test equipment to be commissioned | 102,011,463.64 | 102,011,463.64 | 34,312,847.55 | 34,312,847.55 | ||
Vietnam Dong Nai Decoration | 7,740,644.30 | 7,740,644.30 | 14,686,143.94 | 14,686,143.94 | ||
Dormitory renovation of Huizhou plant | 953,557.22 | 953,557.22 | 1,372,952.11 | 1,372,952.11 | ||
Huizhou YAKO Automation Plant | 3,452,853.07 | 3,452,853.07 | ||||
Qingdao Plant | 1,086,337.54 | 1,086,337.54 | ||||
Huizhou No.2 Industrial Park | 2,916,753.17 | 2,916,753.17 | ||||
Total | 495,248,025.93 | 495,248,025.93 | 292,474,798.41 | 292,474,798.41 |
(2) Changes of major projects under construction in the current period
Unit: Yuan
Project name | Amount budgeted | Beginning balance | Increase in current period | Amount of fixed assets transferred in current period | Other decreases in current period | Ending balance | Proportion of cumulative investment in the project to budget | Project progress | Accumulated amount of interest capitalized | Including: capitalization amount of interest in current period | Capitalization rate of interest in current period | Source of capitals |
Chongqing Yiyuan | 230,000,000.00 | 1,950,161.78 | 14,406,751.14 | 16,356,912.92 | 90.17% | 90% | Fund raising | |||||
Topband | 136,004,000.00 | 12,113,644.13 | 4,058,258.92 | 499,993.98 | 15,671,909.07 | 84.67% | 84% | Other |
(India) Plant | ||||||||||||
Ningbo Topband Industrial Park | 465,704,300.00 | 208,173,673.86 | 133,917,243.64 | 342,090,917.50 | 73.28% | 73% | Fund raising | |||||
Dong Nai Province, Vietnam | 75,000,000.00 | 11,997,186.05 | 45,735,111.41 | 57,732,297.46 | 76.97% | 77% | Other | |||||
Total | 906,708,300.00 | 234,234,665.82 | 198,117,365.11 | 57,732,297.46 | 499,993.98 | 374,119,739.49 | -- | -- | -- |
(3) Provision for impairment of project under construction in current period
□ applicable √ not applicable
(4) Engineering materials
□ applicable √ not applicable
23. Productive biological assets
(1) Productive biological assets with cost measurement model
□ applicable √ not applicable
(2) Productive biological assets with fair value measurement model
□ applicable √ not applicable
24. Oil and gas assets
□ applicable √ not applicable
25. Right-of-use assets
Unit: Yuan
Items | Houses and buildings | Total |
1. Beginning balance | 30,939,385.41 | 30,939,385.41 |
2. Increase in current period | 44,052,298.83 | 44,052,298.83 |
(1) New lease | 44,052,298.83 | 44,052,298.83 |
3. Decrease in current period | 916,406.75 | 916,406.75 |
(1) Termination of contract | 916,406.75 | 916,406.75 |
4. Ending balance | 74,075,277.49 | 74,075,277.49 |
2. Increase in current period | 16,234,413.73 | 16,234,413.73 |
(1) Provision | 16,234,413.73 | 16,234,413.73 |
3. Decrease in current period | 327,288.12 | 327,288.12 |
(1) Disposal | 327,288.12 | 327,288.12 |
4. Ending balance | 15,907,125.61 | 15,907,125.61 |
1. Ending book value | 58,168,151.88 | 58,168,151.88 |
2. Beginning book value | 30,939,385.41 | 30,939,385.41 |
Other descriptions: None
26. Intangible assets
(1) Situation of intangible assets
Unit: Yuan
Items | Land usage right | Patent right | Non-patented technology | Software | Trademark | Total |
I. Original book value | ||||||
1. Beginning balance | 124,135,401.05 | 435,321.58 | 289,470,671.25 | 22,316,899.22 | 9,728,450.00 | 446,086,743.11 |
2. Increase in current period | 114,095,830.12 | 106,410,514.06 | 1,437,032.79 | 222,580,569.33 | ||
(1) Acquisition | 114,095,830.12 | 1,437,032.79 | 116,170,055.27 | |||
(2) Internal R&D | 106,410,514.06 | 106,410,514.06 | ||||
(3) Increase in business merger | ||||||
3. Decrease in current period | ||||||
(1) Disposal | ||||||
(2) Impact of exchange rate changes | ||||||
4. Ending balance | 238,231,231.17 | 435,321.58 | 395,881,185.31 | 23,753,932.01 | 9,728,450.00 | 668,030,120.07 |
II. Accumulated amortization |
1. Beginning balance | 11,381,245.40 | 435,321.58 | 133,292,923.43 | 17,038,370.79 | 4,659,312.50 | 166,807,173.70 |
2. Increase in current period | 4,297,784.55 | 57,270,050.06 | 3,049,788.47 | 965,550.00 | 65,583,173.08 | |
(1) Provision | 4,297,784.55 | 57,270,050.06 | 3,049,788.47 | 965,550.00 | 65,583,173.08 | |
3. Decrease in current period | ||||||
(1) Disposal | ||||||
4. Ending balance | 15,679,029.95 | 435,321.58 | 190,562,973.49 | 20,088,159.26 | 5,624,862.50 | 232,390,346.78 |
III. Provision for impairment | ||||||
1. Beginning balance | ||||||
2. Increase in current period | ||||||
(1) Provision | ||||||
3. Decrease in current period | ||||||
(1) Disposal | ||||||
4. Ending balance | ||||||
IV. Book value | ||||||
1. Ending book value | 222,552,201.22 | 205,318,211.82 | 3,665,772.75 | 4,103,587.50 | 435,639,773.29 | |
2. Beginning book value | 112,754,155.65 | 156,177,747.82 | 5,278,528.43 | 5,069,137.50 | 279,279,569.40 |
The proportion of intangible assets formed through internal R&D in the balance of intangible assets at the end ofthe period accounted for 15.93%.
(2) Situation of Land usage right without property certificate of title
Unit: Yuan
Items | Book value | Reasons for failure to complete certificate of title |
Ningbo Plant | 30,898,573.26 | Under construction |
Other description:
27. Development expenditure
Unit: Yuan
Items | Beginning balance | Increase in current period | Decrease in current period | Ending balance | ||||
Internal | Other | Recognized as | Transferred to |
development expenditure | intangible assets | current profit and loss | ||||||
Intelligent controller project | 45,281,204.14 | 75,909,919.52 | 77,296,763.57 | 43,894,360.09 | ||||
Lithium battery project | 3,803,053.77 | 10,628,061.51 | 7,755,872.71 | 6,675,242.57 | ||||
Motor and control system project | 10,500,319.42 | 10,500,319.42 | ||||||
Other projects | 13,777,521.31 | 12,868,841.87 | 21,357,877.78 | 5,288,485.40 | ||||
Total | 62,861,779.22 | 109,907,142.32 | 106,410,514.06 | 66,358,407.48 |
Other description:
28. Goodwill
(1) Original book value of goodwill
Unit: Yuan
Name of investee or matters forming goodwill | Beginning balance | Increase in current period | Decrease in current period | Ending balance | ||
Resulted from business merger | Disposal | |||||
Shenzhen YAKO Automation Technology Co., Ltd. | 107,314,446.71 | 107,314,446.71 | ||||
Shenzhen Allied Control System Co., Ltd. | 53,768,699.68 | 53,768,699.68 | ||||
Shenzhen Meanstone Intelligent Technology Co., Ltd. | 3,006,892.59 | 3,006,892.59 | ||||
Hangzhou Zhidong Motor Technology Co., Ltd. | 1,322,921.77 | 1,322,921.77 | ||||
Taixing Ninghui Lithium Battery Co., Ltd. | 1,962,891.12 | 1,962,891.12 | ||||
Shenzhen Tengyi Industrial Co., Ltd. | 131,783.24 | 131,783.24 | ||||
Total | 165,412,960.75 | 2,094,674.36 | 167,507,635.11 |
(2) Provision for impairment of goodwill
Unit: Yuan
Name of investee or matters forming goodwill | Beginning balance | Increase in current period | Decrease in current period | Ending balance | ||
Provision | Disposal | |||||
Shenzhen Allied Control System Co., Ltd. | 53,768,699.68 | 53,768,699.68 | ||||
Shenzhen Meanstone Intelligent Technology Co., Ltd. | 3,006,892.59 | 3,006,892.59 | ||||
Total | 56,775,592.27 | 56,775,592.27 |
Information about the asset group or portfolio of goodwillNoneDescription of goodwill impairment test process, key parameters (e.g. growth rate during the forecast period,growth rate during the stabilization period, profitability, discount rate, forecast period, etc. when the present valueof future cash flow is expected) and method for recognizing impairment loss of goodwill:
NoneImpact of goodwill impairment testNoneOther description:
None
29. Long-term deferred expense
Unit: Yuan
Items | Beginning balance | Increase in current period | Current amortization amount | Other reduced amount | Ending balance |
Decoration cost | 71,797,383.61 | 50,816,411.50 | 26,819,984.79 | 1,029,895.74 | 94,763,914.58 |
Other | 280,287.48 | 464,091.69 | 356,677.37 | 387,701.80 | |
Total | 72,077,671.09 | 51,280,503.19 | 27,176,662.16 | 1,029,895.74 | 95,151,616.38 |
Other description:
30. Deferred tax assets / deferred tax liabilities
(1) Deferred tax assets without offset
Unit: Yuan
Items | Ending balance | Beginning balance | ||
Deductible temporary differences | Deferred tax assets | Deductible temporary differences | Deferred tax assets | |
Provision for asset impairment | 261,692,978.84 | 40,332,191.17 | 149,075,252.50 | 23,312,424.21 |
Deductible loss | 69,221,226.16 | 13,336,499.73 | 43,740,568.84 | 10,286,420.54 |
Amortization differences on intangible assets | 60,259,563.87 | 9,038,934.58 | 36,167,726.46 | 5,441,721.65 |
Deferred income | 14,150,200.00 | 2,122,530.00 | 14,279,770.00 | 2,141,965.50 |
Option fee | 253,046,279.23 | 37,956,941.88 | 93,402,952.30 | 14,010,442.85 |
Total | 658,370,248.10 | 102,787,097.36 | 336,666,270.10 | 55,192,974.75 |
(2) Deferred tax liabilities without offset
Unit: Yuan
Items | Ending balance | Beginning balance | ||
Taxable temporary difference | Deferred tax liabilities | Taxable temporary difference | Deferred tax liabilities | |
Valuation and appreciation of assets of business merger under different control | 2,589,919.73 | 388,487.96 | 5,279,699.53 | 791,954.93 |
Changes in fair value of tradable financial assets | 147,744,707.31 | 22,161,706.10 | 62,074,391.17 | 9,311,158.68 |
Book-tax difference of fixed assets depreciation | 10,334,504.12 | 2,570,545.66 | 3,830,509.95 | 863,864.88 |
Book-tax difference of rental income | 4,638,866.49 | 1,159,716.62 | 3,411,531.24 | 852,882.81 |
Total | 165,307,997.65 | 26,280,456.34 | 74,596,131.89 | 11,819,861.30 |
(3) Deferred tax assets or liabilities listed by net amount after offset
Unit: Yuan
Items | Amount of offset between | Ending balance of | Amount of mutual offset | Beginning balance of |
deferred tax assets and liabilities at the end of the period | deferred tax assets or liabilities after offset | between deferred tax assets and liabilities at the beginning of the period | deferred tax assets or liabilities after offset | |
Deferred tax assets | 102,787,097.36 | 55,192,974.75 | ||
Deferred tax liabilities | 26,280,456.34 | 11,819,861.30 |
(4) Details of unrecognized deferred tax assets
Unit: Yuan
Items | Ending balance | Beginning balance |
Deductible temporary differences | 6,322,216.54 | 3,393,804.05 |
Deductible loss | 32,682,476.84 | 14,481,679.98 |
Total | 39,004,693.38 | 17,875,484.03 |
(5) Deductible loss of unrecognized deferred tax assets will mature in the following years
Unit: Yuan
Year | Ending amount | Beginning amount | Remarks |
2022 | |||
2023 | |||
2024 | |||
2025 | |||
2026 | 2,183,482.54 | ||
No time limit | 30,498,994.30 | 14,481,679.98 | |
Total | 32,682,476.84 | 14,481,679.98 | -- |
Other description:
31. Other non-current assets
Unit: Yuan
Items | Ending balance | Beginning balance | ||||
Book balance | Provision for impairment | Book value | Book balance | Provision for impairment | Book value | |
Advanced engineering funds | 22,516,684.86 | 22,516,684.86 | 9,807,616.29 | 9,807,616.29 | ||
Prepayment for fixed assets | 48,511,362.98 | 48,511,362.98 | 24,831,739.10 | 24,831,739.10 | ||
Prepayment for | 1,013,380.56 | 1,013,380.56 |
intangible assets | ||||||
Total | 72,041,428.40 | 72,041,428.40 | 34,639,355.39 | 34,639,355.39 |
Other description:
32. Short-term loans
(1) Classification of short-term loans
Unit: Yuan
Items | Ending balance | Beginning balance |
Credit loan | 150,321,259.95 | 102,151,500.00 |
Letter of credit | 250,000,000.00 | 300,000,000.00 |
Bills receivable discounted but not due | 9,209,847.31 | |
Total | 409,531,107.26 | 402,151,500.00 |
Description of classification of short-term loans
(2) Overdue short-term loans
□ applicable √ not applicable
33. Trading financial liabilities
□ applicable √ not applicable
34. Derivative financial liabilities
□ applicable √ not applicable
35. Notes payable
Unit: Yuan
Category | Ending balance | Beginning balance |
Bank acceptance bill | 1,231,106,148.24 | 715,574,653.91 |
Total | 1,231,106,148.24 | 715,574,653.91 |
The total amount of notes payable due but unpaid at the end of the period was 0.00 yuan.
36. Accounts payable
(1) Accounts payable listed
Unit: Yuan
Items | Ending balance | Beginning balance |
Less than 1 year (including 1 year) | 1,493,504,084.34 | 1,540,652,638.39 |
1-2 years (including 2 years) | 11,697,003.66 | 7,398,205.08 |
2-3 years (including 3 years) | 4,533,633.55 | 484,275.57 |
Above 3 years | 1,550,275.01 | 1,371,220.68 |
Total | 1,511,284,996.56 | 1,549,906,339.72 |
(2) Significant accounts payable aged over 1 year
□ applicable √ not applicable
37. Advances received
(1) Advances received listed
Unit: Yuan
Items | Ending balance | Beginning balance |
Less than 1 year (including 1 year) | 353,895.16 | 487,267.17 |
Total | 353,895.16 | 487,267.17 |
(2) Significant advances received aged over 1 year
□ applicable √ not applicable
38. Contractual liabilities
Unit: Yuan
Items | Ending balance | Beginning balance |
Advances on sales | 93,328,006.70 | 72,576,117.56 |
Total | 93,328,006.70 | 72,576,117.56 |
Amount of and reasons for significant changes in book value during the reporting period
39. Employee compensation payable
(1) Employee compensation payable listed
Unit: Yuan
Items | Beginning balance | Increase in current period | Decrease in current period | Ending balance |
I. Short-term compensation | 174,617,927.43 | 1,392,579,469.40 | 1,368,422,777.24 | 198,774,619.59 |
II. Post-employment benefits - defined contribution plan | 885,836.69 | 41,106,087.75 | 41,902,748.01 | 89,176.43 |
Total | 175,503,764.12 | 1,433,685,557.15 | 1,410,325,525.25 | 198,863,796.02 |
(2) Short-term compensation listed
Unit: Yuan
Items | Beginning balance | Increase in current period | Decrease in current period | Ending balance |
1. Wages, bonuses, allowances and subsidies | 173,067,023.16 | 1,303,110,713.26 | 1,279,689,007.03 | 196,488,729.39 |
2. Employee benefits | 261,063.79 | 30,923,662.71 | 30,537,277.66 | 647,448.84 |
3. Social insurance expense | 231,998.20 | 38,336,814.21 | 38,422,135.37 | 146,677.04 |
Including: medical insurance expense | 210,694.44 | 35,472,068.93 | 35,541,646.15 | 141,117.22 |
Industrial injury insurance expense | 13,785.25 | 892,358.46 | 902,809.11 | 3,334.60 |
Maternity insurance expense | 7,518.51 | 1,972,386.82 | 1,977,680.11 | 2,225.22 |
4. Housing provident fund | 19,644,540.36 | 19,644,540.36 | ||
5. Trade union funds and staff education funds | 209.26 | 41,117.54 | 41,077.51 | 249.29 |
8. Others | 1,057,633.02 | 522,621.32 | 88,739.31 | 1,491,515.03 |
Total | 174,617,927.43 | 1,392,579,469.40 | 1,368,422,777.24 | 198,774,619.59 |
(3) Defined contribution plan listed
Unit: Yuan
Items | Beginning balance | Increase in current period | Decrease in current | Ending balance |
period | ||||
1. Basic endowment insurance | 861,046.07 | 40,208,215.16 | 40,982,196.73 | 87,064.50 |
2. Unemployment insurance expense | 24,790.62 | 897,872.59 | 920,551.28 | 2,111.93 |
Total | 885,836.69 | 41,106,087.75 | 41,902,748.01 | 89,176.43 |
Other description:
40. Taxes payable
Unit: Yuan
Items | Ending balance | Beginning balance |
VAT (value-added tax) | 1,412,358.17 | 12,524,919.27 |
Corporate income tax | 435,351.06 | 41,728,458.33 |
Individual income tax | 13,324,912.30 | 5,003,297.27 |
City maintenance and construction tax | 145,831.34 | 188,254.81 |
Education surcharge | 103,910.96 | 134,467.71 |
Property tax | 751,908.84 | 429,548.57 |
Land use tax | 174,669.06 | |
Stamp duty and others | 80,269.78 | 72,400.58 |
Total | 16,254,542.45 | 60,256,015.60 |
Other description:
41. Other payables
Unit: Yuan
Items | Ending balance | Beginning balance |
Other payables | 318,632,275.66 | 57,160,615.93 |
Total | 318,632,275.66 | 57,160,615.93 |
(1) Interest payable
□ applicable √ not applicable
(2) Dividends payable
□ applicable √ not applicable
(3) Other payables
1) Other payables listed by nature
Unit: Yuan
Items | Ending balance | Beginning balance |
Payment for equipment | 28,870,825.20 | 23,095,663.10 |
Payment for tooling | 965,441.44 | 654,303.42 |
Transportation expenses | 10,878,639.69 | 7,252,963.43 |
Rent and utilities | 4,127,402.12 | 3,105,044.79 |
Margin, deposit | 5,830,893.34 | 7,034,660.06 |
Wages for labor dispatching | 3,595,257.44 | 2,150,932.92 |
Consultation fee | 1,283,728.33 | 1,515,229.67 |
Fuel card fee | 2,977,890.66 | 1,503,438.82 |
Payment of decoration | 3,254,149.87 | 6,055,915.48 |
Restricted share repurchase obligations | 242,525,433.60 | |
Other | 14,322,613.97 | 4,792,464.24 |
Total | 318,632,275.66 | 57,160,615.93 |
2) Other significant payables aged over 1 year
□ applicable √ not applicable
42. Liabilities held for sale
□ applicable √ not applicable
43. Non-current liabilities due within one year
Unit: Yuan
Items | Ending balance | Beginning balance |
Long-term loans due within one year | 27,209,500.00 | |
Lease liabilities due within 1 year | 20,512,195.74 | |
Total | 47,721,695.74 |
Other description:
44. Other current liabilities
Unit: Yuan
Items | Ending balance | Beginning balance |
Tax amount to be resold | 2,874,899.86 | |
Notes receivable that have been endorsed or discounted but not derecognized | 104,189,643.96 | |
Total | 107,064,543.82 |
Changes in short-term bonds payable: None
45. Long-term loans
(1) Classification of long-term loans
Unit: Yuan
Items | Ending balance | Beginning balance |
Credit loan | 318,500,000.00 | |
Pledged borrowings | 156,520,000.00 | 200,000,000.00 |
Total | 475,020,000.00 | 200,000,000.00 |
Description of classification long-term loan-term loans:
Additional notes, including interest rate ranges:
46. Bonds payable
(1) Bonds payable
□ applicable √ not applicable
(2) Changes in increase or decrease of bonds payable (excluding preferred shares, perpetual bonds andother financial instruments classified as financial liabilities)
□ applicable √ not applicable
(3) Description of conversion conditions and time of convertible corporate bond
□ applicable √ not applicable
(4) Description of other financial instruments classified as financial liabilities
□ applicable √ not applicable
47. Lease liabilities
Unit: Yuan
Items | Ending balance | Beginning balance |
Housing and building rents | 40,290,402.14 | 30,939,385.41 |
Total | 40,290,402.14 | 30,939,385.41 |
Other description:
48. Long-term accounts payable
Unit: Yuan
Items | Ending balance | Beginning balance |
(1) Long-term payables listed according to the nature of the payment
□ applicable √ not applicable
(2) Special payable
□ applicable √ not applicable
49. Long-term employee compensation payable
(1) Long-term payroll payable table
□ applicable √ not applicable
(2) Changes in the defined benefit plan
□ applicable √ not applicable
50. Estimated liabilities
□ applicable √ not applicable
51. Deferred income
Unit: Yuan
Items | Beginning balance | Increase in current period | Decrease in current period | Ending balance | Reasons for formation |
Governmental subsidies | 14,624,770.00 | 3,120,700.00 | 3,360,270.00 | 14,385,200.00 | Governmental subsidies related to assets |
Total | 14,624,770.00 | 3,120,700.00 | 3,360,270.00 | 14,385,200.00 | -- |
Items involving government subsidies:
Unit: Yuan
Liability items | Beginning balance | New subsidy amount in current period | Amount included in non-operating income in current period | Amount included in other income in current period | Amount of write-down costs in current period | Other changes | Ending balance | Asset-related/revenue-related |
Special fund for the industrialization of high-efficiency energy-saving rare-earth permanent magnet motor | 1,300,000.00 | 195,000.00 | 1,105,000.00 | Asset-related | ||||
R&D equipment project of intelligent home management system such as IoT cloud computing technology | 394,500.00 | 263,000.00 | 131,500.00 | Asset-related | ||||
R&D project of key technology for clean energy DC system measurement | 225,000.00 | 50,000.00 | 175,000.00 | Asset-related | ||||
Nano lithium iron phosphate power battery project | 750,000.00 | 250,000.00 | 500,000.00 | Asset-related | ||||
Key technology research and | 561,000.00 | 204,000.00 | 357,000.00 | Asset-related |
development of 18650-2.8A.h high power battery | ||||||||
Intelligent grid connected project of distributed photovoltaic power station | 120,000.00 | 60,000.00 | 60,000.00 | Asset-related | ||||
R&D project of 60A solar charging controller with peak power tracking technology | 530,000.00 | 120,000.00 | 410,000.00 | Asset-related | ||||
R&D project of unmanned Robot Cleaner | 3,000,000.00 | 450,000.00 | 2,550,000.00 | Asset-related | ||||
Key technology research and development project of rare-earth permanent magnet brushless DC motor and controller with high speed ratio and variable frequency | 4,000,000.00 | 4,000,000.00 | Asset-related | |||||
Monthly Acceptance Amortization of Huizhou Anti-epidemic National Debt Technical Transformation Project in 2006 for 5 Years | 3,744,270.00 | 832,060.00 | 2,912,210.00 | Asset-related | ||||
Monthly Acceptance Amortization of Technical | 3,120,700.00 | 936,210.00 | 2,184,490.00 | Asset-related |
Transformation Project of Intelligent Controller in Huizhou Province and Technical Transformation of Lithium Battery Automation Production Line in 2006 for 5 Years | ||||||||
Total | 14,624,770.00 | 3,120,700.00 | 3,360,270.00 | 14,385,200.00 |
Other description:
52. Other non-current liabilities
□ applicable √ not applicable
53. Share capital
Unit: Yuan
Beginning balance | Increase and decrease of change this time (+, -) | Ending balance | |||||
Issuance of new shares | Stock dividend | Conversion of accumulation fund into shares | Other | Subtotal | |||
Total number of shares | 1,135,216,809.00 | 110,810,663.00 | 10,950,600.00 | 121,761,263.00 | 1,256,978,072.00 |
Other description:
Note: The share capital increased by CNY 121,761,263.00 yuan in the current period, including CNY92,105,263.00 yuan due to the non-public issuance of shares, CNY 18,705,400.00 yuan due to the implementationof restricted stock incentives, and CNY 10,950,600.00 yuan due to the exercise of stock options.
54. Other equity instruments
(1) Basic information of preferred shares, perpetual bonds and other financial instruments issued at theend of the period
□ applicable √ not applicable
(2) Changes in preferred shares, perpetual bonds and other financial instruments issued at the end of theperiod
□ applicable √ not applicable
55. Capital reserve
Unit: Yuan
Items | Beginning balance | Increase in current period | Decrease in current period | Ending balance |
Capital premium (share premium) | 936,582,920.43 | 1,139,848,687.71 | 2,076,431,608.14 | |
Other capital reserve | 32,787,972.41 | 52,097,203.15 | 21,263,633.96 | 63,621,541.60 |
Total | 969,370,892.84 | 1,191,945,890.86 | 21,263,633.96 | 2,140,053,149.74 |
Other description, including the changes in increase and decrease in current period and the reasons for changes:
Note 1: The share premium increased by CNY 1,139,848,687.71 yuan this year, including: CNY143,802,067.92 yuan due to the subscription of restricted shares by the company, and CNY 996,046,619.79 yuan,which is transferred to the share premium due to the unlocking of options, and was previously included in othercapital reserves as the options tariff.Note 2: Other capital surplus was increased by 52,097,203.21 yuan during the year, of which: 31,425,929.41yuan of share-based payment expense was recognized during the period under the stock option plan and issuanceof restricted stock; 20,671,273.74 yuan of deferred tax assets was recognized based on the pre-tax deductiblestock option expense expected to be exercised in the future. Other capital reserves decreased by CNY9,575,974.17 yuan this year, including CNY 9,183,384.00 due to the capital premium transferred from theexercise of stock options; CNY 392,590.17 due to the resignation of incentive objects and the resulting reversal ofshare payment expenses; CNY 11,699,698.63 yuan due to the fact that Shenzhen YAKO Automation TechnologyCo., Ltd. adjusted the capital increase of minority shareholders, affecting the capital reserve at the merger level;CNY 1,759,546.07 yuan due to the fact that Shenzhen Mintai Intelligent Technology Co., Ltd. adjusted the capitalincrease of minority shareholders, affecting the capital reserve at the merger level; CNY 1,771,584.91 yuan at themerger level due to the acquisition of Ninghui Lithium Battery Co., Ltd.
56. Treasury shares
Unit: Yuan
Items | Beginning balance | Increase in current period | Decrease in current period | Ending balance |
Restricted share repurchase obligations | 242,525,433.60 | 242,525,433.60 | ||
Repurchase of company shares in competitive trading | 80,017,965.68 | 80,017,965.68 | ||
Total | 80,017,965.68 | 242,525,433.60 | 80,017,965.68 | 242,525,433.60 |
Other description, including the changes in increase and decrease in current period and the reasons for changes:
Note: The increase of treasury shares in this period is caused by the accrued restricted stock repurchaseobligation of CNY 242,525,433.60 yuan due to the implementation of stock ownership incentive by majorcompanies.
57. Other comprehensive income
Unit: Yuan
Items | Beginning balance | Amount incurred in current period | Ending balance | |||||
Amount before income tax in current period | Minus: current profits and losses included in other comprehensive income in the previous period | Minus: current retained earnings included in other comprehensive income in the previous period | Minus: income tax expense | Attributable to parent company after tax | Attributable to minority shareholders after tax | |||
(II) Other comprehensive income that is reclassified into profits and losses | -24,555,229.97 | -67,324,542.05 | -48,275.14 | -67,276,266.91 | -91,831,496.88 | |||
Translation difference of foreign currency financial statements | -30,124,805.01 | -62,076,801.28 | -62,076,801.28 | -92,201,606.29 | ||||
Other | 5,569,575.04 | -5,247,740.77 | -48,275.14 | -5,199,465.63 | 370,109.41 | |||
Total amount of other comprehensive income | -24,555,229.97 | -67,324,542.05 | -48,275.14 | -67,276,266.91 | -91,831,496.88 |
Other description, including the adjustment to the effective portion of the profit and loss of cash flowhedging transferred to the amount initially recognized for the hedged item:
58. Special reserve
□ applicable √ not applicable
59. Surplus reserve
Unit: Yuan
Items | Beginning balance | Increase in current period | Decrease in current period | Ending balance |
Statutory surplus reserve | 151,359,957.53 | 35,037,674.23 | 186,397,631.76 | |
Total | 151,359,957.53 | 35,037,674.23 | 186,397,631.76 |
Explanation of the surplus reserve, including the increase or decrease in the current period and the reasons for thechange:
60. Undistributed profit
Unit: Yuan
Items | Current period | Prior period |
Undistributed profit at the end of last period before adjustment | 1,324,944,369.91 | 866,301,932.11 |
Total undistributed profit at the beginning of the period (+ for increase, - for decrease) | -19,061,969.80 | -17,706,279.40 |
Undistributed profit at the beginning of last period after adjustment | 1,305,882,400.11 | 848,595,652.71 |
Plus: net profit attributable to the owners of the parent company in current period | 564,964,282.18 | 532,161,123.64 |
Minus: withdrawal of statutory surplus reserve | 35,037,674.23 | 24,075,745.79 |
Common Stock dividends payable | 56,565,524.45 | 50,798,630.45 |
Undistributed profit at the end of the period | 1,779,243,483.61 | 1,305,882,400.11 |
Details of undistributed profit at the beginning of adjustment period:
1) Due to the retroactive adjustment of Accounting Standards for Business Enterprises and related newregulations, the undistributed profit at the beginning of the period was 0.00 yuan.
2) Due to the change of accounting policy, the undistributed profit at the beginning of the period was 0.00 yuan.
3) Due to the correction of major accounting errors, the undistributed profit at the beginning of the period was-19,061,969.80 yuan.
4) Due to the change in merger under the same control, the undistributed profit at the beginning of the period was
0.00 yuan.
5) The undistributed profit at the beginning of the period was 0.00 yuan with other adjustments.
61. Operating income and operating costs
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period | ||
Income | Cost | Income | Cost | |
Main business | 7,717,976,814.04 | 6,107,767,617.78 | 5,509,664,078.91 | 4,183,169,715.86 |
Other business | 49,058,020.99 | 6,763,737.09 | 50,518,919.30 | 21,124,114.91 |
Total | 7,767,034,835.03 | 6,114,531,354.87 | 5,560,182,998.21 | 4,204,293,830.77 |
Whether the lower of audited net income before or after deducting the non-recurring profit and loss is negative
□ Yes √ No
Income-related information:
Unit: Yuan
Contract classification | Intelligent Control Division | Total |
Including: | ||
Tool | 2,994,451,368.50 | 2,994,451,368.50 |
Home appliances | 2,959,263,866.21 | 2,959,263,866.21 |
New energy | 1,241,478,904.30 | 1,241,478,904.30 |
Industry | 295,153,637.29 | 295,153,637.29 |
Intelligent solutions | 221,269,657.19 | 221,269,657.19 |
Other | 55,417,401.54 | 55,417,401.54 |
Total | 7,767,034,835.03 | 7,767,034,835.03 |
Including: | ||
Domestic | 3,427,652,622.28 | 3,427,652,622.28 |
Foreign | 4,339,382,212.75 | 4,339,382,212.75 |
Total | 7,767,034,835.03 | 7,767,034,835.03 |
Including: | ||
Transfer at a certain point | 7,767,034,835.03 | 7,767,034,835.03 |
Information related to performance obligations:
Not applicableInformation related to the transaction price allocated to the remaining performance obligations:
The amount of income corresponding to the performance obligations that have signed contracts but have not beenperformed or completed at the end of this reporting period is 0.00 yuan, and 0.00 yuan is expected to berecognized within one year.Other description:
62. Taxes and surcharges
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
City maintenance and construction tax | 9,880,306.75 | 6,324,873.31 |
Education surcharge | 7,057,104.39 | 4,517,766.67 |
Property tax | 7,220,449.07 | 6,798,046.02 |
Land use tax | 768,937.95 | 761,833.73 |
Stamp duty | 4,088,571.43 | 3,161,739.96 |
Other | 38,498.12 | 126,323.00 |
Total | 29,053,867.71 | 21,690,582.69 |
Other description:
63. Sales expenses
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Employee compensation | 117,940,781.05 | 84,228,078.15 |
Low-value consumables | 4,721,582.36 | 1,518,012.92 |
Business entertainment expenses | 16,931,032.05 | 11,324,256.98 |
Travel expenses | 11,055,029.71 | 7,151,311.70 |
Intermediary service expenses | 19,280,507.23 | 12,857,876.78 |
Exhibition expenses | 2,256,350.43 | 1,883,321.83 |
Materials expenses | 12,365,975.47 | 4,981,728.64 |
Mail expenses | 3,187,394.23 | 2,083,622.84 |
Option fee | 4,731,183.73 | 1,070,281.42 |
Advertising expenses | 4,568,296.26 | 585,897.69 |
Customs charges | 2,542,454.90 | 1,315,519.21 |
Rentals | 1,980,077.01 | 1,144,877.48 |
Other | 7,002,154.67 | 2,753,648.06 |
Total | 208,562,819.10 | 132,898,433.70 |
Other description:
64. Administrative expenses
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Employee compensation | 155,978,506.36 | 101,669,023.72 |
Decoration cost | 17,168,830.94 | 15,080,374.60 |
Intermediary service expenses | 12,359,796.94 | 11,006,233.18 |
Depreciation and amortization | 19,379,537.14 | 15,388,899.93 |
Rent and utilities | 6,233,831.28 | 4,678,076.32 |
Low-value consumables | 2,819,301.47 | 4,814,426.22 |
Property insurance expenses | 4,833,375.18 | 3,943,952.43 |
Office expenses | 8,227,084.07 | 4,856,861.79 |
Option fee | 10,472,082.30 | 4,922,832.16 |
Travel expenses | 4,686,846.18 | 2,851,141.72 |
Recruitment expenses | 2,814,710.51 | 1,761,794.56 |
Royalties | 3,844,108.79 | 4,013,172.39 |
Business entertainment expenses | 1,936,130.95 | 951,643.69 |
Maintenance fees | 2,493,243.02 | 2,283,380.83 |
Other | 5,097,646.76 | 5,835,657.65 |
Total | 258,345,031.89 | 184,057,471.19 |
Other description:
65. R&D expenses
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Employee compensation | 270,040,042.63 | 209,691,514.52 |
Depreciation and amortization | 67,822,294.92 | 47,941,714.20 |
Material expenses | 32,453,761.31 | 17,494,266.42 |
Option fee | 13,876,403.61 | 4,721,777.37 |
Tooling expense | 19,674,097.73 | 4,480,409.98 |
Intermediary service expenses | 8,558,169.27 | 4,028,380.25 |
Low-value consumables | 5,380,174.29 | 5,367,907.74 |
Testing expense | 6,429,992.15 | 5,009,617.91 |
Decoration cost | 3,724,447.95 | 3,624,175.64 |
Utilities | 4,942,111.11 | 2,880,537.35 |
Travel expenses | 4,141,146.62 | 3,210,677.11 |
Rentals | 1,266,488.74 | 1,876,088.61 |
Other | 11,640,921.78 | 7,215,587.05 |
Total | 449,950,052.11 | 317,542,654.15 |
Other description:
66. Financial expenses
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Interest expense | 24,677,917.47 | 41,611,921.13 |
Minus: interest income | 8,722,530.08 | 7,457,090.20 |
Exchange gains (loss marked with "-") | 44,680,917.00 | 98,517,832.20 |
Handling fee and others | 3,149,246.09 | 44,313,350.36 |
Total | 63,785,550.48 | 176,986,013.49 |
Other description:
67. Other revenues
Unit: Yuan
Source for other revenues | Amount incurred in current period | Amount incurred in prior period |
Governmental subsidies | 16,456,682.22 | 27,326,933.85 |
Added-value tax refund on demand | 8,646,329.13 | 7,158,399.28 |
Return of individual income tax service charge | 1,105,035.34 | 766,726.03 |
Other | 13,534.31 | |
Total | 26,208,046.69 | 35,265,593.47 |
68. Investment revenue
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Long-term equity investment revenue accounted by equity method | -2,883,400.31 | -360,946.80 |
Investment revenue of tradable financial assets during holding period | 38,226,720.08 | 230,366,485.41 |
Investment revenue of financial products | 9,914,763.48 | 5,602,702.63 |
Forward foreign exchange contract settlement profit and loss | 9,569,000.00 | 22,970,000.00 |
Total | 54,827,083.25 | 258,578,241.24 |
Other description:
69. Net exposure hedging revenue
□ applicable √ not applicable
70. Fair value change revenue
Unit: Yuan
Sources of income from change in fair value | Amount incurred in current period | Amount incurred in prior period |
Tradable financial assets | 85,670,316.15 | -105,561,454.64 |
Total | 85,670,316.15 | -105,561,454.64 |
Other description:
71. Credit impairment loss
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Bad debt loss of other receivables | -3,478,279.55 | 1,590,385.44 |
Bad debt loss of receivables | -81,957,775.77 | 9,229,256.64 |
Bad debt loss of commercial acceptance bill | -157,573.76 | -172,417.86 |
Total | -85,593,629.08 | 10,647,224.22 |
Other description:
72. Asset impairment loss
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
II. Loss on inventory valuation and contract performance cost impairment loss | -99,995,344.56 | -64,732,329.22 |
XI. Goodwill impairment loss | -34,531,349.37 | |
Total | -99,995,344.56 | -99,263,678.59 |
Other description:
73. Assets disposal revenue
Unit: Yuan
Source of assets disposal revenue | Amount incurred in current period | Amount incurred in prior period |
Revenue from disposal of non-current assets | -415,086.11 | -932,817.83 |
Right-of-use asset derecognition | 10,696.36 | |
Total | -404,389.75 | -932,817.83 |
74. Non-operating income
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period | Amount included in the current non-recurring profit and loss |
Accepting donations | 22,475.87 | 22,475.87 | |
Quality deduction income | 59,263.20 | 10,645.00 | 59,263.20 |
Other | 2,178,616.67 | 3,080,907.14 | 2,178,616.67 |
Total | 2,260,355.74 | 3,091,552.14 | 2,260,355.74 |
Government subsidy included in the current profits and losses:
Unit: Yuan
Subsidy project | Grant entity | Grant reasons | Nature type | Whether the subsidy affect the profit and loss of the year | Whether it is the special subsidy | Amount incurred in the current period | Amount incurred in the last period | Asset-related/revenue-related |
Added-value tax refund on demand | 8,646,329.13 | 7,158,399.28 | Related to revenue | |||||
Return of individual income | 1,105,035.34 | 766,726.03 | Related to revenue |
tax service charge | ||||||||
Technological transformation supported by 2020 anti-epidemic national debt funds | 832,060.00 | 416,030.00 | Asset-related | |||||
R&D equipment project of intelligent home management system such as IoT cloud computing technology | 263,000.00 | 263,000.00 | Asset-related | |||||
Nano lithium iron phosphate power battery project | 250,000.00 | 250,000.00 | Asset-related | |||||
High rate 18650-2.8Ah power battery key technology research and development project | 204,000.00 | 204,000.00 | Asset-related | |||||
Special fund for the industrialization of high-efficiency energy-saving rare-earth permanent magnet motor | 195,000.00 | 195,000.00 | Asset-related | |||||
R&D project of 60A solar charging controller with peak power tracking technology | 120,000.00 | 120,000.00 | Related to revenue | |||||
Intelligent grid connected project of distributed photovoltaic power station | 60,000.00 | 60,000.00 | Asset-related | |||||
R&D project of key technology for | 50,000.00 | 50,000.00 | Asset-related |
clean energy DC system measurement | ||||||||
R&D project of unmanned Robot Cleaner | 450,000.00 | Asset-related | ||||||
Special fund for intelligent controller and lithium battery technology transformation | 936,210.00 | Related to revenue | ||||||
Return of unemployment insurance premium | 5,991,047.80 | Related to revenue | ||||||
Training replaced for operation subsidy | 288,500.00 | 2,709,000.00 | Related to revenue | |||||
Support and subsidy for enterprises to expand production and increase efficiency | 2,476,845.00 | 2,511,000.00 | Related to revenue | |||||
Enterprise development and research funding | 1,699,000.00 | 2,199,800.00 | Related to revenue | |||||
Export credit insurance subsidy | 1,031,335.00 | 2,052,992.00 | Related to revenue | |||||
Industrial and commercial electricity subsidy | 459,804.80 | 1,629,404.77 | Related to revenue | |||||
Two-tax financial subsidy | 1,540,000.00 | Related to revenue | ||||||
Position stabilization subsidy | 231,269.09 | 1,311,398.13 | Related to revenue | |||||
Technical transformation and improvement project funding | 150,000.00 | 950,000.00 | Related to revenue |
Special funds for foreign trade development of enterprises | 543,789.00 | 655,162.00 | Related to revenue | |||||
Support and subsidiary for emerging industries | 520,000.00 | Related to revenue | ||||||
Denglinghui multiplying plan subsidy | 500,000.00 | Related to revenue | ||||||
Industrial Internet development support plan | 350,000.00 | Related to revenue | ||||||
Reward for scale growth of industrial enterprises | 500,000.00 | 300,000.00 | Related to revenue | |||||
2020 Science and Technology Finance Subsidy Scheme Project | 296,300.00 | Related to revenue | ||||||
Double promotion funding for technically innovative doubling special funding plan quality brand | 340,000.00 | 280,000.00 | Related to revenue | |||||
Filing subsidy | 50,000.00 | 270,000.00 | Related to revenue | |||||
Special fund for Huizhou industry and informatization issued by Zhongkai Economic Development Bureau | 250,000.00 | 250,000.00 | Related to revenue | |||||
Subsidy for recognition of high-tech enterprises for counseling services | 200,000.00 | Related to revenue |
Steady growth subsidy | 200,000.00 | Related to revenue | ||||||
Patent subsidy | 287,750.00 | 169,500.00 | Related to revenue | |||||
Pre-position training subsidy | 127,600.00 | Related to revenue | ||||||
Sub-item funds for energy conservation and emission reduction | 56,073.15 | Related to revenue | ||||||
Enterprise high-tech enterprise recognition award subsidy | 50,000.00 | 50,000.00 | Related to revenue | |||||
Exhibition subsidy | 68,400.00 | 5,000.00 | Related to revenue | |||||
National Innovation Carrier Support Program | 2,000,000.00 | Related to revenue | ||||||
Promotion of financial aid | 300,000.00 | Related to revenue | ||||||
Growth incentive fund in 2020 | 1,600,000.00 | Related to revenue | ||||||
Financial support fund of Xinqiao Town of Songjiang District of Shanghai | 170,000.00 | Related to revenue | ||||||
Other projects | 599,719.33 | 658,160.31 | Related to revenue | |||||
Total | 26,208,046.69 | 35,265,593.47 |
Other description:
75. Non-operating expenses
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period | Amount included in the current non-recurring profit and loss |
External donations | 300,000.00 | 300,000.00 | |
Profits and losses on disposal of non-current assets | 384,846.54 | 1,229,856.20 | 384,846.54 |
Customer quality deduction expenditure | 4,211,737.26 | 3,257,648.65 | 4,211,737.26 |
Other | 641,709.14 | 570,326.97 | 641,709.14 |
Total | 5,538,292.94 | 5,057,831.82 | 5,538,292.94 |
Other description:
76. Income tax expense
(1) Table of income tax expense
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Current income tax expense | 47,133,452.67 | 93,853,943.96 |
Deferred tax expense | 994,237.09 | -20,949,784.64 |
Total | 48,127,689.76 | 72,904,159.32 |
(2) Adjustment process of accounting profit and income tax expense
Unit: Yuan
Items | Amount incurred in current period |
Total profits | 620,240,304.37 |
Income tax expenses calculated at statutory / applicable tax rates | 93,036,045.66 |
Impact of different tax rates on subsidiaries | -6,293,349.43 |
Effect of income tax adjustment in previous period | -3,658,050.20 |
Impact of non-taxable income | 79,120.24 |
Impact of non-deductible costs, expenses and losses | 1,332,705.87 |
Impact of deductible temporary difference or deductible loss of unrecognized deferred tax assets in the current period | 2,086,012.87 |
The impact of changes in tax rates on the initial balance of deferred income tax | 716,712.84 |
Impact of additional deductible expenses | -29,431,470.21 |
Impact of tax exemption policy for companies in Vietnam | -12,333,706.67 |
Effects of deductable temporary difference and deductable losses of deferred tax recognized in previous years | 531,342.96 |
Impact of other adjustments | 2,062,325.84 |
Income tax expenses | 48,127,689.76 |
Other description:
77. Other comprehensive income
See Note 57. Other comprehensive income for details.
78. Items of cash flow statement
(1) Other cash received related to operating activities
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Intercourse funds | 51,529,019.88 | 7,457,090.20 |
Interest income | 8,722,530.08 | 31,929,203.85 |
Governmental subsidies | 16,217,112.22 | 16,606,451.15 |
Other | 3,784,144.14 | 5,887,567.72 |
Deposit and earnest money received | 3,213,112.84 | 12,076,403.76 |
Housing subsidy for talents | 6,277,563.00 | 25,603,304.78 |
Total | 89,743,482.16 | 99,560,021.46 |
Description of other cash received related to operating activities:
(2) Other cash paid related to operating activities
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Service charge | 3,149,246.09 | 2,319,492.32 |
Management expenses | 55,426,043.19 | 53,061,394.35 |
Research and development expenses | 126,948,109.79 | 55,001,890.87 |
Sales expenses | 91,330,261.82 | 47,229,489.36 |
Margin and deposit expenses | 15,969,153.96 | 9,802,400.50 |
Other | 8,980,140.75 | 15,888,925.52 |
Total | 301,802,955.60 | 183,303,592.92 |
Description of other cash paid related to operating activities:
(3) Other cash received related to investment activities
□ applicable √ not applicable
(4) Other cash paid related to investment activities
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Individual income tax on acquisition of shares | 20,016,000.00 | |
Total | 20,016,000.00 |
Description of other cash paid related to investment activities:
(5) Other cash received related to financing activities
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Margins for bills and notes | 18,039,024.44 | 51,476,244.39 |
Bills receivable discounted but not due | 9,209,847.31 | |
Total | 27,248,871.75 | 51,476,244.39 |
Description of other cash received related to funding activities:
(6) Other cash paid related to financing activities
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Margins for bills and notes | 25,597,956.24 | 18,039,024.44 |
Stock issue cost | 1,266,137.03 | |
Repurchase of treasury stock | 20,008,353.16 | |
Lease payments paid | 13,333,649.93 | |
Total | 40,197,743.20 | 38,047,377.60 |
Description of other cash paid related to funding activities:
79. Supplementary information of cash flow statement
(1) Supplementary information of cash flow statement
Unit: Yuan
Supplementary information | Current amount | Amount of the previous period |
1.Adjusting net profit to cash flow from operating activities: | -- | -- |
Net profit | 572,112,614.61 | 546,576,681.09 |
Plus: Impairment of assets | 184,862,507.33 | 88,616,454.37 |
Depreciation of fixed assets, depletion of oil and gas assets as well as depreciation of productive biological assets | 106,211,599.68 | 80,597,211.85 |
Depreciation of right-of-use assets | 16,234,413.73 | |
Amortization of intangible assets | 65,392,596.89 | 54,282,270.44 |
Amortization of long-term deferred expenses | 27,180,925.99 | 15,207,218.24 |
Losses from disposal of fixed assets, intangible assets and other long-term assets (income marked with “-”) | 415,188.40 | 932,817.83 |
Losses on scrapping of fixed assets (income marked with “-”) | 374,047.89 | 1,229,856.20 |
Loss from fair value change (income marked with “-”) | -85,670,316.15 | 105,561,454.64 |
Financial expenses (income marked with “-”) | 52,717,851.97 | 93,764,044.38 |
Return on investment (loss marked with "-") | -54,827,083.25 | -258,578,241.24 |
Decrease in deferred tax assets (increase marked with “-”) | -12,739,891.64 | -5,331,660.91 |
Increase in deferred tax liabilities (decrease marked with “-”) | 14,523,480.93 | -15,619,358.99 |
Decrease in inventory (increase marked with “-”) | -1,161,081,258.04 | -673,392,280.59 |
Decrease in operating receivables (increase marked with “-”) | -593,959,509.24 | -510,665,644.85 |
Increase in operating payables (decrease marked with “-”) | 608,846,276.29 | 1,115,511,120.73 |
Other | 34,844,008.75 | 9,208,765.19 |
Net cash flow from operating activities | -224,562,545.86 | 647,900,708.38 |
2.Major investment and financing activities not involving cash receipts and payments: | -- | -- |
Conversion of debt into capital | ||
Convertible bonds due within one year | ||
Fixed assets acquired under finance leases | ||
3.Net change in cash and cash equivalents: | -- | -- |
Ending balance of cash | 1,736,104,958.20 | 1,196,835,834.92 |
Minus: beginning balance of cash | 1,196,835,834.92 | 761,845,320.49 |
Plus: Ending balance of cash equivalents | ||
Minus: beginning balance of cash equivalents | ||
Net increase in cash and cash equivalents | 539,269,123.28 | 434,990,514.43 |
(2) Net cash paid for acquirement of subsidiaries in the current period
Unit: Yuan
Amount | |
Cash or cash equivalents paid in the current period for business combination occurring in the current period | 15,587,383.24 |
Including: | -- |
Taixing Ninghui Lithium Battery Co., Ltd. | 15,365,383.24 |
Shenzhen Tengyi Industrial Co., Ltd. | 222,000.00 |
Minus: cash and cash equivalents held by the subsidiary on the date of purchase | 1,037,613.21 |
Including: | -- |
Including: | -- |
Net cash paid for acquirement of subsidiaries | 14,549,770.03 |
Other description:
(3) Net cash received for disposal of subsidiaries in the current period
□ applicable √ not applicable
(4) Composition of cash and cash equivalents
Unit: Yuan
Items | Ending balance | Beginning balance |
I. Cash | 1,736,104,958.20 | 1,196,835,834.92 |
III. Balance of cash and cash equivalents at the end of the period | 1,736,104,958.20 | 1,196,835,834.92 |
Other description:
80. Notes to items in change statement of owner’s equity
Describe the names and adjusted amounts of "other" items that adjusted the closing balance of the previous year:
□ applicable √ not applicable
81. Assets with limited ownership or use right
Unit: Yuan
Items | Book value at the end of the period | Restricted reasons |
Monetary capital | 31,475,097.87 | Security deposit used for applying to the bank for issuing bills and letters of guarantee, and the funds frozen in labor arbitration |
Notes receivable | 4,466,422.16 | Notes pledged to the bank due to the application to the bank for the issuance of notes |
Fixed assets | 245,121,797.68 | Mortgage housing loan |
Total | 281,063,317.71 | -- |
Other description:
82. Foreign currency monetary items
(1) Foreign currency monetary items
Unit: Yuan
Items | Foreign currency balance at the end of the period | Conversion rate | Balance converted into RMB at the end of the period |
Monetary capital | -- | -- | |
Including: USD | 72,228,950.81 | 6.3757 | 460,510,131.02 |
Euro | 1,726,388.63 | 7.2197 | 12,464,008.00 |
Hong Kong Dollar | 198,996.13 | 0.8176 | 162,699.24 |
Indian rupee | 559,042,303.93 | 0.0857 | 47,897,413.38 |
Vietnamese dong | 52,702,580,152.00 | 0.0003 | 14,756,722.44 |
Japanese Yen | 4,750,644.00 | 0.0554 | 263,256.94 |
Romanian Leu | 95,485.52 | 1.4581 | 139,230.88 |
Mexican Peso | 104,962.44 | 0.3116 | 32,708.77 |
Accounts receivable | -- | -- | |
Including: USD | 163,210,123.54 | 6.3757 | 1,040,578,805.41 |
Euro | 1,265,108.55 | 7.2197 | 9,133,704.20 |
Hong Kong Dollar | 2,951,083.29 | 0.8176 | 2,412,805.72 |
Vietnamese dong | 77,610,399,338.00 | 0.0003 | 21,730,911.81 |
Indian rupee | 373,111,525.00 | 0.0857 | 31,967,306.99 |
Receivables financing | |||
Including: USD | 1,510,654.47 | 6.3757 | 9,631,479.90 |
Accounts payable |
Including: USD | 14,992,451.78 | 6.3757 | 95,587,376.72 |
Hong Kong Dollar | 35,810.06 | 0.8176 | 29,278.31 |
Vietnamese dong | 59,184,893,993.00 | 0.0003 | 16,571,770.32 |
Indian rupee | 72,157,556.80 | 0.0857 | 6,182,287.64 |
Long-term loans | -- | -- | |
Including: USD | |||
Euro | |||
Hong Kong Dollar | |||
Other description:
(2) Description of overseas business entities, including for important overseas business entities, disclosure ofmain overseas business locations, recording currency and selection basis as well as disclosure of reasons forchanges in recording currency.
√ applicable □ not applicable
1. Topband India Private Limited, a subsidiary of the Company, is mainly located in Pune City, Maharashtra,India, with Indian Rupee as the recording currency;
2. Topband (Vietnam) Co., Ltd, a sub-subsidiary of the Company, is mainly located in Binh Duong, Vietnam,with Vietnamese dong as the recording currency;
3. TOPBAND SMART DONGNAI (VIETNAM) Co., ltd, a sub-subsidiary of the Company, is mainly located inDong Nai, Vietnam, with Vietnamese dong as the recording currency;
4. Topband Germany GmbH, a sub-subsidiary of the Company, is mainly located in Unterf?hring, Germany, withEuro as the recording currency;
5. TOPBAND JAPAN Co., Ltd., a sub-subsidiary of the Company, is mainly located in Nagoya, Japan, withJapanese Yen as the recording currency;
6. QBPTE.LTD, the grandson company of Topband, is located in Singapore, with Singapore dollar as thebookkeeping base currency;
7. TOPBAND SMART EUROPE COMPANY LIMITED SRL., the grandson company of Topband, is located inTimisoara, Romania, with Lei as the bookkeeping base currency;
8. TOPBAND MEXICO, S.DE RLDEC.V, the grandson company of Topband, is located in Monterrey, Mexico,with peso as the bookkeeping base currency.
83. Hedging
The qualitative and quantitative information on hedging items, related hedging instruments, and hedged risks isdisclosed according to the type of hedging:
84. Government subsidies
(1) Basic information of government subsidies
Unit: Yuan
Category | Amount | Items presented | Amount included in current profit and loss |
Technological transformation supported by 2020 anti-epidemic national debt funds | 832,060.00 | Deferred income | 832,060.00 |
R&D equipment project of intelligent home management system such as IoT cloud computing technology | 263,000.00 | Deferred income | 263,000.00 |
Nano lithium iron phosphate power battery project | 250,000.00 | Deferred income | 250,000.00 |
High rate 18650-2.8Ah power battery key technology research and development project | 204,000.00 | Deferred income | 204,000.00 |
Special fund for the industrialization of high-efficiency energy-saving rare-earth permanent magnet motor | 195,000.00 | Deferred income | 195,000.00 |
R&D project of 60A solar charging controller with peak power tracking technology | 120,000.00 | Deferred income | 120,000.00 |
Intelligent grid connected project of distributed photovoltaic power station | 60,000.00 | Deferred income | 60,000.00 |
R&D project of key technology for clean energy DC system measurement | 50,000.00 | Deferred income | 50,000.00 |
R&D project of unmanned Robot Cleaner | 450,000.00 | Deferred income | 450,000.00 |
Special fund for intelligent controller and lithium battery technology transformation | 936,210.00 | Deferred income | 936,210.00 |
Added-value tax refund on demand | 8,646,329.13 | Other income | 8,646,329.13 |
Return of individual income tax service charge | 1,105,035.34 | Other income | 1,105,035.34 |
Training replaced for operation subsidy | 288,500.00 | Other income | 288,500.00 |
Support and subsidy for enterprises to expand production and increase efficiency | 2,476,845.00 | Other income | 2,476,845.00 |
Enterprise development and research funding | 1,699,000.00 | Other income | 1,699,000.00 |
Export credit insurance subsidy | 1,031,335.00 | Other income | 1,031,335.00 |
Industrial and commercial electricity subsidy | 459,804.80 | Other income | 459,804.80 |
Position stabilization subsidy | 231,269.09 | Other income | 231,269.09 |
Technical transformation and improvement project funding | 150,000.00 | Other income | 150,000.00 |
Special funds for foreign trade development of enterprises | 543,789.00 | Other income | 543,789.00 |
Reward for scale growth of industrial enterprises | 500,000.00 | Other income | 500,000.00 |
Double promotion funding for technically innovative doubling special funding plan quality brand | 340,000.00 | Other income | 340,000.00 |
Filing subsidy | 50,000.00 | Other income | 50,000.00 |
Special fund for Huizhou industry and informatization issued by Zhongkai Economic Development Bureau | 250,000.00 | Other income | 250,000.00 |
Patent subsidy | 287,750.00 | Other income | 287,750.00 |
Enterprise high-tech enterprise recognition award subsidy | 50,000.00 | Other income | 50,000.00 |
Exhibition subsidy | 68,400.00 | Other income | 68,400.00 |
National Innovation Carrier Support Program | 2,000,000.00 | Other income | 2,000,000.00 |
Promotion of financial aid | 300,000.00 | Other income | 300,000.00 |
Growth incentive fund in 2020 | 1,600,000.00 | Other income | 1,600,000.00 |
Financial support fund of Xinqiao Town of Songjiang District of Shanghai | 170,000.00 | Other income | 170,000.00 |
Other projects | 599,719.33 | Other income | 599,719.33 |
(2) Situation of government subsidies refund
□ applicable √ not applicable
Other description:
85. Others
VIII. Changes in the scope of consolidation
1. Merger of enterprises under different control
(1) Merger of enterprise under different control occurred in the current period
Unit: Yuan
Name of acquiree | Date of equity acquired | Cost of equity acquired | Ratio of equity acquired | Equity acquired via | Date of purchasing | Basis for determination of acquisition date | Revenue of the acquiree from the date of purchasing | Net profit of acquiree from the acquisition date to the end |
to the end of the period | of the period | |||||||
Taixing Ninghui Lithium Battery Co., Ltd. | February 5, 2021 | 33,400,000.00 | 83.50% | Merger of enterprises under different control | February 5, 2021 | Investment agreement and industrial and commercial change registration | 26,725,657.01 | -4,005,560.30 |
Shenzhen Tengyi Industrial Co., Ltd. | February 4, 2021 | 222,000.00 | 100.00% | Merger of enterprises under different control | February 4, 2021 | Investment agreement and industrial and commercial change registration | 16,268,795.85 | -4,186,494.10 |
Other description:
(2) Merging cost and goodwill
Unit: Yuan
Merging cost | Taixing Ninghui Lithium Battery Co., Ltd. | Shenzhen Tengyi Industrial Co., Ltd. |
--Cash | 33,400,000.00 | 222,000.00 |
Total merging cost | 33,400,000.00 | 222,000.00 |
Minus: share of fair value of the net identifiable assets acquired | 19,649,232.19 | 90,216.76 |
The amount of which the goodwill/merging cost is less than the share of fair value of the net identifiable assets acquired | 1,962,891.12 | 131,783.24 |
The determination method of the fair value of the merger cost, the contingent consideration and the description ofits changes:
The main reasons for the formation of large-denomination goodwill:
Other description:
(3) Identifiable assets and liabilities of the acquiree
Unit: Yuan
Taixing Ninghui Lithium Battery Co., Ltd. | Shenzhen Tengyi Industrial Co., Ltd. | |||
Fair value on the acquisition date | Book value on the acquisition date | Fair value on the acquisition date | Book value on the acquisition date |
Monetary capital | 1,037,613.21 | 1,037,613.21 | 40,216.76 | 40,216.76 |
Accounts receivable | 127,205.42 | 127,205.42 | ||
Inventory | 10,795,207.69 | 10,795,207.69 | ||
Fixed assets | 21,244,666.39 | 21,244,666.39 | ||
Accounts payable | 5,204,644.68 | 5,204,644.68 | ||
Net assets | 19,649,232.19 | 19,649,232.19 | 90,216.76 | 90,216.76 |
Net assets acquired | 19,649,232.19 | 19,649,232.19 | 90,216.76 | 90,216.76 |
Methods for determining the fair value of identifiable assets and liabilities:
Contingent liabilities of the acquiree assumed in a business merger:
Other description:
(4) Gains or losses arising from remeasurement of equity held before the acquisition date at fair valueWas there a transaction that realized business combination step by step through multiple transactions and obtainedcontrol during the reporting period
□ Yes √ No
(5) Relevant explanations for the inability to reasonably determine the merger consideration or the fairvalue of the identifiable assets and liabilities of the acquiree on the acquisition date or at the end of thecurrent periodNot applicable
(6) Other description
2. Merger of enterprises under the same control
(1) Merger of enterprise under the same control occurred in the current period
□ applicable √ not applicable
(2) Combined cost
Other description:
(3) The book value of the assets and liabilities of the merged party on the combining date
□ applicable √ not applicable
3. Reverse purchase
Basic information of the transaction, the basis for the reverse purchase of the transaction, whether the assets andliabilities retained by the listed company constitute the business and its basis, the determination of the merger cost,the amount of the adjustment of the equity when the transaction is processed as an equity transaction and itscalculation:
4. Disposal of subsidiaries
Is there single disposal of the investment in a subsidiary which results in loss of control
□ Yes √ No
Are there are step-by-step disposal of the investment in a subsidiary through multiple transactions and loss ofcontrol in the current period
□ Yes √ No
5. Changes in the scope of merger due to other reasons
Explanations for the changes in the scope of the merger caused by other reasons (e.g., establishment of newsubsidiaries, or liquidation of subsidiaries, etc.) and relevant circumstances:
1. Newly-established subsidiary (grandson) company
During the reporting period, the company established a total of 7 new subsidiaries (grandson companies), asfollows:
No. | Name of subsidiary | Registered place | Registration date | Shareholding proportion (%) | |
Direct | Indirect | ||||
1 | Q.B.PTE.LTD | Singapore | 2020-1-6 | 100 | |
2 | TOPBAND MEXICO,S.DE R.L.DE C.V. | Mexico | 2020-9-30 | 100 | |
3 | TOPBAND SMART EUROPE COMPANY LIMITED S.R.L. | Romania | 2020-03-13 | 100 | |
4 | Tulu Innovation (Hong Kong) Limited | Hong Kong | 2020-03-16 | 100 | |
5 | TUNNU INNOVATION,INC | the United States | 2020-04-08 | 100 | |
6 | Topband (Qingdao) Intelligent Control Co., Ltd. | Qingdao | 2020-09-07 | 100 |
7 | Shenzhen Topband Automotive Electronics Co., Ltd. | Shenzhen | 2020-10-29 | 100 |
6. Others
IX. Interests in Other Entities
1. Interests in subsidiaries
(1) Composition of enterprise group
Name of subsidiary | Principal place of business | Registered place | Nature of business | Shareholding proportion | Acquisition method | |
Direct | Indirect | |||||
Shenzhen Topband Software Technology Co., Ltd. | Shenzhen | Shenzhen | Production and sales | 100.00% | Establishment | |
Shenzhen Topband Automation Technology Co., Ltd. | Shenzhen | Shenzhen | Production and sales | 100.00% | Establishment | |
Shenzhen Topband Battery Co., Ltd. | Shenzhen | Shenzhen | Production and sales | 100.00% | Establishment | |
Chongqing Topband Industrial Co., Ltd. | Chongqing | Chongqing | Production and sales | 100.00% | Establishment | |
Topband (Hong Kong) Co., Ltd. | Hong Kong | Hong Kong | Investment | 100.00% | Establishment | |
Huizhou Topband Electrical Technology Co., Ltd. | Huizhou | Huizhou | Production and sales | 100.00% | Establishment | |
TOPBAND INDIA PRIVATE LIMITED | India | India | Sales | 100.00% | Establishment | |
Shenzhen YAKO Automation Technology Co., Ltd. | Shenzhen | Shenzhen | Production and sales | 71.54% | Merger of enterprises under different control | |
Shenzhen Allied Control System Co., Ltd. | Shenzhen | Shenzhen | Production and sales | 100.00% | Merger of enterprises under different control | |
Huizhou Topband Lithium Battery Co., Ltd. | Huizhou | Huizhou | Production and sales | 100.00% | Establishment | |
Ningbo Topband Intelligent Control Co., Ltd. | Ningbo | Ningbo | Production and sales | 100.00% | Establishment | |
Shenzhen Meanstone Intelligent Technology Co., Ltd. | Shenzhen | Shenzhen | Production and sales | 77.25% | Merger of enterprises under different control |
Shenzhen Yansheng Software Co., Ltd. | Shenzhen | Shenzhen | Production and sales | 71.54% | Merger of enterprises under different control | |
Hangzhou Zhidong Motor Technology Co., Ltd. | Hangzhou | Hangzhou | Production and sales | 53.66% | Merger of enterprises under different control | |
Topband(Vietnam)Co.,ltd | Vietnam | Vietnam | Production and sales | 100.00% | Establishment | |
TOPBAND SMART DONG NAI (VIETNAM) COMPANY LIMITED | Vietnam | Vietnam | Production and sales | 100.00% | Establishment | |
Topband Germany GmbH | Germany | Germany | Sales | 100.00% | Establishment | |
TOPBAND JAPAN Co.,Ltd | Japan | Japan | Sales | 100.00% | Establishment | |
Shenzhen Topband Supply Chain Services Co., Ltd. | Shenzhen | Shenzhen | Sales | 100.00% | Establishment | |
Shenzhen Topband Investment Co., Ltd. | Shenzhen | Shenzhen | Sales | 100.00% | Establishment | |
Shenzhen Spark IOT Technology Co., Ltd. | Shenzhen | Shenzhen | Sales | 100.00% | Establishment | |
Shenzhen Tulu Innovation Co., Ltd. | Shenzhen | Shenzhen | Sales | 100.00% | Establishment | |
Shenzhen Senxuan Technology Co., Ltd. | Shenzhen | Shenzhen | Sales | 100.00% | Establishment | |
Topband (Qingdao) Intelligent Control Co., Ltd. | Qingdao | Qingdao | Sales | 100.00% | Establishment | |
Shenzhen Tengyi Industrial Co., Ltd. | Shenzhen | Shenzhen | Sales | 100.00% | Establishment | |
Taixing Ninghui Lithium Battery Co., Ltd. | Taixing | Taixing | Manufacturing | 90.48% | Merger of enterprises under different control | |
Shenzhen Topband Automotive Electronics Co., Ltd. | Shenzhen | Qingdao | Sales | 100.00% | Establishment | |
Q.B.PTE.LTD | Singapore | Singapore | Sales | 100.00% | Establishment | |
TOPBAND MEXICO,S.DE R.L.DE C.V. | Mexico | Mexico | Sales | 100.00% | Establishment | |
Tulu Innovation (Hong Kong) Limited | Hong Kong | Hong Kong | Sales | 100.00% | Establishment | |
TOPBAND SMART EUROPE COMPANY LIMITED S.R.L. | Romania | Romania | Sales | 100.00% | Establishment | |
Huizhou Yako Automation Technology Co., Ltd. | Shenzhen | Shenzhen | Manufacturing | 71.54% | Establishment | |
Shenzhen Zhongli Consulting Co., Ltd. | Shenzhen | Qingdao | Sales | 100.00% | Establishment | |
TUNNU INNOVATION,INC | the United States | the United States | Sales | 100.00% | Establishment |
Explanation of the shareholding ratio in the subsidiary being different from the voting rights ratio:
Basis for holding half or less of the voting rights but still controlling the investee, and holding more than half of
the voting rights but not controlling the investee:
For important structured entities included in the consolidation scope, the basis for control:
Basis for determining whether a company is an agent or a principal:
Other description:
(2) Important non-wholly-owned subsidiaries
Unit: Yuan
Name of subsidiary | Shareholding ratio of minority shareholders | Profits and losses attributable to minority shareholders during the current period | Dividends declared and distributed to minority shareholders during the current period | Ending balance of minority equity |
Shenzhen YAKO Automation Technology Co., Ltd. | 28.46% | 8,100,059.05 | 5,197,835.08 | 81,331,985.33 |
Explanation of the shareholding ratio of minority shareholder in subsidiary shareholder being different from thevoting rights ratio:
Other description:
(3) Major financial information of important non-wholly-owned subsidiaries
Unit: Yuan
Name of subsidiary | Ending balance | Beginning balance | ||||||||||
Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | |
Shenzhen YAKO Automation Technology Co., Ltd. | 308,879,580.82 | 61,169,539.31 | 370,049,120.13 | 74,267,013.30 | 9,059,144.56 | 83,326,157.86 | 305,948,794.76 | 10,842,526.28 | 316,791,321.04 | 50,893,109.13 | 50,893,109.13 |
Unit: Yuan
Name of subsidiary | Amount incurred in current period | Amount incurred in 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 | |
Shenzhen | 296,759,371.5 | 29,933,264.9 | 29,933,264.92 | -14,283,982.6 | 257,988,191.4 | 43,475,918.2 | 43,475,918.21 | 62,625,702.5 |
YAKO Automation Technology Co., Ltd. | 9 | 2 | 9 | 3 | 1 | 4 |
Other description:
(4) Significant restrictions on the use of enterprise group assets and the liquidation of enterprise groupdebts
□ applicable √ not applicable
(5) Financial support or other support provided to structured entities included in the scope of theconsolidated financial statementsOther description:
2. Transaction in respect of which the share of the owner's equity of a subsidiary is changed and thesubsidiary is still under control
(1) Changes of the share of owner's equity in a subsidiary:
□ applicable √ not applicable
(2) The impact of the transaction on the minority shareholders' equity and the owners' equity attributableto the parent company:
□ applicable √ not applicable
3. Interests in joint venture arrangements or associated enterprises
(1) Important joint ventures or associated enterprises
Explanation of the shareholding ratio in the joint venture or associated enterprise being different from the votingrights ratio:
Basis for holding less than 20% of the voting rights but having significant influence, or holding 20% or more ofthe voting rights but having no significant influence:
(2) Major financial information of important joint ventures
□ applicable √ not applicable
(3) Major financial information of important associated enterprises
□ applicable √ not applicable
(4) Summarized financial information of unimportant joint ventures and associated enterprises
Unit: Yuan
Ending balance/Amount incurred in the current period | Beginning balance/Amount incurred in the previous period | |
Joint Venture: | -- | -- |
Sum of the following items calculated according to the shareholding ratio | -- | -- |
Associated enterprises: | -- | -- |
Total book value of investment | 29,002,528.13 | 6,502,528.13 |
Sum of the following items calculated according to the shareholding ratio | -- | -- |
- Net profit | -2,883,400.31 | -360,946.80 |
- Total comprehensive income | -2,883,400.31 | -360,946.80 |
Other description:
(5) Statement that there is a material limitation on the ability of the joint venture or associated enterprise totransfer funds to the Company
□ applicable √ not applicable
(6) Excess losses incurred by the joint venture or an associated enterprise
□ applicable √ not applicable
(7) Unconfirmed commitments related to the investment of joint ventures
□ applicable √ not applicable
(8) Contingent liabilities related to the investment of joint ventures or associated enterprises
□ applicable √ not applicable
3. Important joint operation
□ applicable √ not applicable
4. Interests in structured entities not included in the scope of the consolidated financial statements
□ applicable √ not applicable
6. Others
□ applicable √ not applicable
X. Risks Associated with Financial InstrumentsThe main financial instruments of the Company include equity investment, debt investment, borrowings,accounts receivable, accounts payable, convertible bonds, etc. For details of each financial instrument, please referto the relevant items in Note VI. The risks associated with these financial instruments and the risk managementpolicies adopted by the Company to mitigate these risks are described below. The Management of the Companymanages and monitors these risk exposures to ensure that these risks are controlled within the limited scope.The Company uses sensitivity analysis technology to analyze the possible impact of reasonable and possiblechanges in risk variables on current profits and losses or shareholders' equity. Since any risk variable rarelychanges in isolation, and the correlation between the variables will have a significant effect on the final amountaffected by a change in a risk variable, the following contents are based on the assumption that changes in eachvariable are made in isolation. The main risks arising from the group's financial instruments include the credit risk,liquidity risk and market risk.(I) Risk management objective and policyThe Company's risk management objective is to strike an appropriate balance between risks and returns,reduce the negative impact of risks on the Company's business performance to the lowest level, and maximize theinterests of shareholders and other equity investors. Based on this risk management objective, the basic riskmanagement strategy of the Company is to determine and analyze various risks faced by it, establish anappropriate risk bearing bottom line and carry out risk management, and conduct timely and reliable supervisionof various risks to control risks within the limited scope.
1. Market risk
(1) Foreign exchange risk
Foreign exchange risk refers to the risk of loss due to exchange rate fluctuations. The company's exposure toforeign exchange risks is mainly related to US dollars and Hong Kong dollars. Except for the company and itssubsidiary, Topband (HK) Co., Limited, which purchases and sells some materials and products in US dollars,euros and Hong Kong dollars, TOPBAND INDIA PRIVATE LIMITED, the subsidiary, uses Indian rupees,Topband (Vietnam) Co., Ltd. and TOPBAND SMART DONGNAI (VIETNAM) Co., Ltd., the grandsoncompanies, use Vietnamese dong, and Topband Germany GmbH, the grandson company, uses euros; TOPBANDJAPAN Co.,Ltd., the grandson company, uses Japanese yen, Q.B.PTE. LTD, the grandson company, usesSingapore dollars, and TOBAND MEXICO, S.DE R.L.DE C.V., the grandson company, uses Mexican pesos;TOBAND SMART EUROPE COMPANY LIMITED S.R.L., the grandson company, uses Romanian Lei, TunnuInnovation HK Limited, the grandson company, uses Hong Kong dollars, and TUNNU INNOVATION, INC., thegrandson company, uses US dollars; other major business activities of Topband are settled in RMB.As ofDecember 31, 2021, the assets and liabilities of the company are all in RMB, except for those described in VI (56)“Foreign currency monetary items” that the assets and liabilities are in U.S. dollars, Hong Kong dollars, euro,Vietnamese dong and Indian rupees. The foreign exchange risks arising from the assets and liabilities of suchforeign currency balances may have an impact on the Company's operating results.The Company pays close attention to the impact of exchange rate fluctuations on the Company's foreignexchange risks. The Company currently does not take any measures to avoid foreign exchange risks.
(2) Other price risks
Investments held by the Company and classified as tradable financial assets are measured at fair value on thebalance sheet date. Therefore, the Company is exposed to the risk of changes in the securities market.
2. Credit risk
On December 31, 2021, the maximum credit risk exposure causing the company's financial losses is mainlyincurred from the other party's failure to fulfill obligations, which leads the company to financial asset losses, andfinancial guarantee undertaken by the company, including confirmed carrying amounts of financial assets inconsolidated balance sheets; the carrying value only reflects risk exposure of financial instruments measured atfair value rather than the maximum risk exposure, that varies with the fair value in the future.
In order to reduce credit risks, the Company has set up special positions responsible for determining creditlimits, conducting credit approval, and implementing other monitoring procedures to ensure that necessarymeasures are taken to recover overdue claims. In addition, the Company reviews the recovery of each individual
receivables on each balance sheet date to ensure that adequate provision is made for uncollectible amounts. As aresult, the Management of the Company believes that the credit risk assumed by the Company has beensignificantly reduced.The Company's working capital is deposited in a bank with a high credit rating, so the credit risk of workingcapital is low.
The Company has adopted necessary policies to ensure that all sales customers have good credit records. TheCompany has no other major credit concentration risk.
3. Flow risk
In managing liquidity risks, the Company maintains and monitors cash and cash equivalents deemedsufficient by the Management to meet the Company's operational needs and reduce the impact of cash flowfluctuations. The Management of the Company monitors the use of bank loans and ensures compliance with loanagreements.XI. Disclosure of Fair Value
1. Ending fair value of assets and liabilities measured at fair value
Unit: Yuan
Items | Ending fair value | |||
The first level of fair value measurement | The second level of fair value measurement | The third level of fair value measurement | Total | |
I. Continuous fair value measurement | -- | -- | -- | -- |
1. Financial assets measured at fair value and whose changes are included in the current profits and losses | 214,999,336.74 | 214,999,336.74 | ||
(1) Debt instrument investment | 4,000,000.00 | 4,000,000.00 | ||
(2) Equity instrument investment | 210,999,336.74 | 210,999,336.74 | ||
(II) Receivables financing | ||||
1. Financial assets measured at fair value and whose changes are included in other comprehensive income | 36,902,507.85 | 36,902,507.85 | ||
(1) Bank acceptance bills | 26,520,757.05 | 26,520,757.05 | ||
(2) Accounts receivable | 10,381,750.80 | 10,381,750.80 | ||
251,901,844.59 | 251,901,844.59 |
II. Non-continuous fair value measurement | -- | -- | -- | -- |
2. The basis for determining the market price of continuous and non-continuous first-level fair valuemeasurement items
□ applicable √ not applicable
3. Continuous and non-continuous second-level fair value measurement items, valuation techniquesadopted and qualitative and quantitative information of important parameters
□ applicable √ not applicable
4. Continuous and non-continuous third-level fair value measurement items, valuation techniques adoptedand qualitative and quantitative information of important parameters
□ applicable √ not applicable
5. Continuous third-level fair value measurement items, adjustment information between beginning andending book value and sensitivity analysis of unobservable parameters
□ applicable √ not applicable
6. For continuous fair value measurement items, if the conversion occurs among different levels in thecurrent period, the reasons for the conversion and the policies for determining the conversion time point
□ applicable √ not applicable
7. Technical changes in valuation during the current period and the reasons for such changes
□ applicable √ not applicable
8. Fair value of financial assets and financial liabilities not measured at fair value
□ applicable √ not applicable
9. Others
□ applicable √ not applicable
XII. Related Parties and Related Transactions
1. Information on the parent company of the Enterprise
Name of parent | Registered | Nature of | Registered | The parent company's shareholding | Proportion of the parent company's |
company | place | business | capital | ratio in the Enterprise | voting rights in the Enterprise |
Wu Yongqiang | Shenzhen | 16.87% | 16.87% |
Description of the parent companyThe ultimate controller of the enterprise isOther description:
2. Information on the Company's subsidiaries
For the subsidiaries the company, please refer to notes.
3. Information on the joint ventures and associated enterprises of the Enterprise
□ applicable √ not applicable
4. Other related parties
Names of other related parties | Relationship between other related parties and the Enterprise |
Shenzhen Jizhiguang Electronics Co., Ltd. | A company substantially controlled by the relative of the Company's legal representative |
Shenzhen Lianghui Technology Co., Ltd. | A company whose shares are held by the Company |
Shenzhen Dynanonic Co., Ltd. | A company whose shares are held by the Company |
Foshan Dynanonic Technology Co., Ltd. | A subsidiary of the company whose shares are held by the Company |
Shenzhen ORVIBO Technology Co., Ltd. | A company whose shares are held by the Company |
Shenzhen HANSC Intelligent Technology Co., Ltd. | A company whose shares are held by the Company |
Guangdong Zhongchuang Zhijia Scientific Research Co., Ltd. | A company whose shares are held by the Company |
Guangdong Huixin Semiconductor Co., Ltd. | A company whose shares are held by the Company |
Fujian Mini Dolphin New Energy Technology Co., Ltd. | A company whose shares are held by the Company |
Chengdu Senwei Technology Co., Ltd. | A company whose shares are held by the Company |
Shenzhen Youbi Technology Co., Ltd. | A company whose shares are held by the Company |
Shanghai Yidong Power Technology Co., Ltd. | A company whose shares are held by the Company |
Pas Electronic Technology (Nanjing) Co., Ltd. | A company whose shares are held by the Company |
Other description:
5. Related transactions
(1) Related transactions involving the purchase and sale of goods and the provision and acceptance ofservicesList of goods purchased/services received
Unit: Yuan
Related party | Related transaction content | Amount incurred in current period | Approved transaction limit | Is the transaction limit exceeded | Amount incurred in prior period |
Shenzhen Jizhiguang Electronics Co., Ltd. | Raw materials | 18,415,795.03 | 40,000,000.00 | No | 15,939,982.64 |
Foshan Dynanonic Technology Co., Ltd. | Raw materials | 49,756,548.15 | No | 13,268,725.49 | |
Shenzhen Dynanonic Co., Ltd. | Raw materials | 1,216,814.15 | No |
List of goods sold/services provided
Unit: Yuan
Related party | Related transaction content | Amount incurred in current period | Amount incurred in prior period |
Shenzhen ORVIBO Technology Co., Ltd. | Goods on hand | 32,048,669.89 | 13,158,867.26 |
Related transactions involving the purchase and sale of goods and the provision and acceptance of services
(2) Relevant entrusted management/contracting and entrusted management/outsourcing
□ applicable √ not applicable
(3) Related lease
□ applicable √ not applicable
(4) Related guarantee
□ applicable √ not applicable
(5) Related parties' loans at call
□ applicable √ not applicable
(6) Asset transfer and debt restructuring of related parties
□ applicable √ not applicable
(7) Remuneration of key management personnel
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Remuneration of key management personnel | 10,758,300.00 | 10,583,700.00 |
(8) Other related transactions
□ applicable √ not applicable
6. Payables due to related parties
(1) Item receivable
Unit: Yuan
Project name | Related party | Ending balance | Beginning balance | ||
Book balance | Provision for bad debts | Book balance | Provision for bad debts | ||
Accounts receivable | Shenzhen ORVIBO Technology Co., Ltd. | 10,396,665.72 | 322,296.64 | 11,456,976.61 | 355,166.27 |
(2) Item payable
Unit: Yuan
Project name | Related party | Book balance at the end of the period | Book balance at the beginning of the period |
Accounts payable | Shenzhen Jizhiguang Electronics Co., Ltd. | 3,099,592.01 | 3,600,589.88 |
Accounts payable | Foshan Dynanonic Technology Co., Ltd. | 2,209,999.98 | 4,573,368.10 |
Accounts payable | Shenzhen Dynanonic Co., Ltd. | 161,905.76 | |
Notes payable | Shenzhen Jizhiguang Electronics Co., Ltd. | 2,376,908.03 | 1,560,000.00 |
Notes payable | Foshan Dynanonic Technology Co., Ltd. | 30,562,779.66 | 1,283,800.00 |
Notes payable | Shenzhen Dynanonic Co., Ltd. | 1,374,999.99 |
7. Commitment of related parties
□ applicable √ not applicable
8. Others
XIII. Share-based payment
1. General situation of share-based payment
√ applicable □ not applicable
Unit: Yuan
Total amount of equity instruments granted by the Company during the current period | 33,544,320.00 |
Total amount of equity instruments exercised by the Company during the current period | 44,494,920.00 |
Total amount of the Company's equity instruments that expired during the current period | 80,500.00 |
The range of the exercise price of the Company's stock options outstanding at the end of the period and the remaining term of the contract | The Company granted 42.8870 million stock options to 684 incentive recipients on November 27, 2018.The performance evaluation and exercise of the Company and the individuals of the incentive objects are conducted by the year, and the evaluation is conducted once each fiscal year. The achievement of the performance evaluation target is taken as the exercise condition of the incentive objects. This plan is valid for a maximum period of 48 months from the date of authorization of stock options to the date on which all options are exercised or cancelled. After the expiration of 12 months from the authorization date of the incentive plan of the current period, the incentive objects shall exercise the stock options by stages according to the exercise proportion of 30%, 30% and 40% within the vesting date. The grant price of the stock options that have not been unlocked at the end of the period is RMB 3.60.On November 2, 2021, the company granted restricted shares to incentive objects at a grant price of 7.23 yuan per share, including 1,224 registered objects and 33,544,320 restricted shares in total. Topband carried out the performance appraisal for companies and the individual incentive objects once in each fiscal year, taking the performance appraisal target as the unlocking condition for restricted stocks. This incentive plan was |
Other description:
Description of share-based payment:
1. Stock options in 2018
On November 27, 2018, the ninth meeting of the sixth Board of Directors of the Company deliberated andpassed the Proposal on Granting Stock Options to Incentive Objects, granting 42,887,000 stock options to 684eligible incentive objects at a grant price of RMB 3.80 per share.On July 26, 2019, the 15th meeting of the sixth Board of Directors of the Company deliberated and passedthe Proposal on Adjusting the Stock Option Exercise Price of the 2018 Stock Option Incentive Plan, whichadjusted the exercise price of the 2018 Stock Option Incentive Plan from RMB 3.80 to RMB 3.70 due to theCompany's 2018 annual equity distribution.On March 30, 2020, the Company held the 22nd Meeting of the 6th Board of Directors, deliberating andapproving the Proposal on the First Exercise Period of 2018 Stock Option Incentive Plan Meeting the ExerciseConditions and Exercisable Rights and the Proposal on Adjustment of the Incentive Objects and the Number ofStock Options of 2018 Stock Option Incentive Plan: In the first exercise period of the 2018 stock option incentiveplan of the Company, a total of 606 incentive objects with 12,014,700 stock options in total were eligible forexercise. In May 2020, a total of 606 incentive objects with 12,014,700 stock options in total in the first exerciseperiod completed exercise.On January 16, 2020, given that 76 original incentive objects of the Company, including Huang Xinyu andYang Shengcang, left office due to personal reasons, according to relevant provisions of the 2018 Stock OptionIncentive Plan (Revised Draft), the above personnel did not meet the incentive conditions, and a total of 2,773,000stock options that were granted to the 76 original incentive objects but were not exercised may not be exercised.The Company completed the cancellation of such stock options on January 29, 2021.On March 5, 2021, the 6th Meeting of the 7th Board of Directors of the Company deliberated and approvedthe Proposal on the Second Exercise Period of 2018 Stock Option Incentive Plan Meeting the Exercise Conditions
and Exercisable Rights and Proposal on Adjustment of the Incentive Objects and the Number of Stock Options of2018 Stock Option Incentive Plan: there are 567 incentive objects in the second exercise period of the 2018 stockoption incentive plan in the Company, in total of 10,950,600 shares of stock options, that meet the exerciseconditions and can be exercised. The Company plans to adopt the independent exercise mode. Cheng Xueqing andLin Qiao, the incentive objects, resigned from the company due to personal reasons, and their 80,500 stockoptions that have been granted but not yet exercised would not be exercised and would be canceled by thecompany. On August 6, 2021, 10,950,600 stock options involving 567 incentive objects that meet the exercisingconditions had been exercised.
2. Restricted stock in 2021
On October 13, 2021, the company held the 14th meeting of the seventh session of the board of directors, andreviewed and approved the Proposal on the < Company's Restricted Stock Incentive Plan in 2021 (Draft)> and itsSummary, Proposal on the < Appraisal Management Measures for the Implementation of the Restricted StockIncentive Plan in 2021> and Proposal on Requesting the General Meeting of Shareholders to Authorize the Boardof Directors to Handle Matters Related to the Company's Restricted Stock Incentive Plan in 2021, agreeing thatthe company would grant 34 million restricted shares to 1,250 incentive objects.On November 2, 2021, the company held the 16th (Extraordinary) meeting of the seventh session of theboard of directors and the 13th (Extraordinary) meeting of the seventh session of the board of supervisors, toreview and approve the Proposal on Adjusting the Number of Granted Options and List of Incentive Objects inRestricted Stock Incentive Plan in 2021.In view of the resignation of the incentive objects, Ou Li, Wang Cheng,Shen Zhiwen and Tian Conghui, which voluntarily gave up the subscription of the restricted shares granted due topersonal reasons, incentive objects were adjusted from 1,250 to 1,246, and the total restricted shares granted forthe first time was changed from 34 million to 33,951,000.
On December 7, 2021, the company held the 17th (extraordinary) meeting of the seventh session of the boardof directors, to review and approve the Proposal on Adjusting the Number of Granted Options and List ofIncentive Objects in Restricted Stock Incentive Plan in 2021.The board of directors believed that after determiningNovember 2, 2021 as the grant date of the restricted stock incentive plan in 2021, in the process of capitalpayment before the share registration, 22 incentive objects determined in this incentive plan, including Li Xiang,Yu Dingguo and Lu Yuanshan, voluntarily gave up the subscription of all the restricted stocks granted due topersonal reasons, and 10 incentive objects, including Ao Xinmeng, Wang Cao, and Liu Xiaoshi, voluntarily gave
up the subscription of some of the restricted stocks granted to them due to personal reasons. With theauthorization of the second extraordinary general meeting of shareholders, the board of directors adjusted thegrant objects and grant quantities of this incentive plan. After adjustment, the number of incentive objects underthe 2021 Restricted Stock Incentive Plan decreased from 1,246 to 1,224, and the number of restricted sharesgranted decreased from 33.951 million to 33.54432 million.
2. Equity-settled share-based payments
√ applicable □ not applicable
Unit: Yuan
Method for determining the fair value of the equity instrument on the grant date | Fair value of equity instruments = (market price on grant date - grant price) * number of shares |
Basis for determining the number of exercisable equity instruments | Estimation shall be based on the latest available changes on vesting employee number and other subsequent information. |
Reasons for the significant difference between the estimates of the current period and that of the previous period | None |
Accumulated amount of equity-settled share-based payments included in capital reserves | 110,403,979.07 |
Total amount of expenses recognized by equity-settled share-based payments in the current period | 31,033,339.36 |
Other description:
3. Cash-settled share-based payments
□ applicable √ not applicable
4. Modification and termination of share-based payments
□ applicable √ not applicable
5. Others
XIV. Commitments and contingencies
1. Important commitments
Important commitments that existed on the balance sheet date
2. Contingencies
(1) Significant contingencies in the balance sheet
(2) If the company has no important contingencies that need to be disclosed, they should also be explainedNo signification contingencies need to be disclosed by the Company.
3. Other
XV. Events after the balance sheet date
1. Important non-adjustment matters
□ applicable √ not applicable
2. Profit distribution
□ applicable √ not applicable
3. Sales return
□ applicable √ not applicable
4. Description of other events after the balance sheet date
□ applicable √ not applicable
XVI. Other important matters
1. Correction of early accounting errors
(1) Retrospective restatement method
Contents of accounting error correction | Handling procedure | Affected report item name for each comparison period | Cumulative number affected |
(1) Capitalization adjustment of research and development expenses R&D projects of Yakotec are divided into research stage and development stage. Projects meeting R&D capitalization conditions were capitalized in previous years. We made retroactive adjustments and expensed | The proposal was deliberated on the 21st meeting of the 7th session of the board of directors and the 17th | Other current assets | 2,121,222.39 |
Intangible assets | -30,514,971.23 | ||
Development expenditure | -5,656,596.57 | ||
Total assets | -34,050,345.41 | ||
Capital reserves | 12,636,853.09 |
the projects capitalized in the previous period in this audit. (2) Adjustment of share-based payment Yakotec granted equity to key employees through the shareholding platform. However, it was not recognized as share-based payment, and the corresponding expenses were not accrued. According to the definition in the Accounting Standards for Business Enterprises No.11 - Share-based Payment, share-based payment refers to the transaction in which an enterprise grants equity instruments or undertakes liabilities determined on the basis of equity instruments in order to obtain services from employees and other parties. Therefore, the equity granted to employees by Yakotec was retroactively recognized as share-based payment, and the corresponding expenses were adjusted and accrued. Corrections were made with the retroactive restatement method. | meeting of the 7th session of the board of supervisors. Meanwhile, the audit institution issued a special explanation, and the independent directors expressed their opinions. | Undistributed profit | -19,061,969.80 |
Minority equity | -27,625,228.70 | ||
Management expenses | 2,761,292.86 | ||
Research and development expenses | 3,924,376.58 | ||
Operating profit | -6,685,669.44 | ||
Total profits | -6,685,669.44 | ||
Income tax expenses | -2,067,266.44 | ||
Net profit | -4,618,403.00 | ||
Net profit attributable to the parent company | -1,355,690.40 | ||
Profits and losses of minority shareholders | -3,262,712.60 |
(2) Prospective application method
□ applicable √ not applicable
2. Debt restructuring
□ applicable √ not applicable
3. Asset replacement
(1) Non-monetary asset exchange
□ applicable √ not applicable
(2) Other asset replacement
□ applicable √ not applicable
4. Annuity plan
□ applicable √ not applicable
5. Termination of operation
□ applicable √ not applicable
6. Division information
1. Determination basis and accounting policy of report segment
□ applicable √ not applicable
(2) Financial information of reportable segments
□ applicable √ not applicable
(3) If the company has no reportable segments, or fails to disclose the total assets and liabilities of each
segment, the reasons shall be given.
□ applicable √ not applicable
(4) Other descriptions
□ applicable √ not applicable
7. Other important transactions and matters that have an impact on investors' decisions
□ applicable √ not applicable
8. Others
□ applicable √ not applicable
XVII. Notes on Main Items in the Financial Statements of the Parent Company
1. Accounts receivable
(1) Disclosure of accounts receivable by category
Unit: Yuan
Category | Ending balance | Beginning balance | ||||||||
Book balance | Provision for bad debts | Book value | Book balance | Provision for bad debts | Book value | |||||
Amount | Proportion | Amount | Proportion of provision | Amount | Proportion | Amount | Proportion of provision | |||
Accounts receivable with provision for bad | 231,814,138.25 | 15.06% | 231,814,138.25 | 70,467,909.49 | 7.62% | 597,758.70 | 99.81% | 69,870,150.79 |
debts by single item | ||||||||||
Including: | ||||||||||
1. Receivables with significant individual amount and individual provision for bad debts | 231,795,120.17 | 15.06% | 231,795,120.17 | 69,868,984.66 | 7.56% | 69,868,984.66 | ||||
Accounts receivable with insignificant single amount but single provision made for bad debts | 19,018.08 | 0.00% | 19,018.08 | 598,924.83 | 0.06% | 597,758.70 | 99.81% | 1,166.13 | ||
Accounts receivable with provision for bad debts by portfolio | 1,306,965,149.94 | 84.94% | 41,858,033.85 | 3.20% | 1,265,107,116.09 | 854,095,677.91 | 92.38% | 27,700,353.00 | 3.24% | 826,395,324.91 |
Including: | ||||||||||
Accounts receivable with provision for bad debts by combination (aging analysis method) | 1,306,965,149.94 | 84.94% | 41,858,033.85 | 3.20% | 1,265,107,116.09 | 854,095,677.91 | 92.38% | 27,700,353.00 | 3.24% | 826,395,324.91 |
Total | 1,538,779,288.19 | 100.00% | 41,858,033.85 | 2.72% | 1,496,921,254.34 | 924,563,587.40 | 100.00% | 28,298,111.70 | 3.06% | 896,265,475.70 |
Single provision for bad debts:
Unit: Yuan
Name | Ending balance | |||
Book balance | Provision for bad debts | Proportion of provision | Reasons for provision | |
1. Receivables with significant individual amount and individual provision for bad debts | 231,795,120.17 |
Accounts receivable with insignificant single amount but single provision made for bad debts | 19,018.08 | |||
Total | 231,814,138.25 | -- | -- |
Single provision for bad debts:
Provision for bad debts by portfolio:
Unit: Yuan
Name | Ending balance | ||
Book balance | Provision for bad debts | Proportion of provision | |
Accounts receivable with provision for bad debts by combination (aging analysis method) | 1,306,965,149.94 | 41,858,033.85 | 3.20% |
Total | 1,306,965,149.94 | 41,858,033.85 | -- |
Description of the basis for determining the portfolio:
Provision for bad debts by portfolio:
□ applicable √ not applicable
Description of the basis for determining the portfolio:
If the provision for bad debts on notes receivable is based on the general model of expected credit loss, theinformation about the provision for bad debts shall be disclosed by referring to the disclosure method of otherreceivables:
□ applicable √ not applicable
Disclosure by aging
Unit: Yuan
Aging | Book balance |
Less than 1 year (including 1 year) | 1,532,571,697.48 |
1 to 2 years | 1,644,720.17 |
2 to 3 years | 3,080,499.38 |
Above 3 years | 1,482,371.16 |
3 to 4 years | 1,481,027.31 |
4 to 5 years | 1,343.85 |
Total | 1,538,779,288.19 |
(2) Provision for bad debts withdrawn, recovered or reversed in current periodProvision for bad debts in current period:
Unit: Yuan
Category | Beginning balance | Amount changed in current period | Ending balance | |||
Provision | Recover or reversal | Write-off | Other | |||
Provision for bad debts | 28,298,111.70 | 15,465,253.39 | 1,905,331.24 | 41,858,033.85 | ||
Total | 28,298,111.70 | 15,465,253.39 | 1,905,331.24 | 41,858,033.85 |
Of which the amount of provision for bad debts reversed or recovered in current period is significant:
(3) Accounts receivable actually written off in current period
Unit: Yuan
Items | Write-off amount |
Accounts receivable actually written off | 1,905,331.24 |
Of which the significant write-offs of accounts receivable:
Description of accounts receivable written off:
(4) Accounts receivable of top five ending balances grouped by debtors
Unit: Yuan
Name of Entity | Ending balance of accounts receivable | Proportion to total ending balances of accounts receivable | Ending balance of provision for bad debts |
No.1 | 531,632,597.55 | 34.55% | 16,480,610.51 |
No.2 | 166,233,853.47 | 10.80% | |
No.3 | 99,449,573.86 | 6.46% | 3,082,936.79 |
No.4 | 44,619,403.18 | 2.90% | 1,383,201.50 |
No.5 | 32,095,302.19 | 2.09% | 994,954.37 |
Total | 874,030,730.25 | 56.80% | -- |
(5) Amount of assets and liabilities formed by transferring accounts receivable and continuing to beinvolvedOther description:
(6) Accounts receivable derecognized due to transfer of financial assets
2. Other receivables
Unit: Yuan
Items | Ending balance | Beginning balance |
Other receivables | 141,619,648.22 | 41,159,647.12 |
Total | 141,619,648.22 | 41,159,647.12 |
(1) Interest receivable
1) Classification of interest receivable
□ applicable √ not applicable
2) Significant overdue interest
□ applicable √ not applicable
3) Provision for bad debts
□ applicable √ not applicable
(2) Dividends receivable
1) Classification of interest receivable
□ applicable √ not applicable
2) Important dividends receivable aged over 1 year
□ applicable √ not applicable
3) Provision for bad debts
□ applicable √ not applicable
Other description:
(3) Other receivables
1) Classification of other receivables by nature of amount
Unit: Yuan
Nature of payment | Book balance at the end of the period | Book balance at the beginning of the period |
Receivables and payables | 131,639,091.99 | 13,021,127.03 |
Margin, deposit | 5,474,993.31 | 4,493,457.54 |
Employee loans | 6,888,020.46 | 4,589,352.52 |
Export rebate amount | 20,264,087.02 | |
Other | 7,693.46 | 62,346.03 |
Total | 144,009,799.22 | 42,430,370.14 |
2) Provision for bad debts
Unit: Yuan
Provision for bad debts | Phase 1 | Phase 2 | Phase 3 | Total |
Expected credit loss in the next 12 months | Expected credit loss for the entire duration (no credit impairment) | Expected credit loss for the entire duration (credit impairment occurred) | ||
Balance as of January 1, 2021 | 1,270,723.02 | |||
Balance as of January 1, 2021 in the current period | —— | —— | —— | —— |
Accrued in current period | 1,120,427.98 | |||
Cancel after verification in the current period | 1,000.00 | |||
Balance as of December 31, 2021 | 2,390,151.00 |
Changes in book balance with significant changes in loss reserves in current period
□ applicable √ not applicable
Disclosure by aging
Unit: Yuan
Aging | Book balance |
Less than 1 year (including 1 year) | 138,220,430.47 |
1 to 2 years | 1,375,978.09 |
2 to 3 years | 3,172,076.12 |
Above 3 years | 1,241,314.54 |
3 to 4 years | 94,902.22 |
4 to 5 years | 1,110,000.00 |
Above 5 years | 36,412.32 |
Total | 144,009,799.22 |
3) Provision for bad debts withdrawn, recovered or reversed in current periodProvision for bad debts in current period:
Unit: Yuan
Category | Beginning balance | Amount changed in current period | Ending balance | |||
Provision | Recover or reversal | Write-off | Other | |||
Provision for bad debts | 1,270,723.02 | 1,120,427.98 | 1,000.00 | 2,390,151.00 | ||
Total | 1,270,723.02 | 1,120,427.98 | 1,000.00 | 2,390,151.00 |
Of which the amount of provision for bad debts reversed or recovered in current period is significant:
□ applicable √ not applicable
4) Other receivables actually written off in current period
□ applicable √ not applicable
5) Other receivables of top five ending balances grouped by debtors
Unit: Yuan
Name of Entity | Nature of payment | Ending balance | Aging | Proportion to total ending balances of other receivables | Ending balance of provision for bad debts |
No.1 | Intercourse funds | 114,130,751.36 | Within 1 year | 79.25% | |
No.2 | Intercourse funds | 14,633,556.05 | Within 1 year | 10.16% | |
No.3 | Guarantee deposit | 1,520,178.00 | 2~3 years | 1.06% | 456,053.40 |
No.4 | Intercourse funds | 1,303,519.10 | Within 1 year | 0.91% | |
No.5 | Guarantee deposit | 1,000,000.00 | 4-5 years | 0.69% | 800,000.00 |
Total | -- | 132,588,004.51 | -- | 92.07% | 1,256,053.40 |
6) Receivables involving government subsidies
Unit: Yuan
Name of Entity | Name of government subsidy project | Ending balance | Ending aging | Estimated time, amount and basis for collection |
7) Other receivables derecognized due to transfer of financial assets
Not applicable
8) Amount of assets and liabilities formed by transferring other receivables and continuing to be involvedOther descriptions: None
3. Long-term equity investment
Unit: Yuan
Items | Ending balance | Beginning balance | ||||
Book balance | Provision for impairment | Book value | Book balance | Provision for impairment | Book value | |
Investment in subsidiaries | 2,941,581,406.04 | 2,941,581,406.04 | 2,194,431,703.81 | 2,194,431,703.81 | ||
Investment in associated enterprises and joint ventures | 18,408,714.90 | 12,433,655.05 | 5,975,059.85 | 18,936,183.18 | 12,433,655.05 | 6,502,528.13 |
Total | 2,959,990,120.94 | 12,433,655.05 | 2,947,556,465.89 | 2,213,367,886.99 | 12,433,655.05 | 2,200,934,231.94 |
(1) Investment in subsidiaries
Unit: Yuan
Investee | Beginning balance (book value) | Changes in increase/decrease in current period | Ending balance (book value) | Ending balance of provision for impairment | |||
Additional investment | Decrease in investment | Provision for impairment | Other | ||||
Shenzhen Topband Software Technology Co., Ltd. | 17,044,333.03 | 1,655,117.41 | 18,699,450.44 | ||||
Shenzhen Topband Battery Co., Ltd. | 4,417,413.65 | 1,546,395.25 | 5,963,808.90 | ||||
Shenzhen Topband Automation | 24,416,539.46 | 10,218,201.67 | 34,634,741.13 |
Technology Co., Ltd. | |||||||
Chongqing Topband Industrial Co., Ltd. | 210,135,072.74 | 195,673.13 | 210,330,745.87 | ||||
Topband (Hong Kong) Co., Ltd. | 249,076,900.00 | 115,434,600.00 | 364,511,500.00 | ||||
Huizhou Topband Electrical Technology Co., Ltd. | 633,267,784.97 | 374,013,935.38 | 1,007,281,720.35 | ||||
Ningbo Topband Intelligent Control Co., Ltd. | 350,044,696.18 | 169,824,138.89 | 519,868,835.07 | ||||
Shenzhen Allied Control System Co., Ltd. | 120,984,983.52 | 1,160,561.29 | 122,145,544.81 | ||||
Shenzhen Meanstone Intelligent Technology Co., Ltd. | 3,000,000.00 | 7,000,000.00 | 10,000,000.00 | ||||
TOPBANDINDIAPRIVATELIMITED | 195,026,748.97 | 195,026,748.97 | |||||
Shenzhen YAKO Automation Technology Co., Ltd. | 350,014,659.96 | 350,014,659.96 | |||||
Shenzhen Topband Investment Co., Ltd. | 30,002,571.33 | 30,089,631.29 | 60,092,202.62 | ||||
Shenzhen Topband Supply Chain Services Co., Ltd. | 5,000,000.00 | 5,000,000.00 | |||||
Shenzhen Senxuan Technology Co., Ltd. | 2,000,000.00 | 6,011,447.92 | 8,011,447.92 | ||||
Topband (Qingdao) Intelligent Control Co., Ltd. | 30,000,000.00 | 30,000,000.00 | |||||
Total | 2,194,431,703.81 | 747,149,702.23 | 2,941,581,406.04 |
(2) Investment in associated enterprises and joint ventures
Unit: Yuan
Investment unit | Beginning balance (book value) | Changes in increase/decrease in current period | Ending balance (book value) | Ending balance of provision for impairment | ||||||||
Additional investment | Decrease in investment | Profit and loss on investment recognized under equity method | Adjustment to other comprehensive income | Other changes in equity | Declaration of distribution for cash dividends or profits | Provision for impairment | Other | |||||
I. Joint venture | ||||||||||||
II. Associates enterprises | ||||||||||||
Shenzhen | 6,502,528. | -527,468. | 5,975,059. |
Daka Optoelectronics Co., Ltd. | 13 | 28 | 85 | ||||||||
Shenzhen Yuchengxin Power Technology Co., Ltd. | 12,433,655.05 | ||||||||||
Subtotal | 6,502,528.13 | -527,468.28 | 5,975,059.85 | 12,433,655.05 | |||||||
Total | 6,502,528.13 | -527,468.28 | 5,975,059.85 | 12,433,655.05 |
(3) Other description
None
4. Operating income and operating cost
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period | ||
Income | Cost | Income | Cost | |
Main business | 4,371,958,034.40 | 3,624,790,477.82 | 3,260,338,225.11 | 2,683,111,915.01 |
Other business | 192,086,856.35 | 167,351,318.23 | 122,029,795.27 | 111,936,235.09 |
Total | 4,564,044,890.75 | 3,792,141,796.05 | 3,382,368,020.38 | 2,795,048,150.10 |
Information related to performance obligations:
Not applicableInformation related to the transaction price allocated to the remaining performance obligations:
The amount of income corresponding to the performance obligations that have signed contracts but have not beenperformed or completed at the end of this reporting period is 0.00 yuan, and 0.00 yuan is expected to berecognized within one year.Other description:
5. Return on investment
Unit: Yuan
Items | Amount incurred in current period | Amount incurred in prior period |
Long-term equity investment income accounted by cost method | 14,053,405.97 | 4,963,933.51 |
Long-term equity investment revenue accounted by equity method | -527,468.28 | -360,946.80 |
Investment revenue from disposal of tradable financial assets | 38,226,720.08 | 230,366,485.41 |
Forward foreign exchange settlement profit and loss | 9,569,000.00 | 22,970,000.00 |
Investment revenue from financial products | 7,977,806.26 | 2,511,036.11 |
Total | 69,299,464.03 | 260,450,508.23 |
6. Others
XVIII. Supplementary Information
1. Schedule of current non-recurring profits and losses
√ applicable □ not applicable
Unit: Yuan
Items | Amount | Description |
Profits and losses on disposal of non-current assets | -789,236.29 | |
Government subsidies included in current profits and losses (except those that are closely related to the normal business of the Company, conform to national policies and regulations and are continuously enjoyed in a fixed or quantitative manner according to certain standards) | 16,456,682.22 | |
Gains and losses due to fair value changes arising from the holding of tradable financial assets and liabilities, as well as the investment income from the disposal of tradable financial assets and liabilities and available-for-sale financial assets, except for the effective hedging business related to the normal business of the Company | 133,466,036.23 | |
Other non-operating income and expenses other than those mentioned above | -1,787,714.37 | |
Other profit and loss items that meet the | 9,914,763.48 |
definition of non-recurring profit and loss | ||
Minus: amount affected by income tax | 23,726,354.32 | |
Impact amount of minority shareholders' equity | 608,113.65 | |
Total | 132,926,063.30 | -- |
Details of other profit and loss items that conform to the definition of non-recurring profits and losses:
□ applicable √ not applicable
None.Explanation of defining the non-recurring profit and loss items listed in the Explanatory Announcement No.1 onInformation Disclosure for Companies Offering Their Securities to the Public - Non-recurring Profits and Lossesas recurring profit and loss items
□ applicable √ not applicable
2. Return on equity and earnings per share
Profit in the reporting period | Weighted average return on net assets | Earnings per share | |
Basic earnings per share (yuan / share) | Diluted earnings per share (yuan / share) | ||
Net income attributable to the common shareholders of the Company | 13.11% | 0.47 | 0.47 |
Net profit attributable to the common shareholders of the Company after deduction of non-recurring profits and losses | 10.03% | 0.36 | 0.36 |
3. Differences in accounting data under domestic and foreign accounting standards
(1) Difference between the net profit and net assets in the financial reports disclosed in accordance withboth international accounting standards and Chinese accounting standards at the same time
□ applicable √ not applicable
(2) Difference between the net profit and net assets in the financial reports disclosed in accordance withboth overseas accounting standards and Chinese accounting standards at the same time
□ applicable √ not applicable
(3) Reasons for differences in accounting data under domestic and foreign accounting standards. If the dataaudited by an overseas audit institution is adjusted for differences, the name of the overseas auditinstitution shall be indicated
4. Other