Foshan Electrical and Lighting Co., Ltd.The semi-annual financial report 2022
Foshan Electrical and Lighting Co., Ltd. semi-annual financial report of 2022
Financial Statements
I Auditor’s Report
Whether the interim report has been audited?
□Yes ? No
The interim report of the Company has not been audited.II Financial StatementsCurrency unit for the financial statements and the notes thereto: RMB
1. Consolidated Balance Sheet
Prepared by Foshan Electrical and Lighting Co., Ltd.
30 June 2022
Unit: RMB
Item | 30 June 2022 | 1 January 2022 |
Current assets: | ||
Monetary assets | 1,839,439,636.83 | 2,381,911,655.35 |
Settlement reserve | ||
Interbank loans granted | ||
Held-for-trading financial assets | 64,068,462.40 | 348,248,125.61 |
Derivative financial assets | ||
Notes receivable | 1,413,792,273.37 | 1,690,356,491.64 |
Accounts receivable | 2,186,178,543.84 | 1,981,538,844.26 |
Accounts receivable financing | ||
Prepayments | 38,244,161.07 | 33,474,104.32 |
Premiums receivable | ||
Reinsurance receivables | ||
Receivable reinsurance contract reserve | ||
Other receivables | 31,235,165.53 | 37,523,072.02 |
Including: Interest receivable | ||
Dividends receivable | ||
Financial assets purchased under resale agreements | ||
Inventories | 1,819,669,430.66 | 1,969,998,988.39 |
Contract assets | 8,089,556.63 | 8,561,303.10 |
Assets held for sale | 17,147,339.84 | 23,831,992.10 |
Current portion of non-current assets |
Other current assets | 54,343,517.04 | 125,675,148.17 |
Total current assets | 7,472,208,087.21 | 8,601,119,724.96 |
Non-current assets: | ||
Loans and advances to customers | ||
Investments in debt obligations | ||
Investments in other debt obligations | ||
Long-term receivables | ||
Long-term equity investments | 180,115,189.99 | 181,545,123.09 |
Investments in other equity instruments | 1,164,717,479.92 | 1,504,980,024.07 |
Other non-current financial assets | ||
Investment property | 42,165,255.37 | 43,347,824.34 |
Fixed assets | 3,337,546,197.41 | 3,360,339,910.95 |
Construction in progress | 1,094,362,246.23 | 1,087,261,052.63 |
Productive living assets | ||
Oil and gas assets | ||
Right-of-use assets | 11,363,508.05 | 14,126,206.08 |
Intangible assets | 364,277,890.38 | 368,954,162.34 |
Development costs | ||
Goodwill | 421,831,593.46 | 421,831,593.46 |
Long-term prepaid expense | 174,834,483.73 | 152,726,512.56 |
Deferred income tax assets | 79,972,630.78 | 82,261,788.58 |
Other non-current assets | 49,992,676.97 | 499,349,770.41 |
Total non-current assets | 6,921,179,152.29 | 7,716,723,968.51 |
Total assets | 14,393,387,239.50 | 16,317,843,693.47 |
Current liabilities: | ||
Short-term borrowings | 65,115,000.00 | 226,779,997.01 |
Borrowings from the central bank | ||
Interbank loans obtained | ||
Held-for-trading financial liabilities | 6,544,500.00 | 9,367.37 |
Derivative financial liabilities | ||
Notes payable | 1,607,406,305.48 | 2,067,111,789.71 |
Accounts payable | 2,228,681,333.31 | 2,429,896,658.92 |
Advances from customers | 4,959,545.56 | 8,106,923.79 |
Contract liabilities | 161,528,315.35 | 140,228,127.84 |
Financial assets sold under repurchase agreements | ||
Customer deposits and interbank deposits | ||
Payables for acting trading of securities | ||
Payables for underwriting of securities | ||
Employee benefits payable | 140,988,596.59 | 167,784,089.64 |
Taxes payable | 77,374,922.57 | 90,981,474.60 |
Other payables | 297,828,933.33 | 333,128,771.81 |
Including: Interest payable | ||
Dividends payable | 15,646.07 | 15,646.07 |
Handling charges and commissions payable | ||
Reinsurance payables | ||
Liabilities directly associated with assets held for sale | ||
Current portion of non-current liabilities | 30,383,518.75 | 27,600,186.15 |
Other current liabilities | 9,952,101.27 | 10,577,082.29 |
Total current liabilities | 4,630,763,072.21 | 5,502,204,469.13 |
Non-current liabilities: | ||
Insurance contract reserve | ||
Long-term borrowings | 556,590,467.75 | |
Bonds payable | ||
Including: Preferred shares | ||
Perpetual bonds | ||
Lease liabilities | 7,287,442.67 | 8,065,560.58 |
Long-term payables | ||
Long-term employee benefits payable | ||
Provisions | 18,378,155.88 | 17,418,343.01 |
Deferred income | 108,223,263.15 | 116,761,570.35 |
Deferred income tax liabilities | 252,930,119.39 | 280,172,789.59 |
Other non-current liabilities | 11,334.19 | 22,653.46 |
Total non-current liabilities | 943,420,783.03 | 422,440,916.99 |
Total liabilities | 5,574,183,855.24 | 5,924,645,386.12 |
Owners’ equity: | ||
Share capital | 1,361,994,647.00 | 1,399,346,154.00 |
Other equity instruments | ||
Including: Preferred shares | ||
Perpetual bonds | ||
Capital reserves | 7,245,971.54 | 994,114,567.16 |
Less: Treasury stock | 82,165,144.15 | 250,600,874.54 |
Other comprehensive income | 754,018,430.97 | 982,972,358.89 |
Specific reserve | ||
Surplus reserves | 86,780,516.19 | 741,353,347.96 |
General reserve | ||
Retained earnings | 3,245,999,616.02 | 3,119,317,423.25 |
Total equity attributable to owners of the Company as the parent | 5,373,874,037.57 | 6,986,502,976.72 |
Non-controlling interests | 3,445,329,346.69 | 3,406,695,330.63 |
Total owners’ equity | 8,819,203,384.26 | 10,393,198,307.35 |
Total liabilities and owners’ equity | 14,393,387,239.50 | 16,317,843,693.47 |
Legal representative: Wu Shenghui Chief Financial Officer: Tang QionglanPerson-in-charge of the Company’s accounting organ: Liang Yuefei
2. Balance Sheet of the Company as the Parent
Unit: RMB
Item | 30 June 2022 | 1 January 2022 |
Current assets: | ||
Monetary assets | 424,568,145.97 | 1,017,365,290.91 |
Held-for-trading financial assets | 304,385,804.11 | |
Derivative financial assets | ||
Notes receivable | 66,011,888.67 | 72,114,026.44 |
Accounts receivable | 1,187,803,897.82 | 1,058,935,664.33 |
Accounts receivable financing | ||
Prepayments | 10,173,470.35 | 9,292,256.82 |
Other receivables | 447,027,739.63 | 511,056,231.24 |
Including: Interest receivable | ||
Dividends receivable | ||
Inventories | 451,972,910.39 | 617,905,747.50 |
Contract assets | 8,089,556.63 | 8,561,303.10 |
Assets held for sale | ||
Current portion of non-current assets | ||
Other current assets | 3,364,413.79 | 36,097,001.14 |
Total current assets | 2,599,012,023.25 | 3,635,713,325.59 |
Non-current assets: | ||
Investments in debt obligations | ||
Investments in other debt obligations | ||
Long-term receivables | ||
Long-term equity investments | 2,476,746,428.40 | 1,243,081,889.11 |
Investments in other equity instruments | 1,123,657,619.00 | 1,474,860,785.15 |
Other non-current financial assets | ||
Investment property | 42,165,255.37 | 43,347,824.34 |
Fixed assets | 556,849,101.34 | 576,386,630.08 |
Construction in progress | 159,339,701.41 | 120,514,314.18 |
Productive living assets | ||
Oil and gas assets | ||
Right-of-use assets | 8,374,369.62 | 9,827,757.94 |
Intangible assets | 121,933,831.47 | 123,089,721.51 |
Development costs | ||
Goodwill | ||
Long-term prepaid expense | 30,088,478.45 | 31,897,595.21 |
Deferred income tax assets | 30,707,247.51 | 31,373,123.07 |
Other non-current assets | 12,476,726.67 | 460,618,564.04 |
Total non-current assets | 4,562,338,759.24 | 4,114,998,204.63 |
Total assets | 7,161,350,782.49 | 7,750,711,530.22 |
Current liabilities: | ||
Short-term borrowings | 127,596,999.82 | |
Held-for-trading financial liabilities | 6,544,500.00 | |
Derivative financial liabilities | ||
Notes payable | 302,876,558.69 | 445,480,718.92 |
Accounts payable | 895,575,614.41 | 949,520,447.82 |
Advances from customers | 4,571,428.58 | 6,857,142.86 |
Contract liabilities | 60,532,518.14 | 64,120,388.15 |
Employee benefits payable | 36,712,883.94 | 51,520,068.31 |
Taxes payable | 17,175,805.06 | 57,207,865.54 |
Other payables | 190,933,919.17 | 223,535,108.76 |
Including: Interest payable | ||
Dividends payable | ||
Liabilities directly associated with assets held for sale | ||
Current portion of non-current liabilities | 2,561,186.34 | 2,800,876.97 |
Other current liabilities | 6,598,016.36 | 5,920,593.62 |
Total current liabilities | 1,524,082,430.69 | 1,934,560,210.77 |
Non-current liabilities: | ||
Long-term borrowings | 336,484,109.53 | |
Bonds payable | ||
Including: Preferred shares | ||
Perpetual bonds | ||
Lease liabilities | 5,813,183.28 | 7,026,880.97 |
Long-term payables | ||
Long-term employee benefits payable | ||
Provisions | ||
Deferred income | ||
Deferred income tax liabilities | 132,200,329.05 | 173,532,376.03 |
Other non-current liabilities | ||
Total non-current liabilities | 474,497,621.86 | 180,559,257.00 |
Total liabilities | 1,998,580,052.55 | 2,115,119,467.77 |
Owners’ equity: | ||
Share capital | 1,361,994,647.00 | 1,399,346,154.00 |
Other equity instruments | ||
Including: Preferred shares | ||
Perpetual bonds | ||
Capital reserves | 17,742,717.33 | 22,568,665.93 |
Less: Treasury stock | 82,165,144.15 | 250,600,874.54 |
Other comprehensive income | 754,235,498.30 | 984,695,765.83 |
Specific reserve |
Surplus reserves | 300,561,517.94 | 741,353,347.96 |
Retained earnings | 2,810,401,493.52 | 2,738,229,003.27 |
Total owners’ equity | 5,162,770,729.94 | 5,635,592,062.45 |
Total liabilities and owners’ equity | 7,161,350,782.49 | 7,750,711,530.22 |
Legal representative: Wu Shenghui Chief Financial Officer: Tang QionglanPerson-in-charge of the Company’s accounting organ: Liang Yuefei
3. Consolidated Income Statement
Unit: RMB
Item | H1 2022 | H1 2021 |
1. Revenue | 4,348,268,999.31 | 3,626,200,260.17 |
Including: Operating revenue | 4,348,268,999.31 | 3,626,200,260.17 |
Interest income | ||
Insurance premium income | ||
Handling charge and commission income | ||
2. Costs and expenses | 4,084,194,362.54 | 3,409,104,001.88 |
Including: Cost of sales | 3,588,065,798.35 | 3,009,499,337.22 |
Interest expense | ||
Handling charge and commission expense | ||
Surrenders | ||
Net insurance claims paid | ||
Net amount provided as insurance contract reserve | ||
Expenditure on policy dividends | ||
Reinsurance premium expense | ||
Taxes and surcharges | 24,369,990.32 | 22,743,190.88 |
Selling expense | 109,839,926.73 | 96,772,619.15 |
Administrative expense | 177,742,698.77 | 139,620,767.72 |
R&D expense | 208,176,593.76 | 144,120,095.18 |
Finance costs | -24,000,645.39 | -3,652,008.27 |
Including: Interest expense | 6,688,232.76 | 2,871,203.53 |
Interest income | 12,905,461.82 | 14,130,946.82 |
Add: Other income | 37,771,447.80 | 33,569,233.15 |
Return on investment (“-” for loss) | 19,613,744.86 | 5,493,482.75 |
Including: Share of profit or loss of joint ventures and associates | 650,457.40 | 37,460.99 |
Income from the derecognition of financial assets at amortized cost (“-” for loss) |
Exchange gain (“-” for loss) | ||
Net gain on exposure hedges (“-” for loss) | ||
Gain on changes in fair value (“-” for loss) | -10,766,595.97 | 1,929,788.30 |
Credit impairment loss (“-” for loss) | -17,052,498.84 | 1,681,781.89 |
Asset impairment loss (“-” for loss) | -23,388,143.98 | -23,464,653.80 |
Asset disposal income (“-” for loss) | 82,362.19 | 1,782,280.34 |
3. Operating profit (“-” for loss) | 270,334,952.83 | 238,088,170.92 |
Add: Non-operating income | 8,961,693.96 | 3,948,332.41 |
Less: Non-operating expense | 7,844,063.02 | 3,694,645.11 |
4. Profit before tax (“-” for loss) | 271,452,583.77 | 238,341,858.22 |
Less: Income tax expense | 41,141,912.01 | 43,339,378.75 |
5. Net profit (“-” for net loss) | 230,310,671.76 | 195,002,479.47 |
5.1 By operating continuity | ||
5.1.1 Net profit from continuing operations (“-” for net loss) | 230,310,671.76 | 195,002,479.47 |
5.1.2 Net profit from discontinued operations (“-” for net loss) | ||
5.2 By ownership | ||
5.2.1 Net profit attributable to owners of the Company as the parent | 160,664,433.28 | 122,377,552.60 |
5.2.1 Net profit attributable to non-controlling interests | 69,646,238.48 | 72,624,926.87 |
6. Other comprehensive income, net of tax | -128,025,149.83 | -243,003,831.01 |
Attributable to owners of the Company as the parent | -128,036,703.73 | -243,003,831.01 |
6.1 Items that will not be reclassified to profit or loss | -128,132,332.34 | -242,940,301.27 |
6.1.1 Changes caused by remeasurements on defined benefit schemes | ||
6.1.2 Other comprehensive income that will not be reclassified to profit or loss under the equity method | ||
6.1.3 Changes in the fair value of investments in other equity instruments | -128,132,332.34 | -242,940,301.27 |
6.1.4 Changes in the fair value arising from changes in own credit risk | ||
6.1.5 Other |
6.2 Items that will be reclassified to profit or loss | 95,628.61 | -63,529.74 |
6.2.1 Other comprehensive income that will be reclassified to profit or loss under the equity method | ||
6.2.2 Changes in the fair value of investments in other debt obligations | ||
6.2.3 Other comprehensive income arising from the reclassification of financial assets | ||
6.2.4 Credit impairment allowance for investments in other debt obligations | ||
6.2.5 Reserve for cash flow hedges | ||
6.2.6 Differences arising from the translation of foreign currency-denominated financial statements | 95,628.61 | -63,529.74 |
6.2.7 Other | ||
Attributable to non-controlling interests | 11,553.90 | |
7. Total comprehensive income | 102,285,521.93 | -48,001,351.54 |
Attributable to owners of the Company as the parent | 32,627,729.55 | -120,626,278.41 |
Attributable to non-controlling interests | 69,657,792.38 | 72,624,926.87 |
8. Earnings per share | ||
8.1 Basic earnings per share | 0.1191 | 0.0907 |
8.2 Diluted earnings per share | 0.1180 | 0.0899 |
Where business combinations under common control occurred in the current period, the net profit achieved by the acquirees beforethe combinations was RMB9,568,639.83, with the amount for the same period of last year being RMB89,810,090.36.Legal representative: Wu Shenghui Chief Financial Officer: Tang QionglanPerson-in-charge of the Company’s accounting organ: Liang Yuefei
4. Income Statement of the Company as the Parent
Unit: RMB
Item | H1 2022 | H1 2021 |
1. Operating revenue | 1,809,179,992.86 | 1,797,795,292.73 |
Less: Cost of sales | 1,476,364,107.19 | 1,485,965,900.74 |
Taxes and surcharges | 10,450,725.11 | 11,528,913.49 |
Selling expense | 60,671,112.08 | 58,577,327.98 |
Administrative expense | 65,659,865.20 | 69,674,599.21 |
R&D expense | 80,982,862.27 | 66,804,608.38 |
Finance costs | -11,830,352.67 | -3,595,436.39 |
Including: Interest expense | 4,427,927.34 | |
Interest income | 3,313,721.07 | 7,925,093.81 |
Add: Other income | 5,635,099.60 | 5,739,842.06 |
Return on investment (“-” for loss) | 21,542,755.12 | 11,964,194.51 |
Including: Share of profit or loss of joint ventures and associates | 650,457.40 | 37,460.99 |
Income from the derecognition of financial assets at amortized cost (“-” for loss) | ||
Net gain on exposure hedges (“-” for loss) | ||
Gain on changes in fair value (“-” for loss) | -10,811,400.00 | 1,940,000.00 |
Credit impairment loss (“-” for loss) | -9,623,686.25 | 2,978,976.42 |
Asset impairment loss (“-” for loss) | -6,552,785.39 | -9,907,597.40 |
Asset disposal income (“-” for loss) | 1,781,700.24 | |
2. Operating profit (“-” for loss) | 127,071,656.76 | 123,336,495.15 |
Add: Non-operating income | -667,333.19 | 2,012,089.62 |
Less: Non-operating expense | 4,998,457.51 | 226,124.51 |
3. Profit before tax (“-” for loss) | 121,405,866.06 | 125,122,460.26 |
Less: Income tax expense | 15,251,135.30 | 18,362,006.98 |
4. Net profit (“-” for net loss) | 106,154,730.76 | 106,760,453.28 |
4.1 Net profit from continuing operations (“-” for net loss) | 106,154,730.76 | 106,760,453.28 |
4.2 Net profit from discontinued operations (“-” for net loss) | ||
5. Other comprehensive income, net of tax | -129,543,043.34 | -242,940,301.27 |
5.1 Items that will not be reclassified to profit or loss | -129,543,043.34 | -242,940,301.27 |
5.1.1 Changes caused by remeasurements on defined benefit schemes | ||
5.1.2 Other comprehensive income that will not be reclassified to profit or loss under the equity method | ||
5.1.3 Changes in the fair value of investments in other equity instruments | -129,543,043.34 | -242,940,301.27 |
5.1.4 Changes in the fair value |
arising from changes in own credit risk | ||
5.1.5 Other | ||
5.2 Items that will be reclassified to profit or loss | ||
5.2.1 Other comprehensive income that will be reclassified to profit or loss under the equity method | ||
5.2.2 Changes in the fair value of investments in other debt obligations | ||
5.2.3 Other comprehensive income arising from the reclassification of financial assets | ||
5.2.4 Credit impairment allowance for investments in other debt obligations | ||
5.2.5 Reserve for cash flow hedges | ||
5.2.6 Differences arising from the translation of foreign currency-denominated financial statements | ||
5.2.7 Other | ||
6. Total comprehensive income | -23,388,312.58 | -136,179,847.99 |
7. Earnings per share | ||
7.1 Basic earnings per share | ||
7.2 Diluted earnings per share |
Legal representative: Wu Shenghui Chief Financial Officer: Tang QionglanPerson-in-charge of the Company’s accounting organ: Liang Yuefei
5. Consolidated Cash Flow Statement
Unit: RMB
Item | H1 2022 | H1 2021 |
1. Cash flows from operating activities: | ||
Proceeds from sale of commodities and rendering of services | 4,002,503,578.81 | 3,946,336,085.43 |
Net increase in customer deposits and interbank deposits | ||
Net increase in borrowings from the central bank | ||
Net increase in loans from other financial institutions | ||
Premiums received on original insurance contracts | ||
Net proceeds from reinsurance |
Net increase in deposits and investments of policy holders | ||
Interest, handling charges and commissions received | ||
Net increase in interbank loans obtained | ||
Net increase in proceeds from repurchase transactions | ||
Net proceeds from acting trading of securities | ||
Tax rebates | 145,624,893.13 | 93,570,819.45 |
Cash generated from other operating activities | 119,333,795.35 | 89,817,744.05 |
Subtotal of cash generated from operating activities | 4,267,462,267.29 | 4,129,724,648.93 |
Payments for commodities and services | 3,065,999,967.63 | 2,761,223,153.05 |
Net increase in loans and advances to customers | ||
Net increase in deposits in the central bank and in interbank loans granted | ||
Payments for claims on original insurance contracts | ||
Net increase in interbank loans granted | ||
Interest, handling charges and commissions paid | ||
Policy dividends paid | ||
Cash paid to and for employees | 702,961,459.58 | 622,589,181.75 |
Taxes paid | 182,912,490.66 | 122,117,306.79 |
Cash used in other operating activities | 165,553,443.03 | 177,582,001.14 |
Subtotal of cash used in operating activities | 4,117,427,360.90 | 3,683,511,642.73 |
Net cash generated from/used in operating activities | 150,034,906.39 | 446,213,006.20 |
2. Cash flows from investing activities: | ||
Proceeds from disinvestment | 502,992,240.66 | 315,735,017.52 |
Return on investment | 21,038,833.14 | 454,878,942.50 |
Net proceeds from the disposal of fixed assets, intangible assets and other long-lived assets | 232,233.41 | 7,762,670.18 |
Net proceeds from the disposal of subsidiaries and other business units | ||
Cash generated from other investing activities |
Subtotal of cash generated from investing activities | 524,263,307.21 | 778,376,630.20 |
Payments for the acquisition of fixed assets, intangible assets and other long-lived assets | 330,641,926.08 | 215,505,442.11 |
Payments for investments | 71,695,763.31 | 29,402,110.68 |
Net increase in pledged loans granted | ||
Net payments for the acquisition of subsidiaries and other business units | ||
Cash used in other investing activities | ||
Subtotal of cash used in investing activities | 402,337,689.39 | 244,907,552.79 |
Net cash generated from/used in investing activities | 121,925,617.82 | 533,469,077.41 |
3. Cash flows from financing activities: | ||
Capital contributions received | ||
Including: Capital contributions by non-controlling interests to subsidiaries | ||
Borrowings raised | 687,436,000.00 | |
Cash generated from other financing activities | 53,126,214.00 | 1,339,606.80 |
Subtotal of cash generated from financing activities | 740,562,214.00 | 1,339,606.80 |
Repayment of borrowings | 309,876,000.00 | |
Interest and dividends paid | 159,400,451.54 | 36,111,859.97 |
Including: Dividends paid by subsidiaries to non-controlling interests | 23,912,623.05 | |
Cash used in other financing activities | 1,062,094,428.42 | 304,224,485.91 |
Subtotal of cash used in financing activities | 1,531,370,879.96 | 340,336,345.88 |
Net cash generated from/used in financing activities | -790,808,665.96 | -338,996,739.08 |
4. Effect of foreign exchange rates changes on cash and cash equivalents | 19,953,587.60 | -8,764,472.98 |
5. Net increase in cash and cash equivalents | -498,894,554.15 | 631,920,871.55 |
Add: Cash and cash equivalents, beginning of the period | 1,886,894,463.37 | 1,325,464,361.36 |
6. Cash and cash equivalents, end of the period | 1,387,999,909.22 | 1,957,385,232.91 |
Legal representative: Wu Shenghui Chief Financial Officer: Tang QionglanPerson-in-charge of the Company’s accounting organ: Liang Yuefei
6. Cash Flow Statement of the Company as the Parent
Unit: RMB
Item | H1 2022 | H1 2021 |
1. Cash flows from operating activities: | ||
Proceeds from sale of commodities and rendering of services | 1,647,925,557.33 | 1,850,655,815.39 |
Tax rebates | 66,177,691.70 | 63,217,537.03 |
Cash generated from other operating activities | 49,023,640.18 | 51,058,701.35 |
Subtotal of cash generated from operating activities | 1,763,126,889.21 | 1,964,932,053.77 |
Payments for commodities and services | 1,182,528,555.48 | 1,436,749,486.58 |
Cash paid to and for employees | 279,898,010.00 | 314,880,615.57 |
Taxes paid | 111,471,325.43 | 24,295,009.50 |
Cash used in other operating activities | 63,008,054.83 | 110,890,242.14 |
Subtotal of cash used in operating activities | 1,636,905,945.74 | 1,886,815,353.79 |
Net cash generated from/used in operating activities | 126,220,943.47 | 78,116,699.98 |
2. Cash flows from investing activities: | ||
Proceeds from disinvestment | 492,992,240.66 | 262,773,600.62 |
Return on investment | 23,125,665.53 | 454,663,109.72 |
Net proceeds from the disposal of fixed assets, intangible assets and other long-lived assets | 42,771.45 | 1,720,784.40 |
Net proceeds from the disposal of subsidiaries and other business units | ||
Cash generated from other investing activities | ||
Subtotal of cash generated from investing activities | 516,160,677.64 | 719,157,494.74 |
Payments for the acquisition of fixed assets, intangible assets and other long-lived assets | 59,178,832.68 | 53,582,153.85 |
Payments for investments | 1,166,664,444.95 | 49,402,110.68 |
Net payments for the acquisition of subsidiaries and other business units | ||
Cash used in other investing activities | ||
Subtotal of cash used in investing activities | 1,225,843,277.63 | 102,984,264.53 |
Net cash generated from/used in investing activities | -709,682,599.99 | 616,173,230.21 |
3. Cash flows from financing activities: | ||
Capital contributions received | ||
Borrowings raised | 382,336,000.00 | |
Cash generated from other financing activities | ||
Subtotal of cash generated from financing activities | 382,336,000.00 | |
Repayment of borrowings | 197,016,000.00 | |
Interest and dividends paid | 135,641,014.35 | |
Cash used in other financing activities | 220,895,890.55 | |
Subtotal of cash used in financing activities | 332,657,014.35 | 220,895,890.55 |
Net cash generated from/used in financing activities | 49,678,985.65 | -220,895,890.55 |
4. Effect of foreign exchange rates changes on cash and cash equivalents | 15,401,360.65 | -7,632,408.62 |
5. Net increase in cash and cash equivalents | -518,381,310.22 | 465,761,631.02 |
Add: Cash and cash equivalents, beginning of the period | 861,826,014.29 | 803,264,792.72 |
6. Cash and cash equivalents, end of the period | 343,444,704.07 | 1,269,026,423.74 |
Legal representative: Wu Shenghui Chief Financial Officer: Tang QionglanPerson-in-charge of the Company’s accounting organ: Liang Yuefei
7. Consolidated Statements of Changes in Owners’ Equity
H1 2022
Unit: RMB
Item | H1 2022 | ||||||||||||||
Equity attributable to owners of the Company as the parent | Non-controlling interests | Total owners’ equity | |||||||||||||
Share capital | Other equity instruments | Capital reserves | Less: Treasury stock | Other comprehensive income | Specific reserve | Surplus reserves | General reserve | Retained earnings | Other | Subtotal | |||||
Preferred shares | Perpetual bonds | Other | |||||||||||||
1. Balance as at the end of the period of prior year | 1,399,346,154.00 | 994,114,567.16 | 250,600,874.54 | 982,972,358.89 | 741,353,347.96 | 3,119,317,423.25 | 6,986,502,976.72 | 3,406,695,330.63 | 10,393,198,307.35 |
Add: Adjustment for change in accounting policy | |||||||||||||||
Adjustment for correction of previous error | |||||||||||||||
Adjustment for business combination under common control | |||||||||||||||
Other adjustments | |||||||||||||||
2. Balance as at the beginning of the Reporting Period | 1,399,346,154.00 | 994,114,567.16 | 250,600,874.54 | 982,972,358.89 | 741,353,347.96 | 3,119,317,423.25 | 6,986,502,976.72 | 3,406,695,330.63 | 10,393,198,307.35 | ||||||
3. Increase/ decrease in the period (“-” for decrease) | -37,351,507.00 | -986,868,595.62 | -168,435,730.39 | -228,953,927.92 | -654,572,831.77 | 126,682,192.77 | -1,612,628,939.15 | 38,634,016.06 | -1,573,994,923.09 | ||||||
3.1 Total comprehensive income | -128,036,703.73 | 160,664,433.28 | 32,627,729.55 | 69,657,792.38 | 102,285,521.93 | ||||||||||
3.2 Capital increased and reduced by owners | -37,351,507.00 | -986,868,595.62 | -168,435,730.39 | -654,572,831.77 | -1,510,357,204.00 | -6,740,912.62 | -1,517,098,116.62 | ||||||||
3.2.1 Ordinary shares increased by owners |
3.2.2 Capital increased by holders of other equity instruments | |||||||||||||||
3.2.3 Share-based payments included in owners’ equity | |||||||||||||||
3.2.4 Other | -37,351,507.00 | -986,868,595.62 | -168,435,730.39 | -654,572,831.77 | -1,510,357,204.00 | -6,740,912.62 | -1,517,098,116.62 | ||||||||
3.3 Profit distribution | -134,899,464.70 | -134,899,464.70 | -24,282,863.70 | -159,182,328.40 | |||||||||||
3.3.1 Appropriation to surplus reserves | |||||||||||||||
3.3.2 Appropriation to general reserve | |||||||||||||||
3.3.3 Appropriation to owners (or shareholders) | -134,899,464.70 | -134,899,464.70 | -24,282,863.70 | -159,182,328.40 | |||||||||||
3.3.4 Other | |||||||||||||||
3.4 Transfers within owners’ equity | -100,917,224.19 | 100,917,224.19 | 0.00 | ||||||||||||
3.4.1 Increase in capital (or share capital) |
from capital reserves | |||||||||||||||
3.4.2 Increase in capital (or share capital) from surplus reserves | |||||||||||||||
3.4.3 Loss offset by surplus reserves | |||||||||||||||
3.4.4 Changes in defined benefit schemes transferred to retained earnings | |||||||||||||||
3.4.5 Other comprehensive income transferred to retained earnings | -100,917,224.19 | 100,917,224.19 | 0.00 | ||||||||||||
3.4.6 Other | |||||||||||||||
3.5 Specific reserve | |||||||||||||||
3.5.1 Increase in the period | |||||||||||||||
3.5.2 Used in the period | |||||||||||||||
3.6 Other | |||||||||||||||
4. Balance as at the end of the Reporting Period | 1,361,994,647.00 | 7,245,971.54 | 82,165,144.15 | 754,018,430.97 | 86,780,516.19 | 3,245,999,616.02 | 5,373,874,037.57 | 3,445,329,346.69 | 8,819,203,384.26 |
H1 2021
Unit: RMB
Item | H1 2021 | ||||||||||||||
Equity attributable to owners of the Company as the parent | Non-controlling interests | Total owners’ equity | |||||||||||||
Share capital | Other equity instruments | Capital reserves | Less: Treasury stock | Other comprehensive income | Specific reserve | Surplus reserves | General reserve | Retained earnings | Other | Subtotal | |||||
Preferred shares | Perpetual bonds | Other | |||||||||||||
1. Balance as at the end of the period of prior year | 1,399,346,154.00 | 15,157,514.90 | 2,349,388,533.61 | 741,567,039.55 | 1,758,462,062.48 | 6,263,921,304.54 | 48,258,834.53 | 6,312,180,139.07 | |||||||
Add: Adjustment for change in accounting policy | |||||||||||||||
Adjustment for correction of previous error | |||||||||||||||
Adjustment for business combination under common control | 991,444,757.70 | -121,812.33 | 169,825,049.30 | 1,161,147,994.67 | 2,774,022,482.92 | 3,935,170,477.59 | |||||||||
Other adjustments | |||||||||||||||
2. Balance as at the beginning of the Reporting Period | 1,399,346,154.00 | 1,006,602,272.60 | 2,349,266,721.28 | 741,567,039.55 | 1,928,287,111.78 | 7,425,069,299.21 | 2,822,281,317.45 | 10,247,350,616.66 | |||||||
3. Increase/ decrease in | - | -9,4 | 220, | -598 | -187 | 470, | -358 | 44,1 | -314 |
the period (“-” for decrease) | 02,110.68 | 708,001.24 | ,873,384.43 | ,889.31 | 342,967.80 | ,828,417.86 | 45,530.39 | ,682,887.47 | |||||||
3.1 Total comprehensive income | -243,003,831.01 | 122,377,552.60 | -120,626,278.41 | 72,624,926.87 | -48,001,351.54 | ||||||||||
3.2 Capital increased and reduced by owners | -9,402,110.68 | 220,708,001.24 | - | -187,889.31 | -230,298,001.23 | 725,095.44 | -229,572,905.79 | ||||||||
3.2.1 Ordinary shares increased by owners | 220,708,001.24 | -220,708,001.24 | -220,708,001.24 | ||||||||||||
3.2.2 Capital increased by holders of other equity instruments | |||||||||||||||
3.2.3 Share-based payments included in owners’ equity | |||||||||||||||
3.2.4 Other | -9,402,110.68 | -187,889.31 | -9,589,999.99 | 725,095.44 | -8,864,904.55 | ||||||||||
3.3 Profit distribution | -7,904,138.22 | -7,904,138.22 | -29,204,491.92 | -37,108,630.14 | |||||||||||
3.3.1 Appropriation to surplus reserves | |||||||||||||||
3.3.2 Appropriation to general reserve | |||||||||||||||
3.3.3 |
Appropriation to owners (or shareholders) | -7,904,138.22 | -7,904,138.22 | -29,204,491.92 | -37,108,630.14 | |||||||||||
3.3.4 Other | |||||||||||||||
3.4 Transfers within owners’ equity | -355,869,553.42 | 355,869,553.42 | |||||||||||||
3.4.1 Increase in capital (or share capital) from capital reserves | |||||||||||||||
3.4.2 Increase in capital (or share capital) from surplus reserves | |||||||||||||||
3.4.3 Loss offset by surplus reserves | |||||||||||||||
3.4.4 Changes in defined benefit schemes transferred to retained earnings | |||||||||||||||
3.4.5 Other comprehensive income transferred to retained earnings | -355,869,553.42 | 355,869,553.42 | |||||||||||||
3.4.6 Other |
3.5 Specific reserve | |||||||||||||||
3.5.1 Increase in the period | |||||||||||||||
3.5.2 Used in the period | |||||||||||||||
3.6 Other | |||||||||||||||
4. Balance as at the end of the Reporting Period | 1,399,346,154.00 | 997,200,161.92 | 220,708,001.24 | 1,750,393,336.85 | 741,379,150.24 | 2,398,630,079.58 | 7,066,240,881.35 | 2,866,426,847.84 | 9,932,667,729.19 |
Legal representative: Wu Shenghui Chief Financial Officer: Tang QionglanPerson-in-charge of the Company’s accounting organ: Liang Yuefei
8. Statements of Changes in Owners’ Equity of the Company as the Parent
H1 2022
Unit: RMB
Item | H1 2022 | |||||||||||
Share capital | Other equity instruments | Capital reserves | Less: Treasury stock | Other comprehensive income | Specific reserve | Surplus reserves | Retained earnings | Other | Total owners’ equity | |||
Preferred shares | Perpetual bonds | Other | ||||||||||
1. Balance as at the end of the period of prior year | 1,399,346,154.00 | 22,568,665.93 | 250,600,874.54 | 984,695,765.83 | 741,353,347.96 | 2,738,229,003.27 | 5,635,592,062.45 | |||||
Add: Adjustment for change in accounting policy | ||||||||||||
Adjustment for correction of previous |
error | ||||||||||||
Other adjustments | ||||||||||||
2. Balance as at the beginning of the Reporting Period | 1,399,346,154.00 | 22,568,665.93 | 250,600,874.54 | 984,695,765.83 | 741,353,347.96 | 2,738,229,003.27 | 5,635,592,062.45 | |||||
3. Increase/ decrease in the period (“-” for decrease) | -37,351,507.00 | -4,825,948.60 | -168,435,730.39 | -230,460,267.53 | -440,791,830.02 | 72,172,490.25 | -472,821,332.51 | |||||
3.1 Total comprehensive income | -129,543,043.34 | 106,154,730.76 | -23,388,312.58 | |||||||||
3.2 Capital increased and reduced by owners | -37,351,507.00 | -4,825,948.60 | -168,435,730.39 | -440,791,830.02 | -314,533,555.23 | |||||||
3.2.1 Ordinary shares increased by owners | ||||||||||||
3.2.2 Capital increased by holders of other equity instruments | ||||||||||||
3.2.3 Share-based payments included in owners’ equity | ||||||||||||
3.2.4 Other | -37,351,507.00 | -4,825,948.60 | -168,435,730.39 | -440,791,830.02 | -314,533,555.23 | |||||||
3.3 Profit distribution | -134,899,464.70 | -134,899,464.70 | ||||||||||
3.3.1 |
Appropriation to surplus reserves | ||||||||||||
3.3.2 Appropriation to owners (or shareholders) | -134,899,464.70 | -134,899,464.70 | ||||||||||
3.3.3 Other | ||||||||||||
3.4 Transfers within owners’ equity | -100,917,224.19 | 100,917,224.19 | 0.00 | |||||||||
3.4.1 Increase in capital (or share capital) from capital reserves | ||||||||||||
3.4.2 Increase in capital (or share capital) from surplus reserves | ||||||||||||
3.4.3 Loss offset by surplus reserves | ||||||||||||
3.4.4 Changes in defined benefit schemes transferred to retained earnings | ||||||||||||
3.4.5 Other comprehensive income transferred to | -100,917,224.19 | 100,917,224.19 | 0.00 |
retained earnings | ||||||||||||
3.4.6 Other | ||||||||||||
3.5 Specific reserve | ||||||||||||
3.5.1 Increase in the period | ||||||||||||
3.5.2 Used in the period | ||||||||||||
3.6 Other | ||||||||||||
4. Balance as at the end of the Reporting Period | 1,361,994,647.00 | 17,742,717.33 | 82,165,144.15 | 754,235,498.30 | 300,561,517.94 | 2,810,401,493.52 | 5,162,770,729.94 |
H1 2021
Unit: RMB
Item | H1 2021 | |||||||||||
Share capital | Other equity instruments | Capital reserves | Less: Treasury stock | Other comprehensive income | Specific reserve | Surplus reserves | Retained earnings | Other | Total owners’ equity | |||
Preferred shares | Perpetual bonds | Other | ||||||||||
1. Balance as at the end of the period of prior year | 1,399,346,154.00 | 7,426,635.62 | 2,349,389,658.23 | 741,567,039.55 | 1,591,884,733.49 | 6,089,614,220.89 | ||||||
Add: Adjustment for change in accounting policy | ||||||||||||
Adjustment for correction of previous error |
Other adjustments | ||||||||||||
2. Balance as at the beginning of the Reporting Period | 1,399,346,154.00 | 7,426,635.62 | 2,349,389,658.23 | 741,567,039.55 | 1,591,884,733.49 | 6,089,614,220.89 | ||||||
3. Increase/ decrease in the period (“-” for decrease) | 220,708,001.24 | -598,809,854.69 | -187,889.31 | 462,630,006.70 | -357,075,738.54 | |||||||
3.1 Total comprehensive income | -242,940,301.27 | 106,760,453.28 | -136,179,847.99 | |||||||||
3.2 Capital increased and reduced by owners | 220,708,001.24 | -187,889.31 | -220,895,890.55 | |||||||||
3.2.1 Ordinary shares increased by owners | ||||||||||||
3.2.2 Capital increased by holders of other equity instruments | ||||||||||||
3.2.3 Share-based payments included in owners’ equity | ||||||||||||
3.2.4 Other | 220,708,001.24 | -187,889.31 | -220,895,890.55 | |||||||||
3.3 Profit distribution | ||||||||||||
3.3.1 Appropriatio |
n to surplus reserves | ||||||||||||
3.3.2 Appropriation to owners (or shareholders) | ||||||||||||
3.3.3 Other | ||||||||||||
3.4 Transfers within owners’ equity | -355,869,553.42 | 355,869,553.42 | ||||||||||
3.4.1 Increase in capital (or share capital) from capital reserves | ||||||||||||
3.4.2 Increase in capital (or share capital) from surplus reserves | ||||||||||||
3.4.3 Loss offset by surplus reserves | ||||||||||||
3.4.4 Changes in defined benefit schemes transferred to retained earnings | ||||||||||||
3.4.5 Other comprehensive income transferred to retained | -355,869,553.42 | 355,869,553.42 |
earnings | ||||||||||||
3.4.6 Other | ||||||||||||
3.5 Specific reserve | ||||||||||||
3.5.1 Increase in the period | ||||||||||||
3.5.2 Used in the period | ||||||||||||
3.6 Other | ||||||||||||
4. Balance as at the end of the Reporting Period | 1,399,346,154.00 | 7,426,635.62 | 220,708,001.24 | 1,750,579,803.54 | 741,379,150.24 | 2,054,514,740.19 | 5,732,538,482.35 |
Legal representative: Wu Shenghui Chief Financial Officer: Tang QionglanPerson-in-charge of the Company’s accounting organ: Liang Yuefei
III Company profile
Foshan Electrical and Lighting Co., Ltd. (hereinafter referred to as “the Company”), a joint-stock limitedcompany jointly founded by Foshan Electrical and Lighting Company, Nanhai Wuzhuang Color Glazed BrickField, and Foshan Poyang Printing Industrial Co. on 20 October 1992 by raising funds under the approval of YGS(1992) No. 63 Document issued by the Joint Examination Group for Experimental Enterprises in Stock System ofGuangdong Province and the Economic System Reform Commission of Guangdong Province, is an enterprisewith its shares held by both the corporate and the natural persons. As approved by China Securities RegulatoryCommission with Document (1993) No. 33, the Company publicly issued 19.3 million shares of social publicshares (A shares) to the public in October 1993, and was listed in Shenzhen Stock Exchange for trade on 23November 1993. The Company was approved to issue 50,000,000 B shares on 23 July 1995. And, as approved tochange into a foreign-invested stock limited company on 26 August 1996 by (1996) WJMZEHZ No. 466Document issued by the Ministry of Foreign Trade and Economic Cooperation of the People’s Republic of China.On 11 December 2000, as approved by China Securities Regulatory Commission with ZJGS Zi [2000] No. 175Document, the Company additionally issued 55,000,000 A shares. At approved by the Shareholders’ GeneralMeeting 2006, 2007, 2008, 2014 and 2017 the Company implemented the plan of capitalization of capital reserve,after the transfer, the registered capital of the Company has increased to RMB1,399,346,154.00. The Companyheld the 26
th
Meeting of the 9
thBoard of Directors on 14 January 2022, where the Proposal on Cancelling SomeShares of the Company's Repurchase Special Securities Account was deliberated and adopted. The repurchased 13million A shares were used for the equity incentive plan. The remaining 18,952,995 A shares and the repurchased18,398,512 B shares, totaling 37,351,507 shares, were all deregistered. On 8 February 2022, it was confirmed byShenzhen Branch of CSDC that the number of repurchased public shares canceled this time was 37,351,507,
accounting for 2.67% of the total share capital of the Company before the cancellation, including 18,952,995 Ashares and 18,398,512 B shares. Upon the cancellation of the shares, the total share capital of the Company waschanged from 1,399,346,154 shares to 1,361,994,647 shares. The Company's registered capital was changed toRMB1,361,994,647.00.Credibility code of the Company: 91440000190352575W.Legal representative: Mr. Wu ShenghuiAddress: No. 64, Fenjiang North Road, Foshan, Guangdong ProvinceMain business of the company and its subsidiaries (hereinafter referred to as “the Company”): lighting products,electro technical products, vehicle lamp products, epitaxy and chip products, LED packaging and componentproducts, trade and application products.The business term of the Company is long-term, which was calculated from the date of issuance of License ofBusiness Corporation.The Financial Report was approved and authorized for issue by the Board of Directors on 30 August 2022.The consolidation scope of the financial statement during the Reporting Period including the Company and FSLChanchang Optoelectronics Co., Ltd. ( referred to as “Chanchang Company”), Foshan Taimei Times Lamps andLanterns Co., Ltd. ( referred to as “Taimei Company”), Nanjing Fozhao Lighting Components Co., Ltd. ( referredto as “Nanjing Fozhao”), FSL (Xinxiang) Lighting Co., Ltd. ( referred to as “Xinxiang Company”), FoshanLighting Lamps & Components Co., Ltd. ( referred to as “Lamps & Components Company”), FSL Zhida ElectricTechnology Co., Ltd ( referred to as “Zhida Company”), FSL LIGHTING GMBH (referred to as “FSLLIGHTING”), Foshan Hortilite Optoelectronics Co.,Ltd. (referred to as “Hortilite Company”), Fozhao (Hainan)Technology Co., Ltd. (referred to as “Hainan Technology”), Foshan Kelian New Energy Technology Co., Ltd.(referred to as “Foshan Kelian”), Nanning Liaowang Auto Lamp Co., Ltd. (referred to as “Nanning Liaowang”),Foshan NationStar Optoelectronics Co., Ltd. (referred to as “NationStar Optoelectronics”) and Foshan SigmaVenture Capital Co., Ltd. (referred to as “Sigma”) in total 14 subsidiaries and Liuzhou Guige LightingTechnology Co., Ltd. (referred to as “Liuzhou Lighting”), Liuzhou Guige Foreshine Technology Co., Ltd.(referred to as “Liuzhou Foreshine”), Chongqing Guinuo Lighting Technology Co., Ltd. (referred to as“Chongqing Guinuo”), Qingdao Guige Lighting Technology Co., Ltd. (referred to as “Qingdao Lighting”),Indonesia Liaowang Auto Lamp Co., Ltd. (referred to as “Indonesia Liaowang”), Foshan NationStar ElectronicManufacturing Co., Ltd. (referred to as “NationStar Electronic Manufacturing”), Foshan NationStarSemiconductor Technology Co., Ltd. (referred to as “NationStar Semiconductor”), Nanyang Baoli VanadiumIndustry Co., Ltd. (referred to as “Baoli Vanadium Industry”), Guangdong New Electronic Information Ltd.(referred to as “New Electronic”) and NationStar Optoelectronics (Germany) Co., Ltd. (referred to as “GermanyNationStar”) in total ten sub-subsidiary.Given that Nanyang Baoli Vanadium Industry Co., Ltd. (Baoli Vanadium), a subsidiary of NationStarOptoelectronics, is in a state of non-continuous operations, the Interim Report 2022 of Baoli Vanadium for thecurrent period was formulated at fair value or costs whichever was lower.Compared with the previous period, the consolidation scope of the current financial statements added twosubsidiaries of NationStar Optoelectronics and Sigma, and five sub-subsidiaries of NationStar ElectronicManufacturing, NationStar Semiconductor, Baoli Vanadium Industry, New Electronic and Germany NationStar.For details, please refer to Note VIII “Changes in the Scope of Consolidation" and Note IX "Interests in OtherSubjects".
IV Basis for Preparation of Financial Statements
1. Preparation Basis
The financial statements of the Company are based on the continuing operation, and are confirmed and measuredaccording to the actual transactions and events, the Accounting Standards for Business Enterprises - BasicStandards, other various specific accounting standards, the application guide, the interpretation of accountingstandards for business enterprises (hereinafter referred to as the Accounting Standards for Business Enterprises).And based on the following important accounting policies, and accounting estimations, they are preparedaccording to the relevant regulations of Rules for the Information Disclosure of Companies Publicly IssuingSecurities No. 15 - General Provisions on Financial Reporting of China Securities Regulatory Commission(Revised in 2014). Except the Cash Flow Statement prepared under the principle of cash basis, the rest of financialstatement of the Company are prepared under the principle of accrual basis.The Company didn’t find anything like being suspicious of the ability of continuing operation within 12 monthsfrom the end of the Reporting Period with all available information.
2. Continuation
The Company has no matters affecting the continuing operation of the Company and is expected to have theability to continue to operate in the next 12 months. The financial statements of the Company are prepared on thebasis of continuing operation.V Important Accounting Policies and EstimationsReminders of the specific accounting policies and accounting estimations:
The Company confirmed the specific accounting policies and estimations according to production and operationfeatures, mainly reflecting in the method of provision for expected credit loss of accounts receivables (Note 12.Accounts Receivable), depreciation of fixed assets and amortization of intangible assets (Note 24. Fixed Assetsand Note 30. Intangible Assets), and recognition of revenue (Note 39. Revenue), etc.
1. Statement of Compliance with the Accounting Standards for Business EnterprisesThe financial statements prepared by the Company are in compliance with the Accounting Standards for BusinessEnterprises, which factually and completely present the Company’s and the consolidated financial positions,business results and cash flows, as well as other relevant information.
2. Fiscal Year
A fiscal year starts on January 1
st and ends on December 31
staccording to the Gregorian calendar.
3. Operating Cycle
An operating cycle for the Company is 12 months, which is also the classification criterion for the liquidity of itsassets and liabilities.
4. Recording Currency
Renminbi is the recording currency for the statements of the Company, and the financial statements are listed andpresented by Renminbi.
5. Accounting Treatment Methods for Business Combinations under the Same Control or not under theSame Control
1. Business Combinations under the Same Control
For the merger of enterprises under the same control, if the consideration of the merging enterprise is that it makespayment in cash, transfers non-cash assets or bear its debts, it shall, on the date of merger, regard the share of thebook value among final controller’s consolidated financial statement of the owner's equity of the mergedenterprise as the initial cost of the long-term equity investment. The difference between the initial cost of thelong-term equity investment and the payment in cash, non-cash assets transferred as well as the book value of thedebts borne by the merging party shall offset against the capital reserve. If the capital reserve is insufficient todilute, the retained earnings shall be adjusted.If the consideration of the merging enterprise is that it issues equity securities, it shall, on the date of merger,regard the share of the book value among final controller’s consolidated financial statement of the owner's equityof the merged enterprise as the initial cost of the long-term equity investment. The total face value of the stocksissued shall be regarded as the capital stock, while the difference between the initial cost of the long-term equityinvestment and total face value of the shares issued shall offset against the capital reserve. If the capital reserve isinsufficient to dilute, the retained earnings shall be adjusted.
2. Business Combinations not under the Same Control
The Company measured the paid assets as the consideration of business combination and liabilities happened orundertaken by fair value. The difference between fair value and its book value shall be included into the currentlosses and gains. The Company distributed combined cost on the purchasing date.The difference of the combination cost greater than the fair value of the identifiable net assets of the acquireeacquired is recognized as goodwill; the difference of the combination cost less than the fair value of theidentifiable net assets of the acquiree acquired is included into current losses and gains.As for the assets other than intangible assets acquired from the acquiree in a business combination (not limited tothe assets which have been recognized by the acquiree), if the economic benefits brought by them are likely toflow into the Company and their fair values can be measured reliably, they shall be separately recognized andmeasured in light of their fair values; intangible asset whose fair value can be measured reliably shall beseparately recognized as an intangible asset and shall measured in light of its fair value; As for the liabilities otherthan contingent liabilities acquired from the acquiree, if the performance of the relevant obligations is likely toresult in any out-flow of economic benefits from the Company, and their fair values can be measured reliably,they shall be separately recognized and measured in light of their fair values; As for the contingent liabilities ofthe acquiree, if their fair values can be measured reliably, they shall separately recognized as liabilities and shallbe measured in light of their fair values.
6. Methods for Preparing Consolidated Financial Statements
1. Principle of Determining the Scope of Consolidation
The scope of consolidation of the consolidated financial statements of the Company is determined on the basis ofcontrol. Control means that the investors has the right to invest in the investee and enjoy a variable return through
the participation of the relevant activities of the investee, and has the ability to use the power over the investee toaffect the amount of its return. The Company includes the subsidiaries with actual right of control (includingseparate entity controlled by the Parent Company) into consolidated financial statements.
2. Principles, Procedures and Methods for the Preparation of Consolidated Statements
(1) Principles, Procedures and Methods for the Preparation of Consolidated StatementsAll subsidiaries included into the scope of consolidated financial statements adopted same accounting policies andfiscal year with the Company. If the accounting policies and fiscal year of the subsidiaries are different to theCompany’s, necessary adjustment should be made in accordance with the Company’s accounting policies andfiscal year when consolidated financial statements are prepared.The consolidated financial statements are based on the financial statements of the Parent Company andsubsidiaries included into the consolidated scope. The consolidated financial statements are prepared by theCompany who makes adjustment to long-term equity investment to subsidiaries by equity method according toother relevant materials after the offset of the share held by the Parent Company in the equity capital investmentof the Parent Company and owner’s equity of subsidiaries and the significant transactions and intrabranch withinthe Company.For the balance formed because the current loss shared by the minority shareholders of the subsidiary is more thanthe share enjoyed by the minority shareholders of the subsidiary in the initial shareholders’ equity, if the Articlesof Corporation or Agreement didn’t stipulate that minority shareholders should be responsible for it, then thebalance need to offset the shareholders’ equity of the Company; if the Articles of Corporation or Agreementstipulated that minority shareholders should be responsible for it, then the balance need to offset the minorityshareholders’ equity.
(2) Treatment Method of Increasing or Disposing Subsidiaries during the Reporting PeriodDuring the Reporting Period, if the subsidiaries were added due to Business combinations under the same control,then initial book balance of consolidated balance sheet need to be adjusted; the income, expenses, and profits ofsubsidiaries from the combination’s period-begin to the end of the reporting period need to be included intoconsolidated income statement; the cash flow of subsidiaries from the combination’s period-begin to the end ofthe reporting period need to be included into consolidated cash flow statement. if the subsidiaries were added dueto Business combinations not under the same control, then initial book balance of consolidated balance sheetdoesn’t need to be adjusted; the income, expenses, and profits of subsidiaries from the purchasing date to the endof the reporting period need to be included into consolidated income statement; the cash flow of subsidiaries frompurchasing date to the end of the reporting period need to be included into consolidated cash flow statement.During the Reporting Period, if the Company disposed the subsidiaries, then the income, expenses, and profits ofsubsidiaries from period-begin to the disposal date need to be included into consolidated income statement; thecash flow of subsidiaries from period-begin to the disposal date need to be included into consolidated cash flowstatement.
7. Classification of Joint Arrangements and Accounting Treatment of Joint OperationsA joint arrangement refers to an arrangement jointly controlled by two participants or above and be divided intojoint operations and joint ventures.When the Company is the joint venture party of the joint operations, should recognize the following items relatedto the interests share of the joint operations:
(1) Recognize the assets individually held and the assets jointly held by recognizing according to the holdingshare;
(2) Recognize the liabilities undertook individually and the liabilities jointly held by recognizing according to theholding share;
(3) Recognize the revenues occurred from selling the output share of the joint operations enjoy by the Company;
(4) Recognize the revenues occurred from selling the assets of the joint operations according to the holding share;
(5) Recognize the expenses individually occurred and the expenses occurred from the joint operations accordingto the holding share of the Company.When the Company is the joint operation party of the joint ventures, should recognize the investment of the jointventures as the long-term equity investment and be measured according g to the said methods of the notes of thelong-term equity investment of the financial statement.
8. Recognition Standard for Cash and Cash Equivalents
In the Company’s understanding, cash and cash equivalents include cash on hand, any deposit that can be used forcover, and short-term (usually due within 3 months since the day of purchase) and high circulating investments,which are easily convertible into known amount of cash and whose risks in change of value are minimal.
9. Foreign Currency and Accounting Method for Foreign Currency
1. Foreign Currency Business
Foreign currency shall be recognized by employing systematic and reasonable methods, and shall be translatedinto the amount in the functional currency at the exchange rate which is approximate to the spot exchange rate ofthe transaction date. On the balance sheet date, the foreign currency monetary items shall be translated at the spotexchange rate. The balance of exchange arising from the difference between the spot exchange rate on the balancesheet date and the spot exchange rate at the time of initial recognition or prior to the balance sheet date shall berecorded into the profits and losses at the current period except that the balance of exchange arising from foreigncurrency borrowings for the purchase and construction or production of qualified assets shall be capitalized. Theforeign currency non-monetary items measured at the historical cost shall still be translated at the spot exchangerate on the transaction date.
2. Translation of Foreign Currency Financial Statements
The asset and liability items in the balance sheets shall be translated at a spot exchange rate on the balance sheetdate. Among the owner’s equity items, except for the items as “undistributed profits”, other items shall betranslated at the spot exchange rate at the time when they are incurred. The revenues and the expenses items of theincome statement should be translated according to the spot rate on the exchange date.The difference of the foreign currency financial statements occurred from the above translation should be listedunder the “other comprehensive income” item of the owners’ equity of the consolidated financial statement. Asfor the foreign currency items which actually form into the net investment of the foreign operation, the exchangedifference occurred from the exchange rate changes should be listed under the “other comprehensive income” ofthe owners’ equity among the consolidated financial statement when compile the consolidated financial statement.When disposing the foreign operation, as for the discounted difference of the foreign financial statement related tothe foreign operation should be transferred in the current gains and losses according to the proportion. The foreigncash flow adopts the spot exchange rate on the occurring date of the cash flow. And the influenced amount of theexchange rate changes should be individually listed among the cash flow statement.
10. Financial Instruments
Financial instruments refer to the contracts that constitute a company’s financial assets and the financial liabilitiesor equity instruments of other units.
1. Recognition and derecognition of financial instruments
When the Company becomes a party to a financial instrument, it shall recognize a financial asset or financialliability.A financial asset (or part of a financial asset or part of a group of similar financial assets) that meets the followingconditions should be derecognized, or in other words, be written off from its account and balance sheet:
1) The right to receive cash flow from the financial asset has expired;
2) The right to receive cash flow from the financial asset has been transferred, or the “transfer” agreementspecifies the obligation to duly pay the full amount of cash flow received to a third party; and (a) has transferredsubstantially all the risks and rewards of the asset, or (b) has neither transferred nor retained substantially all therisks and rewards of the asset, but has transferred control of the asset.A financial liability that has been fulfilled, canceled or expired should be derecognized. If a financial liability isreplaced with another financial liability by the same creditor on almost entirely different terms materially, or theterms for an existing liability have been almost fully revised materially, such replacement or revision should betreated as derecognition of the original liability and recognition of the new liability, and the difference should beincluded into current profits/losses.A financial asset traded in a conventional manner should be recognized and derecognized by trade-dateaccounting. The trading of financial assets in a conventional manner means that financial assets are received ordelivered by the deadline as specified in regulations or general practice according to contract provisions. Tradedate refers to the date committed by the Company to buy or sell a financial asset.
2. Classification and measurement of financial assets
The Company classifies the financial assets when initially recognized into financial assets measured at amortizedcost, financial assets measured by the fair value and the changes recorded in other comprehensive income andfinancial assets at fair value through profit or loss based on the business model for financial assets managementand characteristics of contractual cash flow of financial assets. Financial assets initially recognized shall bemeasured at their fair values. For accounts receivable and notes receivable excluding major financing or withoutregard to financing over one year generated from ales of commodities or provision of labor services, the initialmeasurement shall be conducted based on the transaction price.For financial assets at fair value through profit or loss, the transaction expenses thereof shall be directly includedinto the current profit or loss; for other financial assets, the transaction expenses thereof shall be included into theinitially recognized amount.The subsequent measurement of financial assets depends on the classification thereof:
(1) Debt instrument investments measured at amortized cost
Financial assets meeting the following conditions at the same time shall be classified as financial assets measuredat amortized cost: the business mode of the Company to manage such financial assets targets at collecting thecontractual cash flow. The contract of such financial assets stipulates that the cash flow generated in the specificdate is the payment of the interest based on the principal and outstanding principal amount. The interest incomefor this kind of financial assets shall be recognized by effective interest method, and the gains or losses generatedfrom the derecognition, modification or impairment shall all be included into the current profit or loss. This kindof financial assets mainly consist of monetary capital, accounts receivable and notes receivable, other receivables,investments in debt obligations and long-term receivables. The Company presents the investments in debt
obligations due within one year since the balance sheet date and long-term receivables as current portion ofnon-current assets and the original investments in debt obligations with maturity date within one year as othercurrent assets.
(2) Investments in debt instruments measured at fair value and changes thereof recorded into other comprehensiveincomeFinancial assets meeting the following conditions at the same time shall be classified as financial assets measuredat fair value and changes thereof recorded into other comprehensive income: the business mode of the Companyto manage such financial assets takes contract cash flow collected as target and selling as target. The contract ofsuch financial assets stipulates that the cash flow generated in the specific date is the payment of the interest basedon the principal and outstanding principal amount. The interest income for this kind of financial assets shall berecognized by effective interest method. All changes in fair value should be included into other comprehensiveincome except for interest income, impairment losses and exchange differences, which should be recognized ascurrent profits/losses. When a financial asset is derecognized, the cumulative gains or losses included into othercomprehensive income previously should be transferred out and included into current profits/losses. Suchfinancial assets should be presented as other credit investments. Other credit investments that will mature withinone year from the date of balance sheet should be presented as non-current assets due within one year, and othercredit investments with the original maturity date coming within one year should be presented as other currentassets.
(3) Equity instrument investment measured at fair value with changes included into other comprehensive incomeThe Company irrevocably chooses to designate part of non-trading equity instrument investments as financialassets measured at fair value with changes included into other comprehensive income. Only related dividendincome (excluding the dividend income confirmed to be recovered as part of investment costs) will be recognizedinto current profits/losses, while subsequent changes in fair value will be recognized into other comprehensiveincome without the withdrawal of impairment provisions required. When a financial asset is derecognized, thecumulative gains or losses included into other comprehensive income previously should be recognized intoretained earnings. Such financial assets should be presented as other equity investments.A financial asset that meets one of the following conditions is classified as a trading financial asset: The financialasset has been acquired in order to be sold or repurchased in the near future; the financial asset is part of anidentifiable financial instrument portfolio under centralized management, and there is evidence proving that thecompany has recently adopted a short-term profit model; it is a derivative instrument, but derivative instrumentsthat are designated as and are effective hedging instruments and those conforming with financial guaranteecontracts are excluded.
(4) Financial assets at fair value through profit or loss
The Company classifies financial assets except for above-mentioned financial assets measured with amortizedcost and financial assets measured with fair value whose change is included into other comprehensive income intofinancial assets at fair value through profit or loss. The subsequent measurement of such kind of financial assetsshall be conducted by fair value method and all changes in fair value shall be recorded into the current profit orloss. Such financial assets shall be presented as trading financial assets, and those will due over one year since thebalance sheet date and expectedly held over one year shall be presented as other non-current financial assets.
3. Classification and measurement of financial liabilities
The Company’s financial liabilities are, on initial recognition, classified into financial liabilities at fair valuethrough profit or loss, other financial liabilities and derivative instruments designated as effective hedginginstruments. For financial liabilities at fair value through profit or loss, relevant transaction costs are immediatelyrecognized in profit or loss for the current period, and transaction costs relating to other financial liabilities are
included in the initial recognition amounts.The subsequent measurement of financial liabilities depends on the classification thereof:
(1) Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include trading financial liabilities (including the derivativeinstruments belonging to financial liabilities) and financial liabilities designated at the initial recognition to bemeasured by the fair value and their changes are recorded in the current profit or loss.A financial liability that meets one of the following conditions is classified as a trading financial liability: Thefinancial liability has been undertaken in order to be sold or repurchased in the near future; the financial liability ispart of an identifiable financial instrument portfolio under centralized management, and there is evidence provingthat the company has recently adopted a short-term profit model; it is a derivative instrument, but derivativeinstruments that are designated as and are effective hedging instruments and those conforming with financialguarantee contracts are excluded. Trading financial liabilities (including derivative instruments classified asfinancial liabilities) should be subsequently measured at fair value, and all changes in fair value should berecorded into current profits/losses, except for those related to hedging accounting.
(2) Other financial liabilities
For such kind of financial liabilities, the subsequent measurement shall be conducted by effective interest methodbased on the amortized cost.
4. Impairment of financial instruments
Based on expected credit losses, the Company carries out impairment treatment on financial assets measured atamortized cost and debt instrument investments measured at fair value with changes included into othercomprehensive income, rental receivables, contract assets and financial assets and recognizes bad debt provision.Credit losses refer to the difference between all contract cash flows discounted by the original actual interest ratereceivable according to contracts and all cash flows expected to be received by the Company, which is the presentvalue of all cash shortfalls. The financial assets purchased by or originating from the Company with creditimpairment should be discounted by the actual interest rate of the financial assets after credit adjustment.In respect of receivable accounts that do not contain significant financing components, the Company uses thesimplified measurement method to measure bad debt provision by the amount equivalent to the expected creditlosses of the whole duration.In respect of receivable accounts that contain significant financing components, the Company opts to use thesimplified measurement method to measure bad debt provision by the amount equivalent to the expected creditlosses for the whole duration.For other financial assets and financial guarantee contracts than the above using the simplified measurementmethod, the Company on the balance sheet date assesses whether their credit risks have increased substantiallysince the initial recognition. If the credit risks have not increased substantially since the initial recognition and arein the first stage, the Company will measure bad debt provision by the amount equivalent to the expected creditlosses for the next 12 months and calculate interest income by the book balance and the actual interest rate; if thecredit risks have increased obviously without credit impairment since the initial recognition and are in the secondstage, the Company will measure bad debt provision by the amount equivalent to the expected credit losses for thewhole duration and calculate interest income by the book balance and the actual interest rate; if the credit riskshave increased substantially with credit impairment since the initial recognition and are in the third stage, theCompany will measure bad debt provision by the amount equivalent to the expected credit losses for the wholeduration and calculate interest income by the amortized cost and the actual interest rate. For financial instrumentswith only low credit risks on the balance sheet date, the Company assumes that their credit risks have notincreased substantially since the initial recognition.
The Company 1) assesses expected credit losses of financial assets with credit impairment based on individualitems; 2) assesses expected credit losses of financial assets that are not derecognized but with changes in contractcash flows due to revision of or renegotiation on contracts by the Company and the counterparty, based onindividual items; 3) assesses expected credit losses of other financial assets based on age combination.The Company considers related past matters, current conditions, the reasonableness of the forecast on futureeconomic conditions and well-founded information when assessing expected credit losses.The Company’s information of the judgment standards for remarkable increase in credit risks, definition of assetswith incurred credit impairment and assumption of measurement on expected credit losses is disclosed in thisNote 12 Accounts Receivable.When no longer reasonably expects to recover all or partial contractual cash flow of financial assets, the Companydirectly writes down the carrying amount of the financial assets.
5. Financial instruments offset
a financial asset and a financial liability shall be offset and the net amount is presented in the balance sheet whenthe following conditions are met at the same time: When the Company has a legal right that is currentlyenforceable to set off the recognized financial assets and financial liabilities, and intends either to settle on a netbasis, or to realize the financial asset and settle the financial liability simultaneously.
6. Financial guarantee contract
A financial guarantee contract refers to a contract in which a specific debtor shall compensate the contract holdersuffering the losses when the debtor is unable to repay the debt in due course according to the debt instrumentterms. Financial guarantee contracts are measured at fair value at the initial recognition. After the initialrecognition, all financial guarantee contracts should be subsequently measured by the higher amount between theamount of bad debt provision for expected credit losses recognized on the balance sheet date and the balance ofthe initially recognized amount deducting the cumulative amortization recognized according to the incomerecognition principle, except for the financial guarantee contracts designated as financial liabilities measured atfair value with changes recorded into current profits/losses.
7. Derivative financial instruments
The Company uses derivative financial instruments, which are initially measured at the fair value on the signaturedate of the derivative transaction contract and subsequently measured at their fair value. A derivative financialinstrument with a positive fair value is recognized as an asset and that with a negative fair value is recognized as aliability. Gains or losses from changes in the fair value of derivative instruments are directly recognized intocurrent profits/losses.For the financial assets that are not derecognized but with changes in contract cash flows due to revision of orrenegotiation on contracts by the Company and the counterparty, the Company recalculates the book balance ofthe financial assets according to the renegotiated or revised contract cash flows by the discounted value of theoriginal actual interest rate (or the actual interest rate after credit adjustment). Relevant gains or losses arerecorded into current profits/losses. Costs or expenses for the revision of financial assets are adjusted to therevised book balance of financial assets and amortized in the remaining period of the revised financial assets.
8. Transfer of financial assets
As for the Company transferred nearly all of the risks and rewards related to the ownership of a financial asset tothe transferee, should derecognize the financial assets; as for maintained nearly all of the risks and rewards relatedto the ownership of a financial asset, should continue to recognize the transferred financial assets.
Where the Company does not transfer or retain nearly all of the risks and rewards related to the ownership of afinancial asset, it shall deal with it according to the circumstances as follows, respectively: (1) If it gives up itscontrol over the financial asset, it shall stop recognizing the financial asset and recognize the assets and liabilitiesgenerated; (2) If it does not give up its control over the financial asset, it shall, according to the extent of itscontinuous involvement in the transferred financial asset, recognize the related financial asset and recognize therelevant liability accordingly.
11. Notes Receivable
The Company will always measure the provision for notes receivable whether including major financingcomponents or not based on the amount similar to that of expected credit losses for the whole existence period andthe amount increased or reversed of impairment for losses generated shall be recorded into the current profit orloss as gains or losses of impairment. The bill risk portfolio determined by the Company and basis thereof are asfollows:
Item | Basis |
Group 1 | Bank acceptance bills |
Group 2 | Commercial acceptance bills |
For notes receivable classified into the Group 1 with low credit risks, no bad debt provision will be withdrawn.For notes receivable classified into the Group 2, the bad debt provision shall be withdrawn based on aging withreference to the Group 1 of accounts receivable.
12. Accounts Receivable
The Company withdraws the impairment loss for accounts receivable excluding significant financing componentwith the simplified method.
1. Accounts Receivable with Significant Single Amount for which the Expected Credit Loss is Made Individually
Definition or amount criteria for an account receivable with a significant single amount | Making separate expected credit loss for accounts receivable with a significant single amount |
Making separate expected credit loss for accounts receivable with a significant single amount | For an account receivable with a significant single amount, the impairment test shall be carried out on it separately. If there is any objective evidence of impairment, the impairment loss is recognized and the expected credit loss is made according to the difference between the present value of the account receivable’s future cash flows and its carrying amount. |
2. Accounts Receivable for which the Expected Credit Loss is Withdrawn by Credit Risk Characteristics
Group name | Withdrawal method of expected credit loss |
Common transaction group | Aging analysis method |
Internal transaction group | Other methods |
In the groups, those adopting aging analysis method to withdraw expected credit loss:
Aging | Withdrawal proportion of expected credit loss |
Within 1 year (including 1 year) | 3% |
1 to 2 years | 10% |
2 to 3 years | 30% |
3 to 4 years | 50% |
4 to 5 years | 80% |
Over 5 years | 100% |
3. Accounts Receivable with an Insignificant Single Amount but for which the Expected Credit Loss is MadeIndependently
Reason of individually withdrawing expected credit loss | There are definite evidences indicate the obvious difference of thee return ability |
Withdrawal method for expected credit loss | Recognizing the impairment loss and withdrawing the expected credit loss according to the difference between the present value of the account receivable’s future cash flows and its carrying amount. |
13. Accounts Receivable Financing
Not applicable
14. Other Receivables
Recognition method and accounting treatment for expected credit losses of other receivablesRecognition method and accounting treatment for expected credit losses of other receivablesRefer to Note 12 Accounts Receivable for details about the recognition method and accounting treatment forexpected credit losses of other receivables which is the same as that of accounts receivable.
15. Inventories
1. Classification of Inventory
Inventory refers to finished products, goods in process, and materials consumed in the production process or theprovision of labor services held by the Company for sale in daily activities, mainly including raw materials, goodsin process, materials in transit, finished products, commodities, turnover materials, and commissioned processingmaterials. Turnover materials include low-value consumables and packaging.
2. Pricing Method of Inventory Sent Out
The inventory is valued at actual cost when acquired, and inventory costs include procurement costs, processingcosts and other costs. The weighted average method is used when receiving or sending out inventory.
3. Basis for Determining the Net Realizable Value of Inventory and the Method of Withdrawal for InventoryImpairmentNet realizable value refers to the estimated selling price of the inventory minus the estimated cost to be incurred atthe time of completion, the estimated selling expenses and the relevant taxes and fees in daily activities. Indetermining the net realizable value of inventory, the conclusive evidence obtained is used as the basis and the
purpose of holding the inventory and the impact of the events after the balance sheet date should be taken intoaccount.For finished products, the materials used for sale and other goods used for direct sale, the net realizable value isdetermined by the estimated selling price of the inventory minus the estimated selling expenses and related taxesin the process of normal production and operation.For materials inventory needs to be processed, the net realizable value is determined by the estimated selling priceof the finished products minus the estimated cost to be incurred, the estimated sales costs and the relevant taxesand fees in the process of normal production and operation.
4. Inventory System
The inventory system of the Company is perpetual inventory.
5. Amortization Method of Turnover Materials
Low-value consumables are amortized in one-off method.The packaging is amortized in one-off method.
16. Contract Assets
The Company presents the right possessed to collect consideration from customers unconditionally (onlydepending on the passing of time) as accounts receivable, and the right to charge the consideration throughtransferring any commodity to clients which depends on other factors except the passing of time as contract assets.As for the recognition method and accounting treatment for expected losses of contract assets, please refer to Note
12. Accounts Receivable.
17. Contract Cost
The assets related to contract costs of the Company include contract acquisition costs and contract performancecosts. They are presented in inventories, other current assets, and other non-current assets, respectively, inaccordance with their liquidity.The incremental cost incurred by the acquisition of a contract would be recognized as an asset in the form of acontract acquisition cost, if it was expected to be recovered. Or if the amortization period of the asset does notexceed a year, the asset would be recognized as profit and loss of the current period, when it occurred.Costs incurred for performing a contract, which was not within the scope of other accounting standards forenterprises and met the following conditions, should be recognized as an asset in the form of a contractperformance cost:
(1) The costs were directly related to a current or expected contract, including direct labor, direct materials,manufacturing overhead (or similar), costs that are explicitly chargeable to the customer, and other costs incurredsolely because of the contract;
(2) The costs increased the future resources of the Company to perform performance obligations;
(3) The costs were expected to be recovered.
Assets related to contract costs were amortized on the same basis as the revenue recognition related to the assets,and recognized as profit and loss of the current period.For assets related to contract costs, if the book value was higher than the difference between the following twoitems, the Company would set aside impairment provisions for the extra portion and recognize the impairmentprovisions as impairment losses on assets:
(1) The remaining consideration that the Company expected to obtain due to the transfer of commodities related to
the assets;
(2) Estimated costs to be incurred for the transfer of the related commodities.
If the result of (1) minus (2) was higher than the book value of the assets, due to the subsequent changes in thefactors of impairment in previous periods, the asset impairment provisions set aside should be reversed andrecognized as profit and loss of the current period. However, the book value of the assets, upon the reversal,should not exceed the book value of the assets on the reversal date supposing that impairment provisions were notset aside.
18. Assets Held for Sale
1. Assets Held for Sale
When a company relies mainly on selling (including the exchanges of non-monetary assets with commercialsubstance) instead of continuing to use a non-current asset or disposal group to recover its book value, thenon-current asset or disposal group is classified as asset held for sale. The non-current assets mentioned above donot include investment properties that are subsequently measured by the fair value model, biological assetsmeasured by fair value less net selling costs, assets formed from employee remuneration, financial assets, deferredincome tax assets and rights generated from insurance contracts.Disposal group refers to a group of assets that are disposed of together as a whole through sale or other means in atransaction, and the liabilities directly related to these assets transferred in the transaction. In certaincircumstances, the disposal group includes goodwill obtained in business combination.The Company recognizes non-current assets or disposal groups that meet both of the following conditions as heldfor sale: ① Assets or disposal groups can be sold immediately under current conditions based on the practice ofselling such assets or disposal groups in similar transactions; ② Sales are highly likely to occur, that is, theCompany has already made a resolution on a sale plan and obtained a certain purchase commitment, and the saleis expected to will be completed within one year, and the sale has been approved if relevant regulations requirerelevant authority or regulatory authority of the Company to approve it.Non-current assets or disposal groups specifically obtained by the Company for resale will be classified by theCompany as a held-for-sale category on the acquisition date when they meet the stipulated conditions of“expected to be sold within one year” on the acquisition date, and may well satisfy the category of held-for-salewithin a short time (which is usually 3 months).If one of the following circumstances cannot be controlled by the Company and the transaction betweennon-related parties fails to be completed within one year, and there is sufficient evidence that the Company stillpromises to sell the non-current assets or disposal groups, the Company should continue to classify thenon-current assets or disposal groups as held-for-sale: ①The purchaser or other party unexpectedly setsconditions that lead to extension of the sale. The Company has already acted on these conditions in a timelymanner and it is expected to be able to successfully deal with the conditions that led to the extension of the salewithin one year after the conditions were set. ②Due to unusual circumstances, the non-current assets or disposalgroups held for sale failed to be sold within one year. In the first year, the Company has taken necessary measuresfor these new conditions and the assets or disposal groups meet the conditions of held-for-sale again.If the Company loses control of a subsidiary due to the sale of investments to its subsidiaries, whether or not theCompany retains part of the equity investment after the sale, when the proposed sale of the investment to thesubsidiary meets the conditions of held- for-sale, the investment to the subsidiary will be classified asheld-for-sale in the individual financial statement of the parent company, and all the assets and liabilities of thesubsidiary will be classified as held-for-sale in the consolidated financial statement.
When the company initially measures or re-measures non-current assets or disposal groups held for sale on thebalance sheet date, if the book value is higher than the fair value minus the net amount of the sale costs, the bookvalue will be written down to the net amount of fair value minus the sale costs, and the amount written down willbe recognized as impairment loss of assets and included in the current profit and loss, and provision forimpairment of held-for-sale assets will be made. For the confirmed amount of impairment loss of assets of thedisposal groups held for sale, the book value of goodwill of the disposal groups will be offset first, and then thebook value of various non-current assets in the disposal groups will be offset according to the proportions.If the net amount that the fair value of the non-current assets or disposal groups held for sale on the follow-upbalance sheet date minus the sale costs increases, the previous written-down amount will be restored, and reversedto the asset impairment loss confirmed after the assets being classified as held-for-sale. The reversed amount willbe included in the current profit or loss. The book value of goodwill that has been deducted cannot be reversed.Non-current assets held for sale or non-current assets in the disposal group are not subject to depreciation oramortization. Interest and other expenses of liabilities in the disposal group held for sale will be confirmed asbefore.When a non-current asset or disposal group ceases be classified as held-for-sale or a non-current asset is removedout from the held-for-sale disposal group due to failure in meeting the classification conditions for the category ofheld-for-sale, it will be measured by one of the followings whichever is lower:
① The book value before being classified as held for sale will be adjusted according to the depreciation,amortization or impairment that would have been recognized under the assumption that it was not classified asheld for sale;
② The recoverable amount.
2. Termination of Operation
Termination of operation refers to a separately identifiable constituent part that satisfies one of the followingconditions that has been disposed of by the Company or is classified as held-for-sale:
(1) This constituent part represents an independent main business or a separate main business area.
(2) This constituent part is part of an associated plan that is intended to be disposed of in an independent mainbusiness or a separate major business area.
(3) This constituent part is a subsidiary that is specifically acquired for resale.
3. Presentation
In the balance sheet, the Company distinguishes the non-current assets held for sale or the assets in the disposalgroup held for sale separately from other assets, and distinguish the liabilities in the disposal group held for saleseparately from other liabilities. The non-current assets held for sale or the assets in the disposal group held forsale are not be offset against the liabilities in the disposal group held for sale. They are presented as current assetsand current liabilities respectively.The Company lists profit and loss from continuing operations and profit and loss from operating profits in theincome statement. For the termination of operations for the current period, the Company restates the informationoriginally presented as profit or loss of continuing operation in the current financial statements to profit or loss oftermination of the comparable accounting period. If the termination of operation no longer meets the conditions ofheld-for-sale, the Company restates the information originally presented as a profit and loss of termination in thecurrent financial statements to profit or loss of continuing operation of the comparable accounting period.
19. Investments in Debt Obligations
Not applicable
20. Other Investments in Debt Obligations
Not applicable
21. Long-term Receivables
Not applicable
22. Long-term Equity Investments
Long-term equity investment refers to the Company’s long-term equity investment with control, joint control orsignificant influence on the investee.Joint control refers to the control that is common to an arrangement in accordance with the relevant agreement,and the relevant activities of the arrangement must be agreed upon by the participant who has shared the control.Significant influence refers to the Company has the power to participate in decision-making on the financial andoperating policies of the investee, but can’t control or jointly control the formulation of these policies with otherparties.
1. Investment Cost Recognition for Long-term Equity Investments
(1) For the merger of enterprises under the same control, it shall, on the date of merger, regard the share of thebook value of the owner's equity of the merged enterprise as the initial cost of the long-term equity investment,and the direct relevant expenses occurred for the merger of enterprises shall be included into the profits and lossesof the current period.
(2) For the merger of enterprises not under the same control, The combination costs shall be the fair values, on theacquisition date, of the assets paid, the liabilities incurred or assumed and the equity securities issued by theCompany in exchange for the control on the acquiree, and all relevant direct costs incurred to the acquirer for thebusiness combination. Where any future event that is likely to affect the combination costs is stipulated in thecombination contract or agreement, if it is likely to occur and its effects on the combination costs can be measuredreliably, the Company shall record the said amount into the combination costs.
(3) The cost of a long-term equity investment obtained by making payment in cash shall be the purchase costwhich is actually paid. The cost consists of the expenses directly relevant to the obtainment of the long-termequity investment, taxes and other necessary expenses.
(4) The cost of a long-term equity investment obtained on the basis of issuing equity securities shall be the fairvalue of the equity securities issued.
(5) The cost of a long-term investment obtained by the exchange of non-monetary assets (having commercialnature) shall be recognized base on taking the fair value and relevant payable taxes as the cost of the assetsreceived.
(6) The cost of a long-term equity investment obtained by recombination of liabilities shall be recognized at thefair value.
2. Subsequent Measurement of Long-term Equity Investment and Recognized Method of Profit/LossThe long-term equity investment with joint control (except for the common operator) or significant influence onthe investee is accounted by equity method. In addition, the Company's financial statements use cost method tocalculate long-term equity investments that can control the investee.
(1) Long-term Equity Investment Accounted by Cost Method
When the cost method is used for accounting, the long-term equity investment is priced at the initial investmentcost, and the cost of the long-term equity investment is adjusted according to additional investment or recovered
investment. Except the price actually paid when acquired investment or cash dividends or profits that have beendeclared but not yet paid included in the consideration, current investment income is recognized by the cashdividends or profits declared by the investee.
(2) Long-term Equity Investment Accounted by Equity Method
When the equity method is used for accounting, if the initial investment cost of the long-term equity investment isgreater than the fair value of the investee’s identifiable net assets, the initial investment cost of the long-termequity investment shall not be adjusted; if the initial investment cost is less than the fair value of the investee’sidentifiable net assets, the difference shall be recorded into the current profits and losses, and the cost of thelong-term equity investment shall be adjusted at the same time.When the equity method is used for accounting, the investment income and other comprehensive income shall berecognized separately according to the net profit or loss and other comprehensive income realized by the investee,and the book value of the long-term equity investment shall be adjusted at the same time. The part entitled shall becalculated according to the profits or cash dividends declared by the investee, and the book value of the long-termequity investment shall be reduced accordingly. For other changes in the owner’s equity other than the net profitor loss, other comprehensive income and profit distribution of the investee, the book value of the long-term equityinvestment shall be adjusted and included in the capital reserve. When the share of the net profit or loss of theinvestee is recognized, the net profit of the investee shall be adjusted and recognized according to the fair value ofthe identifiable assets of the investee when the investment is made. If the accounting policies and accountingperiods adopted by the investee are inconsistent with the Company, the financial statements of the investee shallbe adjusted according to the accounting policies and accounting periods of the Company and the investmentincome and other comprehensive income shall be recognized accordingly. For the transactions between theCompany and associates and joint ventures, if the assets made or sold don’t constitute business, the unrealizedgains and losses of the internal transactions are offset by the proportion attributable to the Company, and theinvestment gains and losses are recognized accordingly. However, the loss of unrealized internal transactionsincurred by the Company and the investee attributable to the impairment loss of the transferred assets shall not beoffset. If the assets made to associates or joint ventures constitute business, and the investor makes long-termequity investment but does not obtain the control, the fair value of the investment shall be taken as the initialinvestment cost of the new long-term equity investment, and the difference between initial investment and thebook value of the investment is fully recognized in profit or loss for the current period. If the assets sold by theCompany to joint ventures or associates constitute business, the difference between the consideration and the bookvalue of the business shall be fully credited to the current profits and losses. If the assets purchased by Companyfrom joint ventures or associates constitute business, conduct accounting treatment in accordance with theprovisions of Accounting Standard for Business Enterprises No. 20 - Business combination, and the profits orlosses related to the transaction shall be recognized in full.When the net loss incurred by the investee is recognized, the book value of the long-term equity investment andother long-term equity that substantially constitute the net investment in the investee shall be written down to zero.In addition, if the Company has an obligation to bear additional losses to the investee, the estimated liabilities arerecognized in accordance with the obligations assumed and included in the current investment losses. If theinvestee has realized net profit in later period, the Company will resume the recognition of the income share afterthe income share has made up the unrecognized loss share.
(3) Acquisition of Minority Interests
In the preparation of the consolidated financial statements, capital reserve shall be adjusted according to thedifference between the long-term equity investment increased due to the purchase of minority interests and theshare of the net assets held by the subsidiary from the date of purchase (or the date of combination) calculated
according to the proportion of the new shareholding ratio, and retained earnings shall be adjusted if the capitalreserve is insufficient to offset.
(4) Disposal of Long-term Equity Investment
In the consolidated financial statements, the parent company partially disposes of the long-term equity investmentin the subsidiary without the loss of control, and the difference between the disposal price and the net assets of thesubsidiary corresponding to the disposal of the long-term equity investment is included in the shareholders’ equity.If the disposal of long-term equity investment in subsidiaries results in the loss of control over the subsidiaries,handle in accordance with the relevant accounting policies described in NotesⅥ. “Principles, Procedures andMethods for the Preparation of Consolidated Statements” .In other cases, the difference between the book value and the actual acquisition price shall be recorded into thecurrent profits and losses for the disposal of the long-term equity investment.For long-term equity investment accounted by the equity method and residual equity after disposal still accountedby the equity method, other comprehensive income originally included in the shareholders’ equity shall be treatedin the same basis of the investee directly disposing related assets or liabilities by corresponding proportion. Theowner’s equity recognized by the change of the owner’s equity of the investee other than the net profit or loss,other comprehensive income and profit distribution is carried forward proportionally into the current profits andlosses.For long-term equity investment accounted by the cost method and residual equity after disposal still accounted bythe cost method, other comprehensive income accounted by equity method or recognized by financial instrumentand accounted and recognized by measurement criteria before the acquisition of the control over the investee istreated in the same basis of the investee directly disposing related assets or liabilities, and carried forwardproportionately into the current profits and losses. Other changes of owner’s equity in net assets of the investeeaccounted and recognized by the equity method other than the net profit or loss, other comprehensive income andprofit distribution are carried forward proportionally into the current profits and losses.
3. Impairment Provisions for Long-term Equity Investments
For the relevant testing method and provision making method, see Notes 31. Impairment of Long-term Assets.
23. Investment Property
Measurement model for investment propertyCost method measurementMethod for depreciation or amortizationThe Company's investment real estates include leased land use rights, leased buildings, and land use rights heldand ready to be transferred after appreciation. Investment real estate is initially measured according to cost, andthen measured by cost model.
1. Recognition of investment real estate
Investment real estate can only be recognized if it meets the following conditions at the same time: (1) Economicbenefits related to investment real estate are likely to flow into enterprises. (2) The cost of the investment realestate can be measured reliably.
2. Initial measurement of investment real estate
(1) The cost of purchased investment real estate includes the purchase price, relevant taxes and fees and otherexpenses directly attributable to the asset.
(2) The cost of self-construction of investment real estate consists of the necessary expenses incurred before theconstruction of the asset reaches the predetermined serviceable condition.
(3) The cost of investment real estate acquired by other means shall be determined in accordance with relevantaccounting standards.
(4) Subsequent expenditures related to investment real estate, if they meet the confirmation conditions ofinvestment real estate, shall be included in the cost of investment real estate; those that do not meet therecognition conditions are included in the current profits and losses when they occur.
3. Subsequent measurement of investment real estate
The Company adopts the cost model to carry out subsequent measurement of investment real estate on the balancesheet date. According to the relevant provisions of Accounting Standard for Business Enterprises No.4-FixedAssets and Accounting Standard for Business Enterprises No.6-Intangible Assets, the investment real estate isamortized or depreciated according to the life average method within the expected useful life.
4. Conversion of investment real estate
The Company has conclusive evidence that the use of real estate has changed, and the investment real estate isconverted into other assets, or other assets are converted into investment real estate, and the book value before theconversion of real estate is taken as the recorded value after the conversion.
24. Fixed Assets
(1) Recognition Conditions
Fixed assets of the Company refers to the tangible assets that simultaneously possess the features as follows: theyare held for the sake of producing commodities, rendering labor service, renting or business management; and theiruseful life is in excess of one accounting year and unit price is higher. No fixed assets may be recognized unless itsimultaneously meets the conditions as follows: ① The economic benefits pertinent to the fixed asset are likely toflow into the Company; and ② The cost of the fixed asset can be measured reliably. The Company's fixed assets areinitially measured at cost. Specifically, the costs of purchased fixed assets include the purchase price, relevant taxesand fees, and other expenditures incurred before the fixed assets reach the pre-determined serviceable condition thatcan be directly attributable to the assets. The costs of self-built fixed assets contain the necessary expendituresincurred before the assets built reach their pre-determined serviceable condition. If the amount paid for the purchaseof fixed assets witnesses postponed payment due to that the normal credit conditions are exceeded and is actuallyfinancing in nature, the costs of such fixed assets shall be determined on the basis of the present value of thepurchase price. The difference between the actual amount paid and the present value of the purchase price, exceptfor the difference that should be capitalized, shall be recognized as profit and loss of the current period during thecredit period.
(2) Depreciation Method
Category of fixed assets | Method | Useful life | Expected net salvage value | Annual deprecation |
Housing and building | Average method of useful life | 3—30 years | 1%-5% | 31.67%-3.17% |
Machinery equipments | Average method of useful life | 2—10 years | 1%-5% | 47.50%-9.50% |
Transportation vehicle | Average method of useful life | 5—10 years | 1%-5% | 19.00%-9.50% |
Electronic equipment | Average method of useful life | 2—8 years | 1%-5% | 47.50%-11.88% |
(3) Recognition Basis, Pricing and Depreciation Method of Fixed Assets by Finance LeaseA finance lease refers to a lease where all the risks and rewards, related to the ownership of the leasehold property,are substantially transferred, regardless of whether the ownership is eventually transferred or not. The policy for theaccrual of the depreciation of the leasehold property for the fixed assets acquired under the finance lease wasconsistent with that adopted for the Company's self-owned fixed assets. Where it could be reasonably certain thatthe Company would obtain the ownership of the leasehold property at the end of the lease term, the leaseholdproperty would be depreciated within the service life. Where it could not be reasonably certain that the Companycould obtain ownership of the leased property at the end of the lease term, the leased property would be depreciatedwithin the lease term or the service life of the leased property whichever was shorter.
25. Construction in Progress
1. Pricing of Construction in Progress
The constructions are accounted according to the actual costs incurred. The constructions shall be carried forwardinto fixed assets at the actual cost when reach intended usable condition. The borrowing expenses eligible forcapitalization incurred before the delivery of the construction are included in the construction cost; after thedelivery, the relevant interest expense shall be recorded into the current profits and losses.
2. Standard and Time of Construction in Progress Carrying Forward into Fixed AssetsThe Company’s construction in progress is carried forward into fixed assets when the construction completes andreaches intended usable condition. The criteria for determining the intended usable condition shall meet one of thefollowing:
(1) The physical construction (including installation) of fixed assets has been completed or substantiallycompleted;
(2) Has been produced or run for trial, and the results indicate that the assets can run normally or can producestable products stably, or the results of the trial operation show that it can operate normally;
(3) The amount of the expenditure on the fixed assets constructed is little or almost no longer occurring;
(4) The fixed assets purchased have reached the design or contract requirements, or basically in line with thedesign or contract requirements.
3. Provision for Impairment of Construction in Progress
Please refer to Note 31 Impairment of Long-term Assets, for details of impairment test methods and impairmentprovision methods of construction in progress.
26. Borrowing Costs
The borrowing costs refer to interest and other related costs incurred by the Company as a result of borrowings,including interest on borrowings, amortization of discounts or premiums, ancillary expenses and exchangedifferences arising from foreign currency borrowings. The borrowing costs incurred by the Company directlyattributable to the acquisition, construction or production of assets eligible for capitalization are capitalized andincluded in the cost of the relevant assets. Other borrowing costs are recognized as expenses according to theamount at the time of occurrence, and are included in the current profits and losses.
1. Principle of capitalization of borrowing costs
Borrowing costs can be capitalized when all the following conditions are met: Asset expenditure has alreadyoccurred; borrowing costs have already occurred; construction or production activities necessary to bring the
assets to the intended useable or sellable status have already begun.
2. Capitalization period of borrowing costs
Capitalization period refers to the period from the capitalization of borrowing costs starting to the end ofcapitalization, excluding the period when capitalization is suspended.If assets that meet the conditions of capitalization are interrupted abnormally in the course of construction orproduction, and the interruption time exceeds 3 consecutive months, the capitalization of borrowing costs shall besuspended. The borrowing costs incurred during the interruption are recognized as expenses and included incurrent profits and losses until the acquisition or construction of the assets is resumed. The capitalization of theborrowing costs continues if the interruption is a procedure necessary for the purchase or production of assetseligible for capitalization to meet the intended useable or sellable status.The borrowing costs shall cease to be capitalized when the purchased or produced assets that meet the conditionsof capitalization meet the intended useable or sellable status. The borrowing costs incurred after the assets eligiblefor capitalization meet the intended useable or sellable status can be included in the current profits and losseswhen incurred.
3. Calculation method of capitalized amount of borrowing costs
During the period of capitalization, the capitalization amount of interests (including amortization of discounts orpremiums) for each accounting period is determined in accordance with the following provisions:
(1) For special borrowings for the acquisition or construction of assets eligible for capitalization, the interestexpenses actually incurred in the current period of borrowings shall be recognized after deducting the interestincome obtained by depositing the unused borrowing funds into the bank or investment income obtained fromtemporary investment.
(2) Where the general borrowing is occupied for the acquisition or construction of assets eligible for capitalization,the Company multiplies the weighted average of the asset expenditure of the accumulated asset expenditureexceeding the special borrowing by the capitalization rate of the general borrowing to calculate the amount ofinterest that should be capitalized for general borrowings. The capitalization rate is determined based on theweighted average interest rate of general borrowings.
27. Living Assets
Not applicable
28. Oil and Gas Assets
Not applicable
29. Right-of-use Assets
On the start date of the lease term, the Company recognizes its right to use the leasehold property in the lease termas right-of-use assets, including: The initial measurement amount of the lease obligation; the lease payment paidon or before the start date of the lease term. If there is a lease incentive, the amount related to the lease incentivetaken should be deducted. the initial direct cost incurred by the lessee; the estimated cost that the lessee will use topull down and remove the leasehold property, and restore the site of the leasehold property or restore theleasehold property to the state agreed in the lease clauses. Then, the Company will depreciate the right-of-useassets with the straight-line method. If it is reasonably certain that the ownership of the leasehold property will beobtained at the end of the lease term, the Company will depreciate the leasehold property over its remaining
service life. If it is not reasonably certain that the ownership of the leasehold property will be obtained at the endof the lease term, the Company will depreciate the leased asset(s) over the lease term or the remaining service life,whichever is shorter. When the Company re-calculates the lease obligation using the present value (PV) of thechanged lease payment and correspondingly adjusts the book value of the right-of-use assets, if the book value isalready reduced to zero, yet the lease obligation still needs to be reduced further, the Company will include theremaining amount in the current profit or loss.
30. Intangible Assets
(1) Pricing Method, Useful Life and Impairment Test
1. Recognition Criteria of Intangible Assets
Intangible assets are identifiable non-monetary assets that are owned or controlled by the Company withoutphysical form. The intangible assets are recognized when all the following conditions are met: (1) Conform to thedefinition of intangible assets; (2) Expected future economic benefits related to the assets are likely to flow intothe Company; (3) The costs of the assets can be measured reliably.
2. Initial Measurement of Intangible Assets
Intangible assets are initially measured at cost. Actual costs are determined by the following principles:
(1) The cost of the acquisition of intangible assets, including the purchase price, relevant taxes and other expensesdirectly attributable to the intended use of the asset. The payment of purchase price of intangible assets exceedingnormal credit terms is deferred, and the cost of intangible assets having financing nature in essence shall berecognized based on the present value of the purchase price. The difference between the actual payment price andthe present value of the purchase price shall be recorded into the current profits and losses in the credit periodexcept that can be capitalized in accordance with the Accounting Standard for Business Enterprises No. 17 -Borrowing Cost.
(2) The cost of investing in intangible assets shall be recognized according to the value agreed upon in theinvestment contract or agreement, except that the value of the contract or agreement is unfair.
3. Subsequent Measurement of Intangible Assets
The Company shall determine the useful life when it obtains intangible assets. The useful life of intangible assetsis limited, and the years of the useful life or output that constitutes the useful life or similar measurement unitsshall be estimated. The intangible assets are regarded as intangible assets with uncertain useful life if the term thatbrings economic benefits to the Company is unforeseeableIntangible assets with limited useful life shall be amortized by straight line method from the time when theintangible assets are available until can’t be recognized as intangible assets; intangible assets with uncertain usefullife shall not be amortized. The Company reviews the estimated useful life and amortization method of intangibleassets with limited useful life at the end of each year, and reviews the estimated useful life of intangible assetswith uncertain useful life in each accounting period. For intangible assets that evidence shows the useful life islimited, the useful life shall be estimated and the intangible assets shall be amortized in the estimated useful life.
4. Recognition Criteria and Withdrawal Method of Intangible Asset Impairment ProvisionThe impairment test method and withdrawal method for impairment provision of intangible assets are detailed inNote 31: Long-term asset impairment under Note V.
(2) Accounting Policy for Internal Research and Development ExpendituresThe expenditures in internal research and development projects of the Company are classified into expenditures in
research stage and expenditures in development stage. The expenditures in research stage are included in thecurrent profits and losses when incurred. The expenditures in development stage are recognized as intangibleassets when meeting the following conditions:
(1) The completion of the intangible assets makes it technically feasible for using or selling;
(2) Having the intention to complete and use or sell the intangible assets;
(3) The way in which an intangible asset generates economic benefits, including the proof that the productsproduced with the intangible asset have market or the proof of its usefulness if the intangible asset has market andwill be used internally;
(4) Having sufficient technical, financial resources and other resources to support the development of theintangible assets and the ability to use or sell the intangible assets;
(5) Expenditure attributable to the development stage of intangible assets can be measured reliably.The cost of self-developed intangible assets includes the total expenditure incurred since meeting intangible assetsrecognition criterion until reaching intended use. Expenditures that have been expensed in previous periods are nolonger adjusted.Non-monetary assets exchange, debt restructuring, government subsidies and the cost of intangible assets acquiredby business combination are recognized according to relevant provisions of Accounting Standard for BusinessEnterprises No. 7 - Non-monetary assets exchange, Accounting Standard for Business Enterprises No. 12 - Debtrestructuring, Accounting Standards for Business Enterprises No. 16 - Government subsidies, AccountingStandard for Business Enterprises No. 20 - Business combination respectively.
31. Impairment of Long-term Assets
For non-current non-financial assets such as fixed assets, construction in progress, intangible assets with limiteduseful life, investment real estate measured in cost mode and long-term equity investments in subsidiaries, jointventures and associates, the Company determines whether there is indication of impairment at balance sheet date.If there is indication of impairment, then estimate the amount of its recoverable value and test the impairment.Goodwill, intangible assets with uncertain useful life and intangible assets that have not yet reached useable stateshall be tested for impairment every year, whether or not there is any indication of impairment.If the impairment test results indicate that the recoverable amount of the asset is lower than its book value, theimpairment provision shall be made at the difference and included in the impairment loss. The recoverableamount is the higher of the fair value of the asset minus the disposal cost and the present value of the expectedfuture cash flow of the asset. The fair value of the asset is recognized according to the price of the sales agreementin the fair trade; if there is no sales agreement but there is an active market, the fair value is recognized accordingto the buyer’s bid of the asset; if there is no sales agreement or active market, the fair value of asset shall beestimated based on the best information that can be obtained. Disposal costs include legal costs related to disposalof assets, related taxes, handling charges, and direct costs incurred to enable the asset reaching sellable status. Thepresent value of the expected future cash flows of the assets is recognized by the amount discounted at appropriatediscount rate according to the expected future cash flows arising from the continuing use of the asset and the finaldisposal. The provision for impairment of assets is calculated and recognized on the basis of individual assets. If itis difficult to estimate the recoverable amount of individual assets, the recoverable amount of the asset group shallbe recognized by the asset group to which the asset belongs. The asset group is the smallest portfolio of assets thatcan generate cash inflows independently.The book value of the goodwill presented separately in the financial statements shall be apportioned to the assetgroup or portfolio of asset groups that is expected to benefit from the synergies of the business combination when
the impairment test is conducted. The corresponding impairment loss is recognized if the test results indicate thatthe recoverable amount of the asset group or portfolio of asset groups containing the apportioned goodwill islower than its book value. The amount of the impairment loss shall offset the book value of the goodwillapportioned to the asset group or portfolio of asset groups, and offset the book value of other assets in proportionaccording to the proportion of the book value of other assets except the goodwill in the asset group or portfolio ofasset groups.Once the impairment loss of the above asset is recognized, the portion that the value is restored will not be writtenback in subsequent periods.
32. Long-term Prepaid Expense
Long-term prepaid expense refers to general expenses with the apportioned period over one year (one yearexcluded) that have occurred but attributable to the current and future periods. Long-term deferred expense shallbe amortized averagely within benefit period. In case of no benefit in the future accounting period, the amortizedvalue of such project that fails to be amortized shall be transferred into the profits and losses of the current period.The amortization period of various expenses is as follows:
Item | Amortization Period |
Expenditure on improvement of rented fixed assets | 3-5 years |
Fixed repair expenditure | 5 years |
Mould | 3 years |
Wrap-around boxes | 2 years |
33. Contract Liabilities
The Company’s obligation of transferring commodities to customers due to consideration received or receivablefrom clients. If the client has paid the contract consideration or the Company has obtained the unconditional rightof collection before the Company transfers commodities to the customer, the Company shall present the accountsreceived or receivable as contract liabilities at the earlier time between the time when the client actually conductspayment and the deadline of payment. Contract assets and contract liabilities under the same contract shall bepresented based on the net amount, while those not under the same contract shall not be offset.
34. Payroll
(1) Accounting Treatment of Short-term Compensation
Short-term compensation mainly including salary, bonus, allowances and subsidies, employee services andbenefits, medical insurance premiums, birth insurance premium, industrial injury insurance premium, housingfund, labor union expenditure and personnel education fund, non-monetary benefits etc. The short-termcompensation actually happened during the accounting period when the active staff offering the service for theGroup should be recognized as liabilities and is included in the current gains and losses or relevant assets cost. Of
which the non-monetary benefits should be measured according to the fair value.
(2) Accounting Treatment of the Welfare after Demission
Welfare after demission mainly includes defined contribution plans and defined benefit plans. Of which definedcontribution plans mainly include basic endowment insurance, unemployment insurance, annuity funds, etc., andthe corresponding payable and deposit amount should be included into the relevant assets cost or the current gainsand losses when happen.
(3) Accounting Treatment of the Demission Welfare
If an enterprise cancels the labor relationship with any employee prior to the expiration of the relevant laborcontract or brings forward any compensation proposal for the purpose of encouraging the employee to accept alayoff, and should recognize the payroll liabilities occurred from the demission welfare base on the earlier datebetween the time when the Group could not one-sided withdraw the demission welfare which offered by the planor layoff proposal owning to relieve the labor relationship and the date the Group recognizes the cost related to thereorganization of the payment of the demission welfare and at the same time includes which into the current gainsand losses. But if the demission welfare is estimated that could not totally pay after the end of the annual reportwithin 12 months, should be disposed according to other long-term payroll payment.
(4) Accounting Treatment of the Welfare of Other Long-term Staffs
The inside employee retirement plan is treated by adopting the same principle with the above dismiss ion welfare.The group would recorded the salary and the social security insurance fees paid and so on from the employee’sservice terminative date to normal retirement date into current profits and losses (dismiss ion welfare) under thecondition that they meet the recognition conditions of estimated liabilities.The other long-term welfare that the Group offers to the staffs, if met with the setting drawing plan, should beaccounting disposed according to the setting drawing plan, while the rest should be disposed according to thesetting revenue plan.
35. Lease Liabilities
On the start date of the lease term, the Company recognizes the PV of the unpaid lease payment as a leaseobligation, except for the short-term and low-value asset leases. It will regard the interest rate implicit in lease asthe rate of discount, when calculating the PV of the lease payment. The incremental lending rate of the lessee willbe deemed as the rate of discount, if the interest rate implicit in lease cannot be confirmed. The Companycalculates the interest charge of the lease obligation in each period in the lease term at a fixed periodic interest rateand includes it in the current profit or loss, unless such interest charge is stipulated to be included in theunderlying asset cost. Variable lease payments that are not included in the measurement of the lease obligationshould be included in the current profit or loss when they are actually incurred, unless such payments arestipulated to be included in the underlying asset cost.The Company will re-calculate the lease obligation using the PV of the changed lease payment, if the actual fixedpayment, the estimated payable of the residual value of the guarantee, the index or rate used to confirm the leasepayment, or the assessment result of the call option, the renewal option, or the termination option, or the actualexercise changes, after the start date of the lease term.
36. Provisions
1. Recognition of Provisions
The obligation such as external guaranty, pending litigation or arbitration, product quality assurance, layoff plan,loss contract, restructuring and disposal of fixed assets, pertinent to a contingencies shall be recognized as anprovisions when the following conditions are satisfied simultaneously: ① That obligation is a current obligation ofthe enterprise; ① It is likely to cause any economic benefit to flow out of the enterprise as a result of performanceof the obligation; and ① The amount of the obligation can be measured in a reliable way
2. Measurement of Provisions
The provisions shall be initially measured in accordance with the best estimate of the necessary expenses for theperformance of the current obligation. If there is a sequent range for the necessary expenses and if all theoutcomes within this range are equally likely to occur, the best estimate shall be determined in accordance withthe middle estimate within the range. In other cases, the best estimate shall be conducted in accordance with thefollowing situations, respectively: ① If the Contingencies concern a single item, it shall be determined in the lightof the most likely outcome. ① If the Contingencies concern two or more items, the best estimate should becalculated and determined in accordance with all possible outcomes and the relevant probabilities. ① When all orsome of the expenses necessary for the liquidation of an provisions of an enterprise is expected to be compensatedby a third party, the compensation should be separately recognized as an asset only when it is virtually certain thatthe reimbursement will be obtained. The Company shall check the book value of the provisions on the balancesheet date. The amount of compensation is not exceeding the book value of the recognized provisions.
37. Share-based Payment
Not applicable
38. Other Financial Instruments such as Preferred Shares and Perpetual BondsNot applicable
39. Revenue
The Accounting Policy Adopted for Recognition and Measurement of Revenue
1. Accounting policies adopted in revenue recognition and measurement
The Company recognizes revenue when it has satisfied its performance obligations under the contract, i.e., when thecustomer has obtained control of relevant goods or services. Obtaining control of relevant goods or services meansbeing able to direct the use of them and obtain substantially all of the benefits from them.Where the contract contains two or more performance obligations, the Company, at the inception date of the contract,allocates the transaction price to each performance obligation in accordance with the relative proportion of thestand-alone selling price of the goods or services promised by each performance obligation. The Company measuresrevenue on the basis of the transaction price allocated to each performance obligation.Transaction price is the amount of consideration to which the Company expects to be entitled in exchange fortransferring goods or services to a customer, excluding amounts collected on behalf of third parties and amountsexpected to be returned to the customer. The Company determines the transaction price in accordance with the termsof the contract, with past business practices taken into account. When determining the transaction price, it considers
the impact of variable consideration, the existence of a significant financing component in the contract, non-cashconsideration, consideration payable to a customer and other factors. The transaction price is recognized only to theextent that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will notoccur when the relevant uncertainty is resolved. Where a contract contains a significant financing component, theCompany determines the transaction price on the basis of the amount presumably payable in cash when thecustomer obtains control of the goods or services, and uses the actual interest method to amortize the differencebetween the transaction price and the contract consideration during the contract period.A performance obligation is satisfied over time if one of the following conditions is met; otherwise, it is treated assatisfied at a point in time:
(1) The customer simultaneously receives and consumes the benefits provided by the Company's performance as theCompany performs.
(2) The customer can control the goods as they are created during the Company's performance.
(3) The goods produced by the Company's performance have no alternative use, and the Company has the right tocollect payment for performance completed to date during the entire contract period.Where a performance obligation is to be satisfied over time, the Company recognizes revenue in accordance withthe progress of performance during that period, except when the progress cannot be reasonably determined. Indetermining the progress of performance, the Company takes into account the nature of the goods or services andadopts the output methods or the input methods.Where the performance progress cannot be reasonably determined, and the costs incurred are expected to berecovered, the Company recognizes revenue according to the amount of the costs incurred until the progress can bereasonably determined.Where the performance obligation is to be satisfied at a certain point in time, the Company recognizes revenue at thepoint when the customer obtains control of the relevant goods or services. When judging whether the customer hasobtained control of goods or services, the Company considers the following indicators:
(1) The Company has a present right to receive payment for the goods or services, i.e., the customer has a presentobligation to pay for the goods or services.
(2) The Company has transferred the legal ownership of the goods to the customer, i.e., the customer has obtainedthe legal ownership of the goods.
(3) The Company has transferred physical possession of the goods to the customer, i.e., the customer has takenphysical possession of the goods.
(4) The Company has transferred significant risks and rewards of ownership of the goods to the customer, i.e., thecustomer has obtained significant risks and rewards of ownership of the goods.
(5) The customer has accepted the goods or services.
2. Specific methods
(1) Recognition of domestic sales revenue: Under the conventional settlement mode, the Company has deliveredgoods that have passed inspection to the purchaser as required by the purchaser; the amount of revenue has beendetermined, a sales invoice has been issued and the payment has been received or is expected to be recovered. Underthe consignment sales settlement mode, the Company recognizes sales revenue when the product is issued and thesettlement notice is issued after the customer inspection is qualified.
(2) Recognition of export sales revenue: The Company has produced goods according to the requirements stipulatedin the sales contract, and completed the export declaration procedures after the goods have passed inspection; thefreight company has shipped the goods, the amount of revenue has been determined, an export sales invoice has
been issued, and the payment has been received or is expected to be recovered.
Differences in accounting policies for the recognition of revenue caused by different business models for the sametype of business
40. Government Subsidies
1. Category of Government Subsidies
Government subsidies refer to the monetary assets and non-monetary assets obtained by the Company from thegovernment, which mainly include government subsidies related to assets and government subsidies related toincome.
2. Distinction Standard of Government Subsidies Related to Assets with Government Subsidies Related to IncomeThe government subsidies related to assets refer to the government subsidies obtained for acquisition, constructionor otherwise formation of long-term assets. The government subsidies related to income refer to the governmentsubsidies except the government subsidies related to assets.The specific standard of classifying the government subsidies as subsidies related to assets: government subsidiesfor acquisition, construction or otherwise formation of long-term assets.The specific criteria that the Company classifies government subsidies as income related is: other governmentsubsidies other than asset-related government subsidies.If the government documents do not specify the subsidy object, the bases that the Company classified thegovernment subsidies as assets-related subsidies or income-related subsidies were as follows: (1) If the specificitems for which the subsidy is targeted are stipulated in government documents, divide according to the relativeproportion of the amount of expenditure that forms assets and the amount of expenditure included in the cost inthe budget for that particular project, and the proportion shall be reviewed at each balance sheet date and changedas necessary; (2) if the government documents only have a general statement of the purpose and do not specify aspecific project, the subsidy is recognized as government subsidy related to income.
3. Measurement of Government Subsidies
If a government subsidy is a monetary asset, it shall be measured according to the amount received or receivable.If a government subsidy is a non-monetary asset, it shall be measured at its fair value, and shall be measured at anominal amount (RMB1) when the fair value cannot be obtained reliably.For confirmed government subsidies that need to be returned, if there is relevant deferred income, the bookbalance of related deferred income shall be written off and the excess shall be charged to profit or loss for theCurrent Period; for other circumstances, it shall be directly charged to profit or loss for the Current.
4. Accounting Treatment for Government Subsidies
The Company adopts the gross method to confirm government subsidies.The government subsidies related to assets are recognized as deferred income, and are charged to the currentprofit or loss in a reasonable and systematic manner within the useful lives of the relevant assets (subsidies relatedto the daily activities of the Company are included in other income; while subsidies unrelated to the dailyactivities of the Company are included in non-operating income). Government subsidies measured at nominalamounts are directly charged to profit or loss for the Current Period. Where the relevant assets are sold, transferred,scrapped or damaged before the end of their useful lives, the balance of related undistributed deferred incomeshall be transferred to the profit or loss of the asset disposal in the Current Period.Government subsidies related to income shall be treated as follows:
(1) government subsidies used to compensate the relevant costs, expenses or losses of the Company in thesubsequent period shall be recognized as deferred income, and shall be included in the current profit and lossduring the period of confirming the relevant costs, expenses or losses (subsidies related to the daily activities ofthe Company are included in other income; while subsidies unrelated to the daily activities of the Company areincluded in non-operating income);
(2) government subsidies used to compensate the relevant costs, expenses or losses incurred by the Companyshall be directly included in the current profits and losses (subsidies related to the daily activities of the Companyare included in other income; while subsidies unrelated to the daily activities of the Company are included innon-operating income).For government subsidies that include both assets-related and income-related parts, they should be distinguishedseparately for accounting treatment; for government subsidies that are difficult to be distinguished, they should beclassified as income-related.
41. Deferred Income Tax Assets/Deferred Income Tax Liabilities
The income tax of the Company includes the current income tax and deferred income tax. Both are recorded intothe current gains and losses as income tax expenses or revenue, except in the following circumstances:
(1) The income tax generated from the business combination shall be adjusted into goodwill;
(2) The income tax related to the transaction or event directly included in shareholders’ equity shall be recordedinto shareholders’ equity.At the balance sheet date, the Company recognizes the deferred income tax assets or deferred income taxliabilities in accordance with the balance sheet liability method for the temporary difference between the bookvalue of assets or liabilities and its tax base.The Company recognizes all taxable temporary differences as deferred income tax liabilities unless taxabletemporary differences arise in the following transactions:
(1) The initial recognition of goodwill or the initial recognition of the assets or liabilities arising from a transactionwith the following characteristics: the transaction is not a business combination and neither the accounting profitnor the taxable income is incurred at the time of the transaction;
(2) The time of write-back of taxable temporary differences related to the investments in subsidiaries, associatesand joint ventures can be controlled and the temporary differences are likely to not be written back in theforeseeable future.The Company recognizes the deferred income tax assets arising from deductible temporary differences, subject tothe amount of taxable income obtained to offset the deductible temporary differences, unless the deductibletemporary differences arise in the following transactions:
(1) The transaction is not a business combination, and the transaction does not affect the accounting profit or theamount of taxable income;
(2) The deductible temporary differences related to the investments in subsidiaries, associates and joint venturesare not met simultaneously: Temporary differences are likely to be written back in the foreseeable future and arelikely to be used to offset the taxable income of deductible temporary differences in the future.At the balance sheet date, the Company measures the deferred income tax assets and deferred income taxliabilities at the applicable tax rate of the period expected to recover the asset or pay off the liabilities according totax law, and reflects the income tax effect of expected assets recovery or liabilities payoff method at the balancesheet date.
At the balance sheet date, the Company reviews the book value of the deferred income tax assets. If it is likelythat sufficient taxable income will not be available to offset the benefit of the deferred income tax assets in thefuture period, the book value of the deferred income tax assets will be written down. If it is probable thatsufficient taxable income will be available, the amount of write-down will be written back.
42. Lease
(1) Accounting Treatment of Operating Lease
As the lessee:
On the start date of the lease term, the Company deems the right-of-use assets and lease obligations of all theoperating leases, except for the simplified short-term lease and low-value leases. See Note 29. Right-of-use Assetsand 35. Lease Liabilities for the general accounting treatment of the Company as the lessee.Lease changeA lease change refers to a change in the scope, consideration, and term of lease outside the original contractclauses, including the addition or termination of the one or several rights to use lease assets, and the extension orreduction of the lease term specified in the contract.When the lease changes and the following conditions are met, the Company will regard the lease charge as aseparate lease for accounting treatment:
(1) The lease change expands the scope of lease through the increase of one or several rights to use the leaseassets;
(2) The increased consideration and the separate price of the expanded part of the scope of lease are the same,upon adjustment, according to the contract.If the lease change is not deemed as a separate lease for accounting treatment, the Company will re-amortize theconsideration of the changed contract, re-confirm the lease term, and re-calculate the PV of the lease obligationusing the changed lease payment and the revised rate of discount, on the date when the lease change takes effect.The Company will correspondingly reduce the book value of the right-of-use assets and include the profit or lossof the lease terminated in part or whole in the current profit or loss, if the lease change narrows the scope of leaseor shortens the lease term. The Company will correspondingly adjust the book value of the right-of-use assets, ifother lease changes result in the re-calculation of the lease obligation.Short-term and low-value asset leasesThe Company chooses not to confirm the right-of-use assets and lease obligations of the short-term and low-valueasset leases, and include the relevant lease payment in each period in the lease term in the current profit or loss orthe underlying asset cost on a straight-line basis. A short-term lease refers to the lease whose lease term does notexceed 12 months and that does not include the call option on the start date of the lease term. A low-value assetlease refers to the lease where the value will be low when the single lease asset is the new asset. For the leaseholdproperty that is underleased or expected to be underleased, the original lease does not belong to low-value assetlease.As the lessor:
The Company classifies lease into finance and operating leases on the start date of the lease term. A finance leaserefers to the lease where almost all the risks and remuneration, related to the ownership of the leasehold property,is transferred, no matter whether the ownership is finally transferred or not. An operating lease refers to all leasesother than finance leases.
The lease receivable of the operating lease in each period in the lease term is deemed as a rental on a straight-linebasis. The Company capitalizes the initial direct cost related to the operating finance, amortize and include it inthe current profit or loss on the basis same as the recognition of rentals in the lease term. Variable lease paymentsthat are not included in the lease receivable are included in the current profit or loss when they are actuallyincurred. If an operating lease changes, the Company will regard it as a new lease for accounting treatment fromthe effective date of the change. The advance receipt or the lease receivable related to the lease prior to the changeis recognized as the payment receivable of the new lease.
(2) Accounting Treatments of Financial Lease
As the lessee:
For financing leased assets, on the beginning date of the lease term, the lower of the fair value of the leased asset andthe present value of the minimum lease payment amount on the lease commencement date is taken as the recordedvalue of the leased asset, the minimum lease payment amount is regarded as the recorded value of long-termpayables, and the difference is regarded as unrecognized financing expense, which is apportioned by the effectiveinterest rate method in each period of the lease term. The contingent rentals are included in the profit or loss for thecurrent period upon actual incurrence thereof.As the lessor:
The Company confirms the finance lease receivable of the finance lease and finally confirms the finance leaseholdproperty on the start date of the lease term. It recognizes the net investment in the lease as the entry value of thefinance lease, when initially calculating the finance lease receivable. The net investment in the lease is the sum ofthe net value of the unguaranteed residual value and the lease receivable not received on the start date of the leaseterm at the interest rate implicit in lease. The Company calculates and confirms the interest income at a fixedperiodic interest rate in each period in the lease term.
43. Other Significant Accounting Policies and Estimates
Naught
44. Changes in Main Accounting Policies and Estimates
(1) Change of Accounting Policies
□Applicable ? Not applicable
(2) Changes in Accounting Estimates
□Applicable ? Not applicable
45. Other
Naught
VI. Taxes
1. Main Taxes and Tax Rates
Category of taxes | Tax basis | Tax rate |
VAT | Sales volume from goods selling or taxable service | 3%, 6%, 9%, 13% |
Urban maintenance and construction tax | Turnover tax payable | 7%, 5% |
Enterprise income tax | Taxable income | 10%, 15%, 25% |
Educational surtax | Turnover tax payable | 3% |
Local educational surtax | Turnover tax payable | 2% |
Notes of the disclosure situation of the taxpaying bodies with different enterprises income tax rate
Name | Income tax rate |
The Company, Zhida Company, Chanchang Company, Nanning Liaowang, Chongqing Guinuo, Liuzhou Lighting, Liuzhou Foreshine, Headquarters of NationStar Optoelectronics, NationStar Semiconductor, Germany NationStar | 15% |
FSL Lighting GmbH | 15% |
Indonesia Liaowang | 10% |
Other subsidiaries | 25% |
2. Tax Preference
1. The Company passed the re-examination for High-tech Enterprises in 2020, as well as won the “Certificate ofHigh-tech Enterprise” after approval by Department of Science and Technology of Guangdong Province,Department of Finance of Guangdong Province, Guangdong Provincial Bureau of State Taxation and GuangdongProvincial Bureau of Local Taxation. In accordance with relevant provisions in Corporate Income Tax Law of thePeople’s Republic of China and the Administration Measures for Identification of High-tech Enterprisespromulgated in 2007, the Company paid the corporate income tax based on a tax rate of 15% within three yearssince 1 January 2020.
2. Zhida Company and Chanchang Company passed the examination for High-tech Enterprises respectively inDecember 2019 and December 2021, and thus Zhida Company and Chanchang Company paid the corporateincome tax based on a tax rate of 15% within three years respectively since 1 January 2019 and 1 January 2021 inaccordance with relevant provisions in Corporate Income Tax Law of the People’s Republic of China and theAdministration Measures for Identification of High-tech Enterprises promulgated in 2007.
3. According to the Decision on Tax Matters approved by the Local Taxation Bureau of Nanning High-techIndustrial Development Zone (NGDSSB [2015] No. 1), Nanning Liaowang will enjoy the preferential tax reductionand exemption of enterprise income tax in the western development from 1 January 2015, and the enterprise incometax will be levied at a reduced rate of 15%.
4. After being examined and filed by the competent tax authorities, Chongqing Guinuo will enjoy the preferential
tax reduction and exemption of enterprise income tax in the western development from 1 January 2019, and theenterprise income tax will be levied at a reduced rate of 15%.
5. According to the letter (LFGH Zi [2020] No. 196) issued by Liuzhou Development and Reform Commission on17 August 2020, Liuzhou Guige Photoelectric is determined to be in line with the encouraged industries in thewestern region, and the enterprise income tax will be paid at a reduced rate of 15% from 1 January 2020.
6. According to the letter (GKGH [2021] No. 237) jointly issued by the Science and Technology Department ofGuangxi Zhuang Autonomous Region, Finance Department of Guangxi Zhuang Autonomous Region and GuangxiZhuang Autonomous Region Tax Service, State Taxation Administration on 30 November 2021, Liuzhou GuigeForeshine is recognized as a high-tech enterprise (the certificate has not been obtained yet), and the preferential taxrate of income tax for high-tech enterprises is 15%.
7. NationStar Optoelectronics, a subsidiary of the Company, was recognized as a high-tech enterprise on 16December 2008, and its certificate number was GR200844000097. It was re-recognized as a high-tech enterprisein 2020, and its new certificate number is GR202044006337 dated 9 December 2020. Its corporate income taxrate for 2020-2022 is 15%.
8. Foshan NationStar Semiconductor Technology Co., Ltd., a wholly owned subsidiary of NationStarOptoelectronics, was recognized as a high-tech enterprise on 10 October 2015 and its certificate number wasGR201544001238. It was re-recognized as a high-tech enterprise in 2021, and its new certificate number isGR202144008779 dated 20 December 2021. Its corporate income tax rate for 2021-2023 is 15%.
3. Other
Pay in accordance with the relevant provisions of the tax law
VII. Notes to Main Items of Consolidated Financial Statements
1. Monetary Assets
Unit: RMB
Item | Ending balance | Beginning balance |
Cash on hand | 68,284.86 | 24,635.14 |
Bank deposits | 1,399,979,420.13 | 1,800,849,053.18 |
Other monetary assets (Note 1) | 436,039,030.34 | 578,254,717.74 |
Unexpired interest (Note 2) | 3,352,901.50 | 2,783,249.29 |
Total | 1,839,439,636.83 | 2,381,911,655.35 |
Of which: Total amount deposited overseas | 38,119,429.22 | 27,310,928.58 |
Total amount with restrictions on use due to mortgage, pledge or freeze | 448,713,603.58 | 247,425,015.48 |
Other notesNote 1: Other monetary assets were security deposits for notes and performance bonds, as well as investmentsplaced with security firm and the balance with e-commerce platforms, of which the security deposits for notes andperformance bonds were restricted assets (see “81. Assets with Restricted Ownership or Right of Use” in Note“VII Notes to Consolidated Financial Statements”).Note 2: Unexpired interest did not belong to cash and cash equivalents.
2. Trading Financial Assets
Unit: RMB
Item | Ending balance | Beginning balance |
Financial assets at fair value through profit or loss | 64,068,462.40 | 348,248,125.61 |
Including: | ||
Equity instrument investments | 1,397,612.10 | 1,558,778.18 |
Wealth management products | 62,670,850.30 | 342,422,447.43 |
Others | 4,266,900.00 | |
Including: | ||
Total | 64,068,462.40 | 348,248,125.61 |
3. Derivative Financial Assets
Naught
4. Notes Receivable
(1) Notes Receivable Listed by Category
Unit: RMB
Item | Ending balance | Beginning balance |
Bank acceptance bill | 1,372,158,706.47 | 1,659,553,102.56 |
Commercial acceptance bill | 41,633,566.90 | 30,803,389.08 |
Total | 1,413,792,273.37 | 1,690,356,491.64 |
Unit: RMB
Category | Ending balance | Beginning balance | ||||||||
Carrying amount | Bad debt provision | Carrying value | Carrying amount | Bad debt provision | Carrying value | |||||
Amount | Proportion | Amount | Withdrawal proportion | Amount | Proportion | Amount | Withdrawal proportion | |||
Of which: | ||||||||||
notes receivable withdrawn bad debt provision by group | 1,415,079,909.46 | 100.00% | 1,287,636.09 | 100.00% | 1,413,792,273.37 | 1,690,985,132.23 | 100.00% | 628,640.59 | 100.00% | 1,690,356,491.64 |
Of which: | ||||||||||
Bank | 1,372,1 | 96.97% | 0.00 | 0.00% | 1,372,1 | 1,659,5 | 98.14% | 0.00 | 0.00% | 1,659,5 |
acceptance bill | 58,706.47 | 58,706.47 | 53,102.56 | 53,102.56 | ||||||
Commercial acceptance bill | 42,921,202.99 | 3.03% | 1,287,636.09 | 100.00% | 41,633,566.90 | 31,432,029.67 | 1.86% | 628,640.59 | 100.00% | 30,803,389.08 |
Total | 1,415,079,909.46 | 100.00% | 1,287,636.09 | 100.00% | 1,413,792,273.37 | 1,690,985,132.23 | 100.00% | 628,640.59 | 100.00% | 1,690,356,491.64 |
Withdrawal of bad debt provision by group:
Unit: RMB
Name | Ending balance | ||
Carrying amount | Bad debt provision | Withdrawal proportion | |
Within 1 year | 42,921,202.99 | 1,287,636.09 | 3.00% |
Total | 42,921,202.99 | 1,287,636.09 |
Note:
Please refer to the relevant information of disclosure of bad debt provision of other receivables if adopting the general mode ofexpected credit loss to withdraw bad debt provision of notes receivable.
□Applicable ? Not applicable
(2) Bad Debt Provision Withdrawn, Reversed or Collected during the Reporting PeriodWithdrawal of bad debt provision:
Unit: RMB
Category | Beginning balance | Increase/decrease | Ending balance | |||
Withdrawn | Reversed or collected | Verified | Other | |||
Notes receivable withdrawn bad debt provision separately | ||||||
Notes receivable withdrawn bad debt provision by group | 628,640.59 | 658,995.50 | 1,287,636.09 | |||
Total | 628,640.59 | 658,995.50 | 1,287,636.09 |
For commercial acceptance bills, there is difference in withdrawal proportion of bad debts between the Companyas the Parent and the majority-owned subsidiary NationStar. The Company unified the accounting estimates in theconsolidated financial statements and complementally withdrew the bad debt provision of RMB429,212.03 fornotes receivable.Of which, bad debt provision collected or reversed with significant amount:
□Applicable ? Not applicable
(3) Notes Receivable Pledged by the Company at the Period-end
Unit: RMB
Item | Amount pledged at the period-end |
Bank acceptance bill | 821,993,782.57 |
Total | 821,993,782.57 |
(4) Notes Receivable which Had Endorsed by the Company or Had Discounted and Had not Due on theBalance Sheet Date at the Period-end
Unit: RMB
Item | Amount of recognition termination at the period-end | Amount of not recognition termination at the period-end |
Bank acceptance bill | 675,292,723.41 | |
Total | 675,292,723.41 |
(5) Notes Transferred to Accounts Receivable because Drawer of the Notes Fails to Executed the Contractor AgreementNaught
(6) The Actual Write-off Notes Receivable
Naught
5. Accounts Receivable
(1) Accounts Receivable Disclosed by Category
Unit: RMB
Category | Ending balance | Beginning balance | ||||||||
Carrying amount | Bad debt provision | Carrying value | Carrying amount | Bad debt provision | Carrying value | |||||
Amount | Proportion | Amount | Withdrawal proportion | Amount | Proportion | Amount | Withdrawal proportion | |||
Accounts receivable withdrawn bad debt provision separately | 33,512,866.15 | 1.45% | 33,367,874.59 | 99.57% | 144,991.56 | 33,512,866.15 | 1.60% | 31,123,709.17 | 92.87% | 2,389,156.98 |
Of which: |
Accounts receivable withdrawn bad debt provision by group | 2,284,474,693.96 | 98.55% | 98,441,141.68 | 4.31% | 2,186,033,552.28 | 2,063,205,995.27 | 98.40% | 84,056,307.99 | 4.07% | 1,979,149,687.28 |
Of which: | ||||||||||
(1) General business portfolio | 2,284,474,693.96 | 98.55% | 98,441,141.68 | 4.31% | 2,186,033,552.28 | 2,063,205,995.27 | 98.40% | 84,056,307.99 | 4.07% | 1,979,149,687.28 |
(2) Internal business portfolio | ||||||||||
Total | 2,317,987,560.11 | 100.00% | 131,809,016.27 | 5.69% | 2,186,178,543.84 | 2,096,718,861.42 | 100.00% | 115,180,017.16 | 5.49% | 1,981,538,844.26 |
Individual withdrawal of bad debt provision:
Unit: RMB
Name | Ending balance | |||
Carrying amount | Bad debt provision | Withdrawal proportion | Withdrawal reason | |
Customer A | 11,220,827.14 | 11,220,827.14 | 100.00% | Involved in the lawsuit, the Company won the lawsuit in the second instance, which had not yet executed completely |
Customer B | 9,111,336.51 | 9,111,336.51 | 100.00% | Existing pending litigation matters |
Customer C | 6,024,216.41 | 6,024,216.41 | 100.00% | Less likely to be recovered |
Customer D | 4,702,051.28 | 4,702,051.28 | 100.00% | Existing pending litigation matters |
Customer E | 815,484.27 | 815,484.27 | 100.00% | The compensation amount of the customer lawsuit is large, and less likely to be recovered |
Customer F | 526,858.54 | 526,858.54 | 100.00% | Existing pending litigation matters |
Customer G | 523,448.92 | 523,448.92 | 100.00% | The customer had |
executed bankruptcy liquidation in December 2020, thus the accounts were unrecoverable. | ||||
Customer H | 395,321.00 | 395,321.00 | 100.00% | Expected to be unrecoverable |
Customer I | 193,322.08 | 48,330.52 | 25.00% | In the processing of customer complaints, the possibility of bad debts is greater |
Total | 33,512,866.15 | 33,367,874.59 |
Withdrawal of bad debt provision by group:
Unit: RMB
Name | Ending balance | ||
Carrying amount | Bad debt provision | Withdrawal proportion | |
Credit risk group | 2,284,474,693.96 | 98,441,141.68 | 4.31% |
Total | 2,284,474,693.96 | 98,441,141.68 |
Please refer to the relevant information of disclosure of bad debt provision of other receivables if adopting the general mode ofexpected credit loss to withdraw bad debt provision of accounts receivable.
□Applicable ? Not applicable
Disclosure by aging
Unit: RMB
Aging | Ending balance |
Within 1 year (including 1 year) | 2,141,771,714.41 |
1 to 2 years | 97,849,610.15 |
2 to 3 years | 12,018,016.13 |
Over 3 years | 66,348,219.42 |
3 to 4 years | 29,532,295.52 |
4 to 5 years | 21,599,874.05 |
Over 5 years | 15,216,049.85 |
Total | 2,317,987,560.11 |
(2) Bad Debt Provision Withdrawn, Reversed or Collected during the Reporting PeriodBad debt provision withdrawn in the Reporting Period:
Unit: RMB
Category | Beginning balance | Increase/decrease | Ending balance | |||
Withdrawn | Reversed or collected | Verified | Other | |||
Bad debt provision separately accrued | 31,123,709.17 | 2,244,165.42 | 33,367,874.59 |
Bad debt provision withdrawn according to groups | 84,056,307.99 | 14,385,162.73 | 329.04 | 98,441,141.68 | ||
Total | 115,180,017.16 | 16,629,328.15 | 329.04 | 131,809,016.27 |
For common business group, there is difference in withdrawal proportion of expected credit losses between theCompany as the Parent and the majority-owned subsidiary NationStar. The Company unified the accountingestimates in consolidated financial statements and complementally withdrew bad debt provision ofRMB6,019,862.42 for accounts receivable.The amount of expected credit loss accrued in the current period is RMB16,527,279.88, and the amount ofexpected credit loss recovered or reversed in the current period is RMB0.00, which is RMB102,048.27 differentfrom the amount of credit impairment loss accrued in the current period of RMB16,629,328.15, which is causedby the translation difference of foreign currency statement of Indonesia Liaowang at the end of the period.
(3) Accounts Receivable with Actual Verification for the Reporting Period
Unit: RMB
Item | Amount |
Other retails accounts | 329.04 |
Of which, verification of significant accounts receivable:
Unit: RMB
Name of the entity | Nature | Amount | Reason | Procedure | Whether occurred because of related-party transactions |
Other retails accounts | Payment for goods | 329.04 | Unrecoverable | The approval procedure is carried out according to the Company’s rules for managing bad debt. | Not |
Total | 329.04 |
(4) Top 5 of the Ending Balance of the Accounts Receivable Collected according to the Arrears Party
Unit: RMB
Name of units | Ending balance of accounts receivable | Proportion to total ending balance of accounts receivable (%) | Ending balance of bad debt provision |
No. 1 | 152,875,068.03 | 6.60% | 4,586,252.04 |
No. 2 | 89,987,854.53 | 3.88% | 2,699,635.64 |
No. 3 | 79,809,077.83 | 3.44% | 2,394,272.33 |
No. 4 | 71,161,243.67 | 3.07% | 2,134,837.31 |
No. 5 | 55,652,405.43 | 2.40% | 1,669,572.16 |
Total | 449,485,649.49 | 19.39% |
(5) Derecognition of Accounts Receivable due to the Transfer of Financial AssetsNaught
(6) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement ofAccounts Receivable
Naught
6. Accounts Receivable Financing
NaughtIncrease or decrease of accounts receivable financing and changes in fair value thereof
□Applicable ? Not applicable
If the depreciation reserve for accounts receivable financing was withdrawn in accordance with the general modelof expected credit losses, the information related to depreciation reserve shall be disclosed by reference to thedisclosure method of other receivables:
□Applicable ? Not applicable
7. Prepayment
(1) Listed by Aging
Unit: RMB
Aging | Ending balance | Beginning balance | ||
Amount | Proportion | Amount | Proportion | |
Within 1 year | 28,409,430.08 | 74.28% | 26,325,276.67 | 78.64% |
1 to 2 years | 7,056,500.42 | 18.45% | 4,740,160.27 | 14.16% |
2 to 3 years | 229,005.90 | 0.60% | 553,744.18 | 1.65% |
Over 3 years | 2,549,224.67 | 6.67% | 1,854,923.20 | 5.54% |
Total | 38,244,161.07 | 33,474,104.32 |
(2) Top 5 of the Ending Balance of the Prepayments Collected according to the Prepayment Target
Unit: RMB
Name of units | Relationship with the Company | Ending balance | Proportion to total prepayments (%) | Prepayment time |
No. 1 | Non-related party | 2,731,478.94 | 7.14% | 1 to 2 years |
No. 2 | Non-related party | 1,436,720.69 | 3.76% | Within 1 year |
No. 3 | Non-related party | 1,407,273.77 | 3.68% | Within 1 year |
No. 4 | Non-related party | 1,327,340.00 | 3.47% | Within 1 year |
No. 5 | Non-related party | 1,083,340.97 | 2.83% | Within 1 year |
Total | — — | 7,986,154.37 | 20.88% | — — |
8. Other Receivables
Unit: RMB
Item | Ending balance | Beginning balance |
Other receivables | 31,235,165.53 | 37,523,072.02 |
Total | 31,235,165.53 | 37,523,072.02 |
(1) Interest Receivable
1) Category of Interest Receivable
Naught
2) Significant Overdue Interest
Naught
3) Withdrawal of Bad Debt Provision
□Applicable ? Not applicable
(2) Dividends Receivable
1) Category of Dividends Receivable
Naught
2) Significant Dividends Receivable Aged over 1 Year
Naught
3) Withdrawal of Bad Debt Provision
□Applicable ? Not applicable
(3) Other Receivables
1) Other Receivables Disclosed by Account Nature
Unit: RMB
Nature | Ending carrying amount | Beginning carrying amount |
VAT export tax refunds | 5,260,428.72 | 4,674,335.06 |
Performance bond | 15,114,786.48 | 12,056,403.00 |
Staff borrow and petty cash | 2,342,223.49 | 4,018,439.87 |
Rent, water & electricity fees | 1,458,352.75 | 2,564,557.87 |
Other | 38,298,697.53 | 45,643,798.95 |
Total | 62,474,488.97 | 68,957,534.75 |
2) Information of Withdrawal of Bad Debt Provision
Unit: RMB
Bad debt provision | First stage | Second stage | Third stage | Total |
Expected credit loss of the next 12 months | Expected loss in the duration (credit impairment not occurred) | Expected loss in the duration (credit impairment occurred) | ||
Balance of 1 January 2022 | 890,724.80 | 6,224,279.95 | 24,319,457.98 | 31,434,462.73 |
Balance of 1 January 2022 in the Current Period | ||||
Withdrawal of the Current Period | -234,354.72 | 103,008.43 | -131,346.29 | |
Verification of the Current Period | 6,100.00 | 27,693.00 | 30,000.00 | 63,793.00 |
Balance of 30 June 2022 | 650,270.08 | 6,299,595.38 | 24,289,457.98 | 31,239,323.44 |
Changes of carrying amount with significant amount changed of loss provision in the current period
□Applicable ? Not applicable
Disclosure by aging
Unit: RMB
Aging | Ending balance |
Within 1 year (including 1 year) | 22,573,384.78 |
1 to 2 years | 8,058,085.07 |
2 to 3 years | 5,938,709.25 |
Over 3 years | 25,904,309.87 |
3 to 4 years | 2,907,396.35 |
4 to 5 years | 1,049,775.73 |
Over 5 years | 21,947,137.79 |
Total | 62,474,488.97 |
3) Bad Debt Provision Withdrawn, Reversed or Recovered in the Reporting Period
Bad debt provision withdrawn in the Reporting Period:
Unit: RMB
Category | Beginning balance | Increase/decrease | Ending balance | |||
Withdrawn | Reversed or collected | Verified | Other | |||
Other receivables | 31,434,462.73 | -131,346.29 | 63,793.00 | 31,239,323.44 | ||
Total | 31,434,462.73 | -131,346.29 | 63,793.00 | 31,239,323.44 |
For common business group, there is difference in withdrawal proportion of expected credit losses between theCompany as the Parent and the majority-owned subsidiary NationStar. The Company unified the accountingestimates in consolidated financial statements and complementally withdrew bad debt provision ofRMB11,531.29 for other receivables.The amount of expected credit loss accrued in the current period is RMB-133,776.54, and the amount of expectedcredit loss recovered or reversed in the current period is RMB0.00, which is RMB2,430.55 different from theamount of credit impairment loss accrued in the current period of RMB-131,346.29, which is caused by thetranslation difference of foreign currency statement of Indonesia Liaowang at the end of the period.Of which bad debt provision revered or recovered with significant amount:
Naught
4) Particulars of the Actual Verification of Other Receivables during the Reporting Period
Unit: RMB
Item | Amount |
Bid security and deposit | 32,743.00 |
Others | 31,050.00 |
Of which significant actual verification of other receivables:
Unit: RMB
Name of the entity | Nature | Amount | Reason | Procedure | Whether occurred because of related-party transactions |
Other retails accounts | Bid security and deposit | 32,743.00 | Litigation costs are high and there is a risk of losing | The approval procedure shall be carried out according to the Company’s rules for managing bad debts regarding to verification application before accounts can be verified | Not |
Other retails accounts | Other | 31,050.00 | Litigation costs are high and there is a risk of losing | The approval procedure shall be carried out according to the Company’s rules for managing bad debts regarding to verification application before accounts can be verified | Not |
Total | 63,793.00 |
5) Top 5 of the Ending Balance of the Other Receivables Collected according to the Arrears Party
Unit: RMB
Name of the entity | Nature | Ending balance | Aging | Proportion to total ending balance of other receivables (%) | Ending balance of bad debt provision |
No. 1 | Intercourse accounts | 20,000,000.00 | Over 5 years | 32.01% | 20,000,000.00 |
No. 2 | VAT export tax refunds | 4,496,365.98 | Within 1 year | 7.20% | 172,842.34 |
No. 3 | Intercourse accounts | 2,673,256.53 | Within 2 years | 4.28% | 428,945.80 |
No. 4 | Performance bond | 1,946,000.00 | Within 1 year | 3.11% | 122,223.17 |
No. 5 | Intercourse accounts | 1,712,634.80 | Within 3 years | 2.74% | 583,800.00 |
Total | 30,828,257.31 | 49.34% | 21,307,811.31 |
6) Accounts Receivable Involving Government Grants
Naught
7) Derecognition of Other Receivables due to the Transfer of Financial AssetsNaught
8) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement ofOther ReceivablesNaught
9. Inventory
Whether the Company needs to comply with disclosure requirements for real estate industryNo
(1) Category of Inventory
Unit: RMB
Item | Ending balance | Beginning balance | ||||
Carrying amount | Falling price reserves of inventory or depreciation reserves of contract performance cost | Carrying value | Carrying amount | Falling price reserves of inventory or depreciation reserves of contract performance cost | Carrying value | |
Raw materials | 358,341,044.72 | 6,336,930.47 | 352,004,114.25 | 381,168,885.07 | 14,729,292.64 | 366,439,592.43 |
Goods in process | 12,237,323.82 | 12,237,323.82 | 317,007,606.13 | 317,007,606.13 | ||
Inventory goods | 1,192,382,480.34 | 133,644,653.16 | 1,058,737,827.18 | 1,223,620,511.60 | 135,963,343.21 | 1,087,657,168.39 |
Revolving materials | 5,434,655.63 | 5,434,655.63 | 3,231,115.87 | 3,231,115.87 | ||
Goods in transit | 69,802,063.26 | 3,190,828.40 | 66,611,234.86 | 93,671,492.20 | 3,530,794.31 | 90,140,697.89 |
Semi-finished goods | 304,323,618.44 | 328,502.08 | 303,995,116.36 | 100,723,505.66 | 377,760.65 | 100,345,745.01 |
Others | 20,649,158.56 | 20,649,158.56 | 5,177,062.67 | 5,177,062.67 | ||
Total | 1,963,170,34 | 143,500,914. | 1,819,669,43 | 2,124,600,17 | 154,601,190. | 1,969,998,98 |
4.77 | 11 | 0.66 | 9.20 | 81 | 8.39 |
(2)Falling Price Reserves of Inventory and Depreciation Reserves of Contract Performance Cost
Unit: RMB
Item | Beginning balance | Increase | Decrease | Ending balance | ||
Withdrawal | Other | Reversal or write-off | Other | |||
Raw materials | 14,729,292.64 | 592,123.14 | 8,984,485.31 | 6,336,930.47 | ||
Inventory goods | 135,963,343.21 | 19,075,837.99 | 21,394,528.04 | 133,644,653.16 | ||
Semi-finished goods | 377,760.65 | 90,386.67 | 139,645.24 | 328,502.08 | ||
Goods in transit | 3,530,794.31 | -339,965.91 | 3,190,828.40 | |||
Total | 154,601,190.81 | 19,418,381.89 | 30,518,658.59 | 143,500,914.11 |
Item | Basis for withdrawal of falling price reserves of inventory | Reasons for reversal or write-off of falling price reserves of inventory | Note |
Raw materials | The lower one between the inventory cost and net realizable value | Sales or scrap of raw materials | |
Inventory goods | The lower one between the inventory cost and net realizable value | Sales or scrap of products | |
Goods in transit | The lower one between the inventory cost and net realizable value | Sales or scrap of products |
Reasons for the provision for inventory depreciation: Provisions are set for the stagnancy of a few raw materials;some inventory products become idle due to classification.
(3) Notes to the Ending Balance of Inventories Including Capitalized Borrowing ExpenseNaught
(4) Amortization Amount of Contract Performance Cost during the Reporting PeriodNaught
10. Contract Assets
Unit: RMB
Item | Ending balance | Beginning balance | ||||
Carrying | Depreciation | Carrying value | Carrying | Depreciation | Carrying value |
amount | reserves | amount | reserves | |||
Contract assets | 8,794,261.68 | 704,705.05 | 8,089,556.63 | 8,826,085.67 | 264,782.57 | 8,561,303.10 |
Total | 8,794,261.68 | 704,705.05 | 8,089,556.63 | 8,826,085.67 | 264,782.57 | 8,561,303.10 |
If the bad debt provision for contract assets in accordance with the general model of expected credit losses, theinformation related to the bad debt provision shall be disclosed by reference to the disclosure method of otherreceivables:
□Applicable ? Not applicable
11. Held-for-Sale Assets
Unit: RMB
Item | Ending carrying amount | Depreciation reserves | Ending carrying value | Fair value | Estimated disposal expense | Estimated disposal time |
Houses, buildings and land involved in expropriation | 17,147,339.84 | 17,147,339.84 | 183,855,895.00 | 55,718,333.95 | 31 December 2022 | |
Total | 17,147,339.84 | 17,147,339.84 | 183,855,895.00 | 55,718,333.95 | -- |
Other notes:
Note: For details, see Part X-XVI.Other Major Events-8.Other: "Demolition Matters of Nanjing Fozhao" of thisReport. The estimated disposal costs include employee resettlement fees, compensation for the termination of theoriginal tenant's contract, and taxes related to the proceeds of demolition.
12. Current Portion of Non-current Assets
Naught
13. Other Current Assets
Unit: RMB
Item | Ending balance | Beginning balance |
Input tax of VAT to be certified and deducted | 40,618,746.09 | 111,605,177.04 |
Advance payment of enterprise income tax | 10,323,874.76 | 10,562,615.78 |
Others | 3,400,896.19 | 3,507,355.35 |
Total | 54,343,517.04 | 125,675,148.17 |
14. Investments in debt obligations
Naught
15. Other Investments in Debt Obligations
Naught
16. Long-term Accounts Receivable
(1) List of Long-term Receivables
Naught
(2) Derecognition of Long-term Receivables due to the Transfer of Financial AssetsNaught
(3) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement ofLong-term ReceivablesNaught
17. Long-term Equity Investment
Unit: RMB
Investees | Beginning balance (carrying value) | Increase/decrease | Ending balance (carrying value) | Ending balance of depreciation reserves | |||||||
Additional investment | Reduced investment | Gains and losses recognized under the equity method | Adjustment of other comprehensive income | Changes of other equity | Cash bonus or profits announced to issue | Withdrawal of depreciation reserves | Other | ||||
I. Joint ventures | |||||||||||
Jiangsu Fozhao Contract Energy Management Development Co., Ltd. | 4,804,965.64 |
Shenzhen Primatronix (Nanho) Electronics Ltd. | 181,545,123.09 | 650,457.40 | 2,080,390.50 | 180,115,189.99 | |||||||
Subtotal | 181,545,123.09 | 650,457.40 | 2,080,390.50 | 180,115,189.99 | 4,804,965.64 | ||||||
II. Associated enterprises | |||||||||||
Total | 181,545,123.09 | 650,457.40 | 2,080,390.50 | 180,115,189.99 | 4,804,965.64 |
Other notes
1. The Company's subsidiary, NationStar Optoelectronics, entered into the Contribution Agreement of Jiangsu Fozhao ContractEnergy Management Development Co., Ltd. with the natural persons, Ye Zongcai and Zhao Qiaoyue, on 3 August 2012, to jointlyestablish Jiangsu Fozhao Contract Energy Management Development Co., Ltd. (Jiangsu Fozhao) with the registered capital ofRMB20 million, wherein NationStar Optoelectronics contributed RMB5 million, representing 25.00% of the total investment.
2. Jiangsu Fozhao has been in the red since its establishment, so its production and operations have been stopped. Additionally, itscash realizable value is quite low. Up to now, impairment provisions have been set aside to fully cover the long-term equityinvestment of Jiangsu Fozhao, in line with relevant regulations, such as the No. 8 Accounting Standards for BusinessEnterprises—Asset Impairment.
18. Other Equity Instrument Investment
Unit: RMB
Item | Ending balance | Beginning balance |
Non-listed equity investment | 41,559,860.92 | 41,559,860.92 |
Listed equity investment | 1,123,157,619.00 | 1,463,420,163.15 |
Total | 1,164,717,479.92 | 1,504,980,024.07 |
Disclosure of non-trading equity instrument investment by items
Unit: RMB
Item | Dividend income recognized | Accumulative gains | Accumulative losses | Amount of other comprehensive income transferred to retained earnings | Reason for assigning to measure in fair value and the changes included in other comprehensive | Reason for other comprehensive income transferred to retained earnings |
income | ||||||
Gotion High-tech | 1,715,644.18 | 698,286,384.47 | 6,804,316.24 | Not satisfied with the condition of trading equity instrument | Sale of shareholdings | |
Stock of Xiamen Bank | 14,339,628.75 | 188,899,142.57 | 94,112,907.95 | Not satisfied with the condition of trading equity instrument | Sale of shareholdings | |
Beijing Guangrong Lianmeng Semiconductor lighting Industry Investment Center(L.P.) | 601,263.41 | Not satisfied with the condition of trading equity instrument | Not applicable |
19. Other Non-current Financial Assets
Naught
20. Investment Property
(1)Investment Property Adopting the Cost Measurement Mode
? Applicable □ Not applicable
Unit: RMB
Item | Houses and buildings | Land use right | Construction in progress | Total |
I. Original carrying value | ||||
1. Beginning balance | 49,792,377.90 | 49,792,377.90 | ||
2. Increased amount of the period | ||||
(1) Outsourcing | ||||
(2) Transfer from inventories/fixed assets/construction in progress | ||||
(3) Enterprise combination increase | ||||
3. Decreased amount of the period |
(1) Disposal | ||||
(2) Other transfer | ||||
4. Ending balance | 49,792,377.90 | 49,792,377.90 | ||
II. Accumulative depreciation and accumulative amortization | ||||
1. Beginning balance | 6,444,553.56 | 6,444,553.56 | ||
2. Increased amount of the period | 1,182,568.97 | 1,182,568.97 | ||
(1) Withdrawal or amortization | 1,182,568.97 | 1,182,568.97 | ||
3. Decreased amount of the period | ||||
(1) Disposal | ||||
(2) Other transfer | ||||
4. Ending balance | 7,627,122.53 | 7,627,122.53 | ||
III. Depreciation reserves | ||||
1. Beginning balance | ||||
2. Increased amount of the period | ||||
(1) Withdrawal | ||||
3. Decreased amount of the period | ||||
(1) Disposal | ||||
(2) Other transfer | ||||
4. Ending balance | ||||
IV. Carrying value | ||||
1. Ending carrying value | 42,165,255.37 | 42,165,255.37 | ||
2. Beginning carrying value | 43,347,824.34 | 43,347,824.34 |
(2) Investment Property Adopting the Fair Value Measurement Mode
□Applicable ? Not applicable
(3) Investment Property Failed to Accomplish Certification of Property
NaughtOther notesIn October 2021, the Company held the 20th meeting of the ninth Board of Directors, where the Proposal onChanging Some Self-used Real Estate into Investment Real Estate and Measuring by Cost Model was deliberated
and adopted, and the K2 and K3 buildings of Gaoming Fuwan Standard Workshop were changed from fixedassets projects to investment real estate projects, measured by cost model, and depreciation was accrued by thesame method as fixed assets.
21. Fixed Assets
Unit: RMB
Item | Ending balance | Beginning balance |
Fixed assets | 3,336,828,807.79 | 3,360,175,223.96 |
Disposal of fixed assets | 717,389.62 | 164,686.99 |
Total | 3,337,546,197.41 | 3,360,339,910.95 |
(1) List of Fixed Assets
Unit: RMB
Item | Houses and buildings | Machinery equipment | Transportation equipment | Electronic equipment | Other | Total |
I. Original carrying value | ||||||
1. Beginning balance | 1,737,595,300.29 | 4,469,670,841.25 | 42,703,535.66 | 61,090,328.98 | 83,460,720.97 | 6,394,520,727.15 |
2. Increased amount of the period | 894,770.78 | 227,234,238.39 | 534,994.18 | 2,246,529.05 | 203,915.31 | 231,114,447.71 |
(1) Purchase | 21,554.42 | 23,124,224.57 | 534,994.18 | 1,582,994.99 | 46,214.90 | 25,309,983.06 |
(2) Transfer from construction in progress | 873,216.36 | 204,110,013.82 | 663,534.06 | 157,700.41 | 205,804,464.65 | |
(3) Enterprise combination increase | ||||||
3. Decreased amount of the period | 128,375,789.06 | 2,990,815.72 | 1,188,796.00 | 246,754.89 | 132,802,155.67 | |
(1) Disposal or scrap | 125,062,387.40 | 2,986,522.62 | 1,188,796.00 | 246,754.89 | 129,484,460.91 | |
(2) Equipment transformation | 1,239,430.79 | 1,239,430.79 | ||||
(3) Others | 2,073,970.87 | 4,293.10 | 2,078,263.97 | |||
4. Ending | 1,738,490,07 | 4,568,529,29 | 40,247,714.1 | 62,148,062.0 | 83,417,881.3 | 6,492,833,01 |
balance | 1.07 | 0.58 | 2 | 3 | 9 | 9.19 |
II. Accumulative depreciation | ||||||
1. Beginning balance | 663,293,540.68 | 2,232,542,165.32 | 31,417,598.51 | 45,052,211.22 | 60,223,768.32 | 3,032,529,284.05 |
2. Increased amount of the period | 36,832,884.60 | 192,945,811.92 | 1,090,607.05 | 2,142,857.84 | 3,822,961.11 | 236,835,122.52 |
(1) Withdrawal | 36,832,884.60 | 192,945,811.92 | 1,090,607.05 | 2,142,857.84 | 3,822,961.11 | 236,835,122.52 |
3. Decreased amount of the period | -690,268.32 | 115,883,809.56 | 2,296,635.98 | 951,698.38 | 239,105.20 | 118,680,980.80 |
(1) Disposal or scrap | -690,268.32 | 112,711,842.37 | 2,296,635.98 | 951,698.38 | 239,105.20 | 115,509,013.61 |
(2) Others | 3,171,967.19 | 3,171,967.19 | ||||
4. Ending balance | 700,816,693.60 | 2,309,604,167.68 | 30,211,569.58 | 46,243,370.68 | 63,807,624.23 | 3,150,683,425.77 |
III. Depreciation reserves | ||||||
1. Beginning balance | 1,815,791.11 | 428.03 | 1,816,219.14 | |||
2. Increased amount of the period | 3,529,839.60 | 3,529,839.60 | ||||
(1) Withdrawal | 3,529,839.60 | 3,529,839.60 | ||||
3. Decreased amount of the period | 25,273.11 | 25,273.11 | ||||
(1) Disposal or scrap | 25,273.11 | 25,273.11 | ||||
4. Ending balance | 5,320,357.60 | 428.03 | 5,320,785.63 | |||
IV. Carrying value | ||||||
1. Ending carrying value | 1,037,673,377.47 | 2,253,604,765.30 | 10,036,144.54 | 15,904,263.32 | 19,610,257.16 | 3,336,828,807.79 |
2. Beginning carrying value | 1,074,301,759.61 | 2,235,312,884.82 | 11,285,937.15 | 16,037,689.73 | 23,236,952.65 | 3,360,175,223.96 |
(2) List of Temporarily Idle Fixed Assets
Unit: RMB
Item | Original carrying value | Accumulated depreciation | Depreciation reserves | Carrying value | Note |
T5, T8, energy-saving lamp production line | 6,962,212.78 | 5,382,345.77 | 1,536,408.16 | 43,458.85 |
(3) Fixed Assets Leased out by Operation Lease
Naught
(4) Fixed Assets Failed to Accomplish Certification of Property
Other notesThe Company's Fuwan Standard Workshop J3, Fuwan Standard Workshop K1, Building 8 of Gaoming FamilyDormitory, Fuwan Staff Dormitory Building 7, Family Dormitory Building 3 to 6, Staff Village Dormitory BuildingA, Staff Village Dormitory Building 2, 3, 5, 6, 10 to 13, Staff Dormitory Building 1 to 4, Fuwan Energy SavingLamp Workshop 2, Glass Workshop 8, Glass Workshop 9, Fluorescent Lamp Workshop, Standard Workshop A andled Workshop have been completed and put into use and carried forward fixed assets. As of 30 June 2022, therelevant real estate licenses are being processed. In addition, the ownership of two parking spaces of NanningLiaowang at No. 155 Kerui Jiangyun and No. 160 Kerui Jiangyun, are being processed. The management believedthat there are no substantive legal barriers to the handling of these title certificates, and it will not have a significantadverse impact on the normal operation of the Company.
(5) Proceeds from Disposal of Fixed Assets
Unit: RMB
Item | Ending balance | Beginning balance |
Scrap equipment | 717,389.62 | 164,686.99 |
Total | 717,389.62 | 164,686.99 |
22. Construction in progress
Unit: RMB
Item | Ending balance | Beginning balance |
Construction in progress | 1,094,362,246.23 | 1,087,261,052.63 |
Total | 1,094,362,246.23 | 1,087,261,052.63 |
(1) List of Construction in Progress
Unit: RMB
Item | Ending balance | Beginning balance | ||||
Carrying amount | Depreciation reserves | Carrying value | Carrying amount | Depreciation reserves | Carrying value | |
Construction in progress | 1,095,681,046.23 | 1,318,800.00 | 1,094,362,246.23 | 1,088,579,852.63 | 1,318,800.00 | 1,087,261,052.63 |
Total | 1,095,681,046.23 | 1,318,800.00 | 1,094,362,246.23 | 1,088,579,852.63 | 1,318,800.00 | 1,087,261,052.63 |
(2) Changes in Significant Construction in Progress during the Reporting Period
Unit: RMB
Item | Budget | Beginning balance | Increased amount | Transferred in fixed assets | Other decreased amount | Ending balance | Proportion of accumulative investment in constructions to budget | Job schedule | Accumulative amount of interest capitalization | Of which: amount of capitalized interests for the Reporting Period | Capitalization rate of interests for the Reporting Period | Capital resources |
Kelian Building | 726,738,900.00 | 501,594,852.04 | 29,329,889.54 | 530,924,741.58 | 80.00% | 80.23% | 36,640,953.02 | Other | ||||
15th and 16th floors office buildings of R&F Center | 115,752,763.00 | 106,195,222.94 | 2,896,780.26 | 109,092,003.20 | 100.00% | 98.00% | Other | |||||
Gaoming R&D Workshop 11, 12, 13, 14 and 18 | 71,690,000.00 | 53,531,061.32 | 130,666.92 | 53,661,728.24 | 84.00% | 88.00% | Other | |||||
FSL intelligent manufacturing factory project | 89,680,000.00 | 23,808,849.57 | 23,808,849.57 | 30.00% | 33.00% | Other | ||||||
Gaoming office building | 115,000,000.00 | 22,209,451.41 | 16,766,092.08 | 38,975,543.49 | 40.00% | 25.00% | Other | |||||
Overhaul of Gaoming No. 8 tank furnace Work | 10,890,000.00 | 6,242,799.53 | 1,055,044.70 | 7,297,844.23 | 68.00% | 75.00% | Other |
order: 20029 Gaoming tank furnace | ||||||||||||
The Renovation Project of the Pipe Network for Rain and Sewage Diversion in the Gaoming District Production Base, Foshan City, Guangdong Province | 8,000,000.00 | 198,113.21 | 3,428,042.56 | 3,626,155.77 | 46.00% | 52.00% | Other | |||||
The Project of the MES Contract of the Circuit Board Workshop | 814,489.37 | 814,489.37 | 0.00% | 80.00% | Other | |||||||
The | 450,0 | 497,8 | -0.01 | 497,8 | 102.0 | 99.00 | Other |
Circular Automatic Downlight Assembly Line. Work Order No.: 21007 Gaoming Ceiling Downlight Workshop | 00.00 | 89.31 | 89.30 | 0% | % | |||||||
The Project of Relocation and Renovation of the Halogen Lamp Workshop (formerly T8 III) | 1,874,500.00 | 303,308.37 | 649,343.04 | 952,651.41 | 52.00% | 60.00% | Other | |||||
The PLM system | 2,250,978.00 | 411,239.71 | 411,239.71 | 21.00% | 30.00% | Other | ||||||
A batch of | 14,676,705.40 | 594,723.15 | 594,723.15 | 0.00 | 98.24% | 98.24% | Other |
machinery and equipment from Chongqing Guinuo Lighting Technology Co., Ltd. (Chongqing Guinuo) | ||||||||||||
The LED R&D and Production Base on Jihua Second Road. Others (sporadic equipment) | 16,550,000.00 | 7,348,850.20 | 12,014,860.18 | 17,962,468.80 | 1,401,241.58 | 85.02% | Other | |||||
The Project of Production Expansion of | 913,412,500.00 | 107,986,244.68 | 85,471,636.87 | 173,758,742.29 | 19,699,139.26 | 93.33% | Other |
Packaging Components and Chips of New-generation LEDs | ||||||||||||
The Project of the Geely Industrial Park | 1,714,546,700.00 | 234,319,701.33 | 9,542,742.29 | 3,433,628.26 | 240,428,815.36 | 15.43% | Other | |||||
The Project of Production Expansion of Chips and LEDs | 20,390,000.00 | 2,217,699.14 | 4,033,628.27 | 3,323,893.77 | 2,927,433.64 | 58.95% | Other | |||||
The sporadic equipment of Foshan NationStar Semiconductor Technology Co., Ltd. | 14,157,853.80 | 4,793,237.86 | 370,115.00 | 4,652,186.81 | 511,166.05 | 67.08% | Other |
Total | 3,836,060,900.20 | 1,072,253,243.77 | 166,503,331.07 | 203,725,643.08 | 1,035,030,931.76 | 36,640,953.02 |
(3) List of the Withdrawal of the Depreciation Reserves for Construction in Progress
Unit: RMB
Item | Amount withdrawn | Reason for withdrawal |
Oxidation line engineering | 1,318,800.00 | Idleness |
Total | 1,318,800.00 | -- |
(4) Engineering Materials
Naught
23. Productive Living Assets
(1) Productive Living Assets Adopting Cost Measurement Mode
□Applicable ? Not applicable
(2) Productive Living Assets Adopting Fair Value Measurement Mode
□Applicable ? Not applicable
24. Oil and Gas Assets
□Applicable ? Not applicable
25. Right-of-use Assets
Unit: RMB
Item | Houses and buildings | Land use right | Total |
I. Original carrying value | |||
1. Beginning balance | 17,864,418.29 | 25,688,364.03 | 43,552,782.32 |
2. Increased amount of the period | 1,426,984.46 | 1,426,984.46 | |
(1) Leased in | 1,426,984.46 | 1,426,984.46 | |
3. Decreased amount of the period | 255,370.07 | 255,370.07 | |
(1)Disposal | 255,370.07 | 255,370.07 | |
4. Ending balance | 19,036,032.68 | 25,688,364.03 | 44,724,396.71 |
II. Accumulated amortization | |||
1. Beginning balance | 5,377,288.39 | 24,049,287.85 | 29,426,576.24 |
2. Increased amount of the period | 3,701,364.73 | 612,660.58 | 4,314,025.31 |
(1) Withdrawal | 3,701,364.73 | 612,660.58 | 4,314,025.31 |
3. Decreased amount of the period | 379,712.89 | 379,712.89 | |
(1) Disposal | 379,712.89 | 379,712.89 | |
4. Ending balance | 8,698,940.23 | 24,661,948.43 | 33,360,888.66 |
III. Depreciation reserves | |||
1. Beginning balance | |||
2. Increased amount of the period | |||
(1) Withdrawal | |||
3. Decreased amount of the period | |||
(1) Disposal | |||
4. Ending balance | |||
IV. Carrying value | |||
1. Ending carrying value | 10,337,092.45 | 1,026,415.60 | 11,363,508.05 |
2. Beginning carrying value | 12,487,129.90 | 1,639,076.18 | 14,126,206.08 |
26. Intangible Assets
(1) List of Intangible Assets
Unit: RMB
Item | Land use right | Patent | Non-patent technology | Software use right | Others | Total |
I. Original carrying value | ||||||
1. Beginning balance | 449,104,554.53 | 19,301,370.39 | 29,895,792.52 | 24,344,062.26 | 522,645,779.70 | |
2. Increased amount of the period | 1,687,660.31 | 1,687,660.31 | ||||
(1) Purchase | 1,687,660.31 | 1,687,660.31 | ||||
(2) Internal R&D | ||||||
(3) Business combination increase | ||||||
3. Decreased amount of the period | 1,141,509.42 | 5,421.50 | 1,146,930.92 | |||
(1) Disposal | 1,141,509.42 | 5,421.50 | 1,146,930.92 |
4. Ending balance | 449,104,554.53 | 18,159,860.97 | 31,578,031.33 | 24,344,062.26 | 523,186,509.09 | |
II. Accumulated amortization | ||||||
1. Beginning balance | 96,525,621.78 | 18,579,985.33 | 13,864,588.55 | 24,332,807.83 | 153,303,003.49 | |
2. Increased amount of the period | 4,633,012.89 | 222,875.07 | 1,284,927.22 | 6,138.70 | 6,146,953.88 | |
(1) Withdrawal | 4,633,012.89 | 222,875.07 | 1,284,927.22 | 6,138.70 | 6,146,953.88 | |
3. Decreased amount of the period | 929,952.53 | 929,952.53 | ||||
(1) Disposal | 929,952.53 | 929,952.53 | ||||
4. Ending balance | 101,158,634.67 | 17,872,907.87 | 15,149,515.77 | 24,338,946.53 | 158,520,004.84 | |
III. Depreciation reserves | ||||||
1. Beginning balance | 388,613.87 | 388,613.87 | ||||
2. Increased amount of the period | ||||||
(1) Withdrawal | ||||||
3. Decreased amount of the period | ||||||
(1) Disposal | ||||||
4. Ending balance | 388,613.87 | 388,613.87 | ||||
IV. Carrying value | ||||||
1. Ending carrying value | 347,945,919.86 | 286,953.10 | 16,039,901.69 | 5,115.73 | 364,277,890.38 | |
2. Beginning carrying value | 352,578,932.75 | 721,385.06 | 15,642,590.10 | 11,254.43 | 368,954,162.34 |
The proportion of intangible assets formed from the internal R&D of the Company at the period-end to the ending balance ofintangible assets was 0%.
(2) Land Use Right with Certificate of Title Uncompleted
Naught
27. Development Costs
Naught
28. Goodwill
(1) Original Carrying Value of Goodwill
Unit: RMB
Name of the invested units or events generating goodwill | Beginning balance | Increase | Decrease | Ending balance | ||
Formed by business combination | Disposal | |||||
Nanning Liaowang Auto Lamp Co., Ltd. | 16,211,469.82 | 16,211,469.82 | ||||
Foshan NationStar Optoelectronics Co., Ltd. | 405,620,123.64 | 405,620,123.64 | ||||
Total | 421,831,593.46 | 421,831,593.46 |
(2) Depreciation Reserves of Goodwill
NaughtOther notes:
In 2014, Guangdong Electronics Information Industry Group Ltd., a wholly-owned subsidiary of GuangdongRising Holdings Group Co., Ltd., acquired NationStar. The difference between the fair value and NationStar’sequity attributable to its shareholders on the date of acquisition resulted in a goodwill of RMB405,620,123.64.
29. Long-term Prepaid Expense
Unit: RMB
Item | Beginning balance | Increased amount | Amortization amount of the period | Other decreased amount | Ending balance |
Expense on maintenance and decoration | 53,715,154.13 | 3,937,631.77 | 8,835,275.10 | 48,817,510.80 | |
Mould | 85,904,279.61 | 92,939,851.70 | 55,913,148.49 | 7,976,283.18 | 114,954,699.64 |
Boarding box | 2,991,248.46 | 1,769,090.34 | 1,222,158.12 | ||
Other | 10,115,830.36 | 3,197,070.34 | 3,472,785.53 | 9,840,115.17 | |
Total | 152,726,512.56 | 100,074,553.81 | 69,990,299.46 | 7,976,283.18 | 174,834,483.73 |
30. Deferred Income Tax Assets/Deferred Income Tax Liabilities
(1) Deferred Income Tax Assets that Had not Been Off-set
Unit: RMB
Item | Ending balance | Beginning balance | ||
Deductible temporary difference | Deferred income tax assets | Deductible temporary difference | Deferred income tax assets | |
Provision for impairment of assets | 343,849,141.56 | 52,131,048.21 | 336,887,150.45 | 51,499,888.34 |
Unrealized profit of internal transactions | 15,842,184.29 | 2,376,327.64 | 21,677,239.37 | 3,251,585.91 |
Deductible loss | 32,499,529.28 | 6,913,494.03 | 36,016,962.39 | 7,312,677.73 |
Depreciation of fixed assets | 59,870,010.69 | 8,980,501.62 | 63,273,361.51 | 9,491,004.25 |
Payroll payable | 36,470,119.42 | 5,470,517.91 | 51,262,888.11 | 7,689,433.22 |
Change in fair value of trading financial liabilities | 6,698,629.55 | 1,004,794.43 | 154,129.55 | 23,119.43 |
Accrued liabilities | 17,418,343.01 | 2,612,751.45 | 17,418,343.01 | 2,612,751.45 |
Others | 1,262,443.60 | 466,005.70 | 1,625,953.13 | 364,138.46 |
Lease liabilities | 114,035.93 | 17,189.79 | 114,035.93 | 17,189.79 |
Total | 514,024,437.33 | 79,972,630.78 | 528,430,063.45 | 82,261,788.58 |
(2) Deferred Income Tax Liabilities Had not Been Off-set
Unit: RMB
Item | Ending balance | Beginning balance | ||
Taxable temporary difference | Deferred income tax liabilities | Taxable temporary difference | Deferred income tax liabilities | |
Assets assessment appreciation from business consolidation not under the same control | 91,030,799.80 | 13,654,619.97 | 93,485,366.87 | 14,022,805.03 |
Changes in fair value of other investments in equity instruments | 881,335,527.03 | 132,200,329.05 | 1,152,615,606.86 | 172,892,341.03 |
Changes in fair value of trading financial assets | 816,070.56 | 178,835.44 | 4,912,265.32 | 776,194.13 |
One-off depreciation of fixed assets | 712,642,232.89 | 106,896,334.93 | 616,542,996.01 | 92,481,449.40 |
Total | 1,685,824,630.28 | 252,930,119.39 | 1,867,556,235.06 | 280,172,789.59 |
(3) Deferred Income Tax Assets or Liabilities Listed by Net Amount after Off-set
Unit: RMB
Item | Mutual set-off amount of deferred income tax assets and liabilities at the period-end | Amount of deferred income tax assets or liabilities after off-set at the period-end | Mutual set-off amount of deferred income tax assets and liabilities at the period-begin | Amount of deferred income tax assets or liabilities after off-set at the period-begin |
Deferred income tax assets | 79,972,630.78 | 82,261,788.58 | ||
Deferred income tax liabilities | 252,930,119.39 | 280,172,789.59 |
(4) List of Unrecognized Deferred Income Tax Assets
Naught
(5) Deductible Losses of Unrecognized Deferred Income Tax Assets will Due in the Following YearsNaught
31. Other Non-current Assets
Unit: RMB
Item | Ending balance | Beginning balance | ||||
Carrying amount | Depreciation reserve | Carrying value | Carrying amount | Depreciation reserve | Carrying value | |
Prepayments for equity acquisition (note) | 10,000,000.00 | 10,000,000.00 | 465,129,434.98 | 10,000,000.00 | 455,129,434.98 | |
Prepayments for construction and equipment | 49,249,379.04 | 49,249,379.04 | 43,316,448.13 | 43,316,448.13 | ||
Assets of subsidiaries to be cleared and cancelled | 743,297.93 | 743,297.93 | 903,887.30 | 903,887.30 | ||
Total | 59,992,676.97 | 10,000,000.00 | 49,992,676.97 | 509,349,770.41 | 10,000,000.00 | 499,349,770.41 |
Other notes:
Notes:
1. The other non-current assets of RMB455 million at the beginning of the period was the advance payment for the equity acquisition(such payment accounted for 30% of the total price of the equity acquisition) paid by NationStar Optoelectronics to the originalshareholders of NationStar Optoelectronics, in accordance with the Share Transfer Agreement. The merger under the same controlfor the current period has been completed.
2. The Company's subsidiary, NationStar Optoelectronics, entered into the Capital Injection Agreement with Nanyang XichengTechnology Co., Ltd. (Xicheng Tech). The Company paid RMB10 million for capital injection. Later, the agreement was re-signed tochange the investment method. In order to address issues related to the above payment, NationStar Optoelectronics filed a lawsuitwith the court, claiming the return of the above payment for capital injection. Currently, the court has rejected the claim. As of theend of the Reporting Period, the impairment provision had been set aside in full.
32. Short-term Borrowings
(1) Category of Short-term Borrowings
Unit: RMB
Item | Ending balance | Beginning balance |
Mortgage loans | 65,000,000.00 | |
Guarantee loans | 97,700,000.00 | |
Credit loans | 128,914,000.00 | |
Interest from short-term borrowings | 115,000.00 | 165,997.01 |
Total | 65,115,000.00 | 226,779,997.01 |
Notes of short-term borrowings category:
List of short-term borrowings as of 30 June 2022 was as follows:
Unit: RMB
Borrowing contract number | Loan balance | Term of borrowing | Conditions of loan | Annual interest rate (%) |
XY WYZH2022050700423 | 15,000,000.00 | 2022-5-7 to 2023-5-7 | Mortgage | 2.97 |
XY WYZH2022021100248 | 30,200,000.00 | 2022-2-11 to 2023-2-11 | Mortgage | 2.76 |
XY WYZH2022021100314 | 19,800,000.00 | 2022-2-11 to 2023-2-11 | Mortgage | 2.76 |
Total | 65,000,000.00 | —— | —— | —— |
Note: see Note XIV-3. Others in Part X for details about guarantees of short-term borrowings.
(2) List of the Short-term Borrowings Overdue but not Returned
Naught
33. Held-for-trading Financial Liabilities
Unit: RMB
Item | Ending balance | Beginning balance |
Including: | ||
Financial liabilities designated to be measured at fair value through profit or loss | 6,544,500.00 | 9,367.37 |
Including: | ||
Other | 6,544,500.00 | 9,367.37 |
Total | 6,544,500.00 | 9,367.37 |
34. Derivative Financial Liabilities
Naught
35. Notes Payable
Unit: RMB
Item | Ending balance | Beginning balance |
Bank acceptance bill | 1,607,406,305.48 | 2,067,111,789.71 |
Total | 1,607,406,305.48 | 2,067,111,789.71 |
The total amount of the due but not paid notes payable at the end of the period was of RMB0.00.
36. Accounts Payable
(1) List of Accounts Payable
Unit: RMB
Item | Ending balance | Beginning balance |
Accounts payable | 2,228,681,333.31 | 2,429,896,658.92 |
Total | 2,228,681,333.31 | 2,429,896,658.92 |
(2) Significant Accounts Payable Aging over One Year
Unit: RMB
Item | Ending balance | Unpaid/ Un-carry-over reason |
Supplier A | 32,217,532.68 | No settlement yet for quality dispute |
Supplier B | 11,091,509.09 | No settlement yet for quality dispute |
Supplier C | 2,568,149.78 | No settlement yet for quality dispute |
Supplier D | 2,525,721.16 | No settlement yet for quality dispute |
Supplier E | 2,110,178.88 | No settlement yet for quality dispute |
Supplier F | 1,257,661.77 | No settlement yet for quality dispute |
Total | 51,770,753.36 |
37. Advances from Customer
(1) List of Advances from Customers
Unit: RMB
Item | Ending balance | Beginning balance |
Advances from customers | 4,959,545.56 | 8,106,923.79 |
Total | 4,959,545.56 | 8,106,923.79 |
(2) Significant Advances from Customers Aging over One Year
Naught
38. Contract Liabilities
Unit: RMB
Item | Ending balance | Beginning balance |
Contract liabilities | 161,528,315.35 | 140,228,127.84 |
Total | 161,528,315.35 | 140,228,127.84 |
Significant changes in amount of carrying value and the reason in the Reporting PeriodNaught
39. Employee Benefits Payable
(1) List of Employee Benefits Payable
Unit: RMB
Item | Beginning balance | Increase | Decrease | Ending balance |
I. Short-term salary | 167,333,777.54 | 640,377,296.30 | 667,411,966.26 | 140,299,107.58 |
II. Post-employment benefit-defined contribution plans | 450,312.10 | 50,630,612.22 | 50,391,435.31 | 689,489.01 |
III. Termination benefits | 34,907.78 | 34,907.78 | ||
Total | 167,784,089.64 | 691,042,816.30 | 717,838,309.35 | 140,988,596.59 |
(2) List of Short-term Salary
Unit: RMB
Item | Beginning balance | Increase | Decrease | Ending balance |
1. Salary, bonus, allowance, subsidy | 164,406,249.14 | 563,033,208.86 | 589,519,439.23 | 137,920,018.77 |
2. Employee welfare | 793,469.95 | 31,796,269.92 | 31,922,739.41 | 667,000.46 |
3. Social insurance | 477,866.35 | 25,494,234.34 | 25,735,883.50 | 236,217.19 |
Of which: Medical insurance premiums | 405,051.37 | 24,376,859.15 | 24,626,222.78 | 155,687.74 |
Work-related injury insurance | 68,516.97 | 1,074,573.06 | 1,066,858.59 | 76,231.44 |
Maternity insurance | 4,298.01 | 42,802.13 | 42,802.13 | 4,298.01 |
4. Housing fund | 162,954.71 | 14,238,109.71 | 14,130,367.52 | 270,696.90 |
5. Labor union budget | 1,493,237.39 | 5,815,473.47 | 6,103,536.60 | 1,205,174.26 |
and employee education budget | ||||
Total | 167,333,777.54 | 640,377,296.30 | 667,411,966.26 | 140,299,107.58 |
(3) List of Defined Contribution Plans
Unit: RMB
Item | Beginning balance | Increase | Decrease | Ending balance |
1. Basic pension benefits | 435,529.62 | 48,061,567.85 | 47,833,007.93 | 664,089.54 |
2. Unemployment insurance | 14,782.48 | 739,364.37 | 728,747.38 | 25,399.47 |
3. Annuity | 1,829,680.00 | 1,829,680.00 | ||
Total | 450,312.10 | 50,630,612.22 | 50,391,435.31 | 689,489.01 |
Other notes:
The Company participates in the scheme of pension insurance and unemployment insurance established by government agencies asrequired. According to the scheme, fees are paid to it on a monthly basis and at the rate of stipulated by government agencies. Inaddition to the above monthly deposit fees, the Company no longer assumes further payment obligations. Corresponding expensesare recorded into the current profits or losses or the cost of related assets when incurred.
(4) Termination Benefits
Unit: RMB
Item | Beginning balance | Increase | Decrease | Ending balance |
1. Compensation for termination of labor relations | 34,907.78 | 34,907.78 | ||
2. Estimated internal staff expenditure | ||||
Total | 34,907.78 | 34,907.78 |
40. Taxes Payable
Unit: RMB
Item | Ending balance | Beginning balance |
VAT | 43,758,037.53 | 18,987,452.44 |
Corporate income tax | 19,928,441.78 | 55,204,098.83 |
Personal income tax | 982,742.53 | 3,520,595.97 |
Urban maintenance and construction tax | 3,373,803.44 | 2,527,033.79 |
VAT of land | 6,392,510.40 | |
Education surcharge | 2,358,869.88 | 1,870,243.81 |
Property tax | 3,891,553.04 | 829,364.85 |
Land use tax | 2,379,358.66 | 545,215.31 |
Other | 702,115.71 | 1,104,959.20 |
Total | 77,374,922.57 | 90,981,474.60 |
41. Other Payables
Unit: RMB
Item | Ending balance | Beginning balance |
Dividends payable | 15,646.07 | 15,646.07 |
Other payables | 297,813,287.26 | 333,113,125.74 |
Total | 297,828,933.33 | 333,128,771.81 |
(1) Interest Payable
Naught
(2) Dividends Payable
Unit: RMB
Item | Ending balance | Beginning balance |
Ordinary share dividends | 15,646.07 | 15,646.07 |
Total | 15,646.07 | 15,646.07 |
(3) Other Payables
1) Other Payables Listed by Nature
Unit: RMB
Item | Ending balance | Beginning balance |
Payments for demolition | 37,232,380.44 | 54,990,047.00 |
Performance bond | 67,505,949.95 | 56,777,893.86 |
Relevant expense of sales | 13,665,427.58 | 11,266,922.58 |
Account current | 9,773,968.09 | 186,628,343.72 |
Other | 169,635,561.20 | 23,449,918.58 |
Total | 297,813,287.26 | 333,113,125.74 |
2) Significant Other Payables Aging over One Year
Unit: RMB
Item | Ending balance | Reason for not repayment or carry-over |
Unit A | 5,752,000.00 | Unsettled for involving in lawsuits |
Unit B | 120,352,181.20 | Unsettled |
Total | 126,104,181.20 |
42. Liabilities Held for sale
Naught
43. Current Portion of Non-current Liabilities
Unit: RMB
Item | Ending balance | Beginning balance |
Current portion of long-term borrowings (note) | 20,122,394.84 | 19,423,561.38 |
Current portion of lease liabilities | 10,261,123.91 | 8,176,624.77 |
Total | 30,383,518.75 | 27,600,186.15 |
44. Other Current Liabilities
Unit: RMB
Item | Ending balance | Beginning balance |
Pending changerover output VAT | 9,952,101.27 | 10,577,082.29 |
Total | 9,952,101.27 | 10,577,082.29 |
45. Long-term Borrowings
(1) Category of Long-term Borrowings
Unit: RMB
Item | Ending balance | Beginning balance |
Credit borrowings | 555,550,952.38 | |
Interest of long-term borrowings | 1,039,515.37 | |
Total | 556,590,467.75 |
Notes:
List of long-term borrowings as of 30 June 2022:
Unit: RMB
Borrowing contract number | Loan balance | Term of borrowing | Conditions of loan | Annual interest rate |
China Development Bank 4410202101100001613 | US$40,000,000.00 | 2022.01.06 to 2025.01.06 | Credit loans | 3.2689% |
China Development Bank 4410202101100001613 | US$10,000,000.00 | 2022.02.22 to 2025.01.06 | Credit loans | 3.2689% |
Project Loan of China Development Bank 4410202201100001709 | 20,000,000.00 | 2022.06.29 to 2023.12.10 | Credit loans | 2.80% |
Project Loan of China Development Bank 4410202201100001709 | 20,000,000.00 | 2022.06.29 to 2024.06.10 | Credit loans | 2.80% |
Project Loan of China Development Bank 4410202201100001709 | 20,000,000.00 | 2022.06.29 to 2024.12.10 | Credit loans | 2.80% |
Project Loan of China Development Bank 4410202201100001709 | 20,000,000.00 | 2022.06.29 to 2025.06.10 | Credit loans | 2.80% |
Project Loan of China Development Bank 4410202201100001709 | 20,000,000.00 | 2022.06.29 to 2025.12.10 | Credit loans | 2.80% |
Project Loan of China Development Bank 4410202201100001709 | 20,000,000.00 | 2022.06.29 to 2026.06.10 | Credit loans | 2.80% |
Project Loan of China Development Bank 4410202201100001709 | 20,000,000.00 | 2022.06.29 to 2026.12.10 | Credit loans | 2.80% |
Project Loan of China Development Bank 4410202201100001709 | 30,000,000.00 | 2022.06.29 to 2027.06.29 | Credit loans | 2.80% |
Project Loan of China Development Bank 4410202201100001708 | 119,047.62 | 2022.05.30 to 2023.12.10 | Credit loans | 3.40% |
Project Loan of China Development Bank 4410202201100001708 | 119,047.62 | 2022.05.30 to 2024.06.10 | Credit loans | 3.40% |
Project Loan of China Development Bank 4410202201100001708 | 119,047.62 | 2022.05.30 to 2024.12.10 | Credit loans | 3.40% |
Project Loan of China Development Bank 4410202201100001708 | 8,333,333.33 | 2022.05.30 to 2025.06.10 | Credit loans | 3.40% |
Project Loan of China Development Bank 4410202201100001708 | 8,333,333.33 | 2022.05.30 to 2025.12.10 | Credit loans | 3.40% |
Project Loan of China Development Bank 4410202201100001708 | 8,333,333.33 | 2022.05.30 to 2026.06.10 | Credit loans | 3.40% |
Project Loan of China Development Bank 4410202201100001708 | 8,333,333.33 | 2022.05.30 to 2026.12.10 | Credit loans | 3.40% |
Project Loan of China Development Bank 4410202201100001708 | 16,190,476.20 | 2022.05.30 to 2027.05.30 | Credit loans | 3.40% |
Construction Project Loan of Guangzhou Branch of Minsheng Bank GGDZ No. ZH2200000071614 | 5,000.00 | 2022.06.28 to 2024.11.27 | Credit loans | 3.70% |
Construction Project Loan of Guangzhou Branch of Minsheng Bank GGDZ No. ZH2200000071614 | 5,000.00 | 2022.06.28 to 2025.05.27 | Credit loans | 3.70% |
Construction Project Loan of Guangzhou Branch of Minsheng Bank GGDZ No. ZH2200000071614 | 10,000.00 | 2022.06.28 to 2025.11.27 | Credit loans | 3.70% |
Construction Project Loan of Guangzhou Branch of Minsheng Bank GGDZ No. ZH2200000071614 | 10,000.00 | 2022.06.28 to 2026.05.27 | Credit loans | 3.70% |
Construction Project Loan of Guangzhou Branch of Minsheng Bank GGDZ No. ZH2200000071614 | 10,000.00 | 2022.06.28 to 2026.11.27 | Credit loans | 3.70% |
Construction Project Loan of Guangzhou Branch of Minsheng Bank GGDZ No. ZH2200000071614 | 10,000.00 | 2022.06.28 to 2027.05.27 | Credit loans | 3.70% |
Construction Project Loan of Guangzhou Branch of Minsheng Bank GGDZ No. ZH2200000071614 | 10,000.00 | 2022.06.28 to 2027.11.27 | Credit loans | 3.70% |
Construction Project Loan of Guangzhou Branch of Minsheng Bank GGDZ No. ZH2200000071614 | 10,000.00 | 2022.06.28 to 2028.05.27 | Credit loans | 3.70% |
Construction Project Loan of Guangzhou Branch of Minsheng Bank GGDZ No. ZH2200000071614 | 10,000.00 | 2022.06.28 to 2028.11.27 | Credit loans | 3.70% |
Construction Project Loan of Guangzhou Branch of Minsheng Bank GGDZ No. ZH2200000071614 | 10,000.00 | 2022.06.28 to 2029.05.27 | Credit loans | 3.70% |
Construction Project Loan of Guangzhou Branch of Minsheng Bank GGDZ No. ZH2200000071614 | 5,000.00 | 2022.06.28 to 2029.11.27 | Credit loans | 3.70% |
Construction Project Loan of Guangzhou Branch of Minsheng Bank GGDZ No. ZH2200000071614 | 5,000.00 | 2022.06.28 to 2030.05.27 | Credit loans | 3.70% |
Total | US$50,000,000.00 | |||
219,980,952.38 |
46. Bonds Payable
(1) List of Bonds Payable
Naught
(2) Increase/Decrease of Bonds Payable (Excluding Other Financial Instrument Classified as FinancialLiabilities such as Preferred Shares and Perpetual Bonds)Naught
(3) Notes to the Conditions and Time of the Shares Transfer of the Convertible Corporate BondsNaught
(4) Notes to Other Financial Instruments Classified as Financial Liabilities
Naught
47. Lease Liabilities
Unit: RMB
Item | Ending balance | Beginning balance |
Lease liabilities | 11,403,854.44 | 15,921,272.74 |
Less: current portion of lease liabilities | -4,116,411.77 | -7,855,712.16 |
Total | 7,287,442.67 | 8,065,560.58 |
Analysis on maturity date of lease liabilities
Unit: RMB
Item | Ending balance | Beginning balance |
1 to 2 years | 2,902,042.05 | 2,983,039.14 |
3 to 5 years | 4,385,400.62 | 4,095,243.05 |
Over 5 years | - | 987,278.39 |
Total | 7,287,442.67 | 8,065,560.58 |
48. Long-term Payables
Unit: RMB
Item | Ending balance | Beginning balance |
Long-term payables | 0.00 | 0.00 |
(1) Long-term Payables Listed by Nature
Unit: RMB
Item | Ending balance | Beginning balance |
Principal and interest of financing lease borrowings (note) | 6,341,995.19 | 19,423,561.38 |
Less: Current portion of long-term payables | 6,341,995.19 | 19,423,561.38 |
Total | 0.00 | 0.00 |
Other notes:
Note: The ending balance is generated from the financial leasing business of Nanning Liaowang.
(2) Specific Payables
Naught
49. Long-term Employee Benefits Payable
(1) List of Long-term Payroll Payable
Naught
(2) Changes in Defined Benefit Plans
Naught
50. Provisions
Unit: RMB
Item | Ending balance | Beginning balance | Reason for formation |
Product quality assurance | 18,378,155.88 | 17,418,343.01 | Withdrawal of customers’ claims for quality and product quality assurance expenses |
Total | 18,378,155.88 | 17,418,343.01 |
51. Deferred Income
Unit: RMB
Item | Beginning balance | Increase | Decrease | Ending balance | Reason for formation |
Government grants | 116,761,570.35 | 13,164,706.27 | 21,703,013.47 | 108,223,263.15 | |
Total | 116,761,570.35 | 13,164,706.27 | 21,703,013.47 | 108,223,263.15 |
Item involving government grants:
Unit: RMB
Item | Beginning balance | Amount of newly subsidy | Amount recorded into non-operating income in the Reporting Period | Amount recorded into other income in the Reporting Period | Amount offset cost in the Reporting Period | Other changes | Ending balance | Related to assets/related to income |
The Project of the Innovation in Packaging Technology and Technological Transformation of Key Packaging Equipment of LEDs with High Color Rendering Index for Illumination | 4,590,348.80 | 328,521.60 | 4,261,827.20 | Related to assets | ||||
The Project of the Innovation in Packaging Technology and Technological Transformation of Key | 2,340,610.65 | 269,756.22 | 2,070,854.43 | Related to assets |
Packaging Equipment of LEDs with Small Spacing for Display | ||||||||
The Project of the Innovation in Packaging Technology and Technological Transformation of Key Packaging Equipment of LEDs with Small Spacing for Display (Phase II) | 3,959,107.65 | 240,686.70 | 3,718,420.95 | Related to assets | ||||
The Industrialization and Application of High-power LEDs | 2,299.50 | 1,971.00 | 328.50 | Related to assets | ||||
The Key Technology in the Industrialization of LED Indoor Lighting Sources with High Reliability and Directional | 30,448.12 | 7,314.36 | 23,133.76 | Related to assets |
ity | ||||||||
The Light-converting Films and Components of Highly Efficient White-light LEDs | 1,322,376.26 | 294,038.46 | 1,028,337.80 | Related to assets | ||||
The Structural Design of Epitaxial Wafers and Chips of Highly Efficient LEDs and the R&D of Key Technology in Industrialization | 774,741.64 | 164,174.16 | 610,567.48 | Related to assets | ||||
The Research and Implementation of Standard Optical Components of LEDs for Illumination | 97,557.92 | 18,744.12 | 78,813.80 | Related to assets | ||||
The Industrialization of LED Flip-chips and Light Source | 475,956.81 | 54,586.51 | 421,370.30 | Related to assets |
Modules for the Backlight of Large-size LCDs | ||||||||
The Central R&D Institute of NationStar Optoelectronics | 48,196.60 | 4,709.40 | 43,487.20 | Related to assets | ||||
The R&D and Industrialization of the Optical Components of LEDs with Integrated Circuits (ICs) | 37,559.42 | 37,559.42 | Related to income | |||||
The Research and Industrialization of LED Flip-chips with Combined Electrodes and Chip Scale Package (CSP) with Thin Film Substrates | 52,662.57 | 4,034.71 | 48,627.86 | Related to assets | ||||
The Research and Industrialization of | 294,305.00 | 27,331.38 | 266,973.62 | Related to assets |
Near Ultraviolet LED Flip-chips with High Density and Power and Their Packaging | ||||||||
The Research and Industrialization of the Fluorescent Coating Process of High-quality LEDs and the Key Packaging Technology of Highly Efficient White-light LEDs | 131,956.70 | 9,299.22 | 122,657.48 | Related to assets | ||||
The Projects of the Production Expansion and Technological Transformation of Components of Small-spacing and Outdoor LED Displays | 22,197,600.80 | 2,032,275.84 | 20,165,324.96 | Related to assets |
The Key Packaging Technology and Industrialization of LED Chips | 13,476.00 | 3,978.60 | 9,497.40 | Related to assets | ||||
The R&D of Chip-on-Board (COB) Integrated Packaging and Systems of LED Displays with High Density and Small Spacing | 84,920.52 | 1,100,000.00 | 1,106,061.68 | 78,858.84 | Related to assets/income |
TheResearchon the KeyTechnologyin thePackagingandApplicationofFull-spectrumWhite-lightLEDs andLEDs forWide ColorGamutBacklight
36,008.52 | 2,512.62 | 33,495.90 | Related to assets | |||||
The Research and Application of Epitaxial Wafers, | 603,919.62 | 363,472.59 | 240,447.03 | Related to income |
Chips, and Packaging of Near Ultraviolet Silica-based AlGaN Vertical LEDs with High Power | ||||||||
The Technology Research on Color Micro-LED Displays and Ultra-high Brightness Micro Displays | 116,348.91 | 36,348.91 | 80,000.00 | Related to income | ||||
The Research and Industrialization of New and High-performance Display Components | 1,537,498.09 | 769,003.78 | 768,494.31 | Related to income | ||||
The Research on the Key Technology of High-lumen Compound Reflex LED Chips for Automobil | 367,534.48 | 1,800,000.00 | 1,029,372.73 | 1,138,161.75 | Related to income |
es and High-density Matrix Packaging | ||||||||
The Technology Research and Industrialization of the Micro Display Module Based on Highly Efficient Color Conversion | 43,754.74 | 340,000.00 | 108,309.97 | 275,444.77 | Related to income | |||
New Ceramic Substrates for the Packaging with Inorganic Materials of Power Electronics | 192,775.80 | 10,836.30 | 181,939.50 | Related to assets | ||||
The Research on the Key Technology and Innovative Application of Deep Ultraviolet Solid-state Light Sources | 1,067,475.44 | 253,944.76 | 813,530.68 | Related to income | ||||
The Key Labs of Semiconductor Micro | 1,216,601.56 | 489,875.68 | 726,725.88 | Related to income |
Display Enterprises in Guangdong Province (for 2020) | ||||||||
The R&D and Industrialization of Quantum Dot Light-emitting Materials and Components with Low Environmental Pollution | 355,431.48 | 87,141.04 | 268,290.44 | Related to income | ||||
The Demonstration of Industrial Internet of Things (IIOT) Applications for LED Production Control | 957,037.07 | 374,369.85 | 582,667.22 | Related to assets/income | ||||
The Guangdong-Hong Kong-Macao Joint Lab of Intelligent Micro-nano Photoelectric Technology | 873,271.85 | 348,873.55 | 524,398.30 | Related to income | ||||
Others | 6,867,900.00 | 500,000.00 | 268,537.64 | 7,099,362.36 | Related to assets |
The Subsidy for Metal-organic Chemical Vapor Deposition (MOCVD) | 42,090,261.19 | 9,999,999.60 | 32,090,261.59 | Related to assets | ||||
The Project of Resource Conservation and Environmental Protection | 6,059,215.88 | 904,683.72 | 5,154,532.16 | Related to assets | ||||
The Technology R&D Center of Epitaxial Wafers and Chips of LEDs | 66,000.28 | 10,999.98 | 55,000.30 | Related to assets | ||||
The Research and Industrialization of LED Chips for Displays with Micro Spacing and Key Packaging Technology | 75,000.00 | 7,500.00 | 67,500.00 | Related to assets | ||||
The Key Technology R&D of New High-voltage High-speed | 67,666.64 | 6,000.00 | 61,666.64 | Related to assets |
LEDs for the Conductivity and Illumination of Optical Communication Devices | ||||||||
The R&D Project of Wafer-level Growth of GaN Nanowire Arrays and Ultraviolet Detector Chips | 662,368.68 | 310,611.41 | 351,757.27 | Related to income | ||||
The Research on the Key Technology of Full-color Micro-LED Displays with High Brightness and Contrast | 2,096,708.45 | 502,006.27 | 402,926.54 | 2,195,788.18 | Related to income | |||
The Visible Light Communication and Positioning System for the Industrial Internet of Things (IIOT) | 540,000.00 | 21,175.39 | 518,824.61 | Related to income | ||||
The Project | 6,822,700.00 | 190,473.97 | 6,632,226.03 | Related to assets |
of the Innovation in Packaging Technology and Technological Transformation of Key Packaging Equipment of LEDs with High Color Rendering Index for Illumination (Phase II) | ||||||||
The Research on the Key Technology of 4K/8K Full-color Micro-LED Displays with Ultra-High Definition (UHD) | 2,100,000.00 | 2,100,000.00 | Related to income | |||||
The First Batch of Special Funds for the Industrial and Information Development for the Guangxi Zhuang | 2,166,666.85 | 199,999.98 | 1,966,666.87 | Related to assets |
Autonomous Region for 2017 (technical transformation) for Liuzhou Guige Photoelectric Technology Co., Ltd. (Liuzhou Guige) | ||||||||
The Innovation Fund for Enterprises in Liudong New Area for 2017 for Liuzhou Guige | 900,000.00 | 75,000.00 | 825,000.00 | Related to assets | ||||
The Project of the First Batch of Support Funds for Enterprises in Liuzhou City for 2017 for Liuzhou Guige | 1,800,000.00 | 150,000.00 | 1,650,000.00 | Related to assets | ||||
The Project of the First Batch of Support Funds for Enterprises in Liuzhou City for 2018 for Liuzhou | 405,999.89 | 28,000.02 | 377,999.87 | Related to assets |
Guige | ||||||||
The Project of Support Funds for Enterprises in Liuzhou City for 2020 for Liuzhou Guige | 916,666.65 | 100,000.02 | 816,666.63 | Related to assets | ||||
The Project of the Third Batch of Special Funds of Innovation-driven Development for the Guangxi Zhuang Autonomous Region for 2018 for Liuzhou Guige | 712,000.00 | 48,000.00 | 664,000.00 | Related to assets | ||||
The Project of Financial Support for Developing Liuzhou City into an Industrial Internet of Things (IIOT) Demonstration City for 2021 for Liuzhou Guige | 737,333.32 | 79,000.02 | 658,333.30 | Related to assets | ||||
The Second | 1,966,666.66 | 100,000.02 | 1,866,666.64 | Related to assets |
Batch of Support Funds for the "Technological Transformation of Thousands of Enterprises" in the Guangxi Zhuang Autonomous Region for 2021 | ||||||||
Funding for innovative projects | 352,000.00 | 24,000.00 | 328,000.00 | Related to income | ||||
The Special Fund of the Science and Technology Department of the Guangxi Zhuang Autonomous Region for Innovation-driven Development for 2020 | 108,000.00 | 6,000.00 | 102,000.00 | Related to income | ||||
The Fund for the Project of the Management Committee of the | 576,000.04 | 31,999.98 | 544,000.06 | Related to income |
Liuzhou High-tech Industrial Development Zone | ||||||||
The Fund for the Intelligent Transformation and Upgrading Projects of Automobile Enterprises for 2021 | 623,333.30 | 34,000.02 | 589,333.28 | Related to income | ||||
The Second Batch of Special Funds for the Industrial and Information Development of the City for 2019 | 2,100,000.00 | 150,000.00 | 1,950,000.00 | Related to assets | ||||
The 14th Batch of Industrial Support Funds for 2019 | 1,050,000.00 | 75,000.00 | 975,000.00 | Related to assets | ||||
Total | 116,761,570.35 | 13,164,706.27 | 0.00 | 21,703,013.47 | 0.00 | 0.00 | 108,223,263.15 |
52. Other Non-current Liabilities
Unit: RMB
Item | Ending balance | Beginning balance |
Liabilities of subsidiaries to be cleared and cancelled | 11,334.19 | 22,653.46 |
Total | 11,334.19 | 22,653.46 |
53. Share Capital
Unit: RMB
Beginning balance | Increase/decrease (+/-) | Ending balance | |||||
New shares issued | Bonus shares | Bonus issue from profit | Other (note) | Subtotal | |||
The sum of shares | 1,399,346,154.00 | -37,351,507.00 | -37,351,507.00 | 1,361,994,647.00 |
Other notes:
Item/Investor | Beginning balance | Increase | Decrease | Ending balance | ||
Invested amount | Proportion | Invested amount | Proportion | |||
Restricted shares | 13,169,196.00 | 0.94% | 2,403,332.00 | 10,765,864.00 | 0.79% | |
Unrestricted shares | 1,386,176,958.00 | 99.06% | 34,948,175.00 | 1,351,228,783.00 | 99.21% | |
Total | 1,399,346,154.00 | 100.00% | 37,351,507.00 | 1,361,994,647.00 | 100.00% |
Note: Other decrease in share capital was due to deregistration of treasury shares. For details, please refer to PartVI-XIII. Other Significant Events-Cancellation of Shares of this Report.
54. Other Equity Instruments
(1) The Basic Information of Other Financial Instruments such as Preferred Stock and Perpetual BondOutstanding at the End of the PeriodNaught
(2) Changes in Financial Instruments such as Preferred Stock and Perpetual Bond Outstanding at the Endof the PeriodNaught
55. Capital Reserves
Unit: RMB
Item | Beginning balance | Increase | Decrease | Ending balance |
Capital premium (premium on stock) | 979,245,995.62 | 979,245,995.62 | 0.00 | |
Other capital reserves | 14,868,571.54 | 7,622,600.00 | 7,245,971.54 | |
Total | 994,114,567.16 | 986,868,595.62 | 7,245,971.54 |
Other notes, including changes and reason of change:
1. The cancellation of treasury shares offset the capital reserve of RMB4,825,948.60.
2. Due to the merger of NationStar Optoelectronics under the same control in the current period, the opening balance of the capitalreserve, upon retroactive adjustment, was RMB982,042,647.02. The merger in the current period decreased by RMB982,042,647.02.
56. Treasury Shares
Unit: RMB
Item | Beginning balance | Increase | Decrease (note) | Ending balance |
Treasury shares (A-share) | 201,955,572.33 | 119,790,428.18 | 82,165,144.15 | |
Treasury shares (B-share) | 48,645,302.21 | 48,645,302.21 | ||
Total | 250,600,874.54 | 168,435,730.39 | 82,165,144.15 |
Other notes, including changes and reason of change:
Note: The decrease in treasury shares for the Reporting Period was due to deregistration of treasury shares. Fordetails, please refer to Part VI-XIII. Other Significant Events-Cancellation of Shares of this Report.
57. Other Comprehensive Income
Unit: RMB
Item | Beginning balance | Reporting Period | Ending balance | |||||
Income before taxation in the Current Period | Less: Recorded in other comprehensive income in prior period and transferred to profit or loss in the Current Period | Less: Recorded in other comprehensive income in prior period and transferred to retained earnings in the Current Period | Less: Income tax expense | Attributable to owners of the Company as the parent after tax | Attributable to non-controlling interests after tax | |||
I. Other comprehensive income that may not subsequently be reclassified to profit or loss | 983,157,254.51 | -150,743,920.40 | 100,917,224.19 | -22,611,588.06 | -229,049,556.53 | 754,107,697.98 | ||
Changes in fair value of other | 983,157,254.51 | -150,743,920.40 | 100,917,224.19 | -22,611,588.06 | -229,049,556.53 | 754,107,697.98 |
equity instrument investment | ||||||||
II. Other comprehensive income that may subsequently be reclassified to profit or loss | -184,895.62 | 107,182.51 | 95,628.61 | 11,533.90 | -89,267.01 | |||
Differences arising from translation of foreign currency-denominated financial statements | -184,895.62 | 107,182.51 | 95,628.61 | 11,533.90 | -89,267.01 | |||
Total of other comprehensive income | 982,972,358.89 | -150,636,737.89 | 100,917,224.19 | -22,611,588.06 | -228,953,927.92 | 11,533.90 | 754,018,430.97 |
58. Specific Reserve
Naught
59. Surplus Reserves
Unit: RMB
Item | Beginning balance | Increase | Decrease | Ending balance |
Statutory surplus reserves | 699,673,077.00 | 612,892,560.81 | 86,780,516.19 | |
Discretionary surplus reserves | 41,680,270.96 | 41,680,270.96 | 0.00 | |
Total | 741,353,347.96 | 654,572,831.77 | 86,780,516.19 |
Notes including changes and reasons thereof:
The decrease in surplus reserves for the Reporting Period is mainly due to the de-registration of treasury sharesand the combination of NationStar under the same control in the Reporting Period.
60. Retained Earnings
Unit: RMB
Item | Reporting Period | Same period of last year |
Beginning balance of retained earnings before adjustments | 3,119,317,423.25 | 1,758,462,062.48 |
Beginning balance of total retained earnings of adjustments (“+” for increase, “-“ for decrease) | 169,825,049.30 | |
Beginning balance of retained earnings after adjustments | 3,119,317,423.25 | 1,928,287,111.78 |
Add: Net profit attributable to owners of the Company as the parent | 160,664,433.28 | 293,738,869.27 |
Dividend of ordinary shares payable | 134,899,464.70 | 143,751,806.92 |
Add: Others (note) | -100,917,224.19 | -1,041,043,249.12 |
Ending retained earnings | 3,245,999,616.02 | 3,119,317,423.25 |
List of adjustment of beginning retained earnings:
(1) RMB0.00 beginning retained earnings was affected by retrospective adjustment conducted according to the Accounting Standardsfor Business Enterprises and relevant new regulations.
(2) RMB0.00 beginning retained earnings was affected by changes in accounting policies.
(3) RMB0.00 beginning retained earnings was affected by correction of significant accounting errors.
(4) RMB169,825,049.30 beginning retained earnings was affected by changes in combination scope arising from same control.
(5) RMB0.00 beginning retained earnings was affected totally by other adjustments.
Other notes:
Note: Refer to the accumulative change of fair value which was transferred into retained earnings from other comprehensive incomewhen stocks were sold in the Reporting Period.
61. Operating Revenue and Cost of Sales
Unit: RMB
Item | Reporting Period | Same period of last year | ||
Operating revenue | Cost of sales | Operating revenue | Cost of sales | |
Main operations | 4,200,923,124.71 | 3,480,433,322.74 | 3,563,272,369.88 | 2,954,407,457.50 |
Other operations | 147,345,874.60 | 107,632,475.61 | 62,927,890.29 | 55,091,879.72 |
Total | 4,348,268,999.31 | 3,588,065,798.35 | 3,626,200,260.17 | 3,009,499,337.22 |
Relevant information of revenue:
Category of contracts | Segment 1 | Segment 2 | Total | |
Types of products | 4,348,268,999.31 | 4,348,268,999.31 | ||
Of which: | ||||
General lighting products | 1,794,373,850.48 | 1,794,373,850.48 | ||
LED packaging and component products | 1,285,748,494.95 | 1,285,748,494.95 | ||
Vehicle lamp products | 788,150,928.31 | 788,150,928.31 |
Epitaxy and chip products | 57,483,341.92 | 57,483,341.92 | ||
Trade and other products | 422,512,383.65 | 422,512,383.65 | ||
By operating places | 4,348,268,999.31 | 4,348,268,999.31 | ||
Of which: | ||||
Domestic | 3,277,500,277.81 | 3,277,500,277.81 | ||
Overseas | 1,070,768,721.50 | 1,070,768,721.50 |
Information related to performance obligations:
NaughtInformation related to transaction value assigned to residual performance obligations:
The amount of revenue corresponding to performance obligations of contracts signed but not performed or notfully performed yet was RMB282,686,589.87 at the period-end.
62. Taxes and Surtaxes
Unit: RMB
Item | Reporting Period | Same period of last year |
Urban maintenance and construction tax | 7,260,191.27 | 7,329,896.91 |
Education surcharge | 3,981,871.52 | 4,354,217.61 |
Property tax | 7,097,473.37 | 4,823,023.37 |
Land use tax | 2,985,827.87 | 2,550,114.66 |
Vehicle and vessel use tax | 13,021.56 | 7,800.88 |
Stamp duty | 3,644,570.41 | 2,268,530.04 |
Local education surcharge | 997,922.28 | 911,424.77 |
VAT of land (note) | -2,047,738.45 | 403,671.24 |
Environmental protection tax | 34,492.30 | 93,522.65 |
Others | 402,358.19 | 988.75 |
Total | 24,369,990.32 | 22,743,190.88 |
Other notes:
Note: It was mainly because of the land appreciation tax accrued for the sale of real estate in the previous period.The over-accrued land appreciation tax of RMB2,047,738.45 was released, when the actual payment was madethis year.
63. Selling Expense
Unit: RMB
Item | Reporting Period | Same period of last year |
Employee benefits | 55,164,807.55 | 47,774,786.46 |
Business propagandize fees and advertizing fees | 18,529,841.39 | 12,593,620.80 |
Sales promotion fees | 5,847,930.26 | 4,687,482.20 |
Business travel charges | 2,109,153.50 | 3,945,263.27 |
Dealer meeting expense | 516,954.49 | 201,586.16 |
Commercial insurance premium | 2,387,669.16 | 2,132,533.15 |
Other | 25,283,570.38 | 25,437,347.11 |
Total | 109,839,926.73 | 96,772,619.15 |
64. Administrative Expense
Unit: RMB
Item | Reporting Period | Same period of last year |
Employee benefits | 109,407,584.44 | 83,987,194.14 |
Depreciation charge | 19,194,923.21 | 15,037,827.30 |
Office expenses | 10,061,100.07 | 8,318,762.66 |
Rent of land and management charge | 298,021.09 | 1,842,382.96 |
Amortization of intangible assets | 5,701,115.82 | 6,144,160.12 |
Utilities | 3,880,679.53 | 372,571.56 |
Engineering decoration cost | 2,822,639.45 | 3,786,630.64 |
Intermediary agency fee | 3,536,961.00 | 2,870,509.21 |
Others | 22,839,674.16 | 17,260,729.13 |
Total | 177,742,698.77 | 139,620,767.72 |
65. Development Costs
Unit: RMB
Item | Reporting Period | Same period of last year |
Employee benefits | 97,286,487.05 | 73,244,875.54 |
Expense on equipment debugging | 3,503,274.86 | 5,213,427.98 |
Certification and testing fee | 4,983,719.59 | 4,174,101.50 |
Material consumption | 27,204,093.78 | 6,478,539.00 |
Charges related to patents | 1,323,834.59 | 944,967.99 |
Depreciation and long-term prepaid expense | 21,427,223.15 | 17,196,866.49 |
Other | 52,447,960.74 | 36,867,316.68 |
Total | 208,176,593.76 | 144,120,095.18 |
Other notes:
1. In respect of R&D expense incurred by the Company, expense other than that on bench-scale and pilot-scaleproduction is included in R&D expense; and sales revenue of products from bench-scale and pilot-scaleproduction is included in core business revenue and the relevant costs are included in cost of sales of corebusiness.
2. The R&D expense stood at RMB64,056,498.58 in the current period, up 44.45% year-on-year, primarilydriven by acquisition of Nanning Liaowang, a subsidiary not under the same control in Q3 2021.
66. Finance Costs
Unit: RMB
Item | Reporting Period | Same period of last year |
Interest expense | 6,688,232.76 | 2,871,203.53 |
Less: Interest income | 12,905,461.82 | 14,130,946.82 |
Foreign exchange gains or losses | -18,641,308.34 | 5,974,891.14 |
Handling charge and others | 857,892.01 | 1,632,843.88 |
Total | -24,000,645.39 | -3,652,008.27 |
67. Other Income
Unit: RMB
Sources | Reporting Period | Same period of last year |
Government grants related to assets in carry-over deferred income | 14,936,360.57 | 14,387,027.62 |
Government grants related to income in carry-over deferred income | 5,665,652.84 | 5,523,368.01 |
Foshan's funds for promotion of robot application and industrial development | 2,000,000.00 | |
The Support Fund of the Foshan Municipal Financial Bureau for Promoting the Digital Intelligent Transformation of the Manufacturing Industry in Foshan City for 2021 | 2,000,000.00 | |
The Special Fund for Promoting High-quality Economic Development | 1,842,190.69 | 1,762,092.60 |
The Special Support Fund for the Industrial Internet of Things (IIOT) Development in Foshan City for 2021 (the Special Project of IIOT Demonstration) (the First Batch) | 1,320,000.00 | |
The Subsidy of the Chancheng District Human Resources and Social Security Bureau, Foshan City, for the Skill Training of Millions of Workers for March 2022 | 1,148,000.00 | |
The Subsidy for Stabilizing Employment | 1,126,686.47 | |
Service Charges Returned by the Taxation Administration | 1,110,028.50 | 470,437.25 |
The Special Support Fund for the Industrial Internet of Things (IIOT) Development in Foshan City | 892,500.00 | |
The Special Fund for the Vocational Skill Improvement Campaign | 848,000.00 | |
The L.J.C.Y. [2021] No. 557 Industrial Support Fund of the Finance Bureau of Liang Jiang New Area, Chongqing | 610,000.00 | |
The Support Fund of the Administration of the Chancheng Park of the Foshan High-tech Industrial Development Zone for Champion Manufacturing Enterprises in a Single Item for 2020 | 450,000.00 |
The First Batch of Subsidies for the Special Project of SME Development and the Auxiliary Project of Industrial Chain Collaboration for 2022 | 427,200.00 | |
The N.C.G.J. [2021] No. 452 "Fund for Specialized and Refined Projects" in Nanning City of the Management Committee of the Nanning New & High-tech Industrial Development Zone | 300,000.00 | |
The Subsidy for Employees' On-the-job Training | 2,968,000.00 | |
The R&D Subsidy for High-tech Enterprises | 1,034,800.00 | |
The Municipal Support Fund for the Industrial Design Development of Foshan City | 1,000,000.00 | |
The Support Fund Granted by the Administration of the Chancheng Park of the Foshan High-tech Industrial Development Zone to the Smart Factory Project in the Zone for 2020 | 1,000,000.00 | |
The Social Subsidy Granted by the Chancheng District Human Resources and Social Security Bureau, Foshan City, to Support People with Employment Difficulties | 553,814.44 | |
The Municipal Special Fund for the Intellectual Property Rights for 2020 | 451,043.00 | |
The Incentive for Developing Technological Innovation Platforms in Nanhai District for 2020 – Large Outstanding Enterprises – R&D Subsidies | 366,752.33 | |
The Special Fund Granted by the Administration of the Chancheng Park of the Foshan High-tech Industrial Development Zone to Leading Enterprises for 2020 | 300,000.00 | |
The Reward Granted by the Administration of the Chancheng Park of the Foshan High-tech Industrial Development Zone for Enterprises First Recognized as Champion Manufacturing Enterprises in a Single Item in the Zone | 300,000.00 |
for 2020 | ||
Other | 3,094,828.73 | 3,451,897.90 |
Total | 37,771,447.80 | 33,569,233.15 |
68. Investment Income
Unit: RMB
Item | Reporting Period | Same period of last year |
Long-term equity investment income accounted by equity method | 650,457.40 | 37,460.99 |
Investment income from disposal of trading financial assets | 285,376.51 | 87,850.30 |
Dividend income from holding of other equity instrument investment | 16,055,272.93 | |
Income received from financial products and structural deposits | 673,400.56 | 4,952,121.46 |
Other | 1,949,237.46 | 416,050.00 |
Total | 19,613,744.86 | 5,493,482.75 |
69. Net Gain on Exposure Hedges
Naught
70. Gain on Changes in Fair Value
Unit: RMB
Sources | Reporting Period | Same period of last year |
Held-for-trading financial assets | 35,436.66 | 1,993,168.20 |
Held-for-trading financial liabilities | -10,802,032.63 | -63,379.90 |
Total | -10,766,595.97 | 1,929,788.30 |
71. Credit Impairment Loss
Unit: RMB
Item | Reporting Period | Same period of last year |
Bad debt loss on other receivables | 133,776.54 | -750,332.27 |
Bad debt loss on accounts receivable | -16,527,279.88 | 2,085,332.87 |
Bad debt loss on notes receivable | -658,995.50 | 346,781.29 |
Total | -17,052,498.84 | 1,681,781.89 |
72. Asset Impairment Loss
Unit: RMB
Item | Reporting Period | Same period of last year |
II. Loss on inventory valuation and contract performance cost | -19,418,381.89 | -23,464,653.80 |
V. Loss on impairment of fixed assets | -3,529,839.61 | |
XII. Loss on impairment of contract assets | -439,922.48 | |
Total | -23,388,143.98 | -23,464,653.80 |
73. Assets Disposal Income
Unit: RMB
Sources | Reporting Period | Same period of last year |
Disposal income of fixed assets | 82,362.19 | 1,782,280.34 |
74. Non-operating Income
Unit: RMB
Item | Reporting Period | Same period of last year | Amount recorded in the current non-recurring profit or loss |
Government grants | 976,090.45 | 976,090.45 | |
Total income from disposal of non-current assets | 43,160.43 | 1,674,379.33 | 43,160.43 |
Of which: Income from disposal of fixed assets | 43,160.43 | 1,674,379.33 | 43,160.43 |
Income from default money | 165,006.53 | 35,284.41 | 165,006.53 |
Other | 7,777,436.55 | 2,238,668.67 | 7,777,436.55 |
Total | 8,961,693.96 | 3,948,332.41 | 8,961,693.96 |
75. Non-operating Expense
Unit: RMB
Item | Reporting Period | Same period of last year | Amount recorded in the current non-recurring profit or loss |
Donations | 1,340.00 | ||
Total loss on disposal of non-current assets | 5,943,227.86 | 3,146,405.63 | 5,943,227.86 |
Of which: loss on disposal of fixed assets | 5,731,670.97 | 2,735,764.32 | 5,731,670.97 |
Loss on disposal of intangible assets | 211,556.89 | 211,556.89 | |
Losses on inventories | 41,677.65 | 1.88 | 41,677.65 |
Penalty | 249,481.71 | 249,481.71 | |
Delaying payment | 336,802.22 | 191,967.71 | 336,802.22 |
Other | 1,272,873.58 | 354,929.89 | 1,272,873.58 |
Total | 7,844,063.02 | 3,694,645.11 | 7,844,063.02 |
76. Income Tax Expense
(1) List of Income Tax Expense
Unit: RMB
Item | Reporting Period | Same period of last year |
Current income tax expense | 25,578,945.18 | 38,957,223.88 |
Deferred income tax expense | 15,562,966.83 | 4,382,154.87 |
Total | 41,141,912.01 | 43,339,378.75 |
(2) Adjustment Process of Accounting Profit and Income Tax Expense
Unit: RMB
Item | Reporting Period |
Profit before taxation | 271,452,583.77 |
Current income tax expense accounted at statutory/applicable tax rate | 40,717,887.57 |
Influence of applying different tax rates by subsidiaries | 2,902,251.69 |
Influence of income tax before adjustment | -922,149.05 |
Influence of non-deductable costs, expenses and losses | -192,347.46 |
The effect of using deductible losses of deferred income tax assets that have not been recognized in the previous period | 1,142,128.81 |
Investment income and dividend | -2,505,859.55 |
Income tax expense | 41,141,912.01 |
77. Other Comprehensive Income
Refer to Note VII Notes to Main Items of Consolidated Financial Statements-57 for details.
78. Cash Flow Statement
(1) Cash Generated from Other Operating Activities
Unit: RMB
Item | Reporting Period | Same period of last year |
Deposit interest | 12,342,006.20 | 16,315,569.45 |
Income from insurance compensation | 5,333.08 | 24,207.40 |
Margin income | 13,542,994.58 | 21,824,603.85 |
Rental income from property and equipment, utility | 4,954,716.14 | 6,351,181.05 |
Income from subsidy | 35,542,460.08 | 13,780,707.93 |
Income from waste | 16,645,457.85 | 12,948,191.88 |
Other | 36,300,827.42 | 18,573,282.49 |
Total | 119,333,795.35 | 89,817,744.05 |
(2) Cash Used in Other Operating Activities
Unit: RMB
Item | Reporting Period | Same period of last year |
Administrative and R&D expense paid in cash | 50,240,726.64 | 43,554,740.48 |
Selling expense paid in cash | 34,362,534.37 | 89,858,190.79 |
Finance costs paid in cash | 820,402.36 | 1,255,552.49 |
Returned cash deposit | 12,156,399.92 | 13,794,280.53 |
Other | 67,973,379.74 | 29,119,236.85 |
Total | 165,553,443.03 | 177,582,001.14 |
(3) Cash Generated from Other Investing Activities
Naught
(4) Cash Used in Other Investing Activities
Naught
(5) Cash Generated from Other Financing Activities
Unit: RMB
Item | Reporting Period | Same period of last year |
Cash deposit collected | 53,126,214.00 | 1,339,606.80 |
Total | 53,126,214.00 | 1,339,606.80 |
(6) Cash Used in Other Financing Activities
Unit: RMB
Item | Reporting Period | Same period of last year |
Payment for cash deposit of bank acceptance bills | 121.82 | 83,291,518.32 |
Intermediary fee for financing | 125,624.96 | 37,077.04 |
Cash paid for acquisition under the same control | 1,061,968,681.64 | |
Repurchase of treasury shares | 220,895,890.55 | |
Total | 1,062,094,428.42 | 304,224,485.91 |
79. Supplemental Information for Cash Flow Statement
(1) Supplemental Information for Cash Flow Statement
Unit: RMB
Supplemental information | Reporting Period | Same period of last year |
1. Reconciliation of net profit to net cash |
flows generated from operating activities: | ||
Net profit | 230,310,671.76 | 195,002,479.47 |
Add: Provision for impairment of assets | 40,440,642.82 | 21,782,871.91 |
Depreciation of fixed assets, oil-gas assets, and productive living assets | 236,835,122.52 | 191,592,791.52 |
Depreciation of right-of-use assets | 4,314,025.31 | 1,290,954.05 |
Amortization of intangible assets | 6,146,953.88 | 7,375,589.07 |
Amortization of long-term prepaid expenses | 69,990,299.46 | 8,701,088.44 |
Loss from disposal of fixed assets, intangible assets and other long-term assets (gains: negative) | -82,362.19 | -1,782,280.34 |
Losses from scrapping of fixed assets (gains: negative) | 5,688,510.54 | -628,095.29 |
Losses from changes in fair value (gains: negative) | 10,766,595.97 | -1,929,788.30 |
Finance costs (gains: negative) | 6,688,232.76 | 2,871,203.53 |
Investment loss (gains: negative) | -19,613,744.86 | -5,493,482.75 |
Decrease in deferred income tax assets (increase: negative) | 2,289,157.80 | 2,232,103.26 |
Increase in deferred income tax liabilities (“-” for decrease) | 27,242,670.20 | 2,150,051.61 |
Decrease in inventory (“-” for increase) | 129,815,588.18 | -170,321,475.30 |
Decrease in operating receivables (“-” for increase) | -206,126,131.90 | -337,116,154.02 |
Increase in operating payables (“-” for decrease) | -394,671,325.86 | 530,485,149.34 |
Others | ||
Net cash generated from/used in operating activities | 150,034,906.39 | 446,213,006.20 |
2. Significant investing and financing activities without involvement of cash receipts and payments | ||
Transfer of debts into capital | ||
Current portion of convertible corporate bonds | ||
Fixed assets leased in for financing | ||
3.Net increase/decrease of cash and cash equivalents: | ||
Ending balance of cash | 1,387,999,909.22 | 1,957,385,232.91 |
Less: Beginning balance of cash | 1,886,894,463.37 | 1,325,464,361.36 |
Add: Ending balance of cash |
equivalents | ||
Less: Beginning balance of cash equivalents | ||
Net increase in cash and cash equivalents | -498,894,554.15 | 631,920,871.55 |
(2) Net Cash Paid For Acquisition of Subsidiaries
Unit: RMB
Amount | |
Cash or cash equivalents paid in the Reporting Period for business combination occurring in the Reporting Period | 1,061,968,681.64 |
Of which: | |
Foshan NationStar Optoelectronics Co., Ltd. | 1,061,968,681.64 |
Of which: | |
Of which: | |
Net payments for acquisition of subsidiaries | 1,061,968,681.64 |
(3) Net Cash Received from Disposal of the Subsidiaries
Naught
(4) Cash and Cash Equivalents
Unit: RMB
Item | Ending balance | Beginning balance |
Including: Cash on hand | 68,284.86 | 24,635.14 |
Bank deposit on demand | 1,386,515,662.37 | 1,787,545,524.78 |
Other monetary assets on demand | 1,415,961.99 | 99,324,303.45 |
III. Ending balance of cash and cash equivalents | 1,387,999,909.22 | 1,886,894,463.37 |
80. Notes to Items of the Statements of Changes in Owners’ Equity
Notes to the name of “Other” of ending balance of the same period of last year adjusted and the amount adjusted:
Not applicable
81. Assets with Restricted Ownership or Right of Use
Unit: RMB
Item | Ending carrying value | Reason for restriction |
Monetary assets | 448,713,603.58 | Security deposit of notes, letter of guarantee, etc. |
Notes receivable | 821,993,782.57 | Pledged for notes pool |
Fixed assets | 265,763,688.91 | Related-party mortgage guarantee, see Part X-Note XIV-(III) Others for details |
Intangible assets | 11,119,256.27 | Related-party mortgage guarantee, see Part X-Note XIV-(III) Others for details |
Long-term deferred expense | 1,081,877.32 | Related-party mortgage guarantee, see Part X-Note XIV-(III) Others for details |
Total | 1,548,672,208.65 |
82. Foreign Currency Monetary Items
(1) Foreign Currency Monetary Items
Unit: RMB
Item | Ending foreign currency balance | Exchange rate | Ending balance converted to RMB |
Monetary assets | 264,308,864.20 | ||
Of which: USD | 33,219,428.25 | 6.7114 | 222,948,870.76 |
EUR | 680,375.82 | 7.0084 | 4,768,345.90 |
HKD | 51,801.82 | 0.8552 | 44,300.40 |
IDR | 81,036,246,474.50 | 0.000451 | 36,547,347.16 |
Accounts receivable | 481,373,296.47 | ||
Of which: USD | 69,644,148.32 | 6.7114 | 467,409,737.03 |
EUR | 1,591,497.91 | 7.0084 | 11,153,853.95 |
HKD | 42,850.39 | 0.8552 | 36,645.23 |
IDR | 6,229,945,609.76 | 0.000451 | 2,809,705.47 |
Long-term borrowings | 335,570,000.00 | ||
Of which: USD | 50,000,000.00 | 6.7114 | 335,570,000.00 |
EUR | |||
HKD | |||
Other receivables | 90,529.27 | ||
Of which: USD | 13,488.88 | 6.7114 | 90,529.27 |
Contract liabilities: | 12,568,074.98 | ||
Of which: USD | 1,859,199.25 | 6.7114 | 12,477,829.85 |
EUR | 12,876.71 | 7.0084 | 90,245.13 |
prepayments | 4,402,438.13 | ||
Of which: USD | 655,964.20 | 6.7114 | 4,402,438.13 |
Accounts payable | 22,857,965.67 | ||
Of which: USD | 1,141,727.22 | 6.7114 | 7,662,588.06 |
EUR | 1,119,961.13 | 7.0084 | 7,849,135.58 |
IDR | 33,692,633,281.60 | 0.000451 | 15,195,377.61 |
Other non-current assets | 642,634.75 | ||
Of which: EUR | 91,694.93 | 7.0084 | 642,634.75 |
Other non-current liabilities | 838,740.08 | ||
Of which: EUR | 119,676.40 | 7.0084 | 838,740.08 |
Lease liabilities | 272,954.84 | ||
Of which: IDR | 605,221,374.72 | 0.000451 | 272,954.84 |
(2) Notes to Overseas Entities Including: for Significant Oversea Entities, Main Operating Place, RecordingCurrency and Selection Basis Shall Be Disclosed; if there Are Changes in Recording Currency, RelevantReasons Shall Be Disclosed.
□Applicable ? Not applicable
83. Arbitrage
Qualitative and quantitative information of relevant arbitrage instruments, hedged risk in line with the type of arbitrage to disclose:
Naught
84. Government Grants
(1) Basic Information on Government Grants
Unit: RMB
Sources | Amount | Listed items | Amount recorded in the current profit or loss |
Handling charge returned from tax bureau | 167,848.10 | Other income | 167,848.10 |
Subsidy for stabilizing employment | 285,643.24 | Other income | 285,643.24 |
The Subsidy of the Chancheng District Economy and Technology Promotion Bureau, Foshan City, for Enterprises Organized by Foshan City to Participate in Important Professional Exhibitions in China for 2021 | 6,900.00 | Other income | 6,900.00 |
The Support Fund of the Administration of the Chancheng Park of the Foshan High-tech Industrial Development Zone for Champion Manufacturing Enterprises in a Single Item for 2020 | 450,000.00 | Other income | 450,000.00 |
The Fund of the Organization Department of the Chancheng District Party Committee, Foshan City, China, for Competitive Talent Support Projects | 150,000.00 | Other income | 150,000.00 |
The Auxiliary Fund of the | 250,000.00 | Other income | 250,000.00 |
Organization Department of the Chancheng District Party Committee, Foshan City, China, for Competitive Talent Support Projects | |||
The Support Fund of the Foshan Municipal Financial Bureau for Promoting the Digital Intelligent Transformation of the Manufacturing Industry in Foshan City for 2021 | 2,000,000.00 | Other income | 2,000,000.00 |
The Subsidy of the Chancheng District Human Resources and Social Security Bureau, Foshan City, for the Skill Training of Millions of Workers for March 2022 | 1,148,000.00 | Other income | 1,148,000.00 |
The Subsidy Granted by the Chancheng District Economy and Technology Promotion Bureau, Foshan City, for Promoting the Project of Export Credit Insurance under the Special Provincial Project of Promoting High-quality Economic Development (for the Direction of Promoting Foreign Trade Development) for 2021 | 26,056.34 | Other income | 26,056.34 |
The Special Fund for the Vocational Skill Improvement Campaign | 848,000.00 | Other income | 848,000.00 |
The Special Support Fund for the Industrial Internet of Things (IIOT) Development in Foshan City for 2021 (the Special Project of IIOT Demonstration) (the First Batch) | 1,320,000.00 | Other income | 1,320,000.00 |
The Municipal Support Fund for the Premiums of Short-term Export Credit Insurance for 2022 | 51,962.00 | Other income | 51,962.00 |
The Provincial Fund for Export Credit Insurance for 2022 | 65,029.00 | Other income | 65,029.00 |
The R&D of Chip-on-Board (COB) Integrated Packaging and Systems of LED Displays with High Density and Small Spacing | 1,100,000.00 | Deferred income | 1,100,000.00 |
The Research on the Key Technology of High-lumen Compound Reflex LED Chips for Automobiles and High-density Matrix Packaging | 1,800,000.00 | Deferred income | 685,856.47 |
The Technology Research and Industrialization of the Micro Display Module Based on Highly Efficient Color Conversion | 340,000.00 | Deferred income | 106,747.34 |
Others | 500,000.00 | Deferred income | |
The Research on the Key Technology of Full-color Micro-LED Displays with High Brightness and Contrast | 502,006.27 | Deferred income | |
The Project of the Innovation in Packaging Technology and Technological Transformation of Key Packaging Equipment of LEDs with High Color Rendering Index for Illumination (Phase II) | 6,822,700.00 | Deferred income | 190,473.97 |
The Research on the Key Technology of 4K/8K Full-color Micro-LED Displays with Ultra-High Definition (UHD) | 2,100,000.00 | Deferred income | |
The G.G.X.T.Z. [2017] No. 106 First Batch of Special Funds for the Industrial and Information Development for the Guangxi Zhuang Autonomous Region for 2017 (technical transformation) for Liuzhou Guige Photoelectric | 199,999.98 | Other income | 199,999.98 |
Technology Co., Ltd. (Liuzhou Guige) | |||
The L.D.G.F. [2016] No. 36 Innovation Fund for Enterprises in Liudong New Area for 2017 for Liuzhou Guige | 75,000.00 | Other income | 75,000.00 |
The L.G.X.T. [2017] No. 164 Project of the First Batch of Support Funds for Enterprises in Liuzhou City for 2017 for Liuzhou Guige | 150,000.00 | Other income | 150,000.00 |
The L.G.X.T. [2018] No. 122 Project of the First Batch of Support Funds for Enterprises in Liuzhou City for 2018 for Liuzhou Guige | 28,000.02 | Other income | 28,000.02 |
The L.G.X.T. [2020] No. 134 Project of Support Funds for Enterprises in Liuzhou City for 2020 for Liuzhou Guige | 100,000.02 | Other income | 100,000.02 |
The G.K.J.Z. [2018] No. 242 Project of the Third Batch of Special Funds of Innovation-driven Development for the Guangxi Zhuang Autonomous Region for 2018 for Liuzhou Guige | 48,000.00 | Other income | 48,000.00 |
The L.G.X.T. [2021] No. 72 Project of Financial Support for Developing Liuzhou City into an Industrial Internet of Things (IIOT) Demonstration City for 2021 for Liuzhou Guige | 79,000.02 | Other income | 79,000.02 |
The L.C.Y.ZH. [2021] No. 280 Second Batch of Support Funds for the "Technological Transformation of Thousands of Enterprises" in the Guangxi Zhuang Autonomous Region for 2021 | 100,000.02 | Other income | 100,000.02 |
The Reward of the Bureau of Industry and Information | 31,800.00 | Other income | 31,800.00 |
Technology of Liuzhou City for Controlled Use of Electricity | |||
The Subsidy of the Social Insurance Management Center of Liuzhou City for Stabilizing Employment | 173,672.78 | Other income | 173,672.78 |
The Second Batch of Special Funds for the Industrial and Information Development of the City for 2019 | 150,000.00 | Other income | 150,000.00 |
The 14th Batch of Industrial Support Funds for 2019 | 75,000.00 | Other income | 75,000.00 |
The L.J.C.Y. [2021] No. 557 Industrial Support Fund of the Finance Bureau of Liang Jiang New Area, Chongqing | 610,000.00 | Other income | 610,000.00 |
The One-time Subsidy of Yubei District to Support People with Employment Difficulties for the First Quarter of 2022 | 36,000.00 | Other income | 36,000.00 |
The Subsidy for Stabilizing Employment | 841,043.23 | Other income | 841,043.23 |
The Special Support Fund for the Industrial Internet of Things (IIOT) Development in Foshan City | 892,500.00 | Other income | 892,500.00 |
The Fund of Foshan City for Promoting the Robot Application and Industry | 2,000,000.00 | Other income | 2,000,000.00 |
Special funds for promoting high-quality economic development | 1,842,190.69 | Other income | 1,842,190.69 |
Others | 383,364.86 | Other income | 383,364.86 |
Total | 27,749,716.57 | 16,668,088.08 |
(2) Return of Government Grants
□Applicable ? Not applicable
85. Other
Naught
VIII. Changes of Consolidation Scope
1. Business Combination Not under the Same Control
(1) Business Combination Not under the Same Control in the Reporting PeriodNaught
(2) Combination Cost and Goodwill
Naught
(3) The Identifiable Assets and Liabilities of Acquiree on Purchase Date
Naught
(4) Gains or losses from Re-measurement of Equity Held before the Purchase Date at Fair ValueWhether there is a transaction that through multiple transaction step by step to realize business combination andgaining the control during the Reporting Period
□Yes ? No
(5) Notes to Reasonable Consideration or Fair Value of Identifiable Assets and Liabilities of the Acquireethat Cannot Be Determined on the Acquisition Date or during the Period-end of the MergerNaught
(6) Other Notes
Naught
2. Business Combination under the Same Control
(1) Business Combination under the Same Control during the Reporting Period
Unit: RMB
Combined party | Proportion of the equity | Basis | Combination date | Recognition basis of combination date | Income from the period-begin to the combination date of the acquiree | Net profits from the period-begin to the combination date of the acquiree | Income of the acquiree during the period of comparison | Net profits of the acquiree during the period of comparison |
Foshan NationStar Optoelectronics Co., | 21.48% | Under the control of the Company’s | 28 February 2022 | The actual control has achieved and the | 453,644,780.94 | 9,568,639.83 | 580,345,830.39 | 29,049,597.07 |
Ltd. | actual controller both before and after the combination | industrial and commercial changes have been completed | ||||||
Foshan Sigma Venture Capital Co., Ltd. | 100.00% | Under the control of the Company’s actual controller both before and after the combination | 28 February 2022 | The actual control has achieved and the industrial and commercial changes have been completed | 0.00 | -700.00 | 0.00 | 0.00 |
Other notes:
The Company held the 19th meeting of the ninth Board of Directors and the Third Extraordinary General Meetingin 2021 on 27 October 2021 and 31 December 2021 respectively, where the untport on Major Asset Purchase andRelated Party Trading of Foshan Electrical and Lighting Co., Ltd. (Draft) and Its Summary" and other proposalsrelated to this trading was deliberated and adopted. It was agreed that the Company will purchase 100% equity ofSigma held by Electronics Group (Sigma holds 79,753,050 shares of NationStar Optoelectronics) and 52,051,945tradable shares of NationStar Optoelectronics held by Rising Group and Rising Capital in total by paying cash.Before the spin-off, FSL held 1,014,900 shares of NationStar Optoelectronics, accounting for 0.16% of the totalshare capital of NationStar Optoelectronics. Upon completion of the spin-off, FSL and its wholly-ownedsubsidiary will hold 132,819,895 shares of NationStar Optoelectronics in total, accounting for 21.48% of the totalshare capital of NationStar Optoelectronics, making FSL the controlling shareholder of NationStarOptoelectronics. As of the end of February 2022, the Company has paid 100% of the equity acquisition amount,and the industrial and commercial change registration of Sigma has been completed. As the Company, NationStarOptoelectronics and Sigma are all controlled by the actual controller Guangdong Rising Holdings Group Co., Ltd.before and after the equity change and such control is not temporary, the merger falls under the previous data ofretrospective adjustment of business combination under the same control.
(2) Combination Cost
Unit: RMB
Combination cost | Foshan NationStar Optoelectronics Co., Ltd. and Foshan Sigma Venture Capital Co., Ltd. |
--Cash | 1,517,098,116.62 |
--Carrying value of non-cash assets | |
--Carrying value of debts issued or assumed | |
--Face value of equity securities issued | |
--Contingent consideration |
Contingent consideration and changes thereof:
Naught
Other notes:
Naught
(3) The Carrying Value of Assets and Liabilities of the Combined Party on the Combination Date
Unit: RMB
Foshan NationStar Optoelectronics Co., Ltd. | Foshan Sigma Venture Capital Co., Ltd. | |||
Combination date | Period-end of the last period | Combination date | Period-end of the last period | |
Assets: | ||||
Monetary assets | 921,042,415.96 | 997,688,184.63 | 4,226.45 | 4,926.45 |
Accounts receivable | 525,596,155.73 | 554,384,717.05 | ||
Inventories | 894,257,346.12 | 905,045,064.13 | ||
Fixed assets | 2,035,468,559.47 | 2,037,263,584.35 | ||
Intangible assets | 103,117,840.45 | 103,886,463.82 | ||
Held-for-trading financial assets | 20,000,000.00 | 20,000,000.00 | ||
Notes receivable | 1,000,511,991.86 | 1,102,333,515.11 | ||
Prepayments | 13,259,667.27 | 13,354,147.30 | ||
Other receivables | 2,748,733.29 | 3,451,162.14 | ||
Other current assets | 41,339,558.12 | 39,981,159.43 | ||
Long-term equity investments | 16,852,876.19 | 16,852,876.19 | 73,096,690.00 | 73,096,690.00 |
Other investments in equity instruments | 41,059,860.92 | 41,059,860.92 | ||
Construction in progress | 326,952,490.30 | 356,665,733.21 | ||
Right-of-use assets | 574,365.58 | 629,067.08 | ||
Long-term prepaid expense | 26,736,143.96 | 27,487,572.51 | ||
Deferred income tax assets | 28,064,526.77 | 28,064,526.77 | ||
Other non-current assets | 30,051,607.66 | 29,197,939.66 | ||
Liabilities: | ||||
Borrowings | ||||
Accounts payable | 717,846,900.05 | 899,927,502.97 | ||
Held-for-trading financial liabilities | 2,224.02 | 9,367.37 | ||
Notes payable | 1,184,541,823.20 | 1,247,131,988.05 | ||
Contract liabilities | 75,559,067.88 | 55,409,842.62 | ||
Employee benefits payable | 50,815,459.88 | 78,858,200.44 | ||
Taxes payable | 9,532,874.37 | 8,970,415.15 | ||
Other payables | 31,251,670.01 | 34,566,878.65 | ||
Current portion of non-current liabilities | 323,784.42 | 320,912.61 | ||
Other current liabilities | 1,983,259.30 | 2,538,611.14 |
Lease liabilities | 166,405.64 | 202,757.36 | ||
Provisions | 8,545,934.02 | 9,746,394.32 | ||
Deferred income | 100,184,002.53 | 102,346,903.64 | ||
Deferred income tax liabilities | 92,481,449.40 | 92,481,449.40 | ||
Net assets | 3,754,399,284.93 | 3,744,834,350.58 | 73,100,916.45 | 73,101,616.45 |
Less: Non-controlling interests | -117,113.13 | -117,113.13 | ||
Net assets acquired | 3,754,516,398.06 | 3,744,951,463.71 | 73,100,916.45 | 73,101,616.45 |
Contingent liabilities of the combined party undertaken in the business combination:
NaughtOther notes:
Naught
3. Counter Purchase
Basic information of trading, the basis of transactions constitute counter purchase, the retain assets , liabilities ofthe listed companies whether constituted a business and its basis, the determination of the combination costs, theamount and calculation of adjusted rights and interests in accordance with the equity transaction process:
Naught
4. Disposal of Subsidiary
Whether there is a single disposal of the investment to the subsidiary and lost control?
□Yes ? No
Whether there are several disposals of the investment to the subsidiary and lost controls?
□Yes ? No
5. Changes in Combination Scope for Other Reasons
Note to changes in combination scope for other reasons (such as newly establishment or liquidation of subsidiaries,etc.) and relevant information:
Naught
6. Other
Naught
IX. Equity in Other Entities
1. Equity in Subsidiary
(1) Subsidiaries
Name | Main operating place | Registration place | Nature of business | Holding percentage | Way of gaining | |
Directly | Indirectly | |||||
Foshan Lighting Lamps & Components Co., Ltd. | Foshan | Foshan | Production and sales | 100.00% | Newly established | |
FSL Chanchang Optoelectronics Co., Ltd. | Foshan | Foshan | Production and sales | 100.00% | Newly established | |
Foshan Taimei Times Lamps and Lanterns Co., Ltd. | Foshan | Foshan | Production and sales | 70.00% | Newly established | |
Foshan Electrical & Lighting (Xinxiang) Co., Ltd. | Xinxiang | Xinxiang | Production and sales | 100.00% | Newly established | |
Nanjing Fozhao Lighting Components Manufacturing Co., Ltd. | Nanjing | Nanjing | Production and sales | 100.00% | Acquired | |
FSL Zhida Electric Technology Co., Ltd. | Foshan | Foshan | Production and sales | 51.00% | Newly established | |
FSL LIGHTING GMBH | Germany | Germany | Production and sales | 100.00% | Newly established | |
Foshan Haolaite Lighting Co., Ltd. | Foshan | Foshan | Production and sales | 51.00% | 10.53% | Newly established |
Foshan Kelian New Energy Technology Co., Ltd. | Foshan | Foshan | Property development | 100.00% | Acquired |
Fozhao (Hainan) Technology Co., Ltd. | Haikou | Haikou | Production and sales | 100.00% | Newly established | |
Nanning Liaowang Auto Lamp Co., Ltd. | Nanning | Nanning | Manufacturing of vehicle lamps | 53.79% | Acquired | |
Liuzhou Guige Lighting Technology Co., Ltd. | Liuzhou | Liuzhou | Manufacturing of vehicle lamps | 53.79% | Acquired | |
Liuzhou Guige Foreshine Technology Co., Ltd. | Liuzhou | Liuzhou | Manufacturing of automotive electronic products | 53.79% | Acquired | |
Chongqing Guinuo Lighting Technology Co., Ltd. | Chongqing | Chongqing | Manufacturing of vehicle lamps | 53.79% | Acquired | |
Qingdao Guige Lighting Technology Co., Ltd. | Qingdao | Qingdao | Manufacturing of vehicle lamps | 53.79% | Acquired | |
Indonesia Liaowang Auto Lamp Co., Ltd. | Indonesia | Indonesia | Manufacturing of vehicle lamps | 53.79% | Acquired | |
Foshan Sigma Venture Capital Co., Ltd. | Foshan | Foshan | Business services | 100.00% | Acquired | |
Foshan NationStar Optoelectronics Co., Ltd. (note) | Foshan | Foshan | Electronic manufacturing | 21.48% | Acquired | |
Foshan NationStar Semiconductor Technology Co., Ltd. | Foshan | Foshan | Electronic manufacturing | 21.48% | Acquired | |
Foshan NationStar Electronic Manufacturing Co., Ltd. | Foshan | Foshan | Electronic manufacturing | 21.48% | Acquired | |
Nanyang Baoli Vanadium Industry Co., Ltd. | Henan | Nanyang | Mining | 12.89% | Acquired | |
NationStar | Germany | Germany | Trade | 21.48% | Acquired |
Optoelectronics (Germany) Co., Ltd. | ||||||
Guangdong New Electronic Information Ltd. | Guangzhou | Guangzhou | Trade | 21.48% | Acquired |
Notes to holding proportion in subsidiary different from voting proportion:
NaughtBasis of holding half or less voting rights but still controlling the investee and holding more than half of the votingrights but not controlling the investee:
NaughtSignificant structural entities and controlling basis in the scope of combination:
NaughtBasis of determining whether the Company is the agent or the principal:
Naught
(2) Significant Non-wholly-owned Subsidiary
Unit: RMB
Name | Shareholding proportion of non-controlling interests | The profit or loss attributable to the non-controlling interests | Declaring dividends distributed to non-controlling interests | Balance of non-controlling interests at the period-end |
Foshan Taimei Times Lamps and Lanterns Co., Ltd. | 30.00% | 477,109.34 | 11,927,661.32 | |
FSL Zhida Electric Technology Co., Ltd. | 49.00% | 2,795,200.47 | 27,421,966.35 | |
Foshan Haolaite Lighting Co., Ltd. | 38.47% | 779,318.55 | 14,010,834.93 | |
Nanning Liaowang Auto Lamp Co., Ltd. | 46.21% | 8,404,253.27 | 431,399,428.14 | |
Foshan NationStar Optoelectronics Co., Ltd. | 78.52% | 57,190,356.85 | 24,282,863.70 | 2,960,569,455.95 |
Holding proportion of non-controlling interests in subsidiary different from voting proportion:
NaughtOther notes:
Note: NationStar Electronic Manufacturing, NationStar Semiconductor, Baoli Vanadium Industry, NewElectronic and Germany NationStar are subsidiaries of Foshan NationStar Optoelectronics Co., Ltd.
(3) The Main Financial Information of Significant Not Wholly-owned Subsidiary
Unit: RMB
Name | Ending balance | Beginning balance | ||||||||||
Current assets | Non-current assets | Total assets | Current liabilities | Non-current liability | Total liabilities | Current assets | Non-current assets | Total assets | Current liabilities | Non-current liability | Total liabilities | |
Foshan Taimei Times Lamps and Lanterns Co., Ltd. | 72,200,481.63 | 14,839,246.40 | 87,039,728.03 | 47,280,856.96 | 47,280,856.96 | 135,829,008.12 | 17,573,437.36 | 153,402,445.48 | 115,233,938.88 | 115,233,938.88 | ||
FSL Zhida Electric Technology Co., Ltd. | 162,030,804.64 | 9,189,591.64 | 171,220,396.28 | 102,923,526.20 | 102,923,526.20 | 126,777,943.85 | 12,494,211.78 | 139,272,155.63 | 76,679,776.30 | 76,679,776.30 | ||
Foshan Haolaite Lighting Co., Ltd. | 70,052,380.13 | 11,013,852.14 | 81,066,232.27 | 44,646,073.89 | 44,646,073.89 | 60,890,648.90 | 12,887,936.38 | 73,778,585.28 | 39,384,209.45 | 39,384,209.45 | ||
Nanning Liaowang Auto Lamp Co., Ltd. | 1,302,936,371.97 | 907,827,651.95 | 2,210,764,023.92 | 1,238,851,226.04 | 38,349,871.81 | 1,277,201,097.85 | 1,346,863,737.14 | 817,363,839.98 | 2,164,227,577.12 | 1,305,420,077.19 | 23,058,696.78 | 1,328,478,773.97 |
Foshan NationStar Optoelectronics Co., Ltd. | 3,532,251,904.81 | 2,575,215,720.17 | 6,107,467,624.98 | 1,884,089,421.58 | 430,561,955.17 | 2,314,651,376.75 | 3,636,237,949.79 | 2,641,107,624.51 | 6,277,345,574.30 | 2,327,733,719.00 | 204,777,504.72 | 2,532,511,223.72 |
Total | 5,139,471,943.18 | 3,518,086,062.30 | 8,657,558,005.48 | 3,317,791,104.67 | 468,911,826.98 | 3,786,702,931.65 | 5,306,599,287.80 | 3,501,427,050.01 | 8,808,026,337.81 | 3,864,451,720.82 | 227,836,201.50 | 4,092,287,922.32 |
Unit: RMB
Name | Reporting Period | Same period of last year | ||||||
Operating revenue | Net profit | Total comprehensive income | Cash flows from operating activities | Operating revenue | Net profit | Total comprehensive income | Cash flows from operating activities | |
Foshan Taimei Times Lamps and Lanterns Co., Ltd. | 70,083,077.58 | 1,590,364.47 | 1,590,364.47 | -1,288,012.25 | 72,063,898.77 | 63,872.30 | 63,872.30 | 86,882.37 |
FSL Zhida Electric Technology Co., Ltd. | 105,086,095.87 | 5,704,490.75 | 5,704,490.75 | 3,913,866.98 | 79,244,539.01 | 3,263,540.44 | 3,263,540.44 | -5,139,161.29 |
Foshan Haolaite Lighting Co., Ltd. | 33,735,759.76 | 2,025,782.55 | 2,025,782.55 | 7,961,319.24 | 41,436,035.13 | 1,291,186.52 | 1,291,186.52 | 1,463,433.79 |
Nanning Liaowang Auto Lamp Co., Ltd. | 700,818,199.55 | 18,187,087.80 | 18,351,561.07 | 48,642,332.49 | ||||
Foshan NationStar Optoelectronics Co., Ltd. | 1,664,781,497.45 | 78,987,836.08 | 78,905,756.10 | -6,407,001.17 | 1,729,170,417.10 | 89,810,090.36 | 89,803,977.04 | 400,434,451.27 |
Total | 2,574,504,630.21 | 106,495,561.65 | 106,577,954.94 | 52,822,505.29 | 1,921,914,890.01 | 94,428,689.62 | 94,422,576.30 | 396,845,606.14 |
(4) Significant Restrictions on Using the Assets and Liquidating the Liabilities of the CompanyNaught
(5) Financial Support or Other Supports Provided to Structural Entities Incorporated into the Scope ofConsolidated Financial StatementsNaught
2. The Transaction of the Company with Its Owner’s Equity Share Changed but Still Controlling theSubsidiary
(1) Note to the Owner’s Equity Share Changed in Subsidiary
Naught
(2) The Transaction’s Influence on the Equity of Non-controlling Interests and the Owner's EquityAttributable to the Company as the ParentNaught
3. Equity in Joint Ventures or Associated Enterprises
(1) Significant Joint Ventures or Associated Enterprises
Naught
(2) Main Financial Information of Significant Joint Ventures
Naught
(3) Main Financial Information of Significant Associated Enterprises
Naught
(4) Summary Financial Information of Insignificant Joint Ventures or Associated Enterprises
Unit: RMB
Ending balance/Reporting Period | Beginning balance/Same period of last year | |
Joint ventures: | ||
The total of following items according to the shareholding proportions | ||
Associated enterprises: | ||
Total carrying value of investment | 180,115,189.99 | 181,545,123.09 |
The total of following items according to the shareholding proportions | ||
--Net profit | 650,457.40 | 37,460.99 |
--Total comprehensive income | 650,457.40 | 37,460.99 |
(5) Note to the Significant Restrictions on the Ability of Joint Ventures or Associated Enterprises toTransfer Funds to the CompanyNaught
(6) The Excess Loss of Joint Ventures or Associated Enterprises
Naught
(7) The Unrecognized Commitment Related to Investment to Joint VenturesNaught
(8) Contingent Liabilities Related to Investment to Joint Ventures or Associated EnterprisesNaught
4. Significant Common Operation
Naught
5. Equity in the Structured Entity Excluded in the Scope of Consolidated Financial StatementsNaught
6. Other
Naught
X. The Risk Related to Financial Instruments
The financial instruments of the Company included: equity investment, notes receivable, accounts receivable,accounts payable, etc. The details of each financial instrument see relevant items of Note V.The main risks of the Company due to financial instruments were credit risk, liquidity risk and market risk. Theoperating management of the Company was responsible for the risk management target and the recognition of thepolicies.(I) Credit riskCredit risk was one party of the contract failed to fulfill the obligations and causes loss of financial assets of theother party. The credit risk the Company faced was selling on credit which leads to customer credit risk.The Company will evaluate credit risk of new customer, and set credit limit, once the balance of accountreceivable over credit limit, require the customer to pay or producing and delivering goods shall be approved bythe management of the Company.The Company through monthly aging analysis of account receivable and monitoring the collection situation of thecustomer ensured the overall credit risk of the Company was in control scope. Once appear abnormal situation,the Company should conduct necessary measures to requesting the payment timely.(II) Liquidity RiskLiquidity risk is referred to their risk of incurring capital shortage when performing settlement obligation in theway of cash payment or other financial assets. The policies of the Company are to ensure that there was sufficientcash to pay the due liabilities. The liquidity risk is centralized controlled by the Financial Department of theCompany. The financial department through supervising the balance of the cash and securities can be convert to
cash at any time and the rolling prediction of cash flow in future 12 months to ensure the Company have sufficientcash to pay the liabilities under the case of all reasonable prediction, Each financial liability of the Company wasestimated due within 1 year.(III) Market riskMarket risk was referred to risk of the fair value or future cash flow of financial instrument changed due to thechange of market price, including: exchange rate risk, interest rate risk and other price risk.
1. Exchange rate risk
Exchange rate risk refers to the risk of loss due to exchange rate changes. The Company's exposure to foreignexchange risk is mainly related to the US dollar and the euro. As of 30 June 2022, the Company's assets andliabilities were in RMB, except for the balances of usd, euro, Hong Kong dollar and rupiah as set out in this NoteVII-82, Foreign Currency Monetary Items. Foreign exchange risk arising from the assets and liabilities of suchforeign currency balances may have a certain impact on the Company's operating results. The Company madeefforts to avoid exchange rate risk through forward exchange settlement, improving operation management andpromoting the international competitiveness of the Company, etc.
2. Interest rate risk
Interest rate risk is refers to fluctuation risk of the fair value or future cash flow of financial instrument change dueto the change of market interest rates. The interest rate risk faced by the Company mainly comes from bankborrowings. By establishing a good bank-enterprise relationship, the Company reasonably designed the credit line,credit variety and credit period, ensured sufficient credit line of banks, and met various short-term financing needsof the Company with preferential loan interest rates. As of 30 June 2022, the Company's fixed interest rate loanbalance was RMB620,550,952.38, accounting for 100% of the total loan balance, and the risks in this part werecontrollable.
3. Other price risk
NaughtXI. The Disclosure of Fair Value
1. Ending Fair Value of Assets and Liabilities at Fair Value
Unit: RMB
Item | Ending fair value | |||
Fair value measurement items at level 1 | Fair value measurement items at level 2 | Fair value measurement items at level 3 | Total | |
I. Consistent fair value measurement | -- | -- | -- | -- |
(I) Trading financial assets | 1,397,612.10 | 62,670,850.30 | 64,068,462.40 | |
1. Financial assets at fair value through profit or loss | 1,397,612.10 | 62,670,850.30 | 64,068,462.40 | |
(III) Other equity instrument investment | 1,123,157,619.00 | 41,559,860.92 | 1,164,717,479.92 | |
Total assets measured at fair value on a recurring basis | 1,124,555,231.10 | 62,670,850.30 | 41,559,860.92 | 1,228,785,942.32 |
(VII) Refer as financial liabilities |
measured by fair value and the changes included in the current gains and losses | 6,544,500.00 | 6,544,500.00 | ||
Total liabilities of consistent fair value measurement | 6,544,500.00 | 6,544,500.00 | ||
II. Inconsistent fair value measurement | -- | -- | -- | -- |
2. Market Price Recognition Basis for Consistent and Inconsistent Fair Value Measurement Items at Level
In line with the market price of shares on the balance sheet date and forward foreign exchange option rate.
3. Valuation Technique Adopted and Nature and Amount Determination of Important Parameters forConsistent and Inconsistent Fair Value Measurement Items at Level 2Items measured at fair value level 2 are bank's wealth management products, which are measured at thecontractual expected yield rate as a reasonable estimate of the fair value.
4. Valuation Technique Adopted and Nature and Amount Determination of Important Parameters forConsistent and Inconsistent Fair Value Measurement Items at Level 3
(1) Because the business environment, operation conditions and financial conditions of the invested company,China Guangfa Bank has not changed significantly, the Company takes investment costs as the reasonableestimation of fair value to measure.
(2) Because the business environment, operation conditions and financial conditions of the invested company,Shenzhen Zhonghao (Group) Co., Ltd. were deteriorated, the Company takes zero element as the reasonableestimation of fair value to measure.
(3) Since there is no significant change in the operating environment, operation status and financial condition ofthe investees, including Foshan Nanhai District United Guangdong New Light Source Industrial InnovationCenter and Beijing Guangrong Lianmeng Semiconductor Lighting Industry Investment Center, and GuangdongRising Finance Co., Ltd., the Company's investment cost is measured as a reasonable estimate of the fair value.
5. Sensitiveness Analysis on Unobservable Parameters and Adjustment Information between Beginning andEnding Carrying Value of Consistent Fair Value Measurement Items at Level 3Naught
6. Explain the Reason for Conversion and the Governing Policy when the Conversion Happens ifConversion Happens among Consistent Fair Value Measurement Items at Different LevelsNaught
7. Changes in the Valuation Technique in the Current Period and the Reason for Such ChangesNaught
8. Fair Value of Financial Assets and Liabilities Not Measured at Fair ValueFinancial assets and liabilities not measured at fair value include: monetary assets, accounts receivable andaccounts payable, etc. There is small difference between the carrying value of above financial assets and liabilitiesand fair value.
9. Other
Naught
XII. Related Party and Related-party Transactions
1. The parent company of the Company
Name | Registration place | Nature of business | Registered capital | Proportion of share held by the Company as the parent against the Company (%) | Proportion of voting rights owned by the Company as the parent against the Company (%) |
Hongkong Wah Shing Holding Company Limited | Hong Kong | Investment | HKD110,000 | 13.84% | 13.84% |
Guangdong Electronics Information Industry Group Ltd. | Guangzhou | Production and sales | RMB462 million | 9.01% | 9.01% |
Guangdong Rising Holdings Group Co., Ltd. | Guangzhou | Investment | RMB10 billion | 6.10% | 6.10% |
Rising Investment Development Limited | Hong Kong | Investment | RMB200 million and HKD1 million | 1.87% | 1.87% |
Notes: Information on parent company of the CompanyHongkong Wah Shing Holding Company Limited (hereinafter referred to as "Hongkong Wah Shing"), the largestshareholder of the Company, is a wholly-owned subsidiary of Guangdong Electronics Information Industry GroupLtd. (hereinafter referred to as "Electronics Group"), and Electronics Group, Shenzhen Rising InvestmentDevelopment Co., Ltd. (hereinafter referred to as "Shenzhen Rising"), Guangdong Rising Holdings Group Co.,Ltd. (renamed Guangdong Rising Capital Investment Co., Ltd. on 13 December 2021, hereinafter referred to as“Rising Capital”) and Rising Investment Development Limited (hereinafter referred to as “Rising Investment”)are wholly-owned subsidiaries of Guangdong Rising Holdings Group Co., Ltd. (hereinafter referred to as “RisingHoldings Group”). According to the relevant provisions of the Company Law and the Measures for theAdministrative Measures on Acquisition of Listed Companies, Electronics Group, Shenzhen Rising, Rising
Capital and Rising Investment are concerted actors, and Rising Holdings Group becomes the actual controller ofthe Company. On 15 December 2021, Shenzhen Rising and Rising Capital transferred all their shares of theCompany to Rising Holdings Group. After the transfer, Rising Holdings Group, Electronics Group and RisingInvestment acted in concert with each other. As of 30 June 2022, the above-mentioned persons acting in concertheld a total of 419,803,826.00 A and B shares of the Company, accounting for 30.82% of the total share capital ofthe Company.The final controller of the Company is Guangdong Rising Holdings Group Co., Ltd.
2. Subsidiaries of the Company
Refer to Note IX Equity in Other Entities-1. Equity in Subsidiaries for details.
3. Information on the Joint Ventures and Associated Enterprises of the CompanyRefer to Note IX Equity in Other Entities-3. Equity in Joint Ventures or Associated Enterprises for details ofsignificant joint ventures or associated enterprises of the Company.Information on other joint venture or associated enterprise of occurring related-party transactions with theCompany in Reporting Period, or forming balance due to related-party transactions made in previous period:
Naught
4. Information on Other Related Parties
Name | Relationship with the Company |
Prosperity Lamps & Components Limited | Shareholder owning over 5% shares |
Foshan NationStar Optoelectronics Co., Ltd. (note) | Under same actual controller |
NationStar Optoelectronics (Germany) Co., Ltd. (note) | Under same actual controller |
Guangdong New Electronics Information Import& Export Ltd. (note) | Under same actual controller |
Guangdong Fenghua Advanced Technology (Holding) Co., Ltd. | Under same actual controller |
Guangdong Electronic Technology Research Institute | Under same actual controller |
Guangdong Zhongnan Construction Co., Ltd. | Under same actual controller |
Guangdong Yixin Changcheng Construction Group | Under same actual controller |
Guangdong Zhongren Group Construction Co., Ltd | Under same actual controller |
Shenzhen Yuepeng Construction Co., Ltd. | Under same actual controller |
Foshan Fulong Environmental Technology Co., Ltd. | Under same actual controller |
Jiangmen Dongjiang Environmental Company Limited | Under same actual controller |
Zhuhai Doumen District Yongxingsheng Environmental Industry Waste Recovery and Comprehensive Treatment Co., Ltd. | Under same actual controller |
Shenzhen Zhongjin Lingnan Nonfemet Co., Ltd. | Under same actual controller |
Guangdong Zhongjin Lingnan Equipment Technology Co., Ltd. | Under same actual controller |
Guangdong Rising South Construction Co., Ltd. | Under same actual controller |
Guangdong Electronics Information Industry Group Ltd. | Under same actual controller |
Guangdong Zhongjin Lingnan Junpeng Intelligent Equipment Co., Ltd. | Under same actual controller |
Guangdong Rising Rare Metals and New Photoelectric Materials Co., Ltd. | Under same actual controller |
Guangdong Heshun Property Management Co., Ltd. | Under same actual controller |
Guangdong Zhongjin Construction and Installation Engineering Co., Ltd. | Under same actual controller |
Guangzhou Huajian Engineering Construction Co., Ltd. | Under same actual controller |
Guangdong Heshun Property Management Co., Ltd. The Pinnacle Branch | Under same actual controller |
Guangdong Zhongjin Lingnan Engineering Technology Co., Ltd. | Under same actual controller |
Guangdong Huajian Enterprise Group Co., Ltd. | Under same actual controller |
Guangdong Rising Capital Investment Co., Ltd. | Under same actual controller |
Guangdong Fenghua Advanced Technology (Holding) Co., Ltd. | Under same actual controller |
MTM Semiconductor Equipment Co., Ltd. | Under same actual controller |
Dongguan Hengjian Environmental Protection Technology Co., Ltd. | Under same actual controller |
Shenzhen Longgang Dongjiang Industrial Waste Treatment Co., Ltd. | Under same actual controller |
Guangdong Electronic Technology Research Institute | Under same actual controller |
Guangzhou Wanshun Investment Management Co., Ltd. | Under same actual controller |
Guangdong The Great Wall Building Co., Ltd. | Under same actual controller |
Guangzhou Shengdu Investment Development Co., Ltd. | Under same actual controller |
Guangdong Rising Finance Co., Ltd. | Under same actual controller |
Hangzhou Times Lighting Electric Appliances Co., Ltd. | Enterprise controlled by related natural person |
Prosperity (China) Electrical Company Limited | Enterprise controlled by related natural person |
Nanning Ruixiang Industrial Investment Co., Ltd. | Enterprise significantly affected by related natural person |
Guangdong Fenghua Advanced Technology (Holding) Co., Ltd. | Under same actual controller |
Nanning Ruixiang Industrial Investment Co., Ltd. | Enterprise controlled by related natural person |
Other notes:
Note: Foshan NationStar Optoelectronics Co., Ltd. and its majority-owned subsidiaries NationStarOptoelectronics (Germany) Co., Ltd. and Guangdong New Electronics Information Import& Export Ltd. havebeen included into the Company’s consolidation scope in Q1 2022. For details, please refer to Note VIII Changein Consolidation Scope-2. Business Combination under the Same Control.
5. List of Related-party Transactions
(1) Information on Acquisition of Goods and Reception of Labor Service
Information on acquisition of goods and reception of labor service
Unit: RMB
Related party | Content | Reporting Period | The approval trade credit | Whether exceed trade credit or not | Same period of last year |
Foshan NationStar Optoelectronics Co., Ltd. | Purchase of materials | 17,859,909.28 | 105,000,000.00 | Not | 26,696,615.70 |
Guangdong Fenghua Advanced Technology (Holding) Co., Ltd. | Purchase of materials | 2,757,010.92 | 26,100,000.00 | Not | 6,161,558.19 |
Prosperity Lamps & Components Limited | Purchase of materials | 773,460.05 | 6,000,000.00 | Not | 1,317,138.04 |
Hangzhou Times Lighting Electric Appliances Co., Ltd. | Purchase of materials | 222,265.48 | 218,592.85 | ||
MTM Semiconductor Equipment Co., Ltd. | Purchase of materials | 128,389.38 | |||
Guangdong Zhongnan Construction Co., Ltd. | Receiving labor service | 42,247,083.75 |
Guangdong Yixin Changcheng Construction Group | Receiving labor service | 14,543,474.14 | |||
Guangdong Zhongren Group Construction Co., Ltd | Receiving labor service | 7,242,570.34 | 20,000,000.00 | Not | |
Guangdong Electronic Technology Research Institute | Purchase of equipment | 854,625.55 | 970,000.00 | Not | 142,300.89 |
Jiangmen Dongjiang Environmental Company Limited | Receiving labor service | 502,352.82 | 3,000,000.00 | Not | 306,333.03 |
Shenzhen Yuepeng Construction Co., Ltd. | Receiving labor service | 470,768.94 | 377,087.49 | ||
Foshan Fulong Environmental Technology Co., Ltd. | Receiving labor service | 148,191.03 | 25,471.70 | ||
Zhuhai Doumen District Yongxingsheng Environmental Industry Waste Recovery and Comprehensive Treatment Co., Ltd. | Receiving labor service | 5,660.38 | |||
Guangdong Electronic Technology Research Institute | Receiving labor service | 2,734.91 | |||
Guangdong Fenghua Semiconductor Technology Co., Ltd. | Receiving labor service | 169.90 | |||
Total | 87,621,712.30 | 161,070,000.00 | 35,381,882.56 |
Information of sales of goods and provision of labor service
Unit: RMB
Related party | Content | Reporting Period | Same period of last year |
Prosperity Lamps & Components Limited | Sale of products | 11,487,387.08 | 11,719,058.86 |
NationStar Optoelectronics (Germany) Co., Ltd. | Sale of products | 11,462,187.43 | |
Guangdong New Electronics Information Import& Export Ltd. | Sale of products | 8,159,622.95 | 28,197,238.34 |
Shenzhen Zhongjin Lingnan Nonfemet Co., Ltd. | Sale of products | 607,072.04 | 951,402.66 |
Guangzhou Wanshun Investment Management Co., Ltd. | Sale of products | 538,207.40 | |
Guangdong Yixin Changcheng Construction Group | Sale of products | 441,210.96 | 2,881,672.01 |
Guangzhou Shengdu Investment Development Co., Ltd. | Sale of products | 281,946.91 | |
Guangdong Zhongjin Lingnan | Sale of products | 122,855.75 | 108,659.28 |
Equipment Technology Co., Ltd. | |||
Guangdong Rising South Construction Co., Ltd. | Sale of products | 69,965.06 | |
Guangdong Zhongnan Construction Co., Ltd. | Sale of products | 44,383.37 | |
Prosperity (China) Electrical Company Limited | Sale of products | 41,285.35 | 21,069.56 |
Guangdong Electronics Information Industry Group Ltd. | Sale of products | 27,796.46 | 8,013.27 |
Guangdong Zhongjin Lingnan Junpeng Intelligent Equipment Co., Ltd. | Sale of products | 5,884.96 | |
Guangdong Rising Rare Metals and New Photoelectric Materials Co., Ltd. | Sale of products | 7,990,158.39 | |
Guangdong Heshun Property Management Co., Ltd. | Sale of products | 692,679.04 | |
Guangdong Zhongjin Construction and Installation Engineering Co., Ltd. | Sale of products | 108,592.02 | |
Guangdong Rising Holdings Group Co., Ltd. | Sale of products | 21,203.54 | |
Guangzhou Huajian Engineering Construction Co., Ltd. | Sale of products | 6,145.47 | |
Total | 33,289,805.72 | 52,705,892.44 |
(2) Information on Related-party Trusteeship/Contract
Lists of trusteeship/contract:
NaughtAssociated hosting/ Contracting situationNaughtLists of entrust/contractee
Unit: RMB
Name of the entruster/contractee | Name of the entrustee/ contractor | Type | Start date | Due date | Pricing basis | Charge recognized in this Reporting Period |
Foshan NationStar Optoelectronics Co., Ltd. | Guangdong Zhongren Group Construction Co., Ltd. | 30 December 2020 | 31 December 2022 | |||
Foshan Kelian New Energy Technology Co., Ltd. | Guangdong Zhongnan Construction Co., Ltd. | 23 June 2021 | 23 December 2022 | |||
Fozhao (Hainan) Technology Co., Ltd. | Guangdong Zhongnan Construction Co., Ltd. | 30 March 2022 | 24 April 2023 |
Foshan Electrical and Lighting Co., Ltd. | Guangdong Yixin Changcheng Construction Group Co., Ltd. | 28 May 2021 | 28 February 2023 | |||
Foshan Electrical and Lighting Co., Ltd. | Guangdong Zhongren Group Construction Co., Ltd. | 17 January 2022 | 28 March 2022 |
Notes to entrust/contractee:
1. The Company’s subsidiary Foshan NationStar Optoelectronics Co., Ltd. entered into the General ContractingContract of NationStar Optoelectronics for the Survey, Design, and Construction of the Geely Industrial Park withGuangdong Zhongren Group Construction Co., Ltd., Guangdong Architectural Design & Research Institute Co.,Ltd., and CSIC International Engineering Co., Ltd. on 30 December 2020. The above parties take charge of thesurvey, design, and construction of the Geely Industrial Park. The total price of the contract is RMB509,292,500,and the planned total construction period is 720 calendar days. The overall project must be completed, accepted,and filed by 31 December 2022. The project is in progress now.
2. The Company’s subsidiary Foshan Kelian New Energy Technology Co., Ltd. entered into the GeneralContracting Contract for Design and Construction of the Foshan Kelian Building Decoration Engineering withGuangdong Zhongnan Construction Co., Ltd. and Guangdong Architectural Design & Research Institute Co., Ltd.on 23 June 2021. The above parties take charge of the survey, design and construction of Kelian Building. Thetotal price of the contract is RMB189,070,200, and the planned total construction period is 240 calendar days. Theoverall project is expected to be completed, accepted and filed by 23 December 2022. Among them, except for theself-used layers, the construction period shall be counted from the date when the construction actually begins. Theproject is in progress now.
3. The Company’s subsidiary Fozhao (Hainan) Technology Co., Ltd. entered into the General ContractingContract for Design and Construction of FSL Hainan Industrial Park Phase I with Guangdong ZhongnanConstruction Co., Ltd. and Guangdong Architectural Design & Research Institute Co., Ltd. on 30 March 2022.The above parties take charge of the design and construction of FSL Hainan Industrial Park. The total price of thecontract is RMB179,051,600, and the planned total construction period is 390 calendar days (50 days for designand 340 days for construction). The project is in progress now.
4. The Company entered into the General Contracting Contract of Foshan Electrical and Lighting Co., Ltd. for theDesign and Construction of the Office Buildings of Gaoming Headquarters Production Base Phase II withGuangdong Yixin Changcheng Construction Group Co., Ltd. and Guangdong Architectural Design & ResearchInstitute Co., Ltd. on 28 May 2021. The above parties take charge of the design and construction of Gaomingoffice buildings. The total price of the contract is RMB175,025,600, and the planned total construction period is650 calendar days (90 days for design and 560 days for construction). The overall project must be completed,accepted and filed by 28 February 2023. The project is in progress now.
5. The Company entered into the General Contracting Contract of Foshan Electrical and Lighting Co., Ltd. for theConstruction of the Renovation Project of the Pipe Network for Rain and Sewage Diversion in GaomingProduction Base with Guangdong Zhongren Group Construction Co., Ltd. on 17 January 2022. The above partiestake charge of the renovation construction of the Pipe Network for Rain and Sewage Diversion in GaomingProduction Base. The total price of the contract is RMB7,227,200, and the planned total construction period is 70calendar days. The overall project was completed on 28 March 2022. At present, the project has been completedand the sewage discharge permission shall be applied for from the governing department before settlement.
(3) Information on Related-party Lease
The Company was lessor:
NaughtThe Company was lessee:
The Company served as the lessee:
Name of lessor | Type of assets leased | Rental expenses of short-term lease simplified treated and low-value asset lease (if applicable) | Variable lease payments not included in the measurement of lease liabilities (if applicable) | Paid rent | Income expense of lease liabilities undertaken | Increased right-of-use assets | |||||
Reporting Period | The same period of last year | Reporting Period | The same period of last year | Reporting Period | The same period of last year | Reporting Period | The same period of last year | Reporting Period | The same period of last year | ||
Guangdong Great Wall Building Co., Ltd. | Operating lease | 109,714.21 | 1,557.46 | 54,673.41 |
Notes to related-party leaseNaught
(4) Information on Related-party Guarantee
Naught
(5) Information on Inter-bank Lending of Capital of Related Parties
Naught
(6) Information on Assets Transfer and Debt Restructuring by Related PartyNaught
(7) Information on Remuneration for Key Management Personnel
Unit: RMB
Item | Reporting period | Same period of last year |
Chairman of the Board | 380,814.62 | 481,467.44 |
General Manager | 355,594.62 | 471,367.44 |
Chairman of the Supervisory Committee | 335,628.62 | 454,632.08 |
Secretary of the Board | 227,878.62 | 32,696.24 |
Chief Financial Officer | 336,094.62 | 432,129.14 |
Other | 2,924,372.07 | 3,599,472.96 |
Total | 4,560,383.17 | 5,471,765.30 |
(8) Other Related-party Transactions
(8.1) Share acquisition from related partiesIn October 2021, Electronics Group signed the Equity Transfer Agreement with the Company on Foshan SigmaVenture Capital Co., Ltd., and transferred its 100% equity of Sigma (Sigma holds 79,753,050 shares of NationStarOptoelectronics) to the Company at a consideration of RMB917,980,229.67. In the same month, Rising HoldingsGroup and Rising Capital respectively signed the Share Transfer Agreement on Foshan NationStarOptoelectronics Co., Ltd. with the Company, and transferred their total 52,051,945 tradable shares of NationStarOptoelectronics with unlimited selling conditions to the Company at a consideration of RMB599,117,886.95(RMB11.51/share). As of 30 June 2022, the Company has paid 100% of the equity acquisition amount. For detailsof the equity acquisition, please refer to Note VIII-2. Business Combination under the Same Control.(8.2) Related-party deposits and loansIn accordance with the Financial Service Agreement signed by the Company in 2021 and the Financial ServiceAgreement renewed by the Company’s majority-owned subsidiary Foshan NationStar Optoelectronics Co., Ltd. in2022, the total maximum daily deposit balance of the Company deposited in Guangdong Rising Finance Co., Ltd.does not exceed RMB1.2 billion. As of 30 June 2022, the balance of the Company’s deposit in Guangdong RisingFinance Co., Ltd. is RMB455,268,213.16, and the undue interest income receivable is RMB956,827.44.
6. Accounts Receivable and Payable of Related Party
(1) Accounts Receivable
Unit: RMB
Item | Related party | Ending balance | Beginning balance | ||
Carrying amount | Bad debt provision | Carrying amount | Bad debt provision | ||
Deposit interest | Guangdong Rising Finance Co., Ltd. | 956,827.44 | 1,514,111.47 | ||
Accounts receivable | NationStar Optoelectronics (Germany) Co., Ltd. | 11,887,227.13 | |||
Accounts receivable | Guangdong New Electronics Information Import& Export Ltd. | 9,876,694.00 | 10,627,013.80 | 318,810.41 | |
Accounts receivable | Guangdong Rising Rare Metals and New Photoelectric Materials Co., Ltd. | 6,455,385.93 | 193,661.58 | 6,455,385.93 | 193,661.58 |
Accounts receivable | Guangdong Yixin Changcheng Construction Group | 4,920,512.43 | 400,060.74 | 5,752,518.74 | 172,575.56 |
Accounts receivable | Prosperity Lamps & Components Limited | 4,011,147.66 | 120,334.43 | 7,536,111.98 | 226,083.36 |
Accounts receivable | Shenzhen Zhongjin Lingnan Nonfemet Co., | 1,464,123.60 | 43,923.71 | 2,621,178.80 | 78,635.36 |
Ltd. | |||||
Accounts receivable | Guangdong Zhongjin Lingnan Equipment Technology Co., Ltd. | 703,256.00 | 50,670.65 | 670,784.00 | 46,301.49 |
Accounts receivable | Guangdong Heshun Property Management Co., Ltd. The Pinnacle Branch | 669,790.40 | 20,093.71 | 669,790.40 | 20,093.71 |
Accounts receivable | Guangzhou Shengdu Investment Development Co., Ltd. | 318,600.00 | |||
Accounts receivable | Guangdong Zhongnan Construction Co., Ltd. | 218,038.46 | 6,541.15 | 1,095,727.04 | 32,871.81 |
Accounts receivable | Guangdong Rising South Construction Co., Ltd. | 66,698.32 | 2,000.95 | ||
Accounts receivable | Guangzhou Huajian Engineering Construction Co., Ltd. | 44,823.00 | 9,591.98 | 44,823.00 | 4,445.48 |
Accounts receivable | Guangdong Heshun Property Management Co., Ltd. | 2,303.60 | 230.36 | 2,303.60 | 69.11 |
Accounts receivable | Guangdong Zhongjin Lingnan Engineering Technology Co., Ltd. | 10,118.00 | 303.54 | ||
Prepayments | Prosperity (China) Electrical Company Limited | 39,428.00 | |||
Other receivables | Guangdong The Great Wall Building Co., Ltd. | 53,041.92 | 1,060.84 | 45,600.00 | 912.00 |
Other receivables | Guangdong New Electronics Information Import& Export Ltd. | 8,865.50 | 8,865.50 | 265.97 | |
Other receivables | Guangdong Huajian Enterprise Group Co., Ltd. | 7,060,000.00 | 211,800.00 | ||
Other non-current assets | Guangdong Electronics Information Industry Group Ltd. | 275,394,068.90 | |||
Other non-current assets | Guangdong Rising Holdings Group Co., Ltd. | 159,735,852.51 | |||
Other non-current assets | Guangdong Rising Capital Investment Co., Ltd. | 19,999,513.57 | |||
Total | 41,696,763.39 | 848,170.10 | 499,243,767.24 | 1,306,829.38 |
(2) Accounts Payable
Unit: RMB
Item | Related party | Ending carrying amount | Beginning carrying amount |
Notes payable | Foshan NationStar Optoelectronics Co., Ltd. | 2,655,311.08 | 5,816,952.78 |
Accounts payable | Foshan NationStar Optoelectronics Co., Ltd. | 21,058,724.95 | 13,989,061.63 |
Accounts payable | Guangdong Zhongnan Construction Co., Ltd. | 2,268,254.52 | 12,370,475.74 |
Accounts payable | Guangdong Fenghua Advanced Technology (Holding) Co., Ltd. | 2,110,641.52 | 872,962.28 |
Accounts payable | Prosperity Lamps & Components Limited | 773,460.05 | 1,337,304.32 |
Accounts payable | Hangzhou Times Lighting Electric Appliances Co., Ltd. | 238,275.04 | 178,185.14 |
Accounts payable | Guangdong Yixin Changcheng Construction Group | 26,170.28 | 3,698,122.01 |
Accounts payable | Prosperity (China) Electrical Company Limited | 567,218.00 | |
Other payables | Guangdong Zhongren Group Construction Co., Ltd | 73,816,998.27 | 163,292,707.38 |
Other payables | Guangdong Huajian Enterprise Group Co., Ltd. | 1,726,264.40 | 1,726,264.40 |
Other payables | Guangdong Electronic Technology Research Institute | 660,625.55 | -194,000.00 |
Other payables | Shenzhen Yuepeng Construction Co., Ltd. | 140,000.00 | 298,300.64 |
Other payables | Dongjiang Environmental Company Limited and its holding subsidiary | 47,816.00 | 118,352.30 |
Other payables | Guangdong Fenghua Advanced Technology (Holding) Co., Ltd. | 30,000.00 | 30,000.00 |
Other payables | Nanning Ruixiang Industrial Investment Co., Ltd. | 120,352,181.20 | 120,352,181.20 |
Other payables | Guangdong Electronic Technology Research Institute | 391,025.00 | |
Other payables | Foshan NationStar Optoelectronics Co., Ltd. | 230,354.07 | 240,354.07 |
Contract liabilities, other current liabilities | Prosperity (China) Electrical Company Limited | 21,369.20 | 59,428.00 |
Contract liabilities, other current liabilities | Guangdong Rising South Construction Co., Ltd. | 9,936.00 | 3,233.00 |
Contract liabilities, other current liabilities | Guangdong Heshun Property Management Co., Ltd. | 2,303.60 | 2,303.60 |
Total | 226,168,685.73 | 325,150,431.49 |
7. Commitments of Related Party
1. Commitment on Avoidance of Horizontal Competition
(1) Commitment maker: Electronics Group and Hong Kong Rising Investment
Contents of Commitment: Electronics Group and its acting-in-concert parties Hong Kong Rising Investment havemade more commitments as follows to avoid horizontal competition with the Company: 1. They shall conductsupervision and restraint on the production and operation activities of themselves and their relevant enterprises so
that besides the enterprise above that is in horizontal competition with the Company for now, if the products orbusiness of them or their relevant enterprises become the same with or similar to those of the Company or itssubsidiaries in the future, they shall take the following measures: (1) If the Company thinks necessary, they andtheir relevant enterprises shall reduce and wholly transfer their relevant assets and business; and (2) If theCompany thinks necessary, it is given the priority to acquire first, by proper means, the relevant assets andbusiness of them and their relevant enterprises. 2. All the commitments made by them to eliminate or avoidhorizontal competition with the Company are also applicable to their directly or indirectly controlled subsidiaries.They are obliged to urge and make sure that other subsidiaries execute what’s prescribed in the relevant documentand faithfully honor all the relevant commitments. 3. If they or their directly or indirectly controlled subsidiariesbreak the aforesaid commitments and thus cause a loss for the Company, they shall compensate the Company on arational basis.Date of commitment making: 4 December 2015Term of commitment: Long-standingFulfillment: In execution
(2) Commitment maker: Rising Group
Contents of Commitment: 1. The Promisor will take active measures to avoid any business or activity thatcompetes or may compete with the principal business of the Company and its auxiliary enterprises, and urge thePromisor to control enterprises to avoid any business or activity that competes or may compete with the principalbusiness of the Company and its auxiliary enterprises. 2. If the Promisor and its controlled enterprises are giventhe opportunity to engage in new business that constitutes or may constitute horizontal competition with theprincipal businesses of the Company and its auxiliary enterprises, the Promisor will make every effort to make thebusiness opportunity first available to the Company or its auxiliary enterprises on reasonable and fair terms andconditions on the premise that conditions permit and in the interest of the listed company.Date of commitment making: 4 November 2021Term of commitment: Long-standingFulfillment: In execution
(3)Commitment maker: Rising Group, Rising Capital, and Hongkong Wah ShingContents of Commitment: 1. They shall conduct supervision and restraint on the production and operationactivities of themselves and their relevant enterprises so that besides the enterprise above that is in horizontalcompetition with FSL for now, if the products or business of them or their relevant enterprises become the samewith or similar to those of FSL or its subsidiaries in the future, they shall take the following measures: (1) If FSLthinks necessary, they and their relevant enterprises shall reduce and wholly transfer their relevant assets andbusiness; and (2) If FSL thinks necessary, it is given the priority to acquire first, by proper means, the relevantassets and business of them and their relevant enterprises. 2. All the commitments made by them to eliminate oravoid horizontal competition with FSL are also applicable to their directly or indirectly controlled subsidiaries.They are obliged to urge and make sure that other subsidiaries execute what’s prescribed in the relevant documentand faithfully honor all the relevant commitments. 3. If they or their directly or indirectly controlled subsidiariesbreak the aforesaid commitments and thus cause a loss for FSL, they shall compensate FSL on a rational basis.Date of commitment making: 27 October 2021.Term of commitment: Long-standing.Fulfillment: In execution.
2. Commitment on Reduction and Regulation of Related-party Transactions
(1) Commitment maker: Electronics Group and Hong Kong Rising Investment
Contents of Commitment: Electronics Group and its acting-in-concert parties Hongkong Wah Shing and Hong
Kong Rising Investment have made a commitment that during their direct or indirect holding of the Company’sshares, they shall 1. Strictly abide by the regulatory documents of the CSRC and the SZSE, the Company’sArticles of Association, etc. and not harm the interests of the Company or other shareholders of the Company intheir production and operation activities by taking advantage of their position as the controlling shareholder andactual controller; 2. make sure that they or their other controlled subsidiaries, branch offices, jointly-run orassociated companies (the “Relevant Enterprises” for short) will try their best to avoid or reduce related-partytransactions with the Company or the Company’s subsidiaries; 3. strictly follow the market principle of justness,fairness and equal value exchange for necessary and unavoidable related-party transactions between them andtheir Relevant Enterprises and the Company, and withdraw from voting when a related-party transaction withthem or their Relevant Enterprises is being voted on at a general meeting or a board meeting, and execute therelevant approval procedure and information disclosure duties pursuant to the applicable laws, regulations andregulatory documents. Where the aforesaid commitments are broken and a loss is thus caused for the Company,its subsidiaries or the Company’s other shareholders, they shall be obliged to compensate.Date of commitment making: 4 December 2015Term of commitment: Long-standingFulfillment: In execution
(2) Commitment maker: Rising Group
Contents of Commitment: 1. Strictly abide by the regulatory documents of the CSRC and the SZSE, the Company’sArticles of Association, etc; and not harm the interests of the Company or other shareholders of the Company intheir production and operation activities by taking advantage of their position as the controlling shareholder andactual controller; 2. make sure that they or their other controlled subsidiaries, branch offices, jointly-run orassociated companies (the "Relevant Enterprises" for short) will try their best to avoid or reduce related-partytransactions with the Company or the Company’s subsidiaries; 3. strictly follow the market principle of justness,fairness and equal value exchange for necessary and unavoidable related-party transactions between them and theirRelevant Enterprises and the Company, and withdraw from voting when a related-party transaction with them ortheir Relevant Enterprises is being voted on at a general meeting or a board meeting, and execute the relevantapproval procedure and information disclosure duties pursuant to the applicable laws, regulations and regulatorydocuments.Date of commitment making: 4 November 2021Term of commitment: Long-standingFulfillment: In execution
(3)Commitment maker: Rising Group, Rising Capital, and Hongkong Wah ShingContents of Commitment: They have made a commitment that during their direct or indirect holding of FSLactivities of themselvesstrictly abide by the regulatory documents of the CSRC and the SZSE,FSL’s Articles ofAssociation, etc. and not harm the interests of the Company or other shareholders of FSL in their production andoperation activities by taking advantage of their position as the controlling shareholder and actual controller; 2.make sure that they or their other controlled subsidiaries, branch offices, jointly-run or associated companies (the"Relevant Enterprises" for short) will try their best to avoid or reduce related-party transactions with FSL or FSL’ssubsidiaries; 3. strictly follow the market principle of justness, fairness and equal value exchange for necessary andunavoidable related-party transactions between them and their Relevant Enterprises and FSL, and withdraw fromvoting when a related-party transaction with them or their Relevant Enterprises is being voted on at a generalmeeting or a board meeting, and execute the relevant approval procedure and information disclosure duties pursuantto the applicable laws, regulations and regulatory documents. Where the aforesaid commitments are broken and aloss is thus caused for FSL, its subsidiaries or FSL’s other shareholders, they shall be obliged to compensate.
Date of commitment making: 27 October 2021.Term of commitment: Long-standing.Fulfillment: In execution.
3. Commitment on Independence
(1) Commitment maker: Electronics Group and Hong Kong Rising Investment
Contents of Commitment: In order to ensure the independence of FSL in business, personnel, asset, organizationand finance, Electronics Group and Hong Kong Rising Investment have made the following commitments: 1. Theywill ensure the independence of FSL in business: (1) They promise that FSL will have the assets, personnel,qualifications and capabilities for it to operate independently as well as the ability of independent, sustainableoperation in the market. (2) They promise not to intervene in FSL’s business activities other than the execution oftheir rights as FSL’s shareholders. (3) They promise that they and their related parties will not be engaged inbusiness that is substantially in competition with FSL’s business. And (4) They promise that they and their relatedparties will try their best to reduce related-party transactions between them and FSL; for necessary and unavoidablerelated-party transactions, they promise to operate fairly following the market-oriented principle and at fair prices,and execute the transaction procedure and the duty of information disclosure pursuant to the applicable laws,regulations and regulatory documents. 2.They will ensure the independence of FSL in personnel: (1) They promisethat FSL’s GM, deputy GMs, CFO, Company Secretary and other senior management personnel will work only forand receive remuneration from FSL, not holding any positions in them or their other controlled subsidiaries otherthan director and supervisor. (2) They promise FSL’s absolute independence from their related parties in labor,human resource and salary management. And (3) They promise to follow the legal procedure in theirrecommendation of directors, supervisors and senior management personnel to FSL and not to hire or dismissemployees beyond FSL’s Board of Directors and General Meeting. 3. They will ensure the independence andcompleteness of FSL in asset: (1) They promise that FSL will have a production system, an auxiliary productionsystem and supporting facilities for its operation; legally have the ownership or use rights of the land, plants,machines, trademarks, patents and non-patented technology in relation to its production and operation; and haveindependent systems for the procurement of raw materials and the sale of its products. (2) They promise that FSLwill have independent and complete assets all under FSL’s control and independently owned and operated by FSL.And (3) They promise that they and their other controlled subsidiaries will not illegally occupy FSL’s funds andassets in any way, or use FSL’s assets to provide guarantees for the debts of themselves or their other controlledsubsidiaries with. 4. They will ensure the independence of FSL in organization: (1) They promise that FSL has asound corporate governance structure as a joint-stock company with an independent and complete organizationstructure. (2) They promise that the operational and management organs within FSL will independently executetheir functions according to laws, regulations and FSL’s Articles of Association. 5. They will ensure theindependence of FSL in finance: (1) They promise that FSL will have an independent financial department andfinancial accounting system with normative, independent financial accounting rules. (2) They promise that FSL willhave independent bank accounts and not share bank accounts with its related parties. (3) They promise that FSL’sfinancial personnel do not hold concurrent positions in its related parties. (4) They promise that FSL willindependently pay its tax according to law. And (5) They promise that FSL can make financial decisionsindependently and that they will not illegally intervene in FSL’s use of its funds.Date of commitment making: 4 December 2015Term of commitment: Long-standingFulfillment: In execution
(2) Commitment maker: Rising Group
Contents of Commitment: To maintain the independence of the Company, the Promisor has made the following
commitments: 1. It will ensure the personnel independence of the Company. It promises to ensure personnelindependence with the Company, and GM, deputy GMs, CFO, Secretary of the Board of Directors and other seniormanagement personnel of the Company will not hold positions other than directors and supervisors in theenterprises wholly owned, controlled or actually controlled by it and its subsidiaries (hereinafter referred to as"subsidiaries"), and will not receive salaries from it or its subsidiaries. the Company: To maintain the independenceof the Company, the Promisor has made the following commitments: 1. It will ensure the personnel independence ofthe Company. It promises to ensure personnel independence with the Company, and GM, depnd (2) It promises thatit and its subsidiaries will not illegally occupy the Company’s funds and assets in any way. 3. It will ensure thefinancial independence of the Company: (1) It promises that the Company will have an independent financialdepartment and financial accounting system. (2) It promises that the Company will have a standardized andindependent financial accounting system. (3) It promises that the Company will have independent bank accountsand not share bank accounts with it. (4) It promises that the Company’s financial personnel do not hold concurrentpositions in it or its subsidiaries. And (5) It promises that the Company can make financial decisions independentlyand that they will not illegally intervene in the Company’s use of its funds. 4. It will ensure the independence of theCompany in organization: (1) It promises that the Company can operate independently with an independent andcomplete organization structure. (2) It promises that the office and production and business premises of theCompany are separated from those of Rising Holdings Group. And (3) It promises that the Board of Directors, theSupervisory Committee and various functional departments of the Company operate independently, and there is nosubordinate relationship with the functional departments of Rising Holdings Group. And 5, It will ensure theindependence of the Company in business: (1) It promises that the Company will have independence in business.And (2) It promises that the Company will have the assets, personnel, qualifications and capabilities for it to operateindependently as well as the ability of independent, sustainable operation in the market.Date of commitment making: 4 November 2021Term of commitment: Long-standingFulfillment: In execution
4. Commitment on effective performance of measures to fill up returns
Commitment maker: Rising Group, Rising Capital, Electronics Group, Hongkong Wah Shing, Hong Kong RisingInvestment and Shenzhen Rising InvestmentContents of Commitment: 1. They promise not to interfere in the operation and management activities of the listedcompany beyond their authority and not to encroach on the interests of the listed company. 2. From the date ofissuance of these commitments to the completion of this trading of the listed company, if the CSRC makes newregulatory requirements on measures to fill up returns and commitments of relevant personnel, and the abovecommitments cannot meet these new regulatory requirements of the CSRC, they promise to issue supplementarycommitments according to the latest regulations of the CSRC at that time. 3. They promise to earnestly fulfill themeasures to fill up returns formulated by the listed company and any commitments made by them. If they violatethese commitments and causes losses to the listed company or investors, they are willing to bear the compensationresponsibility for the listed company or investors according to law. As one of the subjects responsible for themeasures to fill up returns, if they violate the above commitments or refuses to fulfill the above commitments, theyagree that the securities regulatory agencies such as the CSRC and the SZSE will punish them or take relevantregulatory measures in accordance with the relevant regulations and rules they formulated or issued.Date of commitment making: 27 October 2021.Term of commitment: Long-standing.Fulfillment: In execution.
5. Commitment on non-reduction of FSL shares during major asset restructuring
Commitment maker: Rising Group, Rising Capital, Electronics Group, Hongkong Wah Shing, Hong Kong RisingInvestment and Shenzhen Rising InvestmentContents of Commitment: 1. They promise that there will be no share reduction plan from the date of issuance ofthis Letter of Commitments to the completion of this trading, and they will not reduce its FSL shares in any otherway (except the transfer or transfer between Rising Holdings Group and its wholly-owned subsidiaries). 2. If FSLimplements ex-rights behaviors such as share conversion, share offering and share allotment from the date ofissuance of this Letter of Commitments to the completion of this trading, the newly added shares obtained by themwill also be subject to the above commitments related to not reducing share holdings.Date of commitment making: 28 September 2021.Term of commitment: Until the completion of this trading.Fulfillment: Complete
6. Commitment on compensation for possible violations of laws and regulations by NationStarOptoelectronicsCommitment maker: Rising Holdings Group, Electronics Group, and Rising CapitalContents of Commitment: If NationStar Optoelectronics is subject to administrative penalties such as accountabilityand fines by relevant competent departments after the completion of this trading due to the illegal acts of NationStarOptoelectronics before the completion of this acquisition, they promise to fully bear the losses of NATIONSTAR orFSL, as well as the expenses and fees under punishment or recourse, to ensure that NationStar Optoelectronics orFSL will not suffer any economic losses.Date of commitment making: 27 October 2021.Term of commitment: Long-standing.Fulfillment: In execution.
7. Commitment on explanation of confidentiality measures and confidentiality system adopted for thistradingCommitment maker: Rising Group, Electronics Group, and Rising CapitalContents of Commitment: 1. During the preliminary negotiation between the listed company and the counterpartyon this trading, necessary and sufficient confidentiality measures were taken to limit the scope of knowledge ofrelevant sensitive information. According to the requirements of the SZSE, the listed company have completed thesubmission and online reporting of the memorandum of trading process, relevant materials of insider informationinsiders. The listed company have hired independent financial advisers, legal advisers, audit institutions, valuationinstitutions and other intermediaries, and signed confidentiality agreements or appointment agreements withconfidentiality clauses with the above intermediaries, clearly stipulating the scope of confidential information andthe confidentiality responsibilities of each intermediary.Date of commitment making: 27 October 2021.Term of commitment: Until the completion of this trading.Fulfillment: Complete.
8. Commitment on the truthfulness, accuracy and completeness of the information provided during thismajor asset restructuring
(1) Commitment maker: Rising Group, Electronics Group, and Rising Capital
Contents of Commitment: 1. They promise that the information provided is true, accurate and complete, and thereare no false records, misleading statements or material omissions. 2. They have provided relevant information anddocuments (including but not limited to original written materials, duplicate materials or oral testimony, etc.) relatedto this trading to the intermediaries. They promise that the copies or photocopies of the documents and materialsprovided are consistent with the originals, and that the signatures and seals of the documents and materials are
authentic, and the signatories of the documents have been legally authorized and effectively signed the documents;that there are no false records, misleading statements or material omissions. 3. They promise that the explanationsand confirmations issued by them are true, accurate and complete, and there are no false records, misleadingstatements or material omissions. 4. During this trading, they will disclose the information about this trading in atimely manner in accordance with relevant laws and regulations, the CSRC and the SZSE, and ensure theauthenticity, accuracy and completeness of such information. 5. They shall bear legal responsibility for theauthenticity, accuracy and completeness of the information, documents, materials, explanations and confirmationsprovided. In case of any violation or losses caused to the listed company, investors, parties to the trading andintermediaries participating in this trading, they will be liable for compensation according to law. 6. Where theinformation provided or disclosed by them in this trading is suspected of false records, misleading statements ormaterial omissions, and they are filed for investigation by the judicial organ or by the CSRC, the shares withinterests in the listed company will not be transferred until the investigation conclusion is formed.Date of commitment making: 27 October 2021.Term of commitment: Long-standing.Fulfillment: In execution.
(2) Commitment maker: NationStar Optoelectronics
Contents of Commitment: NationStar Optoelectronics has provided the necessary, true, accurate, complete andeffective documents, materials or oral statements and explanations for this trading at this stage, and there is noconcealment, falsehood or material omission. The copies or photocopies of the documents provided are consistentwith the original materials or originals. The signatures and seals on the documents and materials provided areauthentic, and NationStar Optoelectronics has fulfilled the legal procedures required for such signatures and sealsand obtained legal authorization. All the facts stated and explained are consistent with the facts that happened.Date of commitment making: 27 October 2021.Term of commitment: Long-standing.Fulfillment: In execution.
(3)Commitment maker: Sigma
Contents of Commitment: 1. Sigma has provided relevant information and documents (including but not limited tooriginal written materials, duplicate materials or oral testimony, etc.) related to this trading to the intermediariesproviding professional services of auditing, valuation, legal and financial consultancy for this trading. Sigmapromises that the copies or photocopies of the documents and materials provided are consistent with the originals,and that the signatures and seals of the documents and materials are authentic, and the signatories of the documentshave been legally authorized and effectively signed the documents; that the provided information and documents areauthentic, accurate and complete and that there are no false records, misleading statements or material omissions.FSL also promises to bear individual and joint and several liability. 2. Sigma promises that the information providedis true, accurate and complete. In case of any losses caused to investors due to any false presentations, misleadingstatements or material omissions in the information provided, Sigma will be liable for compensation according tolaw.Date of commitment making: 27 October 2021Term of commitment: Long-standing..Fulfillment: In execution.
9. Commitment on the clarity of the underlying assets of this major asset restructuring
(1) Commitment maker: Electronics Group
Contents of Commitment: Electronics Group promises that the 100% equity of Sigma it held is clear in ownershipand is not subject to any dispute or potential dispute, and there is no situation affecting its legal existence; and
there is no pending or potential litigation, arbitration and any other administrative or judicial procedure that maylead to the seizure, freezing, expropriation or restriction of transfer of the above-mentioned equity by the relevantjudicial or administrative organs. There is no entrusted shareholding or trust shareholding, restriction orprohibition of transfer of the above-mentioned equity controlled by Electronics Group.Date of commitment making: 27 October 2021.Term of commitment: Long-standing.Fulfillment: In execution.
(2) Commitment maker: Rising Group
Contents of Commitment: Rising Group promises that 46,260,021 shares of NationStar Optoelectronics it held isclear in ownership and is not subject to any dispute or potential dispute, and there is no situation affecting its legalexistence; the above shares are not subject to any other pledges, guarantees or third-party interests or restrictionsand there is no pending or potential litigation, arbitration and any other administrative or judicial procedure thatmay lead to the seizure, freezing, expropriation or restriction of transfer of the above-mentioned equity by therelevant judicial or administrative organs. There is no entrusted shareholding or trust shareholding, restriction orprohibition of transfer of the above-mentioned equity controlled by Rising Group.Date of commitment making: 27 October 2021.Term of commitment: Long-standing.Fulfillment: In execution.
(3) Commitment maker: Rising Capital
Contents of Commitment: Rising Capital promises that 5,791,924 shares of NationStar Optoelectronics it held isclear in ownership and is not subject to any dispute or potential dispute, and there is no situation affecting its legalexistence; the above shares are not subject to any other pledges, guarantees or third-party interests or restrictionsand there is no pending or potential litigation, arbitration and any other administrative or judicial procedure thatmay lead to the seizure, freezing, expropriation or restriction of transfer of the above-mentioned equity by therelevant judicial or administrative organs. There is no entrusted shareholding or trust shareholding, restriction orprohibition of transfer of the above-mentioned equity controlled by Rising Group.Date of commitment making: 27 October 2021.Term of commitment: Long-standing.Fulfillment: In execution.
(4)Commitment maker: Sigma
Contents of Commitment: Among 79,753,050 shares of tradable shares with unlimited selling conditions ofNationStar Optoelectronics held by Sigma, 39,876, 500 shares were pledged for Guangdong ElectronicsInformation Industry Group Ltd. As of the date of issuance of this commitment, the pledge of the above shares hasbeen released. However, the Maximum Pledge Contract for Stocks of Listed Companies (No.: XYYZZ (BY)No.201906280001-2) signed by Sigma and Guangzhou Branch of Industrial Bank Co., Ltd. has not been dissolved.Guangdong Electronics Information Industry Group Ltd. has promised that it will not add any new loans toGuangzhou Branch of Industrial Bank Co., Ltd. as a borrower during the validity period of the guarantee, and that itwill not substantially assume any guarantee responsibility due to the Maximum Pledge Contract for Stocks of ListedCompanies. Except as aforesaid, the asset ownership of Sigma is clear, there is no dispute or potential dispute, andthere is no situation affecting the legal existence. There is no entrusted shareholding or trust shareholding,restriction or prohibition of transfer of the above-mentioned equity controlled by Rising Holdings Group.Date of commitment making: 27 October 2021Term of commitment: Long-standing.Fulfillment: In execution.
10. Commitment on compliance of this major asset restructuring with Several Provisions on the Reduction ofShares by Shareholders, Directors and Supervisors of Listed CompaniesCommitment maker: Rising Group and Rising CapitalContents of Commitment: 1. They are not subject to any securities and futures crimes as stipulated in Article 6 ofSeveral Provisions on the Reduction of Shares by Shareholders, Directors and Supervisors of Listed Companies.During the period when the CSRC or the judicial organ filed a case for investigation, and less than six monthsafter the administrative penalty decision and criminal judgment were made, there was no situation that the sharesof NATIONSTAR could not be reduced due to violation of the rules of stock exchanges and public censure bystock exchanges for less than three months. 2. In case of any violation or losses caused to NATIONSTAR,investors, parties to the trading and intermediaries participating in this trading, they will be liable forcompensation according to law.Date of commitment making: 27 October 2021.Term of commitment: Until the completion of this trading.Fulfillment: Complete.
11. Commitment on the release of credit guarantee
Commitment maker: Electronics GroupContents of Commitment: 1. As of the date of issuance of the Letter of Commitments, Sigma has signed theMaximum Guarantee Contract (Contract No.: XYYBZ (BY) No.201906280001-1) and the Maximum PledgeContract for Stocks of Listed Companies (Contract No.: XYYZZ (BY) No.201906280001-2) with GuangzhouBranch of Industrial Bank Co., Ltd. Sigma will provide the maximum guarantee and pledge guarantee for the debt ofElectronics Group, with the guarantee amount of RMB400 million (in words: RMB Four Hundred Million), and theguarantee will be valid from 28 June 2019 to 27 June 2022. Electronics Group promises that on the date of issuanceof this Letter of Commitment, all the loans involved in the Maximum Guarantee Contract and the Maximum PledgeContract for Stocks of Listed Companies have been repaid, there is no debt based on the guarantee under the abovecontracts, and 39,876,500 shares of NationStar Optoelectronics held by Sigma have been released from pledge. Atthe same time, Electronics Group further makes an irrevocable commitment that it will not add any new loans toGuangzhou Branch of Industrial Bank Co., Ltd. as a borrower before the expiration date of the Maximum GuaranteeContract and the Maximum Pledge Contract for Stocks of Listed Companies, so as to ensure that Sigma will notactually assume any guarantee responsibilities due to the above guarantee contracts. 2. Electronics Group promisesthat it will not arrange for Sigma to add any form of guarantee before the completion of the delivery of Sigma'sequity in this trading. 3. In case of any violations of the above commitments, Electronics Group shall solve andeliminate the above situation within ten days, and bear corresponding legal responsibilities to Sigma and FSL.Date of commitment making: 27 October 2021Term of commitment: Until the completion of this trading.Fulfillment: Complete.
12. Commitment on no ownership dispute in equity
Commitment maker: SigmaContents of Commitment: 1. Sigma promises that all its registered capital has been paid in. 2. Sigma promises thatall existing shareholders contribute their own funds to hold shares, there is no situation such as holding shares onbehalf of them, and there is no dispute or potential dispute between shareholders over their shares.Date of commitment making: 27 October 2021Term of commitment: Long-standing.Fulfillment: In execution.13.About absence of insider trading
Commitment maker: Key management personnel of Rising Group, Electronics Group, and Rising CapitalContents of Commitment: They promise that they will not disclose the relevant insider information of this trading or make use ofthe insider information for insider trading; 2. As of the issuance date of the Report on Major Asset Purchase and Related PartyTrading of Foshan Electrical and Lighting Co., Ltd. (Draft), they have not been placed on file for investigation or criminalinvestigation due to suspected insider trading related to this trading, and have not been subject to administrative punishment by theCSRC or criminal responsibility investigated by judicial organs according to law for insider trading related to any major assetrestructuring, and have not been prohibited from engaging in any major asset restructuring of listed companies according to Article13 of the Interim Provisions on Strengthening the Supervision of Abnormal Stock Trading Related to Major Asset Restructuring ofListed Companies in the last 36 months; 3. In case of violation of the above commitments, they will bear all losses caused to thelisted company and its shareholders.Date of commitment making: 27 October 2021Term of commitment: From the date of the issuance of the letter of commitment until the completion of this tradingFulfillment: Complete.
8. Other
NaughtXIII. Stock Payment
1. The Overall Situation of Stock Payment
□Applicable ? Not applicable
2. The Stock Payment Settled in Equity
□Applicable ? Not applicable
3. The Stock Payment Settled in Cash
□Applicable ? Not applicable
4. Modification and Termination of the Stock Payment
Naught
5. Other
Naught
XIV. Commitments and Contingency
1. Significant Commitments
Significant commitments on the balance sheet dateNaught
2. Contingency
(1) Significant Contingency on Balance Sheet Date
Refer to VIII Legal Matters in Part VI of this Report for details.
(2) In Despite of no Significant Contingency to Disclose, the Company Shall Also Make RelevantStatementsThere was no significant contingency in the Company.
3. Other
As of 30 June 2022, guarantees of subsidiaries were as follows (RMB’0,000):
Principal debtor | Principal debtee | Guarantor | Type of guarantee | Guarantee amount | Guarantee balance |
Nanning Liaowang (note 1) | Nanning Branch of Industrial Bank | Kuang Linchang, Liang Xiaoling, Yang Shiyue, Gu Hanhua, Qingdao Lighting, Liuzhou Lighting, Chongqing Guinuo | Joint-liability guarantee | 20,000.00 | 0.00 |
Nanning Liaowang (note 2) | Far Eastern International Financial Leasing Co., Ltd. | Nanning Liaowang, Qingdao Lighting, Liuzhou Lighting, Kuang Linchang, Liang Xiaoling, Yang Shiyue, Gu Hanhua | Joint-liability guarantee | 2,600.00 | 375.01 |
Liuzhou Lighting (note 3) | Nanning Branch of Industrial Bank | Nanning Liaowang, Liuzhou Lighting, Kuang Linchang, Liang Xiaoling, Yang Shiyue, Gu Hanhua | Joint-liability guarantee | 15,000.00 | 0.00 |
Chongqing Guinuo (note 4) | Far Eastern International Financial Leasing Co., Ltd. | Nanning Liaowang, Qingdao Lighting, Liuzhou Lighting, Kuang Linchang, Liang Xiaoling, Yang Shiyue, Gu Hanhua | Joint-liability guarantee | 3,999.00 | 757.06 |
Nanning Liaowang, Liuzhou Foreshine, Liuzhou Lighting (note 5) | Nanning Branch of Industrial Bank | Nanning Liaowang Auto Lamp Co., Ltd. | Mortgage | 4,500.00 | 4,500.00 |
Nanning Liaowang (note 6) | Nanning Branch of Industrial Bank | Chongqing Guinuo Lighting Technology Co., Ltd. | Mortgage | 8,100.00 | 5,000.00 |
Nanning Liaowang, Liuzhou Fuxuan, Liuzhou Lighting (note 7) | Nanning Branch of Industrial Bank | Liuzhou Guige Lighting Technology Co., Ltd. | Mortgage | 9,100.00 | 3,500.00 |
NationStar Semiconductor (note 8) | Foshan Branch of China Merchants Bank | Foshan NationStar Optoelectronics Co., Ltd. | Joint-liability guarantee | 30,000.00 | 0.00 |
Total | —— | —— | —— | 93,299.00 | 14,132.07 |
Note 1: Nanning Liaowang and Nanning Branch of Industrial Bank signed the Working Capital Loan Contract(XYGCBLJ Zi (2021) No.1001), with a loan amount of RMB47.7 million (from 1 February 2021 to 1 February2022). This guarantee has been terminated. Kuang Linchang, Liang Xiaoling, Yang Shiyue, Gu Hanhua, QingdaoLighting, Liuzhou Guige Lighting and Chongqing Guinuo jointly assume joint and several guarantee liabilities forall creditor's rights balances under the maximum principal limit of RMB200 million, and the guarantee amount isvalid from 30 December 2019 to 30 December 2024. This guarantee has been terminated on 1 February 2022.Note 2: On 18 May 2020, Nanning Liaowang and Far East International Financial Leasing Co., Ltd. (hereinafterreferred to as "Far East Leasing") signed the Sale Lease Contract (Contract No.: IFELC20DE24MZT-L-01), with afinancing loan amount of RMB26 million, and the actual loan amount obtained was RMB24 million (the differencewith the financing loan amount was RMB2 million as a deposit, which was withheld by Far East Leasing), and theloan term of finance lease is 30 months. Liuzhou Guige Lighting, Qingdao Lighting, Yang Shiyue, Gu Hanhua,Kuang Linchang and Liang Xiaoling provide joint and several liability guarantee for this financing loan. NanningLiaowang signed the Ownership Transfer Agreement with Far East Leasing. According to the General Terms andConditions of the Sale and Return Lease Contract: Under the condition that Party B (Nanning Liaowang, the samebelow) enjoys all the rights under this contract and does not affect Party B's normal use, Party A (Far East Leasing,the same below) may transfer its ownership of the leased items to any third party, or mortgage the leased items andother guarantees, and the validity of the contract will not be affected. Party A undertakes not to adversely affectParty B's rights (especially the performance of this contract) due to the transfer/mortgage. Party B shall perform thiscontract according to the contract, and Party A shall guarantee that Party B shall have the right to use the leaseditems and the ownership after the expiration of the lease period according to the contract.Note 3: Liuzhou Guige Lighting and Nanning Branch of Industrial Bank signed loan contracts numberedWYZH2021012600174, WYZH2021042100164 and WYZH2021042100146, borrowing RMB10 million (from 26January 2021 to 26 January 2022), RMB20 million (from 21 April 2021 to 21 April 2022), and RMB20 million(from 22 April 2021 to 22 April 2022) respectively. This guarantee has been terminated. Nanning Liaowang, KuangLinchang, Liang Xiaoling, Yang Shiyue and Gu Hanhua provide joint and several liability guarantee with themaximum balance of principal creditor's rights not exceeding RMB150 million exposure, and the guarantee amountis valid from 30 December 2019 to 30 December 2024. This guarantee has been terminated on 22 April 2022.Note 4: On 21 June 2020, Chongqing Guinuo signed the Sale and Return Lease Contract with Far East Leasing(Contract No.: IFELC20DE2XZXM-L-01), with a financing loan amount of RMB39.9 million and an actual loanamount of RMB35.99 million (the difference with the financing loan amount is RMB4 million as a deposit, which iswithheld by Far East Leasing), and the loan term of finance lease is 30 months. This financial lease loan ismortgaged by Chongqing Guinuo with 28 fixed assets and 104 molds owned by itself. Chongqing Guinuo signed theOwnership Transfer Agreement with Far East Leasing, and Nanning Liaowang, Liuzhou Guige Lighting, QingdaoLighting, Liang Xiaoling, Yang Shiyue, Gu Hanhua and Kuang Linchang provided joint and several liability
guarantee for the lease loan. According to the General Terms and Conditions of the Sale and Return Lease Contract:
Under the condition that Party B (Chongqing Guinuo, the same below) enjoys all the rights under this contract anddoes not affect Party B's normal use, Party A (Far East Leasing, the same below) may transfer its ownership of theleased items to any third party, or mortgage the leased items and other guarantees, and the validity of the contractwill not be affected. Party A undertakes not to adversely affect Party B's rights (especially the performance of thiscontract) due to the transfer/mortgage. Party B shall perform this contract according to the contract, and Party Ashall guarantee that Party B shall have the right to use the leased items and the ownership after the expiration of thelease period according to the contract.Note 5: Nanning Liaowang Auto Lamp Co., Ltd. (Nanning Liaowang) and Nanning Branch of Industrial Bank Co.,Ltd. entered into the Maximum Financing Agreement (X.Y.G.CH.B.R.Z.Z. [2022] No. (01)) to conduct a billtransaction of RMB45 million. Nanning Liaowang provides mortgage guarantee with the immovable propertyowned as collateral, and the balance of its creditor's rights does not exceed the maximum mortgage principal ofRM72,344,400 in the original guarantee contract. The mortgage amount is valid from 23 June 2020 to 23 June2025. This guarantee has been terminated on 24 April 2022. In the new guarantee contract, Nanning Liaowangprovides mortgage guarantee with the immovable property owned as collateral, and the balance of its creditor’srights does not exceed the maximum mortgage principal of RMB69,139,100. The mortgage amount is valid from25 April 2022 to 31 December 2025 and the guarantee amount is RMB45 million. The mortgaged real estate is a)YG (2017) NNSBDCQZ No.0065501; b) EG (2017) NNSBDCQZ No.0065499; c) SG (2017) NNSBDCQZNo.0065498; d) SG (2017) NNSBDCQZ No.0065497.Note 6: Nanning Liaowang and Nanning Branch of Industrial Bank Co., Ltd. entered into the Working Capital LoanContracts, numbered WYZH2022021100314 and WYZH2022021100248, with the loan amounts of RMB19.8million (from 11 February 2022 to 11 February 2023) and RMB30.2 million (from 11 February 2022 to 11 February2023), respectively. Chongqing Guinuo Lighting Technology Co., Ltd. (Chongqing Guinuo) provide mortgageguarantee with the immovable property owned as collateral, and the balance of its creditor's rights does not exceedthe maximum mortgage principal of RM122,294,700. The guarantee amount is RMB81 million and valid from 15June 2020 to 15 June 2023. The mortgaged real estate is a) YY (2020) LJXQBDCQ No.000436821, b) EY (2020)LJXQBDCQ No.000437330, c) SY (2020) LJXQBDCQ No.000437429 and d) SY (2020) LJXQBDCQNo.000437448.Note 7: Liuzhou Guige Photoelectric Technology Co., Ltd. (Liuzhou Guige) and Nanning Branch of IndustrialBank Co., Ltd. entered into the Working Capital Loan Contract, numbered WYZH2022050700423, with a loan ofRMB15 million (from 7 May 2022 to 7 May 2023). Liuzhou Guige and Nanning Branch of Industrial Bank Co., Ltd.entered into the Agreement on Banker's Acceptance Financing Business Cooperation (X.Y.G.CH.B.SH.X. [2022]No. 1002), with a loan of RMB15 million (from 7 May 2022 to 7 May 2023), to conduct a bill transaction of RMB20million. In the original guarantee contract, Liuzhou Guige provides mortgage guarantee with the immovableproperty owned as collateral, and the balance of its creditor's rights does not exceed RMB150 million. Themortgage amount is valid from 30 December 2019 to 30 December 2024. The guarantee has been terminated on23 April 2022. In the new guarantee contract, Liuzhou Guige provides mortgage guarantee with the immovableproperty owned as collateral, and the balance of its principal creditor's rights does not exceed RMB139,943,700.The guarantee amount is RMB91 million and valid from 24 April 2022 to 31 December 2025. The mortgaged realestate is: a) YG (2019) LZSBDCQ No.0191988, located at No.1 Factory Building, No.12 Hengsi Road, Cheyuan; b)EG (2019) LZSBDCQ No.0191991, located in the mold center of No.12 Hengsi Road, Cheyuan; c) SG (2019)LZSBDCQ No.0191994, located in the logistics gate guard room at No.12 Hengsi Road, Cheyuan; d) SG (2019)LZSBDCQ No.0191995, located in the guard room of Gate 12, Hengsi Road, Cheyuan.Note 8: Foshan NationStar Optoelectronics Co., Ltd. convened the 9
th Meeting of the 4
thBoard of Directors on 18
September 2017, on which, the Proposal on Providing Guarantee for the Company’s Wholly-owned Subsidiarywas reviewed and approved and the Company was agreed to provide a credit guarantee not exceeding RMB300million for the corporation overdraft conducted by its wholly-owned subsidiary NationStar Semiconductor atChina Merchants Bank. NationStar Semiconductor signed the Credit Agreement, numbered 757XY2018015331with Foshan Branch of China Merchants Bank which agreed to provide the credit line of RMB100 million forNationStar Semiconductor within the credit period stipulated in the Credit Agreement (from 28 May 2018 to 27May 2019). The guarantor Foshan NationStar Optoelectronics Co., Ltd. has given the Letter of IrrevocableGuarantee for Maximum Amount, numbered 757XY201801533101 to undertake joint liability guarantee for theprincipal debtor valid from 12 June 2018 to 27 May 2022. This guarantee has expired on 27 May 2022.
XV. Events after Balance Sheet Date
1. Significant Non-adjusted Events
Naught
2. Profit Distribution
Naught
3. Sales Return
Naught
4. Notes to Other Events after Balance Sheet Date
1. About the equity transfer of the sub-subsidiary NationStar Optoelectronics (Germany) Co., Ltd.Haolaite, a holding subsidiary of the Company, acquired 100% of the equities of NationStar Optoelectronics(Germany) Co., Ltd., a wholly-owned subsidiary of NATIONSTAR, the holding subsidiary, by means of paymentin cash. On 20 June 2022, an equity transfer agreement was entered into by both parties. On 13 July 2022,Haolaite paid RMB258,700 for the transfer of the 100% equities. On 21 July 2022, NationStar Optoelectronics(Germany) Co., Ltd. completed the application for transfer of domestic entities. As of the date of this report, thechange of NationStar Optoelectronics (Germany) Co., Ltd.'s overseas equities is still underway.
2. About the acquisition of the equities of Guangdong Fenghua Semiconductor Technology Co., Ltd. by theholding subsidiary and its connected transactionIn order to speed up the expansion of 3rd-general semiconductor business of NATIONSTAR, a holding subsidiaryof the Company, the Board of Directors agreed to NATIONSTAR's acquisition of 99.87695% of the equities ofGuangdong Fenghua Semiconductor Technology Co., Ltd. (hereinafter referred to as "Fenghua Semiconductor")held by Guangdong Fenghua Advanced Technology (Holding) Co., Ltd. (hereinafter referred to as "FenghuaAdvanced Technology") at RMB268,819,300. Guangdong Rising Holdings Group is the holding shareholder ofthe Company and Fenghua Advanced Technology, so Fenghua Advanced Technology is the connected legalperson of the Company according to the Stock Listing Rules of Shenzhen Stock Exchange, and this transactionconstitutes a connected transaction but does not constitute a significant assets spin-off under the AdministrativeMeasures for the Material Asset Reorganizations of Listed Companies.The Company convened the 33rd Meeting of the Ninth Board of Directors on 12 August 2022, at which the
Proposal on Holding Subsidiary's Acquisition of the Equities of Guangdong Fenghua Semiconductor TechnologyCo., Ltd. and Its Connected Transaction was deliberated and approved with seven votes of assent, zero votes ofdissent, zero votes of abstention and two votes of withdrawal. Connected directors Mr. Hu Fengcai and Mr. HuangZhiyong recused themselves from voting according to law. Independent directors of the Company expressedex-ante approval and independent opinions on the connected transactions in relation to this acquisition.Meanwhile, the Company convened the 3rd Extraordinary General Meeting in 2022 on 29 August 2022, at whichthe Proposal on Holding Subsidiary's Acquisition of the Equities of Guangdong Fenghua SemiconductorTechnology Co., Ltd. and Its Connected Transaction was deliberated and approved, and connected persons havingan interest in the connected transaction recused themselves from voting.
XVI. Other Significant Events
1. The Accounting Errors Correction in Previous Period
(1) Retrospective Restatement
Naught
(2) Prospective Application
Naught
2. Debt Restructuring
Naught
3. Assets Replacement
(1) Non-monetary Assets Exchange
Naught
(2) Other Assets Replacement
Naught
4. Pension Plans
In accordance with provisions of Measures for Enterprise Annuity (RSBL No. 36), Measures for ManagingEnterprise Annuity Fund (RSBL No. 11) and other policies, the Company has formulated the Enterprise AnnuityPlan of Foshan Electrical and Lighting Co., Ltd. (hereinafter referred to as the “Plan”).The Plan adopts the corporate trusteeship mode. The collected enterprise annuity fund will be managed by thetrustee entrusted by Foshan Electrical and Lighting Co., Ltd. with the Enterprise Annuity Fund TrusteeshipContract. And the trustee of the enterprise annuity fund will entrust eligible account managers, custodians andinvestment managers to provide unified related services. The expenses required shall be jointly borne by theCompany and the employees. The payment channels of the Company shall be implemented according to relevantregulations of the state, and the part that shall be paid by employees themselves will be withheld and paid by the
Company from their salaries.The Plan has been filed at Chancheng District Human Resources and Social Security Bureau of Foshan City andimplemented since 1 June 2022. The management of the enterprise annuity fund is subject to the supervision andinspection of relevant state departments.
5. Discontinued Operations
Naught
6. Segment Information
(1) Determination Basis and Accounting Policies of Reportable Segment
Naught
(2) The Financial Information of Reportable Segment
Naught
(3) If there Was no Reportable Segment, or the Total Amount of Assets and Liabilities of Each ReportableSegment Could not Be Reported, Relevant Reasons Shall Be Clearly StatedNaught
(4) Other notes
Naught
7. Other Significant Transactions and Events with Influence on Investors’ Decision-makingNaught
8. Other
(I) Demolition Matters of Nanjing FozhaoAccording to the Decision of Nanjing Lishui District People's Government on House Expropriation onState-owned Land of Honglan Street Affordable Housing Project in Lishui District (NLFZ Zi [2020] No.18), Thehouse owned by Nanjing Fozhao, a wholly-owned subsidiary of the Company, located at 688 Jinniu North Road,Honglan Street, Lishui District, Nanjing (the total construction area of the house is 44,558.09 square meters,which is an industrial house; The land use right covers an area of 135,882.4 square meters, which is industrial land)belongs to the expropriation scope, and the compensation, relocation fee, loss fee of production and businesssuspension and other rewards of the expropriated assets total RMB183,855,895.00. As of 30 June 2022, NanjingFozhao has received 30% of the compensation, that is, RMB55,160,000.00, and the land use right certificate andhouse ownership certificate of the assets involved have been cancelled. As of the date of this report, the sitehandover is still in progress. After the demolition work is completed, Nanjing Fozhao plans to carry outliquidation and cancellation.
XVII. Notes of Main Items in the Financial Statements of the Company as the Parent
1. Accounts Receivable
(1) Category of Accounts Receivable
Unit: RMB
Item | Ending balance | Beginning balance | ||||||||
Carrying amount | Bad debt provision | Carrying value | Carrying amount | Bad debt provision | Carrying value | |||||
Amount | Proportion | Amount | Withdrawal proportion | Amount | Proportion | Amount | Withdrawal proportion | |||
Accounts receivable for which bad debt provision separately accrued | 11,220,827.14 | 0.89% | 11,220,827.14 | 100.00% | 0.00 | 11,220,827.14 | 1.00% | 8,976,661.72 | 80.00% | 2,244,165.42 |
Of which: | ||||||||||
Accounts receivable for which bad debt provision accrued by group | 1,247,228,261.37 | 99.11% | 59,424,363.55 | 4.76% | 1,187,803,897.82 | 1,108,641,819.86 | 99.00% | 51,950,320.95 | 4.69% | 1,056,691,498.91 |
Of which: | ||||||||||
(1) Common business portfolio | 1,216,449,379.92 | 96.66% | 59,424,363.55 | 4.89% | 1,157,025,016.37 | 1,022,005,643.56 | 91.26% | 51,950,320.95 | 5.08% | 970,055,322.61 |
(2) Internal | 30,778,881.45 | 2.45% | 30,778,881.45 | 86,636,176.30 | 7.74% | 86,636,176.30 |
business portfolio | ||||||||||
Total | 1,258,449,088.51 | 100.00% | 70,645,190.69 | 5.61% | 1,187,803,897.82 | 1,119,862,647.00 | 100.00% | 60,926,982.67 | 5.44% | 1,058,935,664.33 |
Individual withdrawal of bad debt provision by single item:
Unit: RMB
Name | Ending balance | |||
Carrying amount | Bad debt provision | Withdrawal proportion | Reason for withdrawal | |
Customer A | 11,220,827.14 | 11,220,827.14 | 100.00% | Involved in the lawsuit; the Company won in the second instance judgment and not executed completely |
Total | 11,220,827.14 | 11,220,827.14 |
Withdrawal of bad debt provision by group:
Unit: RMB
Name | Ending balance | ||
Carrying amount | Bad debt provision | Withdrawal proportion | |
Credit risk portfolio | 1,247,228,261.37 | 59,424,363.55 | 4.76% |
Total | 1,247,228,261.37 | 59,424,363.55 |
Please refer to the relevant information of disclosure of bad debt provision of other accounts receivable if adopting the general modeof expected credit loss to withdraw bad debt provision of accounts receivable.
□Applicable ? Not applicable
Disclosure by aging
Unit: RMB
Aging | Ending balance |
Within 1 year (including 1 year) | 1,156,764,405.89 |
1 to 2 years | 55,152,654.80 |
2 to 3 years | 5,573,526.47 |
Over 3 years | 40,958,501.35 |
3 to 4 years | 21,341,828.20 |
4 to 5 years | 5,682,589.42 |
Over 5 years | 13,934,083.73 |
Total | 1,258,449,088.51 |
(2) Bad Debt Provision Withdrawn, Reversed or Recovered in the Reporting Period
Bad Debt Provision Withdrawn, Reversed or Recovered in the Reporting Period:
Unit: RMB
Category | Beginning balance | Changes in the Reporting Period | Ending balance | |||
Withdrawal | Reversal or recovery | Write-off | Withdrawal | |||
Bad debt | 8,976,661.72 | 2,244,165.42 | 0.00 | 11,220,827.1 |
provision withdrawn separately | 4 | |||||
Bad debt provision withdrawn by group | 51,950,320.95 | 7,474,298.96 | 256.36 | 59,424,363.55 | ||
Total | 60,926,982.67 | 9,718,464.38 | 0.00 | 256.36 | 70,645,190.69 |
Of which significant amount of reversed or recovered bad debt provision:
Naught
(3) Accounts Receivable with Actual Verification during the Reporting Period
Unit: RMB
Item | Amount |
Other driblet small amount | 256.36 |
Of which, verification of significant accounts receivable:
Unit: RMB
Name of the entity | Nature | Amount | Reason | Procedure | Whether occurred because of related-party transactions |
Other retails accounts | Payment for goods | 256.36 | Unrecoverable | The approval procedure is carried out according to the Company’s rules for managing bad debt. | Not |
Total | -- | 256.36 |
(4) Top 5 of the Ending Balance of the Accounts Receivable Collected according to the Arrears Party
Unit: RMB
Name of units | Ending balance of accounts receivable | Proportion to total ending balance of accounts receivable (%) | Ending balance of bad debt provision |
No. 1 | 152,875,068.03 | 12.15% | 4,586,252.04 |
No. 2 | 89,987,854.53 | 7.15% | 2,699,635.64 |
No. 3 | 31,396,709.13 | 2.49% | 941,901.27 |
No. 4 | 29,155,889.38 | 2.32% | 874,676.68 |
No. 5 | 26,766,896.54 | 2.13% | 803,006.90 |
Total | 330,182,417.61 | 26.24% |
(5) Derecognition of Accounts Receivable due to the Transfer of Financial AssetsNaught
(6) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement ofAccounts ReceivableNaught
2. Other Receivables
Unit: RMB
Item | Ending balance | Beginning balance |
Other receivables | 447,027,739.63 | 511,056,231.24 |
Total | 447,027,739.63 | 511,056,231.24 |
(1) Interest Receivable
1) Category of Interest Receivable
Naught
2) Significant Overdue Interest
Naught
3) Information of Withdrawal of Bad Debt Provision
□Applicable ? Not applicable
(2) Dividend Receivable
1) Category of Dividend Receivable
Naught
2) Significant Dividends Receivable Aging over 1 Year
Naught
3) Information of Withdrawal of Bad Debt Provision
□Applicable ? Not applicable
(3) Other Receivables
1) Other Receivables Disclosed by Account Nature
Unit: RMB
Nature | Ending carrying amount | Beginning carrying amount |
VAT export tax refunds | 4,496,365.98 | 4,674,335.06 |
Performance bond | 8,637,137.38 | 5,597,832.99 |
Staff borrow and petty cash | 1,813,413.90 | 3,486,778.81 |
Rent, water & electricity fees | 1,456,935.93 | 2,564,557.87 |
Other intercourse | 433,601,839.90 | 497,805,458.10 |
Total | 450,005,693.09 | 514,128,962.83 |
2) Information of Withdrawal of Bad Debt Provision
Unit: RMB
Bad debt provision | First stage | Second stage | Third stage | Total |
Expected credit loss of the next 12 months | Expected loss in the duration (credit impairment not occurred) | Expected loss in the duration (credit impairment occurred) | ||
Balance of 1 January 2022 | 763,248.72 | 2,309,482.87 | 3,072,731.59 | |
Balance of 1 January 2022 in the Current Period | ||||
Withdrawal of the Current Period | -282,481.64 | 187,703.51 | -94,778.13 | |
Balance of 30 June 2022 | 480,767.08 | 2,497,186.38 | 2,977,953.46 |
Changes of carrying amount with significant amount changed of loss provision in the current period
□Applicable ? Not applicable
Disclosure by aging
Unit: RMB
Aging | Ending balance |
Within 1 year (including 1 year) | 439,945,369.74 |
1 to 2 years | 6,150,154.66 |
2 to 3 years | 867,074.45 |
Over 3 years | 3,043,094.24 |
3 to 4 years | 2,114,385.69 |
4 to 5 years | 489,061.25 |
Over 5 years | 439,647.30 |
Total | 450,005,693.09 |
3) Bad Debt Provision Withdrawn, Reversed or Recovered in the Reporting Period
Information of bad debt provision withdrawn:
Unit: RMB
Category | Beginning balance | Changes in the Reporting Period | Ending balance | |||
Withdrawal | Reversal or recovery | Write-off | Other | |||
Other receivables | 3,072,731.59 | -94,778.13 | 2,977,953.46 | |||
Total | 3,072,731.59 | -94,778.13 | 2,977,953.46 |
Of which the bad debt provision reversed or recovered with significant amount during the Reporting Period:
Naught
4) Particulars of the Actual Verification of Other Receivables during the Reporting PeriodNaught
5) Top 5 of the Ending Balance of Other Receivables Collected according to the Arrears Party
Unit: RMB
Name of the entity | Nature | Ending balance | Aging | Proportion to total ending balance of other receivables (%) | Ending balance of bad debt provision |
No. 1 | Internal business group | 420,598,696.63 | Within 1 year | 93.47% | |
No. 2 | VAT export tax refunds | 4,496,365.98 | Within 1 year | 1.00% | 134,890.98 |
No. 3 | Internal business group | 4,116,845.26 | Within 2 years | 0.91% | |
No. 4 | Intercourse accounts | 2,673,256.53 | Within 1 year | 0.59% | 80,197.70 |
No. 5 | Performance bond | 1,500,000.00 | Within 1 year | 0.33% | 45,000.00 |
Total | 433,385,164.40 | 96.30% | 260,088.68 |
6) Accounts Receivable Involving Government Grants
Naught
7) Derecognition of Other Receivables due to the Transfer of Financial AssetsNaught
8) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement ofOther ReceivablesNaught
3. Long-term Equity Investment
Unit: RMB
Item | Ending balance | Beginning balance | ||||
Carrying amount | Depreciation reserve | Carrying value | Carrying amount | Depreciation reserve | Carrying value | |
Investment to subsidiaries | 2,296,631,238.41 | 2,296,631,238.41 | 1,061,536,766.02 | 1,061,536,766.02 | ||
Investment to joint ventures and associated enterprises | 180,115,189.99 | 180,115,189.99 | 181,545,123.09 | 181,545,123.09 | ||
Total | 2,476,746,428.40 | 2,476,746,428.40 | 1,243,081,889.11 | 1,243,081,889.11 |
(1) Investment to Subsidiaries
Unit: RMB
Investee | Beginning balance (carrying value) | Increase/decrease | Ending balance (carrying value) | Ending balance of depreciation reserve | |||
Additional investment | Reduced investment | Depreciation reserves withdrawn | Other | ||||
FSL Chanchang Optoelectronics Co., Ltd. | 82,507,350.00 | 82,507,350.00 | |||||
Foshan Taimei Times Lamps and Lanterns Co., Ltd. | 350,000.00 | 350,000.00 |
Nanjing Fozhao Lighting Components Manufacturing Co., Ltd. | 72,000,000.00 | 72,000,000.00 | |||||
Foshan Electrical & Lighting (Xinxiang) Co., Ltd. | 35,418,439.76 | 35,418,439.76 | |||||
Foshan Haolaite Lighting Co., Ltd. | 16,685,000.00 | 16,685,000.00 | |||||
Foshan Lighting Lamps & Components Co., Ltd. | 15,000,000.00 | 15,000,000.00 | |||||
FSL Zhida Electric Technology Co., Ltd. | 25,500,000.00 | 25,500,000.00 | |||||
FSL Lighting GMBH | 195,812.50 | 195,812.50 | |||||
Foshan Kelian New Energy Technology Co., Ltd. | 170,000,000.00 | 170,000,000.00 | |||||
Fozhao (Hainan) Technology Co., Ltd. | 150,000,000.00 | 23,000,000.00 | 173,000,000.00 | ||||
Nanning Liaowang Auto Lamp Co., Ltd. | 493,880,163.76 | 493,880,163.76 | |||||
Foshan NationStar Optoelectronics Co., Ltd. | 1,212,090,245.94 | 1,212,090,245.94 | |||||
Foshan Sigma Venture Capital Co., Ltd. | 4,226.45 | 4,226.45 | |||||
Total | 1,061,536,766.02 | 1,235,094,472.39 | 2,296,631,238.41 |
(2) Investment to Joint Ventures and Associated Enterprises
Unit: RMB
Investee | Beginning balance | Increase/decrease | Ending balance (carryin | Ending balance of | |||||||
Additional | Reduced | Gains and | Adjustment of | Changes of | Cash bonus | Withdrawal of | Other |
(carrying value) | investment | investment | losses recognized under the equity method | other comprehensive income | other equity | or profits announced to issue | impairment provision | g value) | depreciation reserve | ||
I. Joint ventures | |||||||||||
II. Associated enterprises | |||||||||||
ShenzhenPrimatronix (Nanho) Electronics Ltd. | 181,545,123.09 | 650,457.40 | 2,080,390.50 | 180,115,189.99 | |||||||
Subtotal | 181,545,123.09 | 650,457.40 | 2,080,390.50 | 180,115,189.99 | |||||||
Total | 181,545,123.09 | 650,457.40 | 2,080,390.50 | 180,115,189.99 |
(3) Other Notes
Naught
4. Operating Revenue and Cost of Sales
Unit: RMB
Item | Reporting Period | Same period of last year | ||
Operating revenue | Cost of sales | Operating revenue | Cost of sales | |
Main business | 1,743,824,866.67 | 1,430,083,022.73 | 1,712,892,634.56 | 1,415,558,525.32 |
Other business | 65,355,126.19 | 46,281,084.46 | 84,902,658.17 | 70,407,375.42 |
Total | 1,809,179,992.86 | 1,476,364,107.19 | 1,797,795,292.73 | 1,485,965,900.74 |
Relevant information of revenue:
NaughtInformation related to performance obligations:
NaughtInformation related to transaction value assigned to residual performance obligations:
The amount of revenue corresponding to performance obligations of contracts signed but not performed or notfully performed yet was RMB0.00 at the period-end.
5. Investment Income
Unit: RMB
Item | Reporting Period | Same period of last year |
Long-term equity investment income accounted by cost method | 2,653,342.25 | |
Long-term equity investment income accounted by equity method | 650,457.40 | 37,460.99 |
Investment income from disposal of long-term equity investment | 6,754,363.94 | |
Dividend income from holding of other investments in equity instruments | 16,055,272.93 | |
Investment income from financial products and structural deposits | 449,147.49 | 4,756,319.58 |
Other | 1,734,535.05 | 416,050.00 |
Total | 21,542,755.12 | 11,964,194.51 |
6. Other
Naught
XVIII. Supplementary Materials
1. Items and Amounts of Non-recurring Profit or Loss
? Applicable □ Not applicable
Unit: RMB
Item | Amount | Note |
Gain/Loss arising from disposal of non-current assets | -5,723,365.37 | |
Government grants recognized in the current period, except for those acquired in the ordinary course of business or granted at certain quotas or amounts according to the government’s unified standards | 31,578,978.53 | |
Capital occupation charges on non-financial enterprises that are recorded into current profit or loss | 213,042.31 | |
Current net profit or loss of subsidiaries acquired in business combination under the same control from period-beginning to combination date | 9,568,639.83 | |
Gain/loss from change of fair value of trading financial assets and liabilities, | -8,997,858.09 |
and investment gains from disposal of trading financial assets and liabilities, and available-for-sale financial assets, other than valid hedging related to the Company’s common businesses | ||
Other non-operating income and expenses other than the above | 6,044,307.77 | |
Less: Income tax effects | 4,010,901.27 | |
Non-controlling interests effects | 28,870,934.61 | |
Total | -198,090.90 | -- |
Others that meets the definition of non-recurring gain/loss:
□Applicable ? Not applicable
No such cases in the Reporting Period.Explain the reasons if the Company classifies any extraordinary gain/loss item mentioned in the Explanatory Announcement No. 1 onInformation Disclosure for Companies Offering Their Securities to the Public—Non-recurring Gains and Losses as a recurrentgain/loss item
□Applicable ? Not applicable
2. Return on Equity and Earnings Per Share
Profit as of Reporting Period | Weighted average ROE (%) | EPS (Yuan/share) | |
EPS-basic | EPS-diluted | ||
Net profit attributable to ordinary shareholders of the Company | 2.68% | 0.1191 | 0.1180 |
Net profit attributable to ordinary shareholders of the Company after deduction of non-recurring profit or loss | 2.68% | 0.1192 | 0.1181 |
3. Differences between Accounting Data under Domestic and Overseas Accounting Standards
(1) Differences of Net Profit and Net Assets Disclosed in Financial Reports Prepared under Internationaland Chinese Accounting Standards
□Applicable ? Not applicable
(2) Differences of Net profit and Net assets Disclosed in Financial Reports Prepared under Overseas andChinese Accounting Standards
□Applicable ? Not applicable
(3) Explain Reasons for the Differences between Accounting Data under Domestic and OverseasAccounting Standards; for any Adjustment Made to the Difference Existing in the Data Audited by theForeign Auditing Agent, Such Foreign Auditing Agent’s Name Shall Be Clearly StatedNaught
4. Other
Naught