ANHUI GUJING DISTILLERY COMPANY LIMITED
INTERIM REPORT 2021
August 2021
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Part I Important Notes, Table of Contents and DefinitionsThe Board of Directors (or the “Board”), the Supervisory Committee as well as the directors,supervisors and senior management of Anhui Gujing Distillery Company Limited (hereinafterreferred to as the “Company”) hereby guarantee the factuality, accuracy and completeness ofthe contents of this Report and its summary, and shall be jointly and severally liable for anymisrepresentations, misleading statements or material omissions therein.Liang Jinhui, the Company’s legal representative, Zhu Jiafeng, the Company’s ChiefAccountant, and head of the Company’s financial department (equivalent to financialmanager) hereby guarantee that the Financial Statements carried in this Report are factual,accurate and complete.All the Company’s directors have attended the Board meeting for the review of this Reportand its summary.Any plans for the future and other forward-looking statements mentioned in this Report shallNOT be considered as absolute promises of the Company to investors. Investors, amongothers, shall be sufficiently aware of the risk and shall differentiate between plans/forecastsand promises. Again, investors are kindly reminded to pay attention to possible investmentrisks.Investors’ attention is kindly directed to the risk factors that might have an adverse impact onthe fulfillment of the Company’s development strategies and business objectives for the future,as well as to the countermeasures intended to be taken, which have been detailed in “X RisksFacing the Company and Countermeasures” in “Part III Management Discussion andAnalysis” of this Report.The Company has no interim dividend plan, either in the form of cash or stock.This Report and its summary have been prepared in both Chinese and English. Should therebe any discrepancies or misunderstandings between the two versions, the Chinese versionsshall prevail.
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Part I Important Notes, Table of Contents and Definitions 2Part II Corporate Information and Key Financial Information 6Part III Management Discussion and Analysis 9Part IV Corporate Governance 26Part V Environmental and Social Responsibility 27Part VI Significant Events 31Part VII Share Changes and Shareholder Information 36Part VIII Preferred Shares 42Part IX Corporate Bonds 43Part X Financial Statements 44
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Documents Available for Reference
(I) Financial statements signed and sealed by the Company’s legal representative, theCompany’s Chief Accountant and the head of the Company’s financial department(equivalent to financial manager);(II) All originals of the Company’s documents and announcements that have beenpublicly disclosed in the Reporting Period on the media designated by the ChinaSecurities Regulatory Commission; and(III) The interim report disclosed in other securities markets.
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| Term | Definition |
| The “Company”, “ Gu Jing” or “we” | Anhui Gujing Distillery Company Limited inclusive of its consolidated subsidiaries, except where the context otherwise requires |
| The Company as the parent | Anhui Gujing Distillery Company Limited exclusive of subsidiaries, except where the context otherwise requires |
| Gujing Group | Anhui Gujing Group Co., Ltd. |
| Yellow Crane Tower | Yellow Crane Tower Distillery Co., Ltd. |
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Part II Corporate Information and Key Financial InformationI Corporate Information
| Stock name | Gujing Distillery, Gujing Distillery-B | Stock code | 000596, 200596 |
| Stock exchange for stock listing | Shenzhen Stock Exchange | ||
| Company name in Chinese | 安徽古井贡酒股份有限公司 | ||
| Abbr. (if any) | 古井 | ||
| Company name in English (if any) | ANHUI GUJING DISTILLERY COMPANY LIMITED | ||
| Abbr. (if any) | GU JING | ||
| Legal representative | Liang Jinhui | ||
| Board Secretary | Securities Representative | |
| Name | Zhu Jiafeng（Acting responsibilities） | Mei Jia |
| Address | Gujing Town, Bozhou City, Anhui Province, P.R.China | Gujing Town, Bozhou City, Anhui Province, P.R.China |
| Tel. | （0558）5712231 | （0558）5710057 |
| Fax | （0558）5710099 | （0558）5710099 |
| Email address | gjzqb@gujing.com.cn | gjzqb@gujing.com.cn |
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□ Applicable √ Not applicable
The newspapers designated by the Company for information disclosure, the website designated by the CSRC for disclosing theCompany’s periodic reports and the place for keeping such reports did not change in the Reporting Period. The said information canbe found in the 2020 Annual Report.IV Key Financial InformationIndicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Yes √ No
| H1 2021 | H1 2020 | Change (%) | |
| Operating revenue (RMB) | 7,007,496,467.74 | 5,519,621,000.62 | 26.96% |
| Net profit attributable to the listed company’s shareholders (RMB) | 1,378,803,828.46 | 1,024,936,604.36 | 34.53% |
| Net profit attributable to the listed company’s shareholders before exceptional gains and losses (RMB) | 1,338,285,260.99 | 1,007,918,868.52 | 32.78% |
| Net cash generated from/used in operating activities (RMB) | 263,967,132.26 | 2,341,638,100.64 | -88.73% |
| Basic earnings per share (RMB/share) | 2.74 | 2.04 | 34.31% |
| Diluted earnings per share (RMB/share) | 2.74 | 2.04 | 34.31% |
| Weighted average return on equity (%) | 12.85% | 10.84% | 2.01% |
| 30 June 2021 | 31 December 2020 | Change (%) | |
| Total assets (RMB) | 22,774,349,848.99 | 15,186,625,708.79 | 49.96% |
| Equity attributable to the listed company’s shareholders (RMB) | 15,621,511,888.56 | 10,043,288,013.73 | 55.54% |
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XI Exceptional Gains and Losses
√ Applicable □ Not applicable
Unit: RMB
| Item | Amount | Note |
| Gain or loss on disposal of non-current assets (inclusive of impairment allowance write-offs) | -2,117,355.04 | |
| Government grants through profit or loss (exclusive of government grants given in the Company’s ordinary course of business at fixed quotas or amounts as per the government’s uniform standards) | 34,716,270.46 | |
| Gain or loss on fair-value changes on held-for-trading and derivative financial assets and liabilities & income from disposal of held-for-trading and derivative financial assets and liabilities and other investments in debt obligations (exclusive of the effective portion of hedges that arise in the Company’s ordinary course of business) | 6,470,100.21 | |
| Reversed portions of impairment allowances for receivables and contract assets which are tested individually for impairment | 1,949,809.53 | |
| Non-operating income and expense other than the above | 25,569,436.70 | |
| Less: Income tax effects | 16,593,381.40 | |
| Non-controlling interests effects (net of tax) | 9,476,312.99 | |
| Total | 40,518,567.47 | -- |
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Part III Management Discussion and AnalysisI Principal Activity of the Company in the Reporting PeriodThe Company is subject to the Guideline No. 14 of the Shenzhen Stock Exchange on Information Disclosure by Industry—for ListedCompanies Engaging in Food and Liquor & Wine Production.(I) Pricipal Activity of the CompanyThe Company primarily produces and markets liquor and spirits. According to the Industry Categorization Guide for ListedCompanies (Revised in 2012) issued by the CSRC, liquor and spirits making belongs to the “liquor, beverage and refined tea makingindustry" (C15). During the reporting period, there was no change in the company's main business.(II) Status of the Industry and Position of the Company in the Industry
1. Status of the Liquor and Spirits Industry
Since the beginning of the 21st century, China's liquor and spirits industry has experienced three development stages. Before 2012,with rapid economic growth, the income of urban and rural residents rose fast, and the demand for liquor and spirits continued toincrease, while production and sales of liquor and spirits continuously expanded at a fast pace. As a result, the liquor and spiritsindustry witnessed booming supply and demand. During that period, national liquor and spirits brands and local regional renownedliquor enterprises achieved rapid development. In the context of the rise in both the demand and price of liquor and spirits, the salesincome and total profits of liquor enterprises increased quickly.From the second half of 2012 to 2016, China's economy once again entered a period of adjustment, as the Chinese governmentintroduced a string of policies to restrict the spending on official overseas visits, official vehicles and official hospitality, such as the"Eight-point Decision" and "Six Prohibitions", which include restrictions on the consumption of high-end alcohol with public funds.Consumption scenarios such as commercial consumption and government consumption were limited, leading to a drop in consumerdemand in a short time. Moreover, liquor prices were under huge pressure. China's liquor and spirits industry entered a period ofprofound adjustment. After 2012, both the output growth and income growth of China's liquor and spirits industry slowed down.The liquor and spirits industry began to recover in the second half of 2016, with a rise in consumption demand by end-users,propelling the growth of the overall income and profits of the industry. Since 2017, the overall demand and price of liquor and spiritshave increased, and the recovery of mid- and high-end liquor and spirits has picked up. In the future, benefiting from theconsumption upgrade and the change of consumption concept, the growth of sub-high-end liquor and spirits will be the key driver forthe development of the liquor and spirits industry. The consumption upgrade is the major driving force for the development of theliquor and spirits industry. Liquor enterprises need to fully grasp the great opportunities from the extensive consumption upgrade andstrive to better meet the consumption needs of the market through quality improvement, market segmentation and product innovationand other means, so as to advance the transformation and upgrade of the product structure.
2. Position of the Company in the Industry
China has a long history of liquor. There are a large number of liquor production enterprises in the country, but the regionaldistribution of liquor consumers is particularly evident. The liquor and spirits industry is characterized by full competition, with ahigh degree of marketization. The market competition is fierce, and the industry adjustments are constantly deepening. In the nationalmarket, the competitive edges of the enterprises come from their brand influence, product style and marketing & operation models. Ina single regional market, the competitive strengths of the enterprises depend on their brand influence in the region, the recognition ofthe companies by regional consumers and comprehensive marketing capacity.As one of China’s traditional top eight liquor brands, the Company is the first listed liquor and spirits company with both A and B
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stocks. It is located in Bozhou City, Anhui Province in China, the hometown of historic figures Cao Cao and Hua Tuo, as well as oneof the world’s top 10 liquor-producing areas. No changes have occurred to the main business of the Company in the Reporting Period.As the main product of the Company, the Gujing spirit originated as a “JiuYunChun Spirit”, together with its making secrets, beingpresented as a hometown specialty by Cao Cao, a famous warlord in China’s history, to Emperor Han Xiandi (name: Liu Xie) in A.D.196, and was continually presented to the royal house since then. With crystalline liquid, rich aroma, a fine flavor and a lingeringaftertaste, the Gujing spirit has helped the Company win four national distilled spirit golden awards, a golden award at the 13th SIALParis, the title of China’s “Geographical Indication Product”, the recognition as a “Key Cultural Relics Site under the StateProtection”, the recognition with a “National Intangible Cultural Heritage Protection Project”, a Quality Award from the Anhuiprovincial government, a title of “National Quality Benchmark”, among other honors. In 2020, Gujing Distillery ranked fourth inChina's liquor and spirits industry with a brand value of RMB197,136 million in the "Hua Liquor Cup" (list of Chinese liquor brandsby value).In April 2016, Gujing gongjiu signed a strategic cooperation agreement with Huanghelou Liquor Co., Ltd., opening a new era ofcooperation in China's famous liquor industry. Yellow Crane Tower Baijiu is the only famous Chinese liquor in Hubei. Its uniquestyle is "soft, mellow, elegant and cool, and has a long lingering fragrance". It won the two China gold medal in liquor appreciation in1984 and 1989. At present, Huanghelou liquor industry has three bases: Wuhan, Xianning and Suizhou. Among them, HuanghelouLiquor Culture Expo Park in Wuhan base has been approved as national AAA scenic spot, and Huanghelou forest wine town inXianning base has been approved as national AAA scenic spot.In January 2021, Gujing Distillery and Mingguang signed a strategic cooperation agreement. The unique mung bean flavor adds tothe famous liquor family of Gujing. This makes Gujing become a famous Chinese liquor maker with "three brands", "four flavors"and "three production areas".（Ⅲ）Main business conditionsDuring the reporting period, the company realized an operating revenue of 7.007 billion yuan,up 26.96% compared to the sameperiod of last year；a net profit attributable to owners of the Company as the parent of 1.379 billion yuan, representing a year-on-yeargrowth of 34.53%.Brand operations:
The Company's Principal Product System
| Principal product series | Key representative products |
| Aged Original Liquor Series | Gu 26, Gu 20, Gu 16, Gu 8, Gu 5, and Tribute. Positioned as a high-end, sub-high-end, and middle-end product series, Aged Original Liquor represents the key direction of the Company's structural adjustment, and its main consumption scenarios are high-end business, family, daily drinking, and banquet settings. |
| Gujing Liquor Series | Gujing Liquor V9, Gujing Liquor V6, Gujing Liquor 6th Gen, and Gujing Light Bottle. Positioned as a mid/low-priced product series, Gujing Liquor Series is an effective supplement to Aged Original Liquor Series, and its main consumption scenarios are banquets in some urban areas/towns and holiday gifts. |
| Yellow Crane Tower Liquor Series | Fragrant 900, Aged 1979, Ecological 15, and Floor Series-5 Floor. With a focus on the market of Hubei Province, the product series forges a synergy with the Company's original brand in a dual-brand matrix. |
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| By | Operating revenue | Cost of sales | Gross profit margin | YoY change in operating revenue (%) | YoY change in cost of sales (%) | YoY change in gross profit margin (%) |
| Channel | ||||||
| Online | 278,464,746.88 | 66,280,349.19 | 76.20% | 89.44% | 91.77% | -0.29% |
| Offline | 6,729,031,720.86 | 1,587,537,998.12 | 76.41% | 25.25% | 24.09% | 0.22% |
| Total | 7,007,496,467.74 | 1,653,818,347.31 | 76.40% | 26.96% | 25.87% | 0.20% |
| By | Operating revenue | Cost of sales | Gross profit margin | YoY change in operating revenue (%) | YoY change in cost of sales (%) | YoY change in gross profit margin (%) |
| Product series | ||||||
| Aged Original Liquor | 5,069,696,056.94 | 889,635,061.87 | 82.45% | 15.49% | 4.08% | 1.92% |
| Gujinggong Liquor | 806,233,596.57 | 326,766,742.30 | 59.47% | 14.09% | 16.14% | -0.71% |
| Yellow Crane Tower | 581,367,130.91 | 143,320,696.30 | 75.35% | 319.60% | 255.14% | 4.47% |
| Total | 6,457,296,784.42 | 1,359,722,500.47 | 78.94% | 23.35% | 15.58% | 1.42% |
| Segment | Increase | Decrease | Ending number |
| North China | 166 | 83 | 929 |
| South China | 95 | 63 | 412 |
| Central China | 447 | 234 | 2,370 |
| International | 1 | 0 | 9 |
| Total | 709 | 380 | 3,720 |
| No. | Customer | Sales revenue contributed for the Reporting Period (RMB) | As % of total sales revenue (%) | Ending accounts receivable |
| 1 | Customer A | 405,922,602.43 | 5.79% | 0.00 |
| 2 | Customer B | 332,114,750.04 | 4.74% | 0.00 |
| 3 | Customer C | 308,681,593.54 | 4.41% | 0.00 |
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| 4 | Customer D | 127,440,788.33 | 1.82% | 0.00 |
| 5 | Customer E | 95,650,783.14 | 1.36% | 0.00 |
| Total | 1,269,810,517.48 | 18.12% | 0.00 | |
| No. | Supplier | Purchase in the Reporting Period (RMB) | As % of total purchases (%) |
| 1 | Supplier A | 182,709,628.22 | 11.07% |
| 2 | Supplier B | 116,419,556.09 | 7.05% |
| 3 | Supplier C | 83,020,171.96 | 5.03% |
| 4 | Supplier D | 66,434,636.76 | 4.02% |
| 5 | Supplier E | 50,344,694.17 | 3.05% |
| Total | 498,928,687.20 | 30.22% | |
| Purchase contents | Purchase model | Amount (RMB’0,000) | |
| 1 | Raw materials | Strategic purchasing | 8,558.72 |
| Tendering purchasing | 45,123.55 | ||
| 2 | Packing materials | Tendering purchasing | 111,391.56 |
| Total | 165,073.83 | ||
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coordinating the implementation of production plans, release of material production plans, and delivery and tracking of products, andprepares balanced production plans on a quarterly basis according to the product inventory. The logistics distribution system iscoordinated according to the production schedule and inventory with a view to ensuring timely delivery of products.Commissioned production
□ Applicable √ Not applicable
Breakdown of cost of sales
| Item | H1 2021 | H1 2020 | Change (%) | ||
| Cost of sales (RMB) | As % of total cost of sales | Cost of sales (RMB) | As % of total cost of sales | ||
| Direct materials | 1,196,640,235.94 | 72.36% | 973,724,541.41 | 74.11% | 22.89% |
| Direct labor cost | 165,954,324.17 | 10.03% | 153,910,567.38 | 11.71% | 7.83% |
| Manufacturing expenses | 95,017,857.07 | 5.75% | 83,318,785.82 | 6.34% | 14.04% |
| Fuels | 50,979,904.41 | 3.08% | 49,878,003.58 | 3.80% | 2.21% |
| Total | 1,508,592,321.59 | 91.22% | 1,260,831,898.19 | 95.96% | 19.65% |
| Main product | Output | Sales volume | inventory | YoY changes of output | YoY changes of sales volume | YoY changes of inventory |
| Aged Original Liquor Series | 23,518.66 | 23,222.99 | 6,832.55 | 35.72% | -7.33% | 321.00% |
| Gujinggong Liquor Series | 14,277.34 | 12,863.67 | 3,491.87 | 41.59% | 14.13% | 192.00% |
| Yellow Crane Tower Liquor Series | 3,858.38 | 4,782.75 | 690.57 | 75.53% | 203.91% | -49.00% |
| Other series | 12,056.23 | 9,366.98 | 3184.83 | 78.26% | 23.65% | 372.00% |
| Category | Ending quantity (ton) |
| Finished liquor | 14,199.82 |
| Semi-product | 177,145.28 |
| Main product | Designed capacity | Actual capacity | Capacity in progress |
| Finished liquor | 115,000 | 53,710.61 | 130,000 |
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II Core Competitiveness AnalysisNo significant changes occurred to the Company’s core competitiveness in the Reporting Period.
III Analysis of Core Businesses
See contents under the heading “I Principal Activity of the Company in the Reporting Period”.Year-on-year changes in key financial data:
Unit: RMB
| H1 2021 | H1 2020 | Change (%) | Main reason for change | |
| Operating revenue | 7,007,496,467.74 | 5,519,621,000.62 | 26.96% | |
| Cost of sales | 1,653,818,347.31 | 1,313,925,592.48 | 25.87% | |
| Selling expense | 2,028,265,595.93 | 1,618,049,637.27 | 25.35% | |
| Administrative expense | 467,727,393.70 | 395,687,673.15 | 18.21% | |
| Finance costs | -68,690,117.73 | -68,208,467.94 | -0.71% | |
| Income tax expense | 478,730,726.66 | 370,635,522.24 | 29.16% | |
| Net cash generated from/used in operating activities | 263,967,132.26 | 2,341,638,100.64 | -88.73% | Increase in structured deposits purchased in the current period |
| Net cash generated from/used in investing activities | -355,501,003.11 | 61,995,665.31 | -673.43% | Increase in payments for investments |
| Net cash generated from/used in financing activities | 4,097,019,275.25 | 49,803,791.67 | 8,126.32% | Arrival of raised funds |
| Net increase in cash and cash equivalents | 4,005,485,404.40 | 2,453,437,557.62 | 63.26% | Arrival of raised funds |
| H1 2021 | H1 2020 | Change (%) | |||
| Operating revenue | As % of total operating revenue (%) | Operating revenue | As % of total operating revenue (%) | ||
| Total | 7,007,496,467.74 | 100.00% | 5,519,621,000.62 | 100.00% | 26.96% |
| By operating division | |||||
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| Manufacturing | 7,007,496,467.74 | 100.00% | 5,519,621,000.62 | 100.00% | 26.96% |
| By product category | |||||
| Liquor and spirits | 6,808,931,206.29 | 97.17% | 5,432,930,105.02 | 98.43% | 25.33% |
| Hotel services | 37,407,083.13 | 0.53% | 21,665,219.12 | 0.39% | 72.66% |
| Other | 161,158,178.32 | 2.30% | 65,025,676.48 | 1.18% | 147.84% |
| By operating segment | |||||
| North China | 504,700,256.97 | 7.20% | 359,730,201.59 | 6.52% | 40.30% |
| Central China | 6,025,392,454.99 | 85.99% | 4,877,164,641.53 | 88.36% | 23.54% |
| South China | 471,816,171.82 | 6.73% | 281,661,275.86 | 5.10% | 67.51% |
| Overseas | 5,587,583.96 | 0.08% | 1,064,881.64 | 0.02% | 424.71% |
| Operating revenue | Cost of sales | Gross profit margin | YoY change in operating revenue (%) | YoY change in cost of sales (%) | YoY change in gross profit margin (%) | |
| By operating division | ||||||
| Manufacturing | 7,007,496,467.74 | 1,653,818,347.31 | 76.40% | 26.96% | 25.87% | 0.20% |
| By product category | ||||||
| Liquor and spirits | 6,808,931,206.29 | 1,508,592,321.59 | 77.84% | 25.33% | 19.65% | 1.05% |
| Hotel services | 37,407,083.13 | 20,502,666.17 | 45.19% | 72.66% | 58.98% | 4.72% |
| Other | 161,158,178.32 | 124,723,359.55 | 22.61% | 147.84% | 210.28% | -15.57% |
| By operating segment | ||||||
| North China | 504,700,256.97 | 132,704,568.25 | 73.71% | 40.30% | 32.24% | 1.60% |
| Central China | 6,025,392,454.99 | 1,410,414,975.52 | 76.59% | 23.54% | 23.13% | 0.08% |
| South China | 471,816,171.82 | 109,511,567.29 | 76.79% | 67.51% | 62.88% | 0.66% |
| Overseas | 5,587,583.96 | 1,187,236.25 | 78.75% | 424.71% | 36.28% | 60.56% |
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| Item | H1 2021 | H1 2020 | Change (%) | Reason |
| Employee benefits | 385,703,329.21 | 269,309,951.20 | 43.22% | Increase in employee benefits |
| Travel fees | 79,727,177.78 | 55,722,038.26 | 43.08% | Increase in business trips due to the improvement of the pandemic |
| Advertisement fees | 467,467,773.39 | 453,767,973.19 | 3.02% | |
| Transportation charges | 0.00 | 24,048,795.64 | -100.00% | The transportation charges were turned into the item of cost of sales to account as required by the new standards governing revenue. |
| Comprehensive promotion costs | 685,618,164.57 | 475,881,977.13 | 44.07% | Increase in unrecognized expenses in more frequent sales promotions |
| Service fees | 359,748,787.06 | 299,367,311.62 | 20.17% | |
| Others | 50,000,363.92 | 39,951,590.23 | 25.15% | |
| Total | 2,028,265,595.93 | 1,618,049,637.27 | 25.35% |
| No. | Main way | Amount (RMB’0,000) |
| 1 | TV | 28,276.58 |
| 2 | Offline | 15,874.68 |
| 3 | Online | 2,595.52 |
| Total | 46,746.78 | |
| 30 June 2021 | 31 December 2020 | Change in percentage (%) | Reason for any significant change | |||
| Amount | As % of total assets | Amount | As % of total assets | |||
| Monetary assets | 12,144,304,489.85 | 53.32% | 5,971,212,569.66 | 39.32% | 14.00% | |
| Accounts receivable | 65,349,125.90 | 0.29% | 67,933,735.91 | 0.45% | -0.16% | |
| Inventories | 3,969,932,350.43 | 17.43% | 3,416,880,808.96 | 22.50% | -5.07% | |
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| Investment property | 4,234,372.30 | 0.02% | 4,392,943.54 | 0.03% | -0.01% | |
| Long-term equity investments | 4,975,862.87 | 0.02% | 4,915,575.83 | 0.03% | -0.01% | |
| Fixed assets | 1,829,551,984.09 | 8.03% | 1,797,789,271.62 | 11.84% | -3.81% | |
| Construction in progress | 425,876,594.64 | 1.87% | 279,169,201.60 | 1.84% | 0.03% | |
| Right-of-use assets | 50,181,080.29 | 0.22% | 0.00 | 0.00% | 0.22% | |
| Short-term borrowings | 72,231,000.00 | 0.32% | 70,665,500.00 | 0.47% | -0.15% | |
| Contract liabilities | 2,213,592,055.02 | 9.72% | 1,206,573,886.26 | 7.94% | 1.78% | |
| Long-term borrowings | 150,125,972.22 | 0.66% | 60,117,638.89 | 0.40% | 0.26% | |
| Lease liabilities | 47,677,911.46 | 0.21% | 0.00 | 0.00% | 0.21% |
| Item | Beginning amount | Gain/loss on fair-value changes in the Reporting Period | Cumulative fair-value changes charged to equity | Impairment allowance for the Reporting Period | Purchased in the Reporting Period | Sold in the Reporting Period | Other changes | Ending amount |
| Financial assets | ||||||||
| 1. Held-for-trading financial assets (exclusive of derivative financial assets) | 203,877,915.51 | 5,237,242.40 | 209,115,157.91 | |||||
| Subtotal of | 203,877,915.51 | 5,237,242.40 | 209,115,157.91 | |||||
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| financial assets | ||||||||
| Total of the above | 203,877,915.51 | 5,237,242.40 | 209,115,157.91 | |||||
| Financial liabilities | 0.00 | 0.00 | 0.00 |
| Item | Ending carrying value | Reasons |
| Monetary assets | 2,501,915,391.71 | Structured deposit not available for advance withdrawal and security deposits |
| Receivables financing | 24,300,000.00 | As pledge for banker’s acceptance bill |
| Total | 2,526,215,391.71 |
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VI Investments Made
1. Total Investments Made
□ Applicable √ Not applicable
2. Significant Equity Investments Made in the Reporting Period
□ Applicable √ Not applicable
3. Significant Non-Equity Investments Ongoing in the Reporting Period
□ Applicable √ Not applicable
4. Financial Investments
(1) Securities Investments
√ Applicable □ Not applicable
Unit: RMB
| Variety of securities | Code of securities | Name of securities | Initial investment cost | Accounting measurement model | Beginning carrying value | Gain/loss on fair value changes in the Reporting Period | Cumulative fair value changes charged to equity | Purchased in the Reporting Period | Sold in the Reporting Period | Gain/loss in the Reporting Period | Ending carrying value | Accounting title | Funding source |
| Fund | DAPU Asset Management | 200,000,000.00 | Fair value method | 203,877,915.51 | 5,237,242.40 | 0.00 | 0.00 | 0.00 | 1,625.42 | 209,115,157.91 | Held-for-trading financial assets | Self-owned funds | |
| Other ending holding securities investments | -- | -- | -- | ||||||||||
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| Total | 200,000,000.00 | -- | 203,877,915.51 | 5,237,242.40 | 0.00 | 0.00 | 0.00 | 1,625.42 | 209,115,157.91 | -- | -- |
| Disclosure date of the announcement about the board’s consent for the securities investment | Naught | ||||||||||
| Disclosure date of the announcement about the general meeting’s consent for the securities investment (if any) | Naught | ||||||||||
| Operator | Relationship with the Company | Related-party transaction | Type of derivative | Initial investment amount | Starting date | Ending date | Beginning investment amount | Purchased in the Reporting Period | Sold in the Reporting Period | Impairment provision (if any) | Ending investment amount | Proportion of closing investment amount in the Company’s ending net assets | Actual gain/loss in the Reporting Period |
| Reverse repurchase of national debt | Naught | No | Reverse repurchase of national debt | 0.00 | 27 January 2021 | 1 July 2021 | 0.00 | 40,490 | 39,490 | 1,000 | 0.06% | 46.44 | |
| Total | 0.00 | -- | -- | 0.00 | 40,490 | 39,490 | 1,000 | 0.06% | 46.44 | ||||
| Capital source for derivative investment | Company’s own funds | ||||||||||||
~ 21 ~
| Lawsuits involved (if applicable) | N/A |
| Disclosure date of board announcement approving derivative investment (if any) | 30 August 2013 |
| Disclosure date of shareholders’ meeting announcement approving derivative investment (if any) | N/A |
| Analysis of risks and control measures associated with derivative investments held in the Reporting Period (including but not limited to market risk, liquidity risk, credit risk, operational risk, legal risk, etc.) | The Company had controlled the relevant risks strictly according to the Derivatives Investment Management System. |
| Changes in market prices or fair value of derivative investments during the Reporting Period (fair value analysis should include measurement method and related assumptions and parameters) | Naught |
| Significant changes in accounting policies and specific accounting principles adopted for derivative investments in the Reporting Period compared to previous reporting period | Naught |
| Opinion of independent directors on derivative investments and risk control | Based on the sustainable development of the main business and the sufficient free idle money, the Company increased the profits through investing in the reasonable financial derivative instruments, which was in favor of improving the service efficiency of the idle funds; in order to reduce the investment risks of the financial derivative instruments, the Company had set up corresponding supervision mechanism for the financial derivative instrument business and formulated reasonable accounting policy as well as specific principles of financial accounting; the derivative Investment business developed separately took national debts as mortgage object, which was met with the cautious and steady risks management principle and the interest of the Company and shareholders. Therefore, agreed the Company to develop the derivative Investment business of reverse repurchase of national debt not more than the limit of RMB0.3 billion. |
~ 22 ~
VII Sale of Major Assets and Equity Interests
1. Sale of Major Assets
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Sale of Major Equity Interests
□ Applicable √ Not applicable
VIII Main Controlled and Joint Stock Companies
√ Applicable □ Not applicable
Main subsidiaries and joint stock companies with an over 10% influence on the Company’s net profits
Unit: RMB
| Company name | Relationship with the Company | Main business scope | Registered capital | Total assets | Net assets | Operating revenues | Operating profit | Net profit |
| Bozhou Gujing Sales Co., Ltd | Subsidiary | Wholesales of distilled spirit, construction materials, feeds, assistant materials, etc. | 84,864,497.89 | 5,031,652,902.16 | 619,156,126.49 | 6,104,874,556.03 | 657,619,561.02 | 488,704,287.19 |
| Anhui Longrui Glass Co., | Subsidiary | Manufacture and sale of glass | 86,660,268.98 | 410,741,113.04 | 348,456,392.89 | 141,077,429.68 | 26,188,902.74 | 22,078,147.50 |
~ 23 ~
| Ltd | products, etc. | |||||||
| Yellow Crane Tower Wine Industry Co., Ltd | Subsidiary | Production and sales of distilled spirit, etc. | 400,000,000.00 | 1,297,092,584.41 | 634,897,821.96 | 690,959,858.06 | 121,300,166.54 | 93,504,686.38 |
| Shanghai Gujing Jinhao Hotel Management Co., Ltd. | Subsidiary | Hotel management, house lease, etc. | 54,000,000.00 | 194,723,292.59 | 79,241,483.77 | 33,009,451.53 | 3,039,938.91 | 2,264,225.90 |
| Subsidiary | How subsidiary was obtained or disposed | Effects on overall operations and performance |
| Anhui Mingguang Distillery Co., Ltd. | Business combination not under conmmon control | Boosting the development of the Company’s core business of liquor, increase brand recognition and business size |
| Anhui Jiuhao China Railway Construction Engineering Co., Ltd. | Incorporated with investment | Optimizing internal operation structure and enhancing endogenous impetus |
| Anhui Jiuan Mechanical Electrical Equipment Co., Ltd. | Incorporated with investment | Optimizing internal operation structure and enhancing endogenous impetus |
| Bozhou Gujing Waste Recycling Co., Ltd. | De-registered |
~ 24 ~
X Risks Facing the Company and Countermeasures(I) Operating Risk of the Company
1. The adverse effect of the systematic risk in macro-economic environment on the development of the industry and the Company.
2. Impact of industrial policy adjustment and change on the sustainable development of the Company.
3. Impact of normalization of COVID-19 epidemic on the consumption behaviors and habits.(II) Operating Measures
1. Marketing
The Company accelerated efforts to promote its “sub-high-end products nationwide” by strengthening its presence in all provinces and regions, expanding market share and customer base, andlaunching more individual products and outlets. As for brand building, the Company focused on increasing advertising and offline secondary promotion on CCTV, provincial satellite TVstations, the Internet and new media outlets. To expand international market, it actively participated in major international events to promote its brand and products.
2. Product Management
In adherence to the “quality first” principle, the Company enhanced the spirit of craftsmen and awareness of quality and took solid actions to carry forward the Nie Guangrong Spirit in Gujing.It furthered the deep integration of technical quality and liquor production, continuously carried out optimization research on production process concerning liquor making and yeast making,and further optimized liquor making production technology. It conducted in-depth special inspection of quality management, strengthened the handling of production process and marketfeedback, and effectively exercised closed-loop management. Upholding the green brewing principle, the Company continued to make procurement from raw grain base. Besides, it continuedto adopt the "strategic cooperation + grain base planting" model.
3. Engineering Construction
The Company accelerated the construction of the smart technology transformation project (smart park) for liquor production, and adhered to high standards and high quality to promote theconstruction of smart park projects.
4. Informatization Construction
It accelerated the digital transformation and intensified the application and promotion of digital means. It actively pushed forward projects such as the integration of industry and financialresources, while ensuring effective technical undertaking to further speed up the digital transformation and upgrading of Gujing.
5. Human Resource
Based on the demands of the Company’s strategic development, the Company continuously optimized the channels for talents introduction, further improved talent structure and salarystructure; strengthened the orientation of performance appraisal, continuously innovated performance management model; incessantly cemented talent echelon construction, conducted talenttraining and cultivation in a comprehensive, multidimensional and targeted way.
6. Internal Management
~ 25 ~
The Company regularly carried out special actions to "change work style, change methods, and strengthen implementation", raised ideological understanding and political position, listened tothe opinions of grass-roots business lines, ensured steady progress in work in strict accordance with the policies and the law, and actively cemented inter-departmental coordination andcollaboration. The Company actively guided managers to emancipate their minds, organized more training and study programs, thought outside the box, and adopted creative ways to addressproblems.
7. Corporate Culture Construction
The Company upheld strict governance over the Party and strengthened party spirit education as per strict standards and requirements to establish and carry forward excellent work style. Workstyle was into routine management. Actions were taken against unhealthy tendencies in a bid to create a culture featuring pragmatic thinking, simple life, and solid work style. The Companyshould continue to strengthen the leadership team’s construction, temper the core team of “loyalty and cleanness”; continue to carry out warning education on integrity, and further build anideological line of defense against corruption; continue to rectify formalism, bureaucracy, and “laziness, randomness, fatigue, glibness and complacency” and dogmatism, cultivate pragmaticand rigorous work style of cadres and employees; continue to strengthen ideological and political work, maintain the main position of cultural propaganda and ideological work; continue tostrengthen the leadership of Party building, and gather the strong power of the revolution.In 2021, the Company will continue to be guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and thoroughly implement the spirit of the 19th CPCNational Congress and the Second, Third, Fourth and Fifth Plenary Sessions of the 19th CPC Central Committee. Under the strong leadership of the Bozhou Municipal CPC Committee andMunicipal Government, the Company will firmly keep in alignment, boost the morale, strengthen the execution capacity, deeply practice the socialist core values, and uphold its values of "BeHonest, Offer Quality Liquor, Be Stronger and Be Helpful to the Society". It will advocate and adhere to long-term perspective mindset, pursue excellence, produce high-quality products,maintaining strategic resolve, enhance corporate management, work harder, and take concrete actions. It will strive to seek steady progress based on civilized management and technologicaladvances and become an enterprise with “digital and global operations and law-based management”.
~ 26 ~
Part IV Corporate Governance
I Annual and Extraordinary General Meeting Convened during the Reporting Period
1. General Meetings Convened during the Reporting Period
| Meeting | Type | Investor participation ratio | Convened date | Disclosure date | Index to disclosed information |
| The 2020 Annual General Meeting | Annual General Meeting | 59.34% | 25 May 2021 | 26 May 2021 | For details, see Announcement about Resolutions of 2020 Annual General Meeting of the Company disclosed on China Securities Journal, Shanghai Securities News, Ta Kung Pao (HK), and http://www.cninfo.com.cn on 26 May 2021. |
~ 27 ~
Part V Environmental and Social Responsibility
I Major Environmental IssuesIndicate by tick mark whether the Company or any of its subsidiaries is a heavily polluting business identified by the environmentalprotection authorities of China.
√ Yes □ No
| Name of polluter | Name of major pollutants | Way of discharge | Number of discharge outlets | Distribution of discharge outlets | Discharge concentration | Discharge standards implemented | Total discharge | Approved total discharge | Excessive discharge |
| Anbui Gujing Distillery Co., Ltd. | COD | Directly discharge | 3 | Gujing plant, Zhangji plant, Headquarter plant | 30.36mg/L 30.37mg/L 35.13mg/L | Gujing plant≦50mg/L Zhangji plant、Headquarter plant≦100mg/L | Gujing plant：14.76t Zhangji plant：3.03t Headquarter plant：27.38t | Gujing plant：105.916t Zhangji plant：26.504t Headquarter plant：116.0596t | Naught |
| Anbui Gujing Distillery Co., Ltd. | NH3-N | Directly discharge | 3 | Gujing plant, Zhangji plant, Headquarter plant | 0.62mg/L 0.79mg/L 0.86mg/L | Gujing plant≦5mg/L Zhangji plant、Headquarter plant≦10mg/L | Gujing plant：0.3t Zhangji plant：0.08t Headquarter plant：0.67t | Gujing plant：10.5916t Zhangji plant：2.6504t Headquarter plant：11.60596t | Naught |
| Anbui Gujing Distillery Co., Ltd. | Smoke | Organized discharge through chimney | 3 | Gujing plant, Zhangji plant, Headquarter plant | 1.01mg/m? 1.7mg/m? 1.04mg/m? | Gujing plant、Headquarter plant≦10mg/m3 Zhangji plant≦20mg/ m3 | Gujing plant：0.14t Zhangji plant：0.02t Headquarter plant：0.38t | Gujing plant：4.301t Zhangji plant：/ Headquarter plant：5.01t | Naught |
| Anbui Gujing Distillery Co., Ltd. | Sulfur Dioxide | Organized discharge through | 3 | Gujing plant, Zhangji plant, Headquarter plant | 5.71mg/m? 0.94mg/m? 11.58mg/m? | Gujing plant、Headquarter plant≦35m | Gujing plant：0.8t Zhangji plant：0.01t | Gujing plant：15.055t Zhangji plant：/ Headquarter | Naught |
~ 28 ~
| chimney | g/m3 Zhangji plant≦50mg/ m3 | Headquarter plant：4.33t | plant：17.536t | ||||||
| Anbui Gujing Distillery Co., Ltd. | Nitrogen oxide | Organized discharge through chimney | 3 | Gujing plant, Zhangji plant, Headquarter plant | 10.07mg/m? 28.69mg/m? 23.67mg/m? | Gujing plant、Headquarter plant≦50mg/m3 Zhangji plant≦150mg/ m3 | Gujing plant：1.4t Zhangji plant：0.35t Headquarter plant：8.85t | Gujing plant：21.056t Zhangji plant：10.318t Headquarter plant：25.051t | Naught |
| Anhui Longrui Glass Co., Ltd | Smoke | Organized discharge through chimney | 2 | 1# furnace 2# furnace | 1.2mg/m? 1.2mg/m? | ≦10mg/m? | 1# furnace：0.124t 2# furnace：0.19t | / | Naught |
| Anhui Longrui Glass Co., Ltd | Sulfur Dioxide | Organized discharge through chimney | 2 | 1# furnace 2# furnace | 5.6mg/m? 22.5mg/m? | ≦50mg/m? | 1# furnace：0.7t 2# furnace：3.75t | / | Naught |
| Anhui Longrui Glass Co., Ltd | Nitrogen oxide | Organized discharge through chimney | 2 | 1# furnace 2# furnace | 61.4mg/m? 63.7mg/m? | ≦200mg/m? | 1# furnace：7.63t 2# furnace：11t | / | Naught |
~ 29 ~
(4) The production and living sewage of Anhui Longrui Glass Co., Ltd is discharged into the sewage treatment station of ZhangjiPlant under Anhui Gujing Distillery Company Limited, and it is discharged after treatment and up to the standard.
2. Construction and operation situation of waste gas control facilities of the listed Company and its subsidiaries
(1) The flue gas control facilities of thermal power stations of the Headquarters and Gujing Subsidiary of Anhui Gujing DistilleryCompany Limited run well, and waste gas is discharged through the 65-meter-tall exhaust funnel after the waste gas treatment is upto the standard, adopting the process of cloth-bag dust removal + Limestone - Wet flue gas Desulfurization+ SNCR Denitrification bynon-catalytic reduction + SCR Denitrification by catalytic reduction + Wet electrostatic precipitator, and discharge of flue gas meetsthe super-low discharge requirements (smoke ≤10mg/m
, SO2≤35mg/m
, NOx≤50mg/m
).
(2) The gas-fired boilers at Zhangji Plant under Anhui Gujing Distillery Company Limited operate in a steady manner, and waste gasis discharged through the 20-meter-tall exhaust funnel, of which and discharge of flue gas meets the requirements for gas-fired boilerin GB13271-2014 Emission Standard of Air Pollutants for Industrial Kiln and Furnace.
(3) 1#, 2# furnace flue gas treatment facilities of Anhui Longrui Glass Co., Ltd. are operating well. For 1# furnace, the company usesbag dust removal + dry desulfurization + SCR catalytic reduction denitrification process. After it meets the standard, the exhaust gaswill be discharged through a 48-meter high exhaust pipe. The flue gas emission is in line with the glass industry A-class enterpriseemission requirements as set out in Technical Guide for the Development of Emergency Emission Reduction Measures for KeyIndustries in Heavy Pollution Weather (soot ≤ 10 mg/m
, SO2 ≤ 50 mg/m
, NOx ≤ 200 mg/m
). For 2# furnace, the company adoptsbag dust removal + desulfurization tank + SCR low-temperature denitrification process, and the exhaust gas is discharged through a50-meter high exhaust pipe after it meets the standard. The flue gas emission meets the glass industry A-class enterprise emissionrequirements as set out in Technical Guide for the Development of Emergency Emission Reduction Measures for Key Industries inHeavy Pollution Weather (soot ≤ 10 mg/m
, SO2 ≤ 50mg/m
, NOx ≤ 200 mg/m
).
(4) The Headquarter of Anhui Gujing Distillery Company Limited and Gujing Branch finished product coding machine exhaust gastreatment facilities are operating well. By adopting photocatalytic oxidation technology, the Company’s flue gas emissions complywith the Table 1 standard requirements of DB12/524-2014 Emission Standard for Industrial Enterprises Volatile Organic Compounds.
(5) The Headquarters of Anhui Gujing Distillery Company Limited and the odor treatment facilities of Zhangji Sewage Station areoperating well. By adopting technologies like photocatalytic oxidation and activated carbon adsorption, and the Company’s emissionof exhaust gas meets the requirements of Table 2 of the Standard for Emission of Pollutants.In H1 2021, the environment protection facilities of the Company and its subsidiaries ran normally in general, main pollutants canachieve up-to-standard discharge, environment information is opened to the public normally, and they have performed their socialresponsibilities properly.Environmental impact assessment of construction project and other administrative license situation in respect ofenvironmental protection
| No. | Item | Category of EIA | EIA approval (filing) time | EIA approval (filing) number |
| 1 | Intelligent Technical Transformation Project of Liquor Production of Anhui Gujing Distillery Co., Ltd. | Environment affection report | 2 February 2021 | BHS【2021】No. 4 |
| 2 | 12# Intelligent Integrated Storage Center Construction Project of Anhui Gujing Distillery Co., Ltd. | Environment affection form | 17 March 2021 | BHB【2021】No. 5 |
| 3 | VOCs Advanced Treatment Project of Anhui Longrui Glass Co., Ltd | Environment affection form | 14 April 2021 | 20213416000100000018 |
~ 30 ~
The Company has formulated the Emergency Plan of Anhui Gujing Distillery Company Limited for Sudden Environmental PollutionAccident, which has been filed with Bureau of Ecology and Environment of Bozhou (File No. 341602-2021-006-H). Emergency plandrills have been carried out as planned.Anhui Longrui Glass Co., Ltd has formulated the Emergency Plan of Anhui Longrui Glass Co., Ltd for Sudden EnvironmentalPollution Accident, which has been filed with Bureau of Ecology and Environment of Bozhou (File No. 341602-2021-006-M).Emergency plan drills have been carried out as planned.Environmental self-monitoring schemeAnhui Gujing Distillery Co., Ltd. has formulated the Self-Monitoring Scheme of Anhui Gujing Distillery Company Limited andpublished it on the relevant website of Anhui Province.Anhui Longrui Glass Co., Ltd has formulated the Self-Monitoring Scheme of Anhui Longrui Glass Co., Ltd and published it on therelevant website of Anhui Province.Administrative punishments received with respect to environmental issues in the Reporting PeriodNaughtOther environment information that should be disclosedNaughtOther related environment protection informationNaught
II Social ResponsibilityDuring the Reporting Period, the Company, in accordance with the requirements for high-quality development of listed companies inthe new era, focused on its established strategies, actively responded to the expectations of society, shareholders and otherstakeholders, continuously improved its corporate governance structure, standardized its operations, attached importance to investorrelations, and took the initiative to fulfill its social responsibilities in the areas of protection of the rights and interests of suppliers,customers and employees, and environmental protection and sustainable development. The Company upholds the core values of "BeHonest, Offer Quality Liquor, Be Stronger and Be Helpful to the Society", actively builds and develops strategic partnerships withsuppliers and customers. Also, the Company focuses on communication and coordination with all relevant parties, jointly builds aplatform of trust and cooperation, and effectively fulfills the Company's social responsibility to suppliers and customers. TheCompany continues to carry out training on vocational skills and production safety to improve the professional ability of employeesand the ability to prevent risks in their positions, and to establish a sound market-oriented compensation system. The Company andits subsidiaries attach great importance to and continue to proceed with the improvement of ecological and environmental protection.The Company has improved and implemented various environmental and ecological systems in accordance with the relevantrequirements of national laws and regulations, and has effectively performed its environmental protection duties.
~ 31 ~
Part VI Significant EventsI Commitments of the Company’s De Facto Controller, Shareholders, Related Parties andAcquirers, as well as the Company Itself and Other Entities Fulfilled in the Reporting Periodor Ongoing at the Period-End
□ Applicable √ Not applicable
No such cases in the Reporting Period.II Occupation of the Company’s Capital by the Controlling Shareholder or any of Its RelatedParties for Non-Operating Purposes
□ Applicable √ Not applicable
No such cases in the Reporting Period.III Irregularities in the Provision of Guarantees
□ Applicable √ Not applicable
No such cases in the Reporting Period.IV Engagement and Disengagement of Independent AuditorAre the interim financial statements audited?
□ Yes √ No
The interim financial statements have not been audited.V Explanations Given by the Board of Directors and the Supervisory Committee Regardingthe Independent Auditor's “Modified Opinion” on the Financial Statements of the ReportingPeriod
□ Applicable √ Not applicable
VI Explanations Given by the Board of Directors Regarding the Independent Auditor's“Modified Opinion” on the Financial Statements of Last Year
□ Applicable √ Not applicable
VII Insolvency and Reorganization
□ Applicable √ Not applicable
No such cases in the Reporting Period.
~ 32 ~
VIII Legal Matters
Significant lawsuits and arbitrations:
□ Applicable √ Not applicable
No such cases in the Reporting Period.Other legal matters:
□ Applicable √ Not applicable
IX Punishments and Rectifications
□ Applicable √ Not applicable
No such cases in the Reporting Period.
X Credit Quality of the Company as well as its Controlling Shareholder and De FactoController
□ Applicable √ Not applicable
XI Major Related-Party Transactions
1. Continuing Related-Party Transactions
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Related-Party Transactions Regarding Purchase or Disposal of Assets or Equity Investments
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Related-Party Transactions Regarding Joint Investments in Third Parties
□ Applicable √ Not applicable
No such cases in the Reporting Period.
4. Amounts Due to and from Related Parties
□ Applicable √ Not applicable
No such cases in the Reporting Period.
5. Transactions with Related Finance Companies, or Finance Companies Controlled by the Company
□ Applicable √ Not applicable
~ 33 ~
The Company did not make deposits in, receive loans or credit from and was not involved in any other finance business with anyrelated finance company, finance company controlled by the Company or any other related parties.
6. Other Major Related-Party Transactions
□ Applicable √ Not applicable
No such cases in the Reporting Period.XII Major Contracts and Execution thereof
1. Entrustment, Contracting and Leases
(1) Entrustment
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(2) Contracting
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(3) Leases
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Major Guarantees
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Cash Entrusted for Wealth Management
√ Applicable □ Not applicable
Unit: RMB’0,000
| Type | Funding source | Amount | Undue amount | Unrecovered overdue amount |
| Others | Self-funded | 20,000.00 | 20,000.00 | 0.00 |
| Total | 20,000.00 | 20,000.00 | 0.00 | |
~ 34 ~
Unit: RMB’0,000
| Name of the trustee | Type of the trustee | Type of the product | Amount | Capital resource | Start date | End date | Use of fund | Determination method of remuneration | Annual yield for reference | Estimate profit (if any) | Amount of actual profit or loss in Reporting Period | Actual recovery of profit or loss in Reporting Period | Allowance for impairment (if any) | Legal procedures or not | Plan for entrusted asset management in the future or not | Overviews of events and query index (if any |
| DAPU Asset Management | Private fund manager | Fund | 20,000 | Self-funded | Purchasing new shares offline, products with fixed earnings, reverse repurchase of national debt, and etc. | 1.2% of products’ net value and 20% of excess earnings | 7.00% | 0.00 | 0.16 | Yes | Yes | |||||
| Total | 20,000 | -- | -- | -- | -- | -- | -- | 0.00 | 0.16 | -- | -- | -- | -- | |||
~ 35 ~
XIV Significant Events of Subsidiaries
□ Applicable √ Not applicable
~ 36 ~
Part VII Share Changes and Shareholder InformationI Share Changes
1. Share Changes
Unit: share
| Before | Increase/decrease (+/-) | After | |||||||
| Percentage (%) | New issues | Shares as dividend converted from profit | Shares as dividend converted from capital reserves | Other | Subtotal | Shares | Percentage (%) | Percentage (%) | |
| I. Restricted shares | 0 | 0.00% | 0 | 0.00% | |||||
| II. Non-restricted shares | 503,600,000 | 100.00% | 503,600,000 | 100.00% | |||||
| 1 RMB ordinary shares | 383,600,000 | 76.17% | 383,600,000 | 76.17% | |||||
| 2 Domestically listed foreign shares | 120,000,000 | 23.83% | 120,000,000 | 23.83% | |||||
| III. Total shares | 503,600,000 | 100.00% | 503,600,000 | 100.00% | |||||
~ 37 ~
| Name of stock and its derivative securities | Issue date | Issue price (or interest rate) | Issued number | Listing date | Number approved for public trading | Termination date of transaction | Index to disclosed information | Disclosure date |
| Stocks | ||||||||
| Private placement | 23 June 2021 | RMB200/share | 25,000,000 | 22 July 2021 | 25,000,000 | For details, see the Report on the Issuance of the Private Placement of A-shares & Announcement on the Listing of These Shares disclosed by the Company on www.cninfo.com.cn | 21 July 2021 | |
| Number of ordinary shareholders | 33,189 | Number of preference shareholders with resumed voting rights (if any) (see note 8) | 0 | |||||||
| 5% or greater ordinary shareholders or the top 10 ordinary shareholders | ||||||||||
| Name of shareholder | Nature of shareholder | Shareholding percentage | Total ordinary shares held at the period-end | Increase/decrease in the Reporting Period | Restricted ordinary shares held | Non-restricted ordinary shares held | Shares in pledge or frozen | |||
| Status | Shares | |||||||||
| ANHUI GUJING | State-owned | 53.89% | 271,404,022 | 271,404,022 | In pledge | 114,000,000 | ||||
~ 38 ~
| GROUP COMPANY LIMITED | legal person | |||||||
| GAOLING FUND,L.P. | Foreign legal person | 2.47% | 12,446,408 | 12,446,408 | ||||
| INDUSTRIAL AND COMMERCIAL BANK OF CHINA LIMITED- INVESCO GREAT WALL EMERGING GROWTH HYBRID SECURITIES INVESTMENT FUND | Other | 1.89% | 9,505,500 | 9,505,500 | ||||
| CHINA INT'L CAPITAL CORP HONG KONG SECURITIES LTD | Foreign legal person | 1.77% | 8,918,052 | 8,918,052 | ||||
| BANK OF CHINA-CHINA MERCHANTS CHINA SECURITIES LIQUOR INDEX CLASSIFICATION SECURITIES INVESTMENT FUND | Other | 1.60% | 8,055,209 | 8,055,209 | ||||
| AGRICULTURAL BANK OF CHINA－E FUND CONSUMPTION SECTOR STOCK SECURITIES INVESTMENT FUND | Other | 1.58% | 7,972,456 | 7,972,456 | ||||
| UBS (LUX) EQUITY FUND - | Foreign legal person | 1.40% | 7,048,161 | 7,048,161 |
~ 39 ~
| CHINA OPPORTUNITY (USD) | |||||||||
| HONG KONG SECURITIES CLEARING COMPANY LTD. | Foreign legal person | 1.19% | 5,991,640 | 5,991,640 | |||||
| BANK OF CHINA- INVESCO GREAT WALL DINGYI HYBRID SECURITIES INVESTMENT FUND (LOF) | Other | 0.99% | 4,995,403 | 4,995,403 | |||||
| GREENWOODS CHINA ALPHA MASTER FUND | Foreign legal person | 0.92% | 4,614,326 | 4,614,326 | |||||
| Strategic investor or general legal person becoming a top-10 ordinary shareholder due to rights issue (if any) (see note 3) | N/A | ||||||||
| Related or acting-in-concert parties among the shareholders above | Among the shareholders above, the Company’s controlling shareholder—Anhui Gujing Group Company Limited—is not a related party of other shareholders; nor are they parties acting in concert as defined in the Administrative Measures on Information Disclosure of Changes in Shareholding of Listed Companies. As for the other shareholders, the Company does not know whether they are related parties or whether they belong to parties acting in concert as defined in the Administrative Measures on Information Disclosure of Changes in Shareholding of Listed Companies. | ||||||||
| Explain if any of the shareholders above was involved in entrusting/being entrusted with voting rights or waiving voting rights | N/A | ||||||||
| Special account for share repurchases (if any) among the top 10 shareholders (see note 11) | N/A | ||||||||
| Top 10 non-restricted ordinary shareholders | |||||||||
| Name of shareholder | Non-restricted shares held at the period-end | Shares by type | |||||||
| Type | Shares | ||||||||
| ANHUI GUJING GROUP | 271,404,022 | RMB ordinary | 271,404,022 | ||||||
~ 40 ~
| COMPANY LIMITED | stock | ||
| GAOLING FUND,L.P. | 12,446,408 | Domestically listed foreign stock | 12,446,408 |
| INDUSTRIAL AND COMMERCIAL BANK OF CHINA LIMITED- INVESCO GREAT WALL EMERGING GROWTH HYBRID SECURITIES INVESTMENT FUND | 9,505,500 | RMB ordinary stock | 9,505,500 |
| CHINA INT'L CAPITAL CORP HONG KONG SECURITIES LTD | 8,918,052 | Domestically listed foreign stock | 8,918,052 |
| BANK OF CHINA-CHINA MERCHANTS CHINA SECURITIES LIQUOR INDEX CLASSIFICATION SECURITIES INVESTMENT FUND | 8,055,209 | RMB ordinary stock | 8,055,209 |
| AGRICULTURAL BANK OF CHINA－E FUND CONSUMPTION SECTOR STOCK SECURITIES INVESTMENT FUND | 7,972,456 | RMB ordinary stock | 7,972,456 |
| UBS (LUX) EQUITY FUND - CHINA OPPORTUNITY (USD) | 7,048,161 | Domestically listed foreign stock | 7,048,161 |
| HONG KONG SECURITIES CLEARING COMPANY LTD. | 5,991,640 | RMB ordinary stock | 5,991,640 |
| BANK OF CHINA- INVESCO GREAT WALL DINGYI HYBRID SECURITIES INVESTMENT FUND (LOF) | 4,995,403 | RMB ordinary stock | 4,995,403 |
| GREENWOODS CHINA ALPHA MASTER FUND | 4,614,326 | Domestically listed foreign stock | 4,614,326 |
| Related or acting-in-concert parties among top 10 unrestricted ordinary shareholders, as well as between top 10 unrestricted | Among the shareholders above, the Company’s controlling shareholder—Anhui Gujing Group Company Limited—is not a related party of other shareholders; nor are they parties acting in concert as defined in the Administrative Measures on Information Disclosure of Changes in Shareholding of Listed Companies. As for the other shareholders, the Company does not know | ||
~ 41 ~
| ordinary shareholders and top 10 ordinary shareholders | whether they are related parties or whether they belong to parties acting in concert as defined in the Administrative Measures on Information Disclosure of Changes in Shareholding of Listed Companies. |
| Top 10 ordinary shareholders involved in securities margin trading (if any) (see note 4) | N/A |
~ 42 ~
Part VIII Preference Shares
□ Applicable √ Not applicable
No preference shares in the Reporting Period.
~ 43 ~
Part IX Convertible Corporate Bonds
□ Applicable √ Not applicable
No convertible corporate bonds in the Reporting Period.
~ 44 ~
Part X Financial Statements
I Independent Auditor’s ReportAre these interim financial statements audited by an independent auditor?
□ Yes √ No
These interim financial statements have not been audited by an independent auditor.II Financial Statements
Currency unit for the financial statements and the notes thereto: RMB
1. Consolidated Balance Sheet
Prepared by Anhui Gujing Distillery Company Limited
30 June 2021
Unit: RMB
| Item | 30 June 2021 | 31 December 2020 |
| Current assets: | ||
| Monetary assets | 12,144,304,489.85 | 5,971,212,569.66 |
| Settlement reserve | ||
| Interbank loans granted | ||
| Held-for-trading financial assets | 209,115,157.91 | 203,877,915.51 |
| Derivative financial assets | ||
| Notes receivable | ||
| Accounts receivable | 65,349,125.90 | 67,933,735.91 |
| Accounts receivable financing | 2,003,302,090.64 | 1,673,510,794.51 |
| Prepayments | 113,375,594.34 | 55,575,543.21 |
| Premiums receivable | ||
| Reinsurance receivables | ||
| Receivable reinsurance contract reserve | ||
| Other receivables | 86,173,732.22 | 33,451,121.48 |
| Including: Interest receivable | ||
| Dividends receivable | ||
| Financial assets purchased under |
~ 45 ~
| resale agreements | ||
| Inventories | 3,969,932,350.43 | 3,416,880,808.96 |
| Contract assets | ||
| Assets held for sale | ||
| Current portion of non-current assets | ||
| Other current assets | 56,469,996.22 | 97,412,681.26 |
| Total current assets | 18,648,022,537.51 | 11,519,855,170.50 |
| Non-current assets: | ||
| Loans and advances to customers | ||
| Investments in debt obligations | ||
| Investments in other debt obligations | ||
| Long-term receivables | ||
| Long-term equity investments | 4,975,862.87 | 4,915,575.83 |
| Investments in other equity instruments | 54,910,856.74 | 0.00 |
| Other non-current financial assets | ||
| Investment property | 4,234,372.30 | 4,392,943.54 |
| Fixed assets | 1,829,551,984.09 | 1,797,789,271.62 |
| Construction in progress | 425,876,594.64 | 279,169,201.60 |
| Productive living assets | ||
| Oil and gas assets | ||
| Right-of-use assets | 50,181,080.29 | 0.00 |
| Intangible assets | 1,023,016,905.08 | 934,711,977.79 |
| Development costs | ||
| Goodwill | 538,969,677.36 | 478,283,495.29 |
| Long-term prepaid expense | 65,781,236.57 | 64,591,933.65 |
| Deferred income tax assets | 126,821,441.54 | 96,972,421.95 |
| Other non-current assets | 2,007,300.00 | 5,943,717.02 |
| Total non-current assets | 4,126,327,311.48 | 3,666,770,538.29 |
| Total assets | 22,774,349,848.99 | 15,186,625,708.79 |
| Current liabilities: | ||
| Short-term borrowings | 72,231,000.00 | 70,665,500.00 |
| Borrowings from the central bank | ||
| Interbank loans obtained | ||
| Held-for-trading financial liabilities |
~ 46 ~
| Derivative financial liabilities | ||
| Notes payable | 17,730,000.00 | 140,614,535.60 |
| Accounts payable | 469,238,592.62 | 505,206,561.86 |
| Advances from customers | ||
| Contract liabilities | 2,213,592,055.02 | 1,206,573,886.26 |
| 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 | 362,172,696.63 | 498,129,114.76 |
| Taxes payable | 549,835,380.19 | 349,142,692.10 |
| Other payables | 1,794,127,565.68 | 1,396,599,161.14 |
| Including: Interest payable | ||
| Dividends payable | ||
| Handling charges and commissions payable | ||
| Reinsurance payables | ||
| Liabilities directly associated with assets held for sale | ||
| Current portion of non-current liabilities | ||
| Other current liabilities | 675,219,788.39 | 320,792,383.03 |
| Total current liabilities | 6,154,147,078.53 | 4,487,723,834.75 |
| Non-current liabilities: | ||
| Insurance contract reserve | ||
| Long-term borrowings | 150,125,972.22 | 60,117,638.89 |
| Bonds payable | ||
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Lease liabilities | 47,677,911.46 | 0.00 |
| Long-term payables | ||
| Long-term employee benefits payable |
~ 47 ~
| Provisions | ||
| Deferred income | 95,344,263.32 | 75,111,997.53 |
| Deferred income tax liabilities | 159,346,410.21 | 114,821,451.24 |
| Other non-current liabilities | ||
| Total non-current liabilities | 452,494,557.21 | 250,051,087.66 |
| Total liabilities | 6,606,641,635.74 | 4,737,774,922.41 |
| Owners’ equity: | ||
| Share capital | 528,600,000.00 | 503,600,000.00 |
| Other equity instruments | ||
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Capital reserves | 6,224,747,667.10 | 1,295,405,592.25 |
| Less: Treasury stock | ||
| Other comprehensive income | 477,971.52 | 0.00 |
| Specific reserve | ||
| Surplus reserves | 256,902,260.27 | 256,902,260.27 |
| General reserve | ||
| Retained earnings | 8,610,783,989.67 | 7,987,380,161.21 |
| Total equity attributable to owners of the Company as the parent | 15,621,511,888.56 | 10,043,288,013.73 |
| Non-controlling interests | 546,196,324.69 | 405,562,772.65 |
| Total owners’ equity | 16,167,708,213.25 | 10,448,850,786.38 |
| Total liabilities and owners’ equity | 22,774,349,848.99 | 15,186,625,708.79 |
| Item | 30 June 2021 | 31 December 2020 |
| Current assets: | ||
| Monetary assets | 8,863,352,312.80 | 4,287,808,756.66 |
| Held-for-trading financial assets | 209,115,157.91 | 203,877,915.51 |
| Derivative financial assets |
~ 48 ~
| Notes receivable | ||
| Accounts receivable | 1,179,822.50 | 494,976.27 |
| Accounts receivable financing | 1,171,454,770.74 | 1,399,214,331.97 |
| Prepayments | 65,827,793.88 | 11,737,580.47 |
| Other receivables | 278,778,850.21 | 141,378,010.40 |
| Including: Interest receivable | ||
| Dividends receivable | ||
| Inventories | 3,197,095,753.40 | 2,976,360,208.66 |
| Contract assets | ||
| Assets held for sale | ||
| Current portion of non-current assets | ||
| Other current assets | 10,395,729.97 | 9,734,249.41 |
| Total current assets | 13,797,200,191.41 | 9,030,606,029.35 |
| Non-current assets: | ||
| Investments in debt obligations | ||
| Investments in other debt obligations | ||
| Long-term receivables | ||
| Long-term equity investments | 1,312,692,241.38 | 1,118,213,665.32 |
| Investments in other equity instruments | ||
| Other non-current financial assets | ||
| Investment property | 4,234,372.30 | 4,392,943.54 |
| Fixed assets | 1,250,097,272.57 | 1,322,818,855.86 |
| Construction in progress | 211,265,074.95 | 139,865,487.21 |
| Productive living assets | ||
| Oil and gas assets | ||
| Right-of-use assets | 46,286,878.62 | 0.00 |
| Intangible assets | 403,977,549.81 | 369,163,089.18 |
| Development costs | ||
| Goodwill | ||
| Long-term prepaid expense | 46,153,493.43 | 44,072,241.78 |
| Deferred income tax assets | 24,343,790.14 | 30,716,488.80 |
| Other non-current assets | 75,999.80 | |
| Total non-current assets | 3,299,050,673.20 | 3,029,318,771.49 |
~ 49 ~
| Total assets | 17,096,250,864.61 | 12,059,924,800.84 |
| Current liabilities: | ||
| Short-term borrowings | ||
| Held-for-trading financial liabilities | ||
| Derivative financial liabilities | ||
| Notes payable | 0.00 | 74,535.60 |
| Accounts payable | 358,440,748.35 | 397,554,006.51 |
| Advances from customers | ||
| Contract liabilities | 1,169,598,913.91 | 1,130,074,436.39 |
| Employee benefits payable | 88,167,585.28 | 127,974,331.78 |
| Taxes payable | 336,741,977.34 | 200,876,134.49 |
| Other payables | 441,176,218.39 | 524,000,730.59 |
| Including: Interest payable | ||
| Dividends payable | ||
| Liabilities directly associated with assets held for sale | ||
| Current portion of non-current liabilities | ||
| Other current liabilities | 161,917,575.75 | 160,738,917.51 |
| Total current liabilities | 2,556,043,019.02 | 2,541,293,092.87 |
| Non-current liabilities: | ||
| Long-term borrowings | ||
| Bonds payable | ||
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Lease liabilities | 43,739,404.14 | 0.00 |
| Long-term payables | ||
| Long-term employee benefits payable | ||
| Provisions | ||
| Deferred income | 29,654,139.35 | 31,601,732.51 |
| Deferred income tax liabilities | 18,296,746.56 | 19,407,895.89 |
| Other non-current liabilities | ||
| Total non-current liabilities | 91,690,290.05 | 51,009,628.40 |
| Total liabilities | 2,647,733,309.07 | 2,592,302,721.27 |
~ 50 ~
| Owners’ equity: | ||
| Share capital | 528,600,000.00 | 503,600,000.00 |
| Other equity instruments | ||
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Capital reserves | 6,176,504,182.20 | 1,247,162,107.35 |
| Less: Treasury stock | ||
| Other comprehensive income | ||
| Specific reserve | ||
| Surplus reserves | 251,800,000.00 | 251,800,000.00 |
| Retained earnings | 7,491,613,373.34 | 7,465,059,972.22 |
| Total owners’ equity | 14,448,517,555.54 | 9,467,622,079.57 |
| Total liabilities and owners’ equity | 17,096,250,864.61 | 12,059,924,800.84 |
| Item | H1 2021 | H1 2020 |
| 1. Revenue | 7,007,496,467.74 | 5,519,621,000.62 |
| Including: Operating revenue | 7,007,496,467.74 | 5,519,621,000.62 |
| Interest income | ||
| Insurance premium income | ||
| Handling charge and commission income | ||
| 2. Costs and expenses | 5,170,893,817.52 | 4,162,705,858.66 |
| Including: Cost of sales | 1,653,818,347.31 | 1,313,925,592.48 |
| 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 |
~ 51 ~
| Taxes and surcharges | 1,069,811,252.05 | 887,997,040.72 |
| Selling expense | 2,028,265,595.93 | 1,618,049,637.27 |
| Administrative expense | 467,727,393.70 | 395,687,673.15 |
| R&D expense | 19,961,346.26 | 15,254,382.98 |
| Finance costs | -68,690,117.73 | -68,208,467.94 |
| Including: Interest expense | 4,457,905.49 | 28,973,275.97 |
| Interest income | 72,689,006.99 | 96,891,173.45 |
| Add: Other income | 34,701,412.82 | 14,974,353.66 |
| Return on investment (“-” for loss) | -5,122,111.50 | 18,485,972.20 |
| Including: Share of profit or loss of joint ventures and associates | 60,287.04 | -53,631.34 |
| 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) | 5,237,242.40 | -3,596,160.61 |
| Credit impairment loss (“-” for loss) | 1,945,965.69 | -388,444.57 |
| Asset impairment loss (“-” for loss) | 2,464,519.26 | -5,693,185.77 |
| Asset disposal income (“-” for loss) | 1,014,902.90 | 77,867.25 |
| 3. Operating profit (“-” for loss) | 1,876,844,581.79 | 1,380,775,544.12 |
| Add: Non-operating income | 25,707,115.31 | 20,575,161.54 |
| Less: Non-operating expense | 3,255,078.91 | 24,273,656.49 |
| 4. Profit before tax (“-” for loss) | 1,899,296,618.19 | 1,377,077,049.17 |
| Less: Income tax expense | 478,730,726.66 | 370,635,522.24 |
| 5. Net profit (“-” for net loss) | 1,420,565,891.53 | 1,006,441,526.93 |
| 5.1 By operating continuity | ||
| 5.1.1 Net profit from continuing operations (“-” for net loss) | 1,420,565,891.53 | 1,006,441,526.93 |
| 5.1.2 Net profit from discontinued operations (“-” for net loss) | ||
| 5.2 By ownership |
~ 52 ~
| 5.2.1 Net profit attributable to owners of the Company as the parent | 1,378,803,828.46 | 1,024,936,604.36 |
| 5.2.1 Net profit attributable to non-controlling interests | 41,762,063.07 | -18,495,077.43 |
| 6. Other comprehensive income, net of tax | 796,619.20 | 0.00 |
| Attributable to owners of the Company as the parent | 477,971.52 | 0.00 |
| 6.1 Items that will not be reclassified to profit or loss | 477,971.52 | 0.00 |
| 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 | 477,971.52 | 0.00 |
| 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 | ||
| 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 | ||
| 6.2.7 Other | ||
| Attributable to non-controlling interests | 318,647.68 | 0.00 |
~ 53 ~
| 7. Total comprehensive income | 1,421,362,510.73 | 1,006,441,526.93 |
| Attributable to owners of the Company as the parent | 1,379,281,799.98 | 1,024,936,604.36 |
| Attributable to non-controlling interests | 42,080,710.75 | -18,495,077.43 |
| 8. Earnings per share | ||
| 8.1 Basic earnings per share | 2.74 | 2.04 |
| 8.2 Diluted earnings per share | 2.74 | 2.04 |
| Item | H1 2021 | H1 2020 |
| 1. Operating revenue | 3,596,233,135.46 | 3,297,117,172.49 |
| Less: Cost of sales | 1,388,312,451.57 | 1,317,059,263.62 |
| Taxes and surcharges | 912,790,380.44 | 826,730,898.61 |
| Selling expense | 26,922,520.17 | 22,901,348.42 |
| Administrative expense | 274,336,727.36 | 287,708,363.27 |
| R&D expense | 12,595,670.28 | 9,137,959.37 |
| Finance costs | -33,519,413.78 | -44,796,771.26 |
| Including: Interest expense | 1,102,140.59 | 28,288,982.29 |
| Interest income | 34,468,139.72 | 73,155,252.32 |
| Add: Other income | 4,448,910.21 | 4,622,731.11 |
| Return on investment (“-” for loss) | -3,772,871.47 | 12,434,590.21 |
| Including: Share of profit or loss of joint ventures and associates | ||
| 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) | 5,237,242.40 | -3,596,160.61 |
~ 54 ~
| Credit impairment loss (“-” for loss) | 1,815,211.93 | 540,745.12 |
| Asset impairment loss (“-” for loss) | 2,968,599.03 | -5,693,185.77 |
| Asset disposal income (“-” for loss) | 1,217,988.71 | 60,176.99 |
| 2. Operating profit (“-” for loss) | 1,026,709,880.23 | 886,745,007.51 |
| Add: Non-operating income | 17,347,810.40 | 15,201,396.26 |
| Less: Non-operating expense | 1,424,712.54 | 20,488,855.01 |
| 3. Profit before tax (“-” for loss) | 1,042,632,978.09 | 881,457,548.76 |
| Less: Income tax expense | 260,679,576.97 | 232,611,329.35 |
| 4. Net profit (“-” for net loss) | 781,953,401.12 | 648,846,219.41 |
| 4.1 Net profit from continuing operations (“-” for net loss) | 781,953,401.12 | 648,846,219.41 |
| 4.2 Net profit from discontinued operations (“-” for net loss) | ||
| 5. Other comprehensive income, net of tax | ||
| 5.1 Items that will not be reclassified to profit or loss | ||
| 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 | ||
| 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 |
~ 55 ~
| 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 | 781,953,401.12 | 648,846,219.41 |
| 7. Earnings per share | ||
| 7.1 Basic earnings per share | 1.55 | 1.29 |
| 7.2 Diluted earnings per share | 1.55 | 1.29 |
| Item | H1 2021 | H1 2020 |
| 1. Cash flows from operating activities: | ||
| Proceeds from sale of commodities and rendering of services | 8,064,793,672.94 | 6,336,568,642.45 |
| 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 | 3,388,614.96 | 3,020,222.21 |
~ 56 ~
| Cash generated from other operating activities | 1,598,870,662.08 | 1,323,750,535.31 |
| Subtotal of cash generated from operating activities | 9,667,052,949.98 | 7,663,339,399.97 |
| Payments for commodities and services | 1,273,004,707.79 | 733,871,614.50 |
| 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 | 1,492,074,698.56 | 1,250,084,349.76 |
| Taxes paid | 2,121,640,018.53 | 1,853,009,320.89 |
| Cash used in other operating activities | 4,516,366,392.84 | 1,484,736,014.18 |
| Subtotal of cash used in operating activities | 9,403,085,817.72 | 5,321,701,299.33 |
| Net cash generated from/used in operating activities | 263,967,132.26 | 2,341,638,100.64 |
| 2. Cash flows from investing activities: | ||
| Proceeds from disinvestment | 396,849,809.53 | 309,070,000.00 |
| Return on investment | 1,258,176.12 | 18,539,603.54 |
| Net proceeds from the disposal of fixed assets, intangible assets and other long-lived assets | 1,570,219.30 | 92,400.01 |
| Net proceeds from the disposal of subsidiaries and other business units | ||
| Cash generated from other investing activities | ||
| Subtotal of cash generated from investing activities | 399,678,204.95 | 327,702,003.55 |
| Payments for the acquisition of fixed assets, intangible assets and other long-lived assets | 285,092,874.96 | 220,906,338.24 |
| Payments for investments | 404,900,000.00 | 44,800,000.00 |
~ 57 ~
| Net increase in pledged loans granted | ||
| Net payments for the acquisition of subsidiaries and other business units | 65,186,333.10 | 0.00 |
| Cash used in other investing activities | ||
| Subtotal of cash used in investing activities | 755,179,208.06 | 265,706,338.24 |
| Net cash generated from/used in investing activities | -355,501,003.11 | 61,995,665.31 |
| 3. Cash flows from financing activities: | ||
| Capital contributions received | 4,962,827,169.81 | 0.00 |
| Including: Capital contributions by non-controlling interests to subsidiaries | 5,280,000.00 | 0.00 |
| Borrowings raised | 130,330,000.00 | 50,094,500.00 |
| Cash generated from other financing activities | ||
| Subtotal of cash generated from financing activities | 5,093,157,169.81 | 50,094,500.00 |
| Repayment of borrowings | 228,437,703.59 | |
| Interest and dividends paid | 759,464,406.09 | 290,708.33 |
| Including: Dividends paid by subsidiaries to non-controlling interests | ||
| Cash used in other financing activities | 8,235,784.88 | 0.00 |
| Subtotal of cash used in financing activities | 996,137,894.56 | 290,708.33 |
| Net cash generated from/used in financing activities | 4,097,019,275.25 | 49,803,791.67 |
| 4. Effect of foreign exchange rates changes on cash and cash equivalents | ||
| 5. Net increase in cash and cash equivalents | 4,005,485,404.40 | 2,453,437,557.62 |
| Add: Cash and cash equivalents, beginning of the period | 5,636,903,693.74 | 2,944,749,918.09 |
| 6. Cash and cash equivalents, end of the period | 9,642,389,098.14 | 5,398,187,475.71 |
| Item | H1 2021 | H1 2020 |
~ 58 ~
| 1. Cash flows from operating activities: | ||
| Proceeds from sale of commodities and rendering of services | 7,096,307,729.01 | 3,777,524,502.26 |
| Tax rebates | 0.00 | |
| Cash generated from other operating activities | 2,341,213,371.64 | 936,783,738.07 |
| Subtotal of cash generated from operating activities | 9,437,521,100.65 | 4,714,308,240.33 |
| Payments for commodities and services | 1,352,698,829.10 | 1,149,042,873.79 |
| Cash paid to and for employees | 501,300,793.46 | 450,118,968.16 |
| Taxes paid | 1,342,951,770.60 | 1,415,720,556.26 |
| Cash used in other operating activities | 7,545,117,742.35 | 508,102,703.30 |
| Subtotal of cash used in operating activities | 10,742,069,135.51 | 3,522,985,101.51 |
| Net cash generated from/used in operating activities | -1,304,548,034.86 | 1,191,323,138.82 |
| 2. Cash flows from investing activities: | ||
| Proceeds from disinvestment | 386,849,809.53 | 276,900,000.00 |
| Return on investment | 438,267.56 | 12,434,590.21 |
| Net proceeds from the disposal of fixed assets, intangible assets and other long-lived assets | 1,475,459.30 | 68,000.00 |
| Net proceeds from the disposal of subsidiaries and other business units | 3,123,346.37 | 0.00 |
| Cash generated from other investing activities | ||
| Subtotal of cash generated from investing activities | 391,886,882.76 | 289,402,590.21 |
| Payments for the acquisition of fixed assets, intangible assets and other long-lived assets | 203,961,053.06 | 160,840,403.43 |
| Payments for investments | 394,900,000.00 | 21,800,000.00 |
| Net payments for the acquisition of subsidiaries and other business units | 205,920,000.00 | 0.00 |
| Cash used in other investing activities | ||
| Subtotal of cash used in investing activities | 804,781,053.06 | 182,640,403.43 |
| Net cash generated from/used in | -412,894,170.30 | 106,762,186.78 |
~ 59 ~
| investing activities | ||
| 3. Cash flows from financing activities: | ||
| Capital contributions received | 4,957,547,169.81 | 0.00 |
| Borrowings raised | ||
| Cash generated from other financing activities | ||
| Subtotal of cash generated from financing activities | 4,957,547,169.81 | 0.00 |
| Repayment of borrowings | ||
| Interest and dividends paid | 755,225,623.63 | 0.00 |
| Cash used in other financing activities | 7,335,784.88 | 0.00 |
| Subtotal of cash used in financing activities | 762,561,408.51 | 0.00 |
| Net cash generated from/used in financing activities | 4,194,985,761.30 | 0.00 |
| 4. Effect of foreign exchange rates changes on cash and cash equivalents | ||
| 5. Net increase in cash and cash equivalents | 2,477,543,556.14 | 1,298,085,325.60 |
| Add: Cash and cash equivalents, beginning of the period | 4,087,808,756.66 | 2,079,818,830.20 |
| 6. Cash and cash equivalents, end of the period | 6,565,352,312.80 | 3,377,904,155.80 |
~ 60 ~
7. Consolidated Statements of Changes in Owners’ Equity
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 | 503,600,000.00 | 1,295,405,592.25 | 256,902,260.27 | 7,987,380,161.21 | 10,043,288,013.73 | 405,562,772.65 | 10,448,850,786.38 | ||||||||
| Add: Adjustment for change in accounting policy | |||||||||||||||
| Adjustment for correction of previous error | |||||||||||||||
| Adjustment | |||||||||||||||
~ 61 ~
| for business combination under common control | |||||||||||||||
| Other adjustments | |||||||||||||||
| 2. Balance as at the beginning of the Reporting Period | 503,600,000.00 | 1,295,405,592.25 | 256,902,260.27 | 7,987,380,161.21 | 10,043,288,013.73 | 405,562,772.65 | 10,448,850,786.38 | ||||||||
| 3. Increase/ decrease in the period (“-” for decrease) | 25,000,000.00 | 4,929,342,074.85 | 477,971.52 | 623,403,828.46 | 5,578,223,874.83 | 140,633,552.04 | 5,718,857,426.87 | ||||||||
| 3.1 Total comprehensive income | 477,971.52 | 1,378,803,828.46 | 1,379,281,799.98 | 42,080,710.75 | 1,421,362,510.73 | ||||||||||
| 3.2 Capital increased and reduced by owners | 25,000,000.00 | 4,929,342,074.85 | 4,954,342,074.85 | 98,552,841.29 | 5,052,894,916.14 | ||||||||||
| 3.2.1 Ordinary shares | 25,000,000.00 | 4,929,342,074.85 | 4,954,342,074.85 | 4,954,342,074.85 |
~ 62 ~
| 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 | 98,552,841.29 | 98,552,841.29 | |||||||||||||
| 3.3 Profit distribution | -755,400,000.00 | -755,400,000.00 | -755,400,000.00 | ||||||||||||
| 3.3.1 Appropriation to surplus reserves | |||||||||||||||
| 3.3.2 Appropriation to general reserve | |||||||||||||||
| 3.3.3 Appropriatio | -755,400,000.00 | -755,400,000.00 | -755,400,000.00 |
~ 63 ~
| n to owners (or shareholders) | |||||||||||||||
| 3.3.4 Other | |||||||||||||||
| 3.4 Transfers within owners’ equity | |||||||||||||||
| 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 |
~ 64 ~
| defined benefit schemes transferred to retained earnings | |||||||||||||||
| 3.4.5 Other comprehensive income transferred to 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 | 528,600,000.00 | 6,224,747,667.10 | 477,971.52 | 256,902,260.27 | 8,610,783,989.67 | 15,621,511,888.56 | 546,196,324.69 | 16,167,708,213.25 |
~ 65 ~
Period
H1 2020
Unit: RMB
| Item | H1 2020 | ||||||||||||||
| 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 | 503,600,000.00 | 1,295,405,592.25 | 256,902,260.27 | 6,888,203,911.92 | 8,944,111,764.44 | 488,042,947.30 | 9,432,154,711.74 | ||||||||
| Add: Adjustment for change in accounting policy | |||||||||||||||
| Adjustment for correction of previous error | |||||||||||||||
| Adjustment for business combination | |||||||||||||||
~ 66 ~
| under common control | |||||||||||||||
| Other adjustments | |||||||||||||||
| 2. Balance as at the beginning of the Reporting Period | 503,600,000.00 | 1,295,405,592.25 | 256,902,260.27 | 6,888,203,911.92 | 8,944,111,764.44 | 488,042,947.30 | 9,432,154,711.74 | ||||||||
| 3. Increase/ decrease in the period (“-” for decrease) | 269,536,604.36 | 269,536,604.36 | -18,495,077.43 | 251,041,526.93 | |||||||||||
| 3.1 Total comprehensive income | 1,024,936,604.36 | 1,024,936,604.36 | -18,495,077.43 | 1,006,441,526.93 | |||||||||||
| 3.2 Capital increased and reduced by owners | |||||||||||||||
| 3.2.1 Ordinary shares increased by owners | |||||||||||||||
| 3.2.2 |
~ 67 ~
| Capital increased by holders of other equity instruments | |||||||||||||||
| 3.2.3 Share-based payments included in owners’ equity | |||||||||||||||
| 3.2.4 Other | |||||||||||||||
| 3.3 Profit distribution | -755,400,000.00 | -755,400,000.00 | -755,400,000.00 | ||||||||||||
| 3.3.1 Appropriation to surplus reserves | |||||||||||||||
| 3.3.2 Appropriation to general reserve | |||||||||||||||
| 3.3.3 Appropriation to owners (or shareholders) | -755,400,000.00 | -755,400,000.00 | -755,400,000.00 |
~ 68 ~
| 3.3.4 Other | |||||||||||||||
| 3.4 Transfers within owners’ equity | |||||||||||||||
| 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 |
~ 69 ~
| retained earnings | |||||||||||||||
| 3.4.5 Other comprehensive income transferred to 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 | 503,600,000.00 | 1,295,405,592.25 | 256,902,260.27 | 7,157,740,516.28 | 9,213,648,368.80 | 469,547,869.87 | 9,683,196,238.67 |
~ 70 ~
8. Statements of Changes in Owners’ Equity of the Company as the Parent
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 | 503,600,000.00 | 1,247,162,107.35 | 251,800,000.00 | 7,465,059,972.22 | 9,467,622,079.57 | |||||||
| 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 | 503,600,000.00 | 1,247,162,107.35 | 251,800,000.00 | 7,465,059,972.22 | 9,467,622,079.57 | |||||||
| 3. Increase/ decrease in the period (“-” for decrease) | 25,000,000.00 | 4,929,342,074.85 | 26,553,401.12 | 4,980,895,475.97 | ||||||||
| 3.1 Total comprehensive income | 781,953,401.12 | 781,953,401.12 | ||||||||||
| 3.2 Capital increased and reduced | 25,000,000.00 | 4,929,342,074.85 | 4,954,342,074.85 | |||||||||
~ 71 ~
| by owners | ||||||||||||
| 3.2.1 Ordinary shares increased by owners | 25,000,000.00 | 4,929,342,074.85 | 4,954,342,074.85 | |||||||||
| 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 | ||||||||||||
| 3.3 Profit distribution | -755,400,000.00 | -755,400,000.00 | ||||||||||
| 3.3.1 Appropriation to surplus reserves | ||||||||||||
| 3.3.2 Appropriation to owners (or shareholders) | -755,400,000.00 | -755,400,000.00 | ||||||||||
| 3.3.3 Other | ||||||||||||
| 3.4 Transfers within owners’ equity | ||||||||||||
| 3.4.1 Increase in capital (or share capital) from capital reserves |
~ 72 ~
| 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 | ||||||||||||
| 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 | 528,600,000.00 | 6,176,504,182.20 | 251,800,000.00 | 7,491,613,373.34 | 14,448,517,555.54 |
| Item | H1 2020 |
~ 73 ~
| 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 | 503,600,000.00 | 1,247,162,107.35 | 251,800,000.00 | 6,397,131,020.62 | 8,399,693,127.97 | |||||||
| 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 | 503,600,000.00 | 1,247,162,107.35 | 251,800,000.00 | 6,397,131,020.62 | 8,399,693,127.97 | |||||||
| 3. Increase/ decrease in the period (“-” for decrease) | -106,553,780.59 | -106,553,780.59 | ||||||||||
| 3.1 Total comprehensive income | 648,846,219.41 | 648,846,219.41 | ||||||||||
| 3.2 Capital increased and reduced by owners | ||||||||||||
| 3.2.1 Ordinary shares increased by owners | ||||||||||||
~ 74 ~
| 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 | ||||||||||||
| 3.3 Profit distribution | -755,400,000.00 | -755,400,000.00 | ||||||||||
| 3.3.1 Appropriation to surplus reserves | ||||||||||||
| 3.3.2 Appropriation to owners (or shareholders) | -755,400,000.00 | -755,400,000.00 | ||||||||||
| 3.3.3 Other | ||||||||||||
| 3.4 Transfers within owners’ equity | ||||||||||||
| 3.4.1 Increase in capital (or share capital) from capital reserves | ||||||||||||
| 3.4.2 Increase in capital (or share capital) from surplus |
~ 75 ~
| 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 | ||||||||||||
| 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 | 503,600,000.00 | 1,247,162,107.35 | 251,800,000.00 | 6,290,577,240.03 | 8,293,139,347.38 |
~ 76 ~
Anhui Gujing Distillery Company LimitedNotes to Financial Statements for H1 2021(Currency Unit Is RMB Unless Otherwise Stated)
1. BASIC INFORMATION ABOUT THE COMPANY
1.1 Corporate Information
Authorized by document WGZGZ (1996) No.053 of Anhui Administrative Bureau of State-owned Property,Anhui Gujing Distillery Company Limited (“the Company”) was established as a limited liability company withnet assets of RMB377,167,700 and state-owned shares of 155,000,000 shares and considered Anhui GujingCompany as the only promoter. The registration place was Bozhou Anhui China. The Company was establishedon 5 March 1996 by document of WZM (1996) No.42 of Anhui People’s Government. The Company set upplenary session on 28 May 1996 and registered in Anhui on 30 May 1996 with business license of 14897271-1.The Company has issued 60,000,000 domestic listed foreign shares (“B” shares) in June 1996 and 20,000,000ordinary shares (“A shares) on September 1996, ordinary shares are listed in national and par value is RMB1.00per share. Those A shares and B shares are listed in Shenzhen Stock exchange.Headquarter of the Company is located in Gujing Bozhou Anhui. The Company and its subsidiaries (the Company)specialize in producing and selling white spirit.Registered capitals of the Company were RMB235,000,000 with stocks of 235,000,000, of which 155,000,000shares were issued in China, B shares of 60,000,000 shares and A shares of 20,000,000 shares. The book value ofthe stocks of the Company was of RMB1 per share.On 29 May 2006, a shareholder meeting was held to discuss and approval a program of equity division of A share,the program was implement in June 2006. After implementation, all shares are outstanding share, which include147,000,000 shares with restrict condition on disposal, represent 62.55% of total equity, and 88,000,000 shareswithout restrict condition on disposal, represent 37.45% of total equity.The Company issued <Announcement of release restriction shares by Anhui Gujing Distillery Company Limited>on 27 June 2007, 11,750,000 outstanding shares with restrict condition on disposal are listed in stock market on 29June 2007. Up to that day, outstanding shares with restrict condition on disposal are 135,250,000, representing
57.55% of total equity, the share without restrict condition are 99,750,000, representing 42.45% of total equity.The Company issued <Announcement of release restriction shares by Anhui Gujing Distillery Company Limited>on 17 July 2008, 11,750,000 outstanding shares with restrict condition on disposal are listed in stock market on 18July 2008. Up to that day, outstanding shares with restrict condition on disposal are 123,500,000, representing
52.55% of total equity, the share without restrict condition are 111,500,000, representing 47.45% of total equity.The Company issued <Announcement of release restriction shares by Anhui Gujing Distillery Company Limited>on 24 July 2009, 123,500,000 outstanding shares with restrict condition on disposal are listed in stock market on
~ 77 ~
29 July 2009. Up to that day, the Company’s all shares are all tradable.Approved by the CSRC Document Zheng-Jian-Xu-Ke [2011] No. 943, the Company privately offered 16,800,000ordinary shares (A-shares) to special investors on 15 July 2011, with a par value of RMB1 and the price ofRMB75.00 per share, raising RMB1,260,000,000.00 in total, the net amount of raised funds stood atRMB1,227,499,450.27 after deducting RMB32,500,549.73 of various issuance expenses. Certified PublicAccountants verified the raised capital upon its arrival and issued the Capital Verification Report Reanda-Yan-Zi[2011] No. 1065. After private issuance, the share capital of the Company increased to RMB251.8 million.Pursuant to the Resolution of The 2011 Annual General Meeting, the Company that considered 251,800,000shares as base number on 31 December 2011 transferred capital reserve into share capital at a rate of “10 sharesfor per 10 shares” accounting for 251,800,000 shares and implemented in the year of 2012. Upon the transference,the registered capitals increased to RMB503,600,000.In April 2016, the Company entered a strategic cooperation agreement with Wuhan Tianlong Yellow Crane TowerCo., Ltd., creating a new age for cooperation related to Chinese famous spirit. As the only Chinese famous spiritin Hubei Province, it features unique mellow taste, elegant appearance and tempting smell. Moreover, YellowCrane Tower White Spirit won the Golden Prize respectively in 1984 and 1989 National White Spirit AppraisalCompetition as one of the business card representing Hubei Province’s economy. At present, the Company hasestablished three major bases in Wuhan, Xianning and Suizhou, of which, Xianning Base has integratedmodernism, ecologism and high technology as a new spirit-making base, known as “the most beautiful chateau inChina”. In 2016, Yellow Crane Tower Spirit won “2015 Top 10 Star Product in Hubei Province”.In January 2021, the Company and Mingguang Distillery signed a strategic cooperation agreement. The uniquemung bean flavor adds to the famous liquor family of Gujing. This makes Gujing become a famous Chinese liquormaker with "three brands", "four flavors" and "three production areas".By 30 June 2021, the Company issued 528,600,000 shares.The Company is registered at Gujing Town, Bozhou City, Anhui Province.The approved business of the Company including procurement of grain (operating with business license),manufacture of distilled spirits, wine distilling facilities, packaging material, bottles, alcohol, grease (limited tobyproducts from wine manufacture), and research and development of high-tech, biotechnology development,agricultural and sideline products deep processing, as well as sale of self-manufacturing products.The Company as the parent and the final company as the parent is Anhui Gujing Company Co., Ltd in China.Financial statement of the Company will be released on 27 August 2021 by the Board of Directors.
1.2 Scope of Consolidation and Changes Thereof
(1) Incorporated subsidiaries of the Company
| Name of Subsidiaries | Proportion of Shareholding (or similar equity interest) (%) | |
| Direct | Indirect | |
~ 78 ~
| Name of Subsidiaries | Proportion of Shareholding (or similar equity interest) (%) | |
| Direct | Indirect | |
| Bozhou Gujing Sales Co., Ltd. | 100.00 | - |
| Anhui Longrui Glass Co., Ltd | 100.00 | - |
| Bozhou Gujing Waste Reclamation Co., Ltd. (cancelled) | 100.00 | - |
| Anhui Jinyunlai Culture & Media Co., Ltd. | 100.00 | - |
| Anhui Ruisiweier Technology Co., Ltd. | 100.00 | - |
| Shanghai Gujing Jinhao Hotel Management Co., Ltd. | 100.00 | - |
| Bozhou Gujing Hotel Co., Ltd | 100.00 | - |
| Anhui Yuanqing Environmental Protection Co., Ltd. | 100.00 | - |
| Anhui Gujing Yunshang E-commerce Co., Ltd. | 100.00 | - |
| Anhui Zhenrui Construction Engineering Co., Ltd | - | 52.00 |
| Anhui RunAnXinKe Testing Technology Co., Ltd. | 100.00 | - |
| Anhui Jiudao Culture Media Co., Ltd. | 100.00 | - |
| Anhui Jiuan Mechanical Electrical Equipment Co., Ltd. | 100.00 | |
| Anhui Jiuhao China Railway Construction Engineering Co., Ltd. | 52.00 | |
| Anhui Mingguang Wine Co., Ltd. | 60.00 | |
| Mingguang Tiancheng Ming Wine Sales Co., Ltd. | 60.00 | |
| Fengyang Xiaogang Village Ming Wine Distillery Co., Ltd. | 42.00 | |
| Yellow Crane Tower Distillery Co., Ltd. | 51.00 | - |
| Yellow Crane Tower Distillery (Xianning) Co., Ltd. | - | 51.00 |
| Yellow Crane Tower Distillery (Suizhou) Co., Ltd. | - | 51.00 |
| Hubei Junlou Cultural Tourism Co., Ltd. | - | 51.00 |
| Hubei Yellow Crane Tower Beverage Co., Ltd. | - | 51.00 |
| Wuhan Yashibo Technology Co., Ltd. | - | 51.00 |
| Hubei Xinjia Testing Technology Co., Ltd. | - | 51.00 |
| Wuhan Tianlong Jindi Technology Development Co., Ltd | - | 51.00 |
| Xianning Junhe Sales Co., Ltd | - | 51.00 |
| Wuhan Junya Sales Co., Ltd | - | 51.00 |
~ 79 ~
| Name of Subsidiaries | Proportion of Shareholding (or similar equity interest) (%) | |
| Direct | Indirect | |
| Suizhou Junhe Commercial Co., Ltd. | - | 51.00 |
~ 80 ~
The accounting year of the Company is from January 1 to December 31 in calendar year.
3.3 Operating Cycle
The normal operating cycle of the Company is one year.
3.4 Currency Used in Bookkeeping
The Company's functional currency is RMB, and its overseas subsidiaries are operated in the currency of the maineconomic environment in which they operate.
3.5 Accounting Treatment of Business Combinations under and not under Common Control(a) Business combinations under common controlThe assets and liabilities that the Company obtains in a business combination under common control shall bemeasured at their carrying amount of the acquired entity at the combination date. If the accounting policy adoptedby the acquired entity is different from that adopted by the acquiring entity, the acquiring entity shall, according toaccounting policy it adopts, adjust the relevant items in the financial statements of the acquired party based on theprincipal of materiality. As for the difference between the carrying amount of the net assets obtained by theacquiring entity and the carrying amount of the consideration paid by it, the capital reserve (capital premium orshare premium) shall be adjusted. If the capital reserve (capital premium or share premium) is not sufficient toabsorb the difference, any excess shall be adjusted against retained earnings.For the accounting treatment of business combination under common control by step acquisitions, please refer toNote 3.6 (6).(b) Business combinations not under common controlThe assets and liabilities that the Company obtains in a business combination not under common control shall bemeasured at their fair value at the acquisition date. If the accounting policy adopted by the acquired entity isdifferent from that adopted by the acquiring entity, the acquiring entity shall, according to accounting policy itadopts, adjust the relevant items in the financial statements of the acquired entity based on the principal ofmateriality. The acquiring entity shall recognise the positive balance between the combination costs and the fairvalue of the identifiable net assets it obtains from the acquired entity as goodwill. The acquiring entity shall,pursuant to the following provisions, treat the negative balance between the combination costs and the fair valueof the identifiable net assets it obtains from the acquired entity:
(i) It shall review the measurement of the fair values of the identifiable assets, liabilities and contingent liabilitiesit obtains from the acquired entity as well as the combination costs;(ii) If, after the review, the combination costs are still less than the fair value of the identifiable net assets itobtains from the acquired entity, the balance shall be recognised in profit or loss of the reporting period.For the accounting treatment of business combination under the same control by step acquisitions, please refer toNote 3.6 (f).(c) Treatment of business combination related costs
~ 81 ~
The intermediary costs such as audit, legal services and valuation consulting and other related management coststhat are directly attributable to the business combination shall be charged in profit or loss in the period in whichthey are incurred. The costs to issue equity or debt securities for the consideration of business combination shallbe recorded as a part of the value of the respect equity or debt securities upon initial recognition.
3.6 Method of Preparing the Consolidated Financial Statements
(a) Scope of consolidationThe scope of consolidated financial statements shall be determined on the basis of control. It not only includessubsidiaries determined based on voting power (or similar) or other arrangement, but also structured entities underone or several contract arrangements.Control exists when the Company has all the following: power over the investee; exposure, or rights to variablereturns from the Company’s involvement with the investee; and the ability to use its power over the investee toaffect the amount of the investor’s returns. Subsidiaries are the entities that controlled by the Company (includingenterprise, a divisible part of the investee, and structured entity controlled by the enterprise). A structured entity(sometimes called a Special Purpose Entity) is an entity that has been designed so that voting or similar rights arenot the dominant factor in deciding who controls the entity.(b) Special requirement as the parent company is an investment entityIf the parent company is an investment entity, it should measure its investments in particular subsidiaries asfinancial assets at fair value through profit or loss instead of consolidating those subsidiaries in its consolidatedand separate financial statements. However, as an exception to this requirement, if a subsidiary providesinvestment-related services or activities to the investment entity, it should be consolidated.The parent company is defined as investment entity when meets following conditions:
a. Obtains funds from one or more investors for the purpose of providing those investors with investmentmanagement services;b. Commits to its investors that its business purpose is to invest funds solely for returns from capital appreciation,investment income or both; andc. Measures and evaluates the performance of substantially all of its investments on a fair value basis.If the parent company becomes an investment entity, it shall cease to consolidate its subsidiaries at the date of thechange in status, except for any subsidiary which provides investment-related services or activities to theinvestment entity shall be continued to be consolidated. The deconsolidation of subsidiaries is accounted for asthough the investment entity partially disposed subsidiaries without loss of control.When the parent company previously classified as an investment entity ceases to be an investment entity,subsidiary that was previously measured at fair value through profit or loss shall be included in the scope ofconsolidated financial statements at the date of the change in status. The fair value of the subsidiary at the date ofchange represents the transferred deemed consideration in accordance with the accounting for business
~ 82 ~
combination not under common control.(c) Method of preparing the consolidated financial statementsThe consolidated financial statements shall be prepared by the Company based on the financial statements of theCompany and its subsidiaries, and using other related information.When preparing consolidated financial statements, the Company shall consider the entire group as an accountingentity, adopt uniform accounting policies and apply the requirements of Accounting Standard for BusinessEnterprises related to recognition, measurement and presentation. The consolidated financial statements shallreflect the overall financial position, operating results and cash flows of the group.(i) Like items of assets, liabilities, equity, income, expenses and cash flows of the parent are combined with thoseof the subsidiaries.(ii) The carrying amount of the parent’s investment in each subsidiary is eliminated (off-set) against the parent’sportion of equity of each subsidiary.(iii) Eliminate the impact of intragroup transactions between the Company and the subsidiaries or betweensubsidiaries, and when intragroup transactions indicate an impairment of related assets, the losses shall berecognised in full.(iv) Make adjustments to special transactions from the perspective of the group.(d) Method of preparation of the consolidated financial statements when subsidiaries are acquired ordisposed in the reporting period(i) Acquisition of subsidiaries or businessSubsidiaries or business acquired through business combination under common controlWhen preparing consolidated statements of financial position, the opening balance of the consolidated balancesheet shall be adjusted. Related items of comparative financial statements shall be adjusted as well, deeming thatthe combined entity has always existed ever since the ultimate controlling party began to control.Incomes, expenses and profits of the subsidiary incurred from the beginning of the reporting period to the end ofthe reporting period shall be included into the consolidated statement of profit or loss. Related items ofcomparative financial statements shall be adjusted as well, deeming that the combined entity has always existedever since the ultimate controlling party began to control.Cash flows from the beginning of the reporting period to the end of the reporting period shall be included into theconsolidated statement of cash flows. Related items of comparative financial statements shall be adjusted as well,deeming that the combined entity has always existed ever since the ultimate controlling party began to control.Subsidiaries or business acquired through business combination not under common controlWhen preparing the consolidated statements of financial position, the opening balance of the consolidatedstatements of financial position shall not be adjusted.Incomes, expenses and profits of the subsidiary incurred from the acquisition date to the end of the reporting
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period shall be included into the consolidated statement of profit or loss.Cash flows from the acquisition date to the end of the reporting period shall be included into the consolidatedstatement of cash flows.(ii) Disposal of subsidiaries or businessWhen preparing the consolidated statements of financial position, the opening balance of the consolidatedstatements of financial position shall not be adjusted.Incomes, expenses and profits incurred from the beginning of the subsidiary to the disposal date shall be includedinto the consolidated statement of profit or loss.Cash flows from the beginning of the subsidiary to the disposal date shall be included into the consolidatedstatement of cash flows.(e) Special consideration in consolidation elimination(i) Long-term equity investment held by the subsidiaries to the Company shall be recognised as treasury stock ofthe Company, which is offset with the owner’s equity, represented as “treasury stock” under “owner’s equity” inthe consolidated statement of financial position.Long-term equity investment held by subsidiaries between each other is accounted for taking long-term equityinvestment held by the Company to its subsidiaries as reference. That is, the long-term equity investment iseliminated (off- set) against the portion of the corresponding subsidiary’s equity.(ii) Due to not belonging to paid-in capital (or share capital) and capital reserve, and being different from retainedearnings and undistributed profit, “Specific reserves” and “General risk provision” shall be recovered based on theproportion attributable to owners of the parent company after long-term equity investment to the subsidiaries iseliminated with the subsidiaries’ equity.(iii) If temporary timing difference between the book value of the assets and liabilities in the consolidatedstatement of financial position and their tax basis is generated as a result of elimination of unrealizedinter-company transaction profit or loss, deferred tax assets of deferred tax liabilities shall be recognised, andincome tax expense in the consolidated statement of profit or loss shall be adjusted simultaneously, excludingdeferred taxes related to transactions or events directly recognised in owner’s equity or business combination.(iv) Unrealised inter-company transactions profit or loss generated from the Company selling assets to itssubsidiaries shall be eliminated against “net profit attributed to the owners of the parent company” in full.Unrealized inter-company transactions profit or loss generated from the subsidiaries selling assets to the Companyshall be eliminated between “net profit attributed to the owners of the parent company” and “non-controllinginterests” pursuant to the proportion of the Company in the related subsidiaries. Unrealized inter-companytransactions profit or loss generated from the assets sales between the subsidiaries shall be eliminated between“net profit attributed to the owners of the parent company” and “non-controlling interests” pursuant to theproportion of the Company in the selling subsidiaries.
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(v) If loss attributed to the minority shareholders of a subsidiary in current period is more than the proportion ofnon-controlling interest in this subsidiary at the beginning of the period, non-controlling interest is still to bewritten down.(f) Accounting for Special Transactions(i) Purchasing of non-controlling interestsWhere, the Company purchases non-controlling interests of its subsidiary, in the separate financial statements ofthe Company, the cost of the long-term equity investment obtained in purchasing non-controlling interests ismeasured at the fair value of the consideration paid. In the consolidated financial statements, difference betweenthe cost of the long-term equity investment newly obtained in purchasing non-controlling interests and share ofthe subsidiary’s net assets from the acquisition date or combination date continuingly calculated pursuant to thenewly acquired shareholding proportion shall be adjusted into capital reserve (capital premium or share premium).If capital reserve is not enough to be offset, surplus reserve and undistributed profit shall be offset in turn.(ii) Gaining control over the subsidiary in stages through multiple transactionsBusiness combination under common control in stages through multiple transactionsOn the combination date, in the separate financial statement, initial cost of the long-term equity investment isdetermined according to the share of carrying amount of the acquiree’s net assets in the ultimate controllingentity’s consolidated financial statements after combination. The difference between the initial cost of thelong-term equity investment and the carrying amount of the long -term investment held prior of control plus bookvalue of additional consideration paid at acquisition date is adjusted into capital reserve (capital premium or sharepremium). If the capital reserve is not enough to absorb the difference, any excess shall be adjusted againstsurplus reserve and undistributed profit in turn.In the consolidated financial statements, the assets and liabilities acquired during the combination should berecognized at their carrying amount in the ultimate controlling entity’s consolidated financial statements on thecombination date unless any adjustment is resulted from the difference in accounting policies. The differencebetween the carrying amount of the investment held prior of control plus book value of additional considerationpaid on the acquisition date and the net assets acquired through the combination is adjusted into capital reserve(capital premium or share premium). If the capital reserve is not enough to absorb the difference, any excess shallbe adjusted against retained earnings.If the acquiring entity holds equity investment in the acquired entity prior to the combination date and the equityinvestment is accounted for under the equity method, related profit or loss, other comprehensive income and otherchanges in equity which have been recognised during the period from the later of the date of the Companyobtaining original equity interest and the date of both the acquirer and the acquiree under common control of thesame ultimate controlling party to the combination date should be offset against the opening balance of retainedearnings at the comparative financial statements period respectively.
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Business combination not under common control in stages through multiple transactionsOn the consolidation date, in the separate financial statements, the initial cost of long-term equity investment isdetermined according to the carrying amount of the original long-term investment plus the cost of newinvestment.In the consolidated financial statements, the equity interest of the acquired entity held prior to the acquisition dateshall be re-measured at its fair value on the acquisition date. Difference between the fair value of the equityinterest and its book value is recognised as investment income. The other comprehensive income related to theequity interest held prior to the acquisition date calculated through equity method, should be transferred tocurrent investment income of the acquisition period, excluding other comprehensive income resulted from theremeasurement of the net assets or net liabilities under defined benefit plan. The Company shall discloseacquisition-date fair value of the equity interest held prior to the acquisition date, and the related gains or lossesdue to the remeasurement based on fair value.(iii) Disposal of investment in subsidiaries without a loss of controlFor partial disposal of the long-term equity investment in the subsidiaries without a loss of control, when theCompany prepares consolidated financial statements, difference between consideration received from the disposaland the corresponding share of subsidiary’s net assets cumulatively calculated from the acquisition date orcombination date shall be adjusted into capital reserve (capital premium or share premium). If the capital reserveis not enough to absorb the difference, any excess shall be offset against retained earnings.(iv) Disposal of investment in subsidiaries with a loss of controlDisposal through one transactionIf the Company loses control in an investee through partial disposal of the equity investment, when theconsolidated financial statements are prepared, the retained equity interest should be re-measured at fair value atthe date of loss of control. The difference between i) the fair value of consideration received from the disposalplus non-controlling interest retained; ii) share of the former subsidiary’s net assets cumulatively calculated fromthe acquisition date or combination date according to the original proportion of equity interest, shall be recognisedin current investment income when control is lost.Moreover, other comprehensive income and other changes in equity related to the equity investment in the formersubsidiary shall be transferred into current investment income when control is lost, excluding othercomprehensive income resulted from the remeasurement of the movement of net assets or net liabilities underdefined benefit plan.Disposal in stagesIn the consolidated financial statements, whether the transactions should be accounted for as “a single transaction”needs to be decided firstly.If the disposal in stages should not be classified as “a single transaction”, in the separate financial statements, for
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transactions prior of the date of loss of control, carrying amount of each disposal of long-term equity investmentneed to be recognized, and the difference between consideration received and the carrying amount of long-termequity investment corresponding to the equity interest disposed should be recognized in current investmentincome; in the consolidated financial statements, the disposal transaction should be accounted for according torelated policy in “Disposal of long-term equity investment in subsidiaries without a loss of control”.If the disposal in stages should be classified as “a single transaction”, these transactions should be accounted foras a single transaction of disposal of subsidiary resulting in loss of control. In the separate financial statements, foreach transaction prior of the date of loss of control, difference between consideration received and the carryingamount of long-term equity investment corresponding to the equity interest disposed should be recognised asother comprehensive income firstly, and transferred to profit or loss as a whole when control is lost; in theconsolidated financial statements, for each transaction prior of the date of loss of control, difference betweenconsideration received and proportion of the subsidiary’s net assets corresponding to the equity interest disposedshould be recognised in profit or loss as a whole when control is lost.In considering of the terms and conditions of the transactions as well as their economic impact, the presence ofone or more of the following indicators may lead to account for multiple transactions as a single transaction:
(a) The transactions are entered into simultaneously or in contemplation of one another.(b) The transactions form a single transaction designed to achieve an overall commercial effect.(c) The occurrence of one transaction depends on the occurrence of at least one other transaction.(d) One transaction, when considered on its own merits, does not make economic sense, but when consideredtogether with the other transaction or transactions would be considered economically justifiable.(v) Diluting equity share of parent company in its subsidiaries due to additional capital injection by thesubsidiaries’ minority shareholders.Other shareholders (minority shareholders) of the subsidiaries inject additional capital in the subsidiaries, whichresulted in the dilution of equity interest of parent company in these subsidiaries. In the consolidated financialstatements, difference between share of the corresponding subsidiaries’ net assets calculated based on the parent’sequity interest before and after the capital injection shall be adjusted into capital reserve (capital premium or sharepremium). If the capital reserve is not enough to absorb the difference, any excess shall be adjusted againstretained earnings.
3.7 Classification of Joint Arrangements and Accounting for Joint OperationA joint arrangement is an arrangement of which two or more parties have joint control. Joint arrangement of theCompany is classified as either a joint operation or a joint venture.(a) Joint operationA joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rightsto the assets, and obligations for the liabilities, relating to the arrangement.
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The Company shall recognise the following items in relation to shared interest in a joint operation, and accountfor them in accordance with relevant accounting standards of the Accounting Standards for Business Enterprises:
(i) its assets, including its share of any assets held jointly;(ii) its liabilities, including its share of any liabilities incurred jointly;(iii) its revenue from the sale of its share of the output arising from the joint operation;(iv) its share of the revenue from the sale of the output by the joint operation; and(v) its expenses, including its share of any expenses incurred jointly.(b) Joint ventureA joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights tothe net assets of the arrangement.The Company accounts for its investment in the joint venture by applying the equity method of long-term equityinvestment.
3.8 Cash and Cash Equivalents
Cash comprises cash on hand and deposits that can be readily withdrawn on demand. Cash equivalents includeshort-term (generally within three months of maturity at acquisition), highly liquid investments that are readilyconvertible into known amounts of cash and which are subject to an insignificant risk of changes in value.
3.9 Foreign Currency Transactions and Translation of Foreign Currency Financial Statements(a) Determination of the exchange rate for foreign currency transactionsAt the time of initial recognition of a foreign currency transaction, the amount in the foreign currency shall betranslated into the amount in the functional currency at the spot exchange rate of the transaction date, or at anexchange rate which is determined through a systematic and reasonable method and is approximate to the spotexchange rate of the transaction date (hereinafter referred to as the approximate exchange rate).(b) Translation of monetary items denominated in foreign currency on the balance sheet dateThe foreign currency monetary items shall be translated at the spot exchange rate on the balance sheet date. Thebalance of exchange arising from the difference between the spot exchange rate on the balance sheet date and thespot exchange rate at the time of initial recognition or prior to the balance sheet date shall be recorded into theprofits and losses at the current period. The foreign currency non-monetary items measured at the historical costshall still be translated at the spot exchange rate on the transaction date; for the foreign currency non-monetaryitems restated to a fair value measurement, shall be translated into the at the spot exchange rate at the date whenthe fair value was determined, the difference between the restated functional currency amount and the originalfunctional currency amount shall be recorded into the profits and losses at the current period.(c) Translation of foreign currency financial statementsBefore translating the financial statements of foreign operations, the accounting period and accounting policyshall be adjusted so as to conform to the Company. The adjusted foreign operation financial statements
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denominated in foreign currency (other than functional currency) shall be translated in accordance with thefollowing method:
(i) The asset and liability items in the statement of financial position shall be translated at the spot exchange ratesat the date of that statement of financial position. The owners’ equity items except undistributed profit shall betranslated at the spot exchange rates when they are incurred.(ii) The income and expense items in the statement of profit and other comprehensive income shall be translated atthe spot exchange rates or approximate exchange rate at the date of transaction.(iii)Foreign currency cash flows and cash flows of foreign subsidiaries shall be translated at the spot exchange rateor approximate exchange rate when the cash flows are incurred. The effect of exchange rate changes on cash ispresented separately in the statement of cash flows as an adjustment item.(iv) The differences arising from the translation of foreign currency financial statements shall be presentedseparately as “other comprehensive income” under the owners’ equity items of the consolidated statement offinancial position.When disposing a foreign operation involving loss of control, the cumulative amount of the exchange differencesrelating to that foreign operation recognised under other comprehensive income in the statement of financialposition, shall be reclassified into current profit or loss according to the proportion disposed.
3.10 Financial Instruments
Financial instrument is any contract which gives rise to both a financial asset of one entity and a financial liabilityor equity instrument of another entity.(a) Recognition and derecognition of financial instrumentA financial asset or a financial liability should be recognised in the statement of financial position when, and onlywhen, an entity becomes party to the contractual provisions of the instrument.A financial asset can only be derecognised when meets one of the following conditions:
(i) The rights to the contractual cash flows from a financial asset expire(ii) The financial asset has been transferred and meets one of the following derecognition conditions:
Financial liabilities (or part thereof) are derecognised only when the liability is extinguished—i.e., when theobligation specified in the contract is discharged or cancelled or expires. An exchange of the Company (borrower)and lender of debt instruments that carry significantly different terms or a substantial modification of the terms ofan existing liability are both accounted for as an extinguishment of the original financial liability and therecognition of a new financial liability.Purchase or sale of financial assets in a regular-way shall be recognised and derecognised using trade dateaccounting. A regular-way purchase or sale of financial assets is a transaction under a contract whose termsrequire delivery of the asset within the time frame established generally by regulations or convention in themarket place concerned. Trade date is the date at which the entity commits itself to purchase or sell an asset.
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(b) Classification and measurement of financial assetsAt initial recognition, the Company classified its financial asset based on both the business model for managingthe financial asset and the contractual cash flow characteristics of the financial asset: financial asset at amortisedcost, financial asset at fair value through profit or loss (FVTPL) and financial asset at fair value through othercomprehensive income (FVTOCI). Reclassification of financial assets is permitted if, and only if, the objective ofthe entity’s business model for managing those financial assets changes. In this circumstance, all affectedfinancial assets shall be reclassified on the first day of the first reporting period after the changes in businessmodel; otherwise the financial assets cannot be reclassified after initial recognition.Financial assets shall be measured at initial recognition at fair value. For financial assets measured at FVTPL,transaction costs are recognised in current profit or loss. For financial assets not measured at FVTPL, transactioncosts should be included in the initial measurement. Notes receivable or accounts receivable that arise from salesof goods or rendering of services are initially measured at the transaction price defined in the accounting standardof revenue where the transaction does not include a significant financing component.Subsequent measurement of financial assets will be based on their categories:
(i)Financial asset at amortised costThe financial asset at amortised cost category of classification applies when both the following conditions are met:
the financial asset is held within the business model whose objective is to hold financial assets in order to collectcontractual cash flows, and the contractual term of the financial asset gives rise on specified dates to cash flowsthat are solely payment of principal and interest on the principal amount outstanding. These financial assets aresubsequently measured at amortised cost by adopting the effective interest rate method. Any gain or loss arisingfrom derecognition according to the amortization under effective interest rate method or impairment arerecognised in current profit or loss.(ii)Financial asset at fair value through other comprehensive income (FVTOCI)The financial asset at FVTOCI category of classification applies when both the following conditions are met: thefinancial asset is held within the business model whose objective is achieved by both collecting contractual cashflows and selling financial assets, and the contractual term of the financial asset gives rise on specified dates tocash flows that are solely payment of principle and interest on the principal amount outstanding. All changes infair value are recognised in other comprehensive income except for gain or loss arising from impairment orexchange differences, which should be recognised in current profit or loss. At derecognition, cumulative gain orloss previously recognised under OCI is reclassified to current profit or loss. However, interest income calculatedbased on the effective interest rate is included in current profit or loss.The Company make an irrevocable decision to designate part of non-trading equity instrument investments asmeasured through FVTOCI. All changes in fair value are recognised in other comprehensive income except fordividend income recognised in current profit or loss. At derecognition, cumulative gain or loss are reclassified to
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retained earnings.(iii)Financial asset at fair value through profit or loss (FVTPL)Financial asset except for above mentioned financial asset at amortised cost or financial asset at fair value throughother comprehensive income (FVTOCI), should be classified as financial asset at fair value through profit or loss(FVTPL). These financial assets should be subsequently measured at fair value. All the changes in fair value areincluded in current profit or loss.(c) Classification and measurement of financial liabilitiesThe Company classified the financial liabilities as financial liabilities at fair value through profit or loss (FVTPL),loan commitments at a below-market interest rate and financial guarantee contracts and financial asset atamortised cost.Subsequent measurement of financial assets will be based on the classification:
(i)Financial liabilities at fair value through profit or loss (FVTPL)Held-for-trading financial liabilities (including derivatives that are financial liabilities) and financial liabilitiesdesignated at FVTPL are classified as financial liabilities at FVTP. After initial recognition, any gain or loss(including interest expense) are recognised in current profit or loss except for those hedge accounting is applied.For financial liability that is designated as at FVTPL, changes in the fair value of the financial liability that isattributable to changes in the own credit risk of the issuer shall be presented in other comprehensive income. Atderecognition, cumulative gain or loss previously recognised under OCI is reclassified to retained earnings.(ii)Loan commitments and financial guarantee contractsLoan commitment is a commitment by the Company to provide a loan to customer under specified contract terms.The provision of impairment losses of loan commitments shall be recognised based on expected credit lossesmodel.Financial guarantee contract is a contract that requires the Company to make specified payments to reimburse theholder for a loss it incurs because a specified debtor fails to make payment when due in accordance with theoriginal or modified terms of a debt instrument. Financial guarantee contracts liability shall be subsequentlymeasured at the higher of: The amount of the loss allowance recognised according to the impairment principles offinancial instruments; and the amount initially recognised less the cumulative amount of income recognised inaccordance with the revenue principles.(iii)Financial liabilities at amortised costAfter initial recognition, the Company measured other financial liabilities at amortised cost using the effectiveinterest method.Except for special situation, financial liabilities and equity instrument should be classified in accordance with thefollowing principles:
(i) If the Company has no unconditional right to avoid delivering cash or another financial instrument to fulfill a
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contractual obligation, this contractual obligation meet the definition of financial liabilities. Some financialinstruments do not comprise terms and conditions related to obligations of delivering cash or another financialinstrument explicitly, they may include contractual obligation indirectly through other terms and conditions.(ii) If a financial instrument must or may be settled in the Company's own equity instruments, it should beconsidered that the Company’s own equity instruments are alternatives of cash or another financial instrument, orto entitle the holder of the equity instruments to sharing the remaining rights over the net assets of the issuer. If theformer is the case, the instrument is a liability of the issuer; otherwise, it is an equity instrument of the issuer.Under some circumstances, it is regulated in the contract that the financial instrument must or may be settled inthe Company's own equity instruments, where, amount of contractual rights and obligations are calculated bymultiplying the number of the equity instruments to be available or delivered by its fair value upon settlement.Such contracts shall be classified as financial liabilities, regardless that the amount of contractual rights andliabilities is fixed, or fluctuate totally or partially with variables other than market price of the entity’s own equityinstruments(d) Derivatives and embedded derivativesAt initial recognition, derivatives shall be measured at fair value at the date of derivative contracts are signed andsubsequently measured at fair value. The derivative with a positive fair value shall be recognized as an asset, andwith a negative fair value shall be recognised as a liability.Gains or losses arising from the changes in fair value of derivatives shall be recognised directly into current profitor loss except for the effective portion of cash flow hedges which shall be recognised in other comprehensiveincome and reclassified into current profit or loss when the hedged items affect profit or loss.An embedded derivative is a component of a hybrid contract with a financial asset as a host, the Company shallapply the requirements of financial asset classification to the entire hybrid contract. If a host that is not a financialasset and the hybrid contract is not measured at fair value with changes in fair value recognised in profit or loss,and the economic characteristics and risks of the embedded derivative are not closely related to the economiccharacteristics and risks of the host, and a separate instrument with the same terms as the embedded derivativewould meet the definition of a derivative, the embedded derivative shall be separated from the hybrid instrumentand accounted for as a separate derivative instrument. If the Company is unable to measure the fair value of theembedded derivative at the acquisition date or subsequently at the balance sheet date, the entire hybrid contract isdesignated as financial assets or financial liabilities at fair value through profit or loss.(e) Impairment of financial instrumentThe Company shall recognise a loss allowance based on expected credit losses on a financial asset that ismeasured at amortised cost, a debt investment at fair value through other comprehensive income, a contract asset,a lease receivable, a loan commitment and a financial guarantee contract.(i) Measurement of expected credit losses
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Expected credit losses are the weighted average of credit losses of the financial instruments with the respectiverisks of a default occurring as the weights. Credit loss is the difference between all contractual cash flows that aredue to the Company in accordance with the contract and all the cash flows that the Company expects to receive,discounted at the original effective interest rate or credit- adjusted effective interest rate for purchased ororiginated credit-impaired financial assets.Lifetime expected credit losses are the expected credit losses that result from all possible default events over theexpected life of a financial instrument.12-month expected credit losses are the portion of lifetime expected credit losses that represent the expected creditlosses that result from default events on a financial instrument that are possible within the 12 months after thereporting date (or the expected lifetime, if the expected life of a financial instrument is less than 12 months).At each reporting date, the Company classifies financial instruments into three stages and makes provisions forexpected credit losses accordingly. A financial instrument of which the credit risk has not significantly increasedsince initial recognition is at stage 1. The Company shall measure the loss allowance for that financial instrumentat an amount equal to 12-month expected credit losses. A financial instrument with a significant increase in creditrisk since initial recognition but is not considered to be credit-impaired is at stage 2. The Company shall measurethe loss allowance for that financial instrument at an amount equal to the lifetime expected credit losses. Afinancial instrument is considered to be credit-impaired as at the end of the reporting period is at stage 3. TheCompany shall measure the loss allowance for that financial instrument at an amount equal to the lifetimeexpected credit losses.The Company may assume that the credit risk on a financial instrument has not increased significantly since initialrecognition if the financial instrument is determined to have low credit risk at the reporting date and measure theloss allowance for that financial instrument at an amount equal to 12-month expected credit losses.For financial instrument at stage 1, stage 2 and those have low credit risk, the interest revenue shall be calculatedby applying the effective interest rate to the gross carrying amount of a financial asset. For financial instrument atstage 3, interest revenue shall be calculated by applying the effective interest rate to the amortised cost afterdeducting of impairment loss.For notes receivable, accounts receivable and accounts receivable financing, no matter it contains a significantfinancing component or not, the Company shall measure the loss allowance at an amount equal to the lifetimeexpected credit losses.ReceivablesFor the notes receivable, accounts receivable, other receivables, accounts receivable financing and long-termreceivables which are demonstrated to be impaired by any objective evidence, or applicable for individualassessment, the Company shall individually assess for impairment and recognise the loss allowance for expectedcredit losses. If the Company determines that no objective evidence of impairment exists for notes receivable,
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accounts receivable, other receivables, accounts receivable financing and long-term receivables, or the expectedcredit loss of a single financial asset cannot be assessed at reasonable cost, such notes receivable, accountsreceivable, other receivables, accounts receivable financing and long-term receivables shall be divided intoseveral groups with similar credit risk characteristics and collectively calculated the expected credit loss. Thedetermination basis of groups is as following:
Determination basis of notes receivable is as following:
Group 1: Commercial acceptance billsGroup 2: Bank acceptance billsFor each group, the Company calculates expected credit losses through default exposure and the lifetime expectedcredit losses rate, taking reference to historical experience for credit losses and considering current condition andexpectation for the future economic situation.Determination basis of accounts receivable is as following:
Group 1: Accounts receivables due from the company within the scope of consolidationGroup 2: Accounts receivables due from other customersFor each group, the Company calculates expected credit losses through preparing an aging analysis schedule withthe lifetime expected credit losses rate, taking reference to historical experience for credit losses and consideringcurrent condition and expectation for the future economic situation.Determination basis of other receivables is as following:
Group 1: Other receivables due from the company within the scope of consolidationGroup 2: Other receivables due from othersFor each group, the Company calculates expected credit losses through default exposure and the 12-months orlifetime expected credit losses rate, taking reference to historical experience for credit losses and consideringcurrent condition and expectation for the future economic situation.Debt investment and other debt investmentFor debt investment and other debt investment, the Company shall calculate the expected credit loss through thedefault exposure and the 12-month or lifetime expected credit loss rate based on the nature of the investment,counterparty and the type of risk exposure.(ii) Low credit riskIf the financial instrument has a low risk of default, the borrower has a strong capacity to meet its contractual cashflow obligations in the near term and adverse changes in economic and business conditions in the longer term may,but will not necessarily, reduce the ability of the borrower to fulfill its contractual cash flow obligations.(iii) Significant increase in credit riskThe Company shall assess whether the credit risk on a financial instrument has increased significantly since initialrecognition, using the change in the risk of a default occurring over the expected life of the financial instrument,
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through the comparison of the risk of a default occurring on the financial instrument as at the reporting date withthe risk of a default occurring on the financial instrument as at the date of initial recognition.To make that assessment, the Company shall consider reasonable and supportable information, that is availablewithout undue cost or effort, and that is indicative of significant increases in credit risk since initial recognition,including forward-looking information. The information considered by the Company are as following:
? Significant changes in internal price indicators of credit risk as a result of a change in credit risk sinceinception? Existing or forecast adverse change in the business, financial or economic conditions of the borrower that
results in a significant change in the borrower’s ability to meet its debt obligations；? An actual or expected significant change in the operating results of the borrower; An actual or expected
significant adverse change in the regulatory, economic, or technological environment of the borrower；? Significant changes in the value of the collateral supporting the obligation or in the quality of third-party
guarantees or credit enhancements, which are expected to reduce the borrower’s economic incentive to make
scheduled contractual payments or to otherwise have an effect on the probability of a default occurring;? Significant change that are expected to reduce the borrower’s economic incentive to make scheduled
contractual payments;? Expected changes in the loan documentation including an expected breach of contract that may lead to
covenant waivers or amendments, interest payment holidays, interest rate step-ups, requiring additional
collateral or guarantees, or other changes to the contractual framework of the instrument；? Significant changes in the expected performance and behaviour of the borrower；? Contractual payments are more than 30 days past due.Depending on the nature of the financial instruments, the Company shall assess whether the credit risk hasincreased significantly since initial recognition on an individual financial instrument or a group of financialinstruments. When assessed based on a group of financial instruments, the Company can group financialinstruments on the basis of shared credit risk characteristics, for example, past due information and credit riskrating.Generally, the Company shall determine the credit risk on a financial asset has increased significantly since initialrecognition when contractual payments are more than 30 days past due. The Company can only rebut thispresumption if the Company has reasonable and supportable information that is available without undue cost oreffort, that demonstrates that the credit risk has not increased significantly since initial recognition even thoughthe contractual payments are more than 30 days past due.(iv) Credit-impaired financial assetThe Company shall assess at each reporting date whether the credit impairment has occurred for financial asset atamortised cost and debt investment at fair value through other comprehensive income. A financial asset is
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credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of thatfinancial asset have occurred. Evidences that a financial asset is credit-impaired include observable data about thefollowing events:
Significant financial difficulty of the issuer or the borrower；a breach of contract, such as a default or past dueevent; the lender(s) of the borrower, for economic or contractual reasons relating to the borrower’s financialdifficulty, having granted to the borrower a concession(s) that the lender(s) would not otherwise consider；it isbecoming probable that the borrower will enter bankruptcy or other financial reorganisation；the disappearance ofan active market for that financial asset because of financial difficulties；the purchase or origination of a financialasset at a deep discount that reflects the incurred credit losses.(v) Presentation of impairment of expected credit lossIn order to reflect the changes of credit risk of financial instrument since initial recognition, the Company shall ateach reporting date remeasure the expected credit loss and recognise in profit or loss, as an impairment gain orloss, the amount of expected credit losses addition (or reversal). For financial asset at amortised cost, the lossallowance shall reduce the carrying amount of the financial asset in the statement of financial position; for debtinvestment at fair value through other comprehensive income, the loss allowance shall be recognised in othercomprehensive income and shall not reduce the carrying amount of the financial asset in the statement of financialposition.(vi) Write-offThe Company shall directly reduce the gross carrying amount of a financial asset when the Company has noreasonable expectations of recovering the contractual cash flow of a financial asset in its entirety or a portionthereof. Such write-off constitutes a derecognition of the financial asset. This circumstance usually occurs whenthe Company determines that the debtor has no assets or sources of income that could generate sufficient cashflow to repay the write-off amount.Recovery of financial asset written off shall be recognised in profit or loss as reversal of impairment loss.(f) Transfer of financial assetsTransfer of financial assets refers to following two situations:
? Transfers the contractual rights to receive the cash flows of the financial asset;? Transfers the entire or a part of a financial asset and retains the contractual rights to receive the cash flows of
the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients.(i) Derecognition of transferred assetsIf the Company transfers substantially all the risks and rewards of ownership of the financial asset, or neithertransfers nor retains substantially all the risks and rewards of ownership of the financial asset but has not retainedcontrol of the financial asset, the financial asset shall be derecognised.Whether the Company has retained control of the transferred asset depends on the transferee’s ability to sell the
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asset. If the transferee has the practical ability to sell the asset in its entirety to an unrelated third party and is ableto exercise that ability unilaterally and without needing to impose additional restrictions on the transfer, theCompany has not retained control.The Company judges whether the transfer of financial asset qualifies for derecognition based on the substance ofthe transfer.If the transfer of financial asset qualifies for derecognition in its entirety, the difference between the followingshall be recognised in profit or loss:
? The carrying amount of transferred financial asset;? The sum of consideration received and the part derecognised of the cumulative changes in fair valuepreviously recognised in other comprehensive income (The financial assets involved in the transfer areclassified as financial assets at fair value through other comprehensive income in accordance with Article 18of the Accounting Standards for Business Enterprises No.22 - Recognition and Measurement of FinancialInstruments).If the transferred asset is a part of a larger financial asset and the part transferred qualifies for derecognition, theprevious carrying amount of the larger financial asset shall be allocated between the part that continues to berecognised (For this purpose, a retained servicing asset shall be treated as a part that continues to be recognised)and the part that is derecognised, based on the relative fair values of those parts on the date of the transfer. Thedifference between following two amounts shall be recognised in profit or loss:
? The carrying amount (measured at the date of derecognition) allocated to the part derecognised；? The sum of the consideration received for the part derecognised and part derecognised of the cumulativechanges in fair value previously recognised in other comprehensive income (The financial assets involved inthe transfer are classified as financial assets at fair value through other comprehensive income in accordancewith Article 18 of the Accounting Standards for Business Enterprises No.22 - Recognition and Measurementof Financial Instruments).(ii) Continuing involvement in transferred assetsIf the Company neither transfers nor retains substantially all the risks and rewards of ownership of a transferredasset, and retains control of the transferred asset, the Company shall continue to recognise the transferred asset tothe extent of its continuing involvement and also recognise an associated liability.The extent of the Company’s continuing involvement in the transferred asset is the extent to which it is exposed tochanges in the value of the transferred asset(iii) Continue to recognise the transferred assetsIf the Company retains substantially all the risks and rewards of ownership of the transferred financial asset, theCompany shall continue to recognise the transferred asset in its entirety and the consideration received shall berecognised as a financial liability.
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The financial asset and the associated financial liability shall not be offset. In subsequent accounting period, theCompany shall continuously recognise any income (gain) arising from the transferred asset and any expense (loss)incurred on the associated liability.(g) Offsetting financial assets and financial liabilitiesFinancial assets and financial liabilities shall be presented separately in the statement of financial position andshall not be offset. When meets the following conditions, financial assets and financial liabilities shall be offsetand the net amount presented in the statement of financial position:
The Company currently has a legally enforceable right to set off the recognised amounts; The Company intendseither to settle on a net basis, or to realise the asset and settle the liability simultaneously.In accounting for a transfer of a financial asset that does not qualify for derecognition, the Company shall notoffset the transferred asset and the associated liability.(h) Determination of fair value of financial instrumentsDetermination of financial assets and financial liabilities please refer to Note 3.11
3.11 Fair Value Measurement
Fair value refers to the price that would be received to sell an asset or paid to transfer a liability in an orderlytransaction between market participants at the measurement date.The Company determines fair value of the related assets and liabilities based on market value in the principalmarket, or in the absence of a principal market, in the most advantageous market price for the related asset orliability. The fair value of an asset or a liability is measured using the assumptions that market participants woulduse when pricing the asset or liability, assuming that market participants act in their economic best interest.The principal market is the market in which transactions for an asset or liability take place with the greatestvolume and frequency. The most advantageous market is the market which maximizes the value that could bereceived from selling the asset and minimizes the value which is needed to be paid in order to transfer a liability,considering the effect of transport costs and transaction costs both.If the active market of the financial asset or financial liability exists, the Company shall measure the fair valueusing the quoted price in the active market. If the active market of the financial instrument is not available, theCompany shall measure the fair value using valuation techniques.A fair value measurement of a non-financial asset takes into account a market participant’s ability to generateeconomic benefits by using the asset in its highest and best use or by selling it to another market participant thatwould use the asset in its highest and best use.? Valuation techniquesThe Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data areavailable to measure fair value, including the market approach, the income approach and the cost approach. TheCompany shall use valuation techniques consistent with one or more of those approaches to measure fair value. If
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multiple valuation techniques are used to measure fair value, the results shall be evaluated considering thereasonableness of the range of values indicated by those results. A fair value measurement is the point within thatrange that is most representative of fair value in the circumstances.When using the valuation technique, the Company shall give the priority to relevant observable inputs. Theunobservable inputs can only be used when relevant observable inputs is not available or practically would not beobtained. Observable inputs refer to the information which is available from market and reflects the assumptionsthat market participants would use when pricing the asset or liability. Unobservable Inputs refer to the informationwhich is not available from market and it has to be developed using the best information available in thecircumstances from the assumptions that market participants would use when pricing the asset or liability.? Fair value hierarchyTo Company establishes a fair value hierarchy that categorises into three levels the inputs to valuation techniquesused to measure fair value. The fair value hierarchy gives the highest priority to Level 1 inputs and second to theLevel 2 inputs and the lowest priority to Level 3 inputs. Level 1 inputs are quoted prices (unadjusted) in activemarkets for identical assets or liabilities that the entity can access at the measurement date. Level 2 inputs areinputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directlyor indirectly. Level 3 inputs are unobservable inputs for the asset or liability.
3.12 Inventories
(a) Classification of inventoriesInventories are finished goods or products held for sale in the ordinary course of business, in the process ofproduction for such sale, or in the form of materials or supplies to be consumed in the production process or in therendering of services, including raw materials, work in progress, semi-finished goods, finished goods, goods instock, turnover material, etc.(b) Measurement method of cost of inventories sold or usedInventories are initially measured at the actual cost. Cost of inventories includes purchase cost, processing cost,and other costs. Cost of the issue is measured using the weighted average method.(c) Inventory systemThe perpetual inventory system is adopted. The inventories should be counted at least once a year, and surplus orlosses of inventory stocktaking shall be included in current profit and loss.(d) Provision for impairment of inventoryInventories are stated at the lower of cost and net realizable value. The excess of cost over net realizable value ofthe inventories is recognised as provision for impairment of inventory, and recognised in current profit or loss.Net realizable value of the inventory should be determined on the basis of reliable evidence obtained, and factorssuch as purpose of holding the inventory and impact of post balance sheet event shall be considered.(i) In normal operation process, finished goods, products and materials for direct sale, their net realizable values
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are determined at estimated selling prices less estimated selling expenses and relevant taxes and surcharges; forinventories held to execute sales contract or service contract, their net realizable values are calculated on the basisof contract price. If the quantities of inventories specified in sales contracts are less than the quantities held by theCompany, the net realizable value of the excess portion of inventories shall be based on general selling prices. Netrealizable value of materials held for sale shall be measured based on market price.(ii) For materials in stock need to be processed, in the ordinary course of production and business, net realisablevalue is determined at the estimated selling price less the estimated costs of completion, the estimated sellingexpenses and relevant taxes. If the net realisable value of the finished products produced by such materials ishigher than the cost, the materials shall be measured at cost; if a decline in the price of materials indicates that thecost of the finished products exceeds its net realisable value, the materials are measured at net realisable value anddifferences shall be recognised at the provision for impairment.(iii) Provisions for inventory impairment are generally determined on an individual basis. For inventories withlarge quantity and low unit price, the provisions for inventory impairment are determined on a category basis.(iv) If any factor rendering write-downs of the inventories has been eliminated at the reporting date, the amountswritten down are recovered and reversed to the extent of the inventory impairment, which has been provided for.The reversal shall be included in profit or loss.(e) Amortization method of low-value consumablesLow-value consumables: One-off writing off method is adoptedPackage material: One-off writing off method is adopted
3.13 Contract assets and contract liabilities
Effective from 1 January 2020Contract assets and contract liabilities are reocgnised on the basis of fulfilment of performance obligations andpayment received from clients. A right to receive a promised consideration from a client resulting from goodstransferred to or services provided to the client (where the right to consideration is dependent on factors other thanthe passage of time) is reocgnised a contract asset. A payment received from a client for which goods shall betransferred to or services shall be provided to the client is recognised as a contract liability.See Note 3.10 for the determination method and accounting treatment method of impairment of contract assets.Contract assets and contract liabilities are presentd as line items on the statement of financial position. A contractasset and contract liability arising from one contract are presented in net; while the net amount is a debit balance,it is presented in contract assets or other non-current assets depending on liquidity; while the net amount is acredit balance, it is presented in contract liabilities or other non-current liabilities depending on liquidity. Contractassets and contract liabilities arising form different contracts are not be offset.
3.14 Contract costs
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Effective at 1 January 2020Costs for a contract include costs to fulfill the contract and costs to obtain the contract.An asset is recognised for the costs incurred to fulfill a contract on if those costs meet all of the following criteria:
I. the costs are directly associated with a contract or an anticipated contract, explicitly chargeable to the clientunder the contract, incurred only for the contract;II. the costs generate or enhance resouces of the Company that will be used in satisfying performanceobligations in the future; andIII. the costs are expected to be recovered.An asset is recognised for the costs incurred to obtained a contract with a client if those costs are expected to berecovered.An asset recognised for the costs of a contract are amortised on a systematic basis that is consistent withrecognition of revenue arising from the contract. Where the costs incurred to obtain a contract would be amortisedfor a period less than one year should they be recognised as an asset, the costs are recognised in the current profitor loss as incurred.An impairment is recognised for an asset recognised for the costs of a contract to the extent that the carryingamount of the asset exceeds:
I. the remaining amount of consideration that is expected to be received in exchange for the goods or servicesto which the asset relates; lessII. the costs that relate directly to providing those goods or services and that have not been recognised asexpenses.Upon recognition of the impairment, further consideration is given for provision for an onerous contract, innecessary.A reversal of some or all of an impairment loss previously recognised for an asset for the costs of a contract whenthe impairment conditions no longer exist or have improved. The increased carrying amount of the asset iscappted by the amount that would have been determined (net of amortisation) if no impairment loss had beenrecognised previously.An asset recognised for the costs to fulfill a contract is presented in inventories if its amortisation is not longerthan 1 year or an operating cycle upon initial recognition; otherwise, it is presented in other non-current assets.An asset recognised for the costs to obtain a contract is presented in other current assets if its amortisation is notlonger than 1 year or an operating cycle upon initial recognition; otherwise, it is presented in other non-current
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assets.
3.15 Long-term Equity Investments
Long-term equity investments refer to equity investments where an investor has control of, or significant influenceover, an investee, as well as equity investments in joint ventures. Associates of the Company are those entitiesover which the Company has significant influence.(a) Determination basis of joint control or significant influence over the investeeJoint control is the relevant agreed sharing of control over an arrangement, and the arranged relevant activity mustbe decided under unanimous consent of the parties sharing control. In assessing whether the Company has jointcontrol of an arrangement, the Company shall assess first whether all the parties, or a group of the parties, controlthe arrangement. When all the parties, or a group of the parties, considered collectively, are able to direct theactivities of the arrangement, the parties control the arrangement collectively. Then the Company shall assesswhether decisions about the relevant activities require the unanimous consent of the parties that collectivelycontrol the arrangement. If two or more groups of the parties could control the arrangement collectively, it shallnot be assessed as have joint control of the arrangement. When assessing the joint control, the protective rights arenot considered.Significant influence is the power to participate in the financial and operating policy decisions of the investee butis not control or joint control of those policies. In determination of significant influence over an investee, theCompany should consider not only the existing voting rights directly or indirectly held but also the effect ofpotential voting rights held by the Company and other entities that could be currently exercised or converted,including the effect of share warrants, share options and convertible corporate bonds that issued by the investeeand could be converted in current period.If the Company holds, directly or indirectly 20% or more but less than 50% of the voting power of the investee, itis presumed that the Company has significant influence of the investee, unless it can be clearly demonstrated thatin such circumstance, the Company cannot participate in the decision-making in the production and operating ofthe investee.(b) Determination of initial investment cost(i) Long-term equity investments generated in business combinationsFor a business combination involving enterprises under common control, if the Company makes payment in cash,transfers non-cash assets or bears liabilities as the consideration for the business combination, the share ofcarrying amount of the owners’ equity of the acquiree in the consolidated financial statements of the ultimatecontrolling party is recognised as the initial cost of the long-term equity investment on the combination date. Thedifference between the initial investment cost and the carrying amount of cash paid, non-cash assets transferredand liabilities assumed shall be adjusted against the capital reserve; if capital reserve is not enough to be offset,undistributed profit shall be offset in turn.
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For a business combination involving enterprises under common control, if the Company issues equity securitiesas the consideration for the business combination, the share of carrying amount of the owners’ equity of theacquiree in the consolidated financial statements of the ultimate controlling party is recognised as the initial costof the long-term equity investment on the combination date. The total par value of the shares issued is recognisedas the share capital. The difference between the initial investment cost and the carrying amount of the total parvalue of the shares issued shall be adjusted against the capital reserve; if capital reserve is not enough to be offset,undistributed profit shall be offset in turn.For business combination not under common control, the assets paid, liabilities incurred or assumed and the fairvalue of equity securities issued to obtain the control of the acquiree at the acquisition date shall be determined asthe cost of the business combination and recognised as the initial cost of the long-term equity investment. Theaudit, legal, valuation and advisory fees, other intermediary fees, and other relevant general administrative costsincurred for the business combination, shall be recognised in profit or loss as incurred.(ii) Long-term equity investments acquired not through the business combination, the investment cost shall bedetermined based on the following requirements:
For long-term equity investments acquired by payments in cash, the initial cost is the actually paid purchase cost,including the expenses, taxes and other necessary expenditures directly related to the acquisition of long-termequity investments.For long-term equity investments acquired through issuance of equity securities, the initial cost is the fair value ofthe issued equity securities.For the long-term equity investments obtained through exchange of non-monetary assets, if the exchange hascommercial substance, and the fair values of assets traded out and traded in can be measured reliably, the initialcost of long-term equity investment traded in with non-monetary assets are determined based on the fair values ofthe assets traded out together with relevant taxes. Difference between fair value and book value of the assetstraded out is recorded in current profit or loss. If the exchange of non-monetary assets does not meet the abovecriterion, the book value of the assets traded out and relevant taxes are recognised as the initial investment cost.For long-term equity investment acquired through debt restructuring, the initial cost is determined based on thefair value of the equity obtained and the difference between initial investment cost and carrying amount of debtsshall be recorded in current profit or loss.(c) Subsequent measurement and recognition of profit or lossLong-term equity investment to an entity over which the Company has ability of control shall be accounted for atcost method. Long-term equity investment to a joint venture or an associate shall be accounted for at equitymethod.(i) Cost methodFor Long-term equity investment at cost method, cost of the long-term equity investment shall be adjusted when
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additional amount is invested or a part of it is withdrawn. The Company recognises its share of cash dividends orprofits which have been declared to distribute by the investee as current investment income.(ii) Equity methodIf the initial cost of the investment is in excess of the share of the fair value of the net identifiable assets in theinvestee at the date of investment, the difference shall not be adjusted to the initial cost of long-term equityinvestment; if the initial cost of the investment is in short of the share of the fair value of the net identifiable assetsin the investee at the date investment, the difference shall be included in the current profit or loss and the initialcost of the long-term equity investment shall be adjusted accordingly.The Company recognises the share of the investee’s net profits or losses, as well as its share of the investee’sother comprehensive income, as investment income or losses and other comprehensive income respectively, andadjusts the carrying amount of the investment accordingly. The carrying amount of the investment shall bereduced by the share of any profit or cash dividends declared to distribute by the investee. The investor’s share ofthe investee’s owners’ equity changes, other than those arising from the investee’s net profit or loss, othercomprehensive income or profit distribution, shall be recognised in the investor’s equity, and the carrying amountof the long-term equity investment shall be adjusted accordingly. The Company recognises its share of theinvestee’s net profits or losses after making appropriate adjustments of investee’s net profit based on the fairvalues of the investee’s identifiable net assets at the investment date. If the accounting policy and accountingperiod adopted by the investee is not in consistency with the Company, the financial statements of the investeeshall be adjusted according to the Company’s accounting policies and accounting period, based on which,investment income or loss and other comprehensive income, etc., shall be adjusted. The unrealized profits orlosses resulting from inter-company transactions between the company and its associate or joint venture areeliminated in proportion to the company’s equity interest in the investee, based on which investment income orlosses shall be recognised. Any losses resulting from inter-company transactions between the investor and theinvestee, which belong to asset impairment, shall be recognised in full.Where the Company obtains the power of joint control or significant influence, but not control, over the investee,due to additional investment or other reason, the relevant long-term equity investment shall be accounted for byusing the equity method, initial cost of which shall be the fair value of the original investment plus the additionalinvestment. Where the original investment is classified as investments in other equity instrument, differencebetween its fair value and the carrying value, in addition to the cumulative gains or losses previously recorded inother comprehensive income, shall be transferred from other comprehensive income and recorded in retainedearnings during the current period using equity method.If the Company loses the joint control or significant influence of the investee for some reasons such as disposal ofequity investment, the retained interest shall be measured at fair value and the difference between the carryingamount and the fair value at the date of loss the joint control or significant influence shall be recognised in profit
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or loss. When the Company discontinues the use of the equity method, the Company shall account for all amountspreviously recognised in other comprehensive income under equity method in relation to that investment on thesame basis as would have been required if the investee had directly disposed of the related assets or liabilities.(d) Equity investment classified as held for saleAny retained interest in the equity investment not classified as held for sale, shall be accounted for using equitymethod.When an equity investment in an associate or a joint venture previously classified as held for sale no longer meetsthe criteria to be so classified, it shall be accounted for using the equity method retrospectively as from the date ofits classification as held for sale. Financial statements for the periods since classification as held for sale shall beamended accordingly.(f) Impairment testing and provision for impairment lossFor investment in subsidiaries, associates or a joint venture, provision for impairment loss please refer to Note
3.21.
3.16 Investment Properties
(a) Classification of investment propertiesInvestment properties are properties to earn rentals or for capital appreciation or both, including:
(i)Land use right leased out(ii)Land held for transfer upon appreciation(iii)Buildings leased out(b) The measurement model of investment propertyThe Company adopts the cost model for subsequent measurement of investment properties. For provision forimpairment please refer to Note 3.21.The Company calculates the depreciation or amortization based on the net amount of investment property cost lessthe accumulated impairment and the net residual value using straight-line method.
3.17 Fixed Assets
Fixed assets refer to the tangible assets with higher unit price held for the purpose of producing commodities,rendering services, renting or business management with useful lives exceeding one year.(a) Recognition criteria of fixed assetsFixed assets will only be recognised at the actual cost paid when obtaining as all the following criteria aresatisfied:
(i) It is probable that the economic benefits relating to the fixed assets will flow into the Company;(ii) The costs of the fixed assets can be measured reliably.Subsequent expenditure for fixed assets shall be recorded in cost of fixed assets, if recognition criteria of fixedassets are satisfied, otherwise the expenditure shall be recorded in current profit or loss when incurred.
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(b) Depreciation methods of fixed assetsThe Company begins to depreciate the fixed asset from the next month after it is available for intended use usingthe straight-line-method. The estimated useful life and annual depreciation rates which are determined accordingto the categories, estimated economic useful lives and estimated net residual rates of fixed assets are listed asfollowings:
| Category | Depreciation method | Estimated useful life (year) | Residual rates (%) | Annual depreciation rates (%) |
| Buildings and constructions | straight-line-method | 8.00-35.00 | 3.00-5.00 | 2.70-12.10 |
| Machinery equipment | straight-line-method | 5.00-10.00 | 3.00-5.00 | 9.50-19.40 |
| Vehicles | straight-line-method | 4.00 | 3.00 | 24.25 |
| Office equipment and others | straight-line-method | 3.00 | 3.00 | 32.33 |
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loan for the construction or the proportion of the general loan used for the constructions incurred before they areready for their intended use. The construction in progress shall be transferred to fixed asset when the installationor construction is ready for the intended use. For construction in progress that has been ready for their intendeduse but relevant budgets for the completion of projects have not been completed, the estimated values of projectbudgets, prices, or actual costs should be included in the costs of relevant fixed assets, and depreciation should beprovided according to relevant policies of the Company when the fixed assets are ready for intended use. After thecompletion of budgets needed for the completion of projects, the estimated values should be substituted by actualcosts, but depreciation already provided is not adjusted.
3.19 Right-of-use assets
The Company initially measures right-of-use assets at cost, which includes:
(1) The initial measurement amount of the lease obligation.
(2) If a lease incentive exists for lease payments made on or before the commencement date of the lease term, theamount related to the lease incentive already taken is deducted.
(3) Initial direct costs incurred by the Company.
(4) Costs expected to be incurred by the Company to disassemble and remove the leasehold property, restore thesite where the leasehold property is located, or restore the leasehold property to the condition agreed upon underthe terms of the lease (excluding costs incurred to produce inventory). Subsequent to the commencement date ofthe lease term, the Company uses the cost model for subsequent measurement of right-of-use assets.If it is reasonably certain that ownership of the leasehold property will be obtained at the end of the lease term, theCompany depreciates the leasehold property over its remaining service life.If it may not be reasonably ascertained that ownership of the leasehold property can be obtained at the end of thelease term, the Company will depreciate the leasehold property over the shorter ofthe lease term or the remaining service life of the leasehold property. Right-of-use assets for which depreciationreserves have been made are depreciated in future periods at their carrying amounts net of depreciation reserves,with reference to the above principles.
3.20 Borrowing Costs
(a) Recognition criteria and period for capitalization of borrowing costsThe Company shall capitalize the borrowing costs that are directly attributable to the acquisition, construction orproduction of qualifying assets when meet the following conditions:
(i) Expenditures for the asset are being incurred;(ii) Borrowing costs are being incurred, and;(iii) Acquisition, construction or production activities that are necessary to prepare the assets for their intended use
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or sale are in progress.Other borrowing cost, discounts or premiums on borrowings and exchange differences on foreign currencyborrowings shall be recognized into current profit or loss when incurred.Capitalization of borrowing costs is suspended during periods in which the acquisition, construction or productionof a qualifying asset is interrupted abnormally and the interruption is for a continuous period of more than 3months.Capitalization of such borrowing costs ceases when the qualifying assets being acquired, constructed or producedbecome ready for their intended use or sale. The expenditure incurred subsequently shall be recognised asexpenses when incurred.(b) Capitalization rate and measurement of capitalized amounts of borrowing costsWhen funds are borrowed specifically for purchase, construction or manufacturing of assets eligible forcapitalization, the Company shall determine the amount of borrowing costs eligible for capitalisation as the actualborrowing costs incurred on that borrowing during the period less any interest income on bank deposit orinvestment income on the temporary investment of those borrowings.Where funds allocated for purchase, construction or manufacturing of assets eligible for capitalization are part of ageneral borrowing, the eligible amounts are determined by the weighted-average of the cumulative capitalexpenditures in excess of the specific borrowing multiplied by the general borrowing capitalization rate. Thecapitalization rate will be the weighted average of the borrowing costs applicable to the general borrowing.
3.21 Intangible Assets
(a) Measurement method of intangible assetsIntangible assets are recognised at actual cost at acquisition.(b) The useful life and amortisation of intangible assets(i) The estimated useful lives of the intangible assets with finite useful lives are as follows:
| Category | Estimated useful life | Basis |
| Land use right | 50 years | Legal life |
| Patent right | 10 years | The service life is determined by reference to the period that can bring economic benefits to the Company |
| Software | 3-5 years | The service life is determined by reference to the period that can bring economic benefits to the Company |
| Trademark | 10 years | The service life is determined by reference to the period that can bring economic benefits to the Company |
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(ii) Assets of which the period to bring economic benefits to the Company are unforeseeable are regarded asintangible assets with indefinite useful lives. The Company reassesses the useful lives of those assets at every yearend. If the useful lives of those assets are still indefinite, impairment test should be performed on those assets atthe balance sheet date.(iii) Amortisation of the intangible assetsFor intangible assets with finite useful lives, their useful lives should be determined upon their acquisition andsystematically amortised on a straight-line basis over the useful life. The amortisation amount shall be recognizedinto current profit or loss according to the beneficial items. The amount to be amortised is cost deducting residualvalue. For intangible assets which has impaired, the cumulative impairment provision shall be deducted as well.The residual value of an intangible asset with a finite useful life shall be assumed to be zero unless: there is acommitment by a third party to purchase the asset at the end of its useful life; or there is an active market for theasset and residual value can be determined by reference to that market; and it is probable that such a market willexist at the end of the asset’s useful life.Intangible assets with indefinite useful lives shall not be amortised. The Company reassesses the useful lives ofthose assets at every year end. If there is evidence to indicate that the useful lives of those assets become finite,the useful lives shall be estimated and the intangible assets shall be amortised systematically and reasonablywithin the estimated useful lives.(c) Criteria of classifying expenditures on internal research and development projects into research phaseand development phasePreparation activities related to materials and other relevant aspects undertaken by the Company for the purposeof further development shall be treated as research phase. Expenditures incurred during the research phase ofinternal research and development projects shall be recognised in profit or loss when incurred.Development activities after the research phase of the Company shall be treated as development phase.(d) Criteria for capitalization of qualifying expenditures during the development phaseExpenditures arising from development phase on internal research and development projects shall be recognisedas intangible assets only if all of the following conditions have been met:
(i) Technical feasibility of completing the intangible assets so that they will be available for use or sale;(ii) Its intention to complete the intangible asset and use or sell it;(iii) The method that the intangible assets generate economic benefits, including the Company can demonstratethe existence of a market for the output of the intangible assets or the intangible assets themselves or, if it is to beused internally, the usefulness of the intangible assets;(iv) The availability of adequate technical, financial and other resources to complete the development and to useor sell the intangible asset; and(v) Its ability to measure reliably the expenditure attributable to the intangible asset.
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3.22 Impairment of Long-Term Assets
Impairment loss of long-term equity investment in subsidiaries, associates and joint ventures, investmentproperties, fixed assets and constructions in progress subsequently measured at cost, intangible assets, shall bedetermined according to following method:
The Company shall assess at the end of each reporting period whether there is any indication that an asset may beimpaired. If any such indication exists, the Company shall estimate the recoverable amount of the asset and testfor impairment. Irrespective of whether there is any indication of impairment, the Company shall test forimpairment of goodwill acquired in a business combination, intangible assets with an indefinite useful life orintangible assets not yet available for use annually.The recoverable amounts of the long-term assets are the higher of their fair values less costs to dispose and thepresent values of the estimated future cash flows of the long-term assets. The Company estimate the recoverableamounts on an individual basis. If it is difficult to estimate the recoverable amount of the individual asset, theCompany estimates the recoverable amount of the groups of assets that the individual asset belongs to.Identification of an group of asset is based on whether the cash inflows from it are largely independent of the cashinflows from other assets or groups of assets.If, and only if, the recoverable amount of an asset or a group of assets is less than its carrying amount, the carryingamount of the asset shall be reduced to its recoverable amount and the provision for impairment loss shall berecognised accordingly.For the purpose of impairment testing, goodwill acquired in a business combination shall, from the acquisitiondate, be allocated to relevant group of assets based on reasonable method; if it is difficult to allocate to relevantgroup of assets, good will shall be allocated to relevant combination of asset groups. The relevant group of assetsor combination of asset groups is a group of assets or combination of asset groups that is benefit from thesynergies of the business combination and is not larger than the reporting segment determined by the Company.When test for impairment, if there is an indication that relevant group of assets or combination of asset groupsmay be impaired, impairment testing for group of assets or combination of asset groups excluding goodwill shallbe conducted first, and calculate the recoverable amount and recognize the impairment loss. Then the group ofassets or combination of asset groups including goodwill shall be tested for impairment, by comparing thecarrying amount with its recoverable amount. If the recoverable amount is less than the carrying amount, theCompany shall recognise the impairment loss.The mentioned impairment loss will not be reversed in subsequent accounting period once it had been recognised.
3.23 Long-term Deferred Expenses
Long-term deferred expenses are various expenses already incurred, which shall be amortised over current andsubsequent periods with the amortisation period exceeding one year. Long-term deferred expenses are evenlyamortised over the beneficial period
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3.24 Employee Benefits
Employee benefits refer to all forms of consideration or compensation given by the Company in exchange forservice rendered by employees or for the termination of employment relationship. Employee benefits includeshort-term employee benefits, post-employment benefits, termination benefits and other long-term employeebenefits. Benefits provided to an employee's spouse, children, dependents, family members of decreasedemployees, or other beneficiaries are also employee benefits.According to liquidity, employee benefits are presented in the statement of financial position as “Employeebenefits payable” and “Long-term employee benefits payable”.(a) Short-term employee benefits(i) Employee basic salary (salary, bonus, allowance, subsidy)The Company recognises, in the accounting period in which an employee provides service, actually occurredshort-term employee benefits as a liability, with a corresponding charge to current profit except for thoserecognised as capital expenditure based on the requirement of accounting standards.(ii) Employee welfareThe Company shall recognise the employee welfare based on actual amount when incurred into current profit orloss or related capital expenditure. Employee welfare shall be measured at fair value as it is a non-monetarybenefit.(iii) Social insurance such as medical insurance and work injury insurance, housing funds, labor union fund andemployee education fundPayments made by the Company of social insurance for employees, such as medical insurance and work injuryinsurance, payments of housing funds, and labor union fund and employee education fund accrued in accordancewith relevant requirements, in the accounting period in which employees provide services, is calculated accordingto required accrual bases and accrual ratio in determining the amount of employee benefits and the relatedliabilities, which shall be recognised in current profit or loss or the cost of relevant asset.(iv) Short-term paid absencesThe company shall recognise the related employee benefits arising from accumulating paid absences when theemployees render service that increases their entitlement to future paid absences. The additional payable amountsshall be measured at the expected additional payments as a result of the unused entitlement that has accumulated.The Company shall recognise relevant employee benefit of non-accumulating paid absences when the absencesactually occurred.(v) Short-term profit-sharing planThe Company shall recognise the related employee benefits payable under a profit-sharing plan when all of thefollowing conditions are satisfied:
(i) The Company has a present legal or constructive obligation to make such payments as a result of past events;
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and(ii) A reliable estimate of the amounts of employee benefits obligation arising from the profit- sharing plan can bemade.(b) Post-employment benefits(i) Defined contribution plansThe Company shall recognise, in the accounting period in which an employee provides service, the contributionpayable to a defined contribution plan as a liability, with a corresponding charge to the current profit or loss or thecost of a relevant asset.When contributions to a defined contribution plan are not expected to be settled wholly before twelve monthsafter the end of the annual reporting period in which the employees render the related service, they shall bediscounted using relevant discount rate (market yields at the end of the reporting period on high quality corporatebonds in active market or government bonds with the currency and term which shall be consistent with thecurrency and estimated term of the defined contribution obligations) to measure employee benefits payable.(ii) Defined benefit planThe present value of defined benefit obligation and current service costsBased on the expected accumulative welfare unit method, the Company shall make estimates about demographicvariables and financial variables in adopting the unbiased and consistent actuarial assumptions and measuredefined benefit obligation, and determine the obligation period. The Company shall discount the obligation arisingfrom defined benefit plan using relevant discount rate (market yields at the end of the reporting period on highquality corporate bonds in active market or government bonds with the currency and term which shall beconsistent with the currency and estimated term of the defined benefit obligations) in order to determine thepresent value of the defined benefit obligation and the current service cost.The net defined benefit liability or assetThe net defined benefit liability (asset) is the deficit or surplus recognised as the present value of the definedbenefit obligation less the fair value of plan assets (if any).When the Company has a surplus in a defined benefit plan, it shall measure the net defined benefit asset at thelower of the surplus in the defined benefit plan and the asset ceiling.The amount recognised in the cost of asset or current profit or lossService cost comprises current service cost, past service cost and any gain or loss on settlement. Other service costshall be recognised in profit or loss unless accounting standards require or allow the inclusion of current servicecost within the cost of assets.Net interest on the net defined benefit liability (asset) comprising interest income on plan assets, interest cost onthe defined benefit obligation and interest on the effect of the asset ceiling, shall be included in profit or loss.The amount recognised in other comprehensive income
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Changes in the net liability or asset of the defined benefit plan resulting from the remeasurements including:
? Actuarial gains and losses, the changes in the present value of the defined benefit obligation resulting fromexperience adjustments or the effects of changes in actuarial assumptions;? Return on plan assets, excluding amounts included in net interest on the net defined benefit liability or asset;? Any change in the effect of the asset ceiling, excluding amounts included in net interest on the net definedbenefit liability (asset).Remeasurements of the net defined benefit liability (asset) recognised in other comprehensive income shall not bereclassified to profit or loss in a subsequent period. However, the Company may transfer those amountsrecognised in other comprehensive income within equity.(c) Termination benefitsThe Company providing termination benefits to employees shall recognise an employee benefits liability fortermination benefits, with a corresponding charge to the profit or loss of the reporting period, at the earlier of thefollowing dates:
(i) When the Company cannot unilaterally withdraw the offer of termination benefits because of an employmenttermination plan or a curtailment proposal.(ii) When the Company recognises costs or expenses related to a restructuring that involves the payment oftermination benefits.If the termination benefits are not expected to be settled wholly before twelve months after the end of the annualreporting period, the Company shall discount the termination benefits using relevant discount rate (market yieldsat the end of the reporting period on high quality corporate bonds in active market or government bonds with thecurrency and term which shall be consistent with the currency and estimated term of the defined benefitobligations) to measure the employee benefits.(d) Other long-term employee benefits(i) Meet the conditions of the defined contribution planWhen other long-term employee benefits provided by the Company to the employees satisfies the conditions forclassifying as a defined contribution plan, all those benefits payable shall be accounted for as employee benefitspayable at their discounted value.(ii) Meet the conditions of the defined benefit planAt the end of the reporting period, the Company recognised the cost of employee benefit from other long-termemployee benefits as the following components:
? Service costs;? Net interest cost for net liability or asset of other long-term employee benefits? Changes resulting from the remeasurements of the net liability or asset of other long-term employee benefitsIn order to simplify the accounting treatment, the net amount of above items shall be recognised in profit or loss
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or relevant cost of assets.
3.25 Lease Liabilities
The Company initially measures the lease obligation at the present value of the lease payments outstanding at thecommencement date of the lease term. When calculating the present value of lease payments,the Company uses the interest rate implicit in lease as the rate of discount. If the interest rate implicit in leasecannot be determined, the Company's incremental lending rate is used as the rate of discount. Lease paymentsinclude:
(1) The amount of fixed payments, net of amounts related to lease incentives, and the amount of substantive fixedpayments.
(2) Variable lease payments that depend on indexation or ratio.
(3) The lease payment amount includes the exercise price of the purchase option if the Company is reasonablycertain that the option will be exercised.
(4) Where the lease term reflects that the Company will exercise the option to terminate the lease, the leasepayment amount includes the amount required to be paid to exercise the option to terminate the lease.
(5) Estimated amount payable based on the residual value of the guarantee provided by the Company.The Company calculates the interest expense on the lease obligation for each period of the lease term at a fixedrate of discount and includes it in the current profit or loss or cost of the related assets. Variable lease paymentsthat are not included in the measurement of the lease obligation should be charged to current profit or loss or thecost of the related assets when they are actually incurred.
3.26 Estimated Liabilities
(a) Recognition criteria of estimated liabilitiesThe Company recognises the estimated liabilities when obligations related to contingencies satisfy all thefollowing conditions:
(i) That obligation is a current obligation of the Company;(ii) It is likely to cause any economic benefit to flow out of the Company as a result of performance of theobligation; and(iii) The amount of the obligation can be measured reliably.(b) Measurement method of estimated liabilitiesThe estimated liabilities of the Company are initially measured at the best estimate of expenses required for theperformance of relevant present obligations. The Company, when determining the best estimate, has had acomprehensive consideration of risks with respect to contingencies, uncertainties and the time value of money.The carrying amount of the estimated liabilities shall be reviewed at the end of every reporting period. Ifconclusive evidences indicate that the carrying amount fails to be the best estimate of the estimated liabilities, the
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carrying amount shall be adjusted based on the updated best estimate.
3.27 Revenue Recognition Principle and Measurement
3.25.1 General principle
Revenue is the total inflow of economic benefits formed in the company's daily activities that will increaseshareholders' equity and does not relate to the capital invested by shareholders.The Company has fulfilled the performance obligation in the contract, that is, the revenue is recognised when thecustomer obtains the control right of relevant goods. To obtain the control right of the relevant commodity meansto be able to dominate the use of the commodity and obtain almost all the economic benefits from it.If there are two or more performance obligations in the contract, the Company will allocate the transaction priceto each performance obligation based on the relative proportion of the separate selling price of the goods orservices promised by each performance obligation on the start date of the contract, and measure the income basedon the transaction price allocated to each single performance obligation.The transaction price refers to the amount of consideration that the Company is expected to be entitled to receivedue to the transfer of goods or services to customers, excluding payments collected on behalf of third parties.When determining the transaction price of the contract, the Company determines the transaction price accordingto the terms of the contract and in combination with its historical practices. When determining the transactionprice, the Company takes into account the influence of variable considerations, significant financing elements inthe contract, the non-cash considerations, the considerations payable to customers and other factors. TheCompany determines the transaction price including variable consideration at an amount that does not exceed theamount at which the accumulated recognized income is unlikely to have a significant reversal when the relevantuncertainty is eliminated. If there is a significant financing component in the contract, the Company willdetermine the transaction price based on the amount payable in cash when the customer obtains the control rightof the commodity. The difference between the transaction price and the contract consideration will be amortisedby the effective interest method during the contract period. If the interval between the control right transfer andthe customer's payment is less than one year, the company will not consider the financing component.If one of the following conditions is met, the performance obligation shall be fulfilled within a certain period oftime; otherwise, the performance obligation shall be fulfilled at a certain point of time:
(a) The customer obtains and consumes the economic benefits brought by the Company's fulfillment of contractwhen the Company performs the obligations;(b) The customer can control the commodities under construction during the Company's execution of thecontract;
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(c) The commodities produced by the Company during the performance of the contract have irreplaceable uses,and the Company has the right to collect payment for the cumulative performance part that has been completedso far during the entire contract period.For performance obligations fulfilled within a certain period of time, the Company recognises revenue inaccordance with the performance progress during that period, except where the performance progress cannot bereasonably determined. The Company determines the progress of the performance of services in accordance withthe input method (or output method). When the progress of the contract performance cannot be reasonablydetermined, if the cost incurred by the Company is expected to be compensated, the revenue shall be recognisedaccording to the amount of the cost incurred until the progress of the contract performance can be reasonablydetermined.For performance obligations fulfilled at a certain point in time, the Company recognises revenue at the point whenthe customer obtains control of the relevant commodities. The Company considers the following signs whenjudging whether a customer has obtained control of goods or services:
(a)The Company has the current right to receive payment for the goods or services, that is, the customer has thecurrent obligation to pay for the goods;(b) The Company has transferred the legal ownership of the goods to the customer, that is, the customer has thelegal ownership of the goods;(c) The Company has transferred the goods in kind to the customer, that is, the customer has possessed thegoods in kind;(d) The company has transferred the main risks and rewards of the ownership of the goods to the customers, thatis, the customers have obtained the main risks and rewards of the ownership of the goods;(e) The customer has accepted the goods or services.(f) Other indications that the customer has obtained control of the product
3.25.2 Specific methods
The specific methods of the Company's revenue recognition are as follows:
(a) Revenue from sale of goodsRevenue from sale of goods shall be recognised when the following criteria are satisfied:
(i) Significant risks and rewards related to ownership of the goods have been transferred to the buyer;(ii) The Company retains neither continuous management rights associated with ownership of the goods sold noreffective control over the goods sold;
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(iii) Relevant amount of revenue can be measured reliably;(iv) It is probable that the economic benefits associated with the transaction will flow into the Company; and(v) Relevant amount of cost incurred or to be incurred can be measured reliably.Revenue arising from domestic sales of goods is recognized when goods are dispatched and delivered to the buyer,when significant risks and rewards attached to the ownership of the goods sold are passed to the buyer, whenneither continual involvement in the rights normally associated with the ownership of the goods sold nor effectivecontrol over the goods controls are retained, when revenue arising from the goods sold is reliably measurable,when inflow of future economic benefits is probable, and when cost incurred or to be incurred associated with thegoods sold is reliably measurable. Revenue arising from non-domestic sales of goods is recognized when goodsare loaded on board and when the export clearance with the custom is completed.(b) Revenue from rendering of servicesWhen the outcome of rendering of services can be estimated reliably at the balance sheet date, revenue associatedwith the transaction is recognised using the percentage of completion method. Percentage of completion isdetermined based on the measurement of the work completedThe outcome of rendering of services can be estimated reliably when all of the following conditions are satisfied: i)the amount of revenue can be measured reliably; ii) it is probable that the associated economic benefits will flowto the Company; iii) the percentage of completion of the transaction can be measured reliably; iv) the costsincurred and to be incurred for the transaction can be measured reliably.The Company shall determine the total revenue from rendering of services based on the received or receivableprice stipulated in the contract or agreement, unless the received or receivable amount as stipulated in the contractor agreement is unfair. At the end of the reporting period, the Company shall recognise the revenue fromrendering of the services in current period, based on the amount of multiplying the total amount of revenues fromrendering of the services by the percentage of completion then deducting the accumulative revenues fromrendering of the services that have been recognised in the previous accounting periods. At the same time, theCompany shall recognise the current cost incurred for rendering of the services based on the amount ofmultiplying the total estimated cost for rendering of the services by the percentage of completion and thendeducting the accumulative costs from rendering of the services that have been recognised in the previousaccounting periods.If the outcome of rendering of services cannot be estimated reliably at the balance sheet date, the accountingtreatment shall be based on the following circumstances, respectively:
(i) When the costs incurred are expected to be recovered, revenue shall be recognised to the extent of costs
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incurred and charge an equivalent amount of cost to the profit and loss;(ii) When the costs incurred are not expected to be recovered, revenue shall not be recognised and the costsincurred are recognised into current profit or loss(c) Revenue from alienating the right to use assetsWhen it is probable that the economic benefits associated with the transaction will flow into the Company andamount of revenue can be measured reliably, the Company shall recognise the amount of revenue from thealienating of right to use assets based on the following circumstances, respectively:
(i) Interest revenue should be calculated in accordance with the period for which the enterprise's cash is used byothers and the effective interest rate; or(ii) The amount of royalty revenue should be calculated in accordance with the period and method of charging asstipulated in the relevant contract or agreement.
3.28 Government Grants
(a) Recognition of government grantsA government grant shall not be recgonised until there is reasonable assurance that:
(i) The Company will comply with the conditions attaching to them; and(ii) The grants will be received.(b) Measurement of government grantsMonetary grants from the government shall be measured at amount received or receivable, and non-monetarygrants from the government shall be measured at their fair value or at a nominal value of RMB 1.00 when reliablefair value is not available.(c) Accounting for government grants(i) Government grants related to assetsGovernment grants pertinent to assets mean the government grants that are obtained by the Company used forpurchase or construction, or forming the long-term assets by other ways. Government grants pertinent to assetsshall be recognised as deferred income, and should be recognised in profit or loss on a systematic basis over theuseful lives of the relevant assets. Grants measured at their nominal value shall be directly recognised in profit orloss of the period when the grants are received. When the relevant assets are sold, transferred, written off ordamaged before the assets are terminated, the remaining deferred income shall be transferred into profit or loss ofthe period of disposing relevant assets.(ii) Government grants related to incomeGovernment grants other than related to assets are classified as government grants related to income. Governmentgrants related to income are accounted for in accordance with the following principles:
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If the government grants related to income are used to compensate the enterprise’s relevant expenses or losses infuture periods, such government grants shall be recognised as deferred income and included into profit or loss inthe same period as the relevant expenses or losses are recognised;If the government grants related to income are used to compensate the enterprise’s relevant expenses or lossesincurred, such government grants are directly recognised into current profit or lossFor government grants comprised of part related to assets as well as part related to income, each part is accountedfor separately; if it is difficult to identify different part, the government grants are accounted for as governmentgrants related to income as a whole.Government grants related to daily operation activities are recognised in other income in accordance with thenature of the activities, and government grants irrelevant to daily operation activities are recognised innon-operating income.(iii) Loan interest subsidyWhen loan interest subsidy is allocated to the bank, and the bank provides a loan at lower-market rate of interestto the Company, the loan is recognised at the actual received amount, and the interest expense is calculated basedon the principal of the loan and the lower-market rate of interest.When loan interest subsidy is directly allocated to the Company, the subsidy shall be recognised as offsetting therelevant borrowing cost.(iv) Repayment of the government grantsRepayment of the government grants shall be recorded by increasing the carrying amount of the asset if the bookvalue of the asset has been written down, or reducing the balance of relevant deferred income if deferred incomebalance exists, any excess will be recognised into current profit or loss; or directly recognised into current profitor loss for other circumstances.
3.29 Deferred Tax Assets and Deferred Tax Liabilities
Temporary differences are differences between the carrying amount of an asset or liability in the statement offinancial position and its tax base at the balance sheet date. The Company recognise and measure the effect oftaxable temporary differences and deductible temporary differences on income tax as deferred tax liabilities ordeferred tax assets using liability method. Deferred tax assets and deferred tax liabilities shall not be discounted.(a) Recognition of deferred tax assetsDeferred tax assets should be recognised for deductible temporary differences, the carryforward of unused taxlosses and the carryforward of unused tax credits to the extent that it is probable that taxable profit will beavailable against which the deductible temporary differences, the carryforward of unused tax losses and thecarryforward of unused tax credits can be utilised at the tax rates that are expected to apply to the period when theasset is realised, unless the deferred tax asset arises from the initial recognition of an asset or liability in a
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transaction that:
(i) Is not a business combination; and(ii) At the time of the transaction, affects neither accounting profit nor taxable profit (tax loss)The Company shall recognise a deferred tax asset for all deductible temporary differences arising frominvestments in subsidiaries, associates and joint ventures, only to the extent that, it is probable that:
(i) The temporary difference will reverse in the foreseeable future; and(ii) Taxable profit will be available against which the deductible temporary difference can be utilised.At the end of each reporting period, if there is sufficient evidence that it is probable that taxable profit will beavailable against which the deductible temporary difference can be utilized, the Company recognises a previouslyunrecognised deferred tax asset.The carrying amount of a deferred tax asset shall be reviewed at the end of each reporting period. The Companyshall reduce the carrying amount of a deferred tax asset to the extent that it is no longer probable that sufficienttaxable profit will be available to allow the benefit of part or all of that deferred tax asset to be utilised. Any suchreduction shall be reversed to the extent that it becomes probable that sufficient taxable profit will be available.(b) Recognition of deferred tax liabilitiesA deferred tax liability shall be recognised for all taxable temporary differences at the tax rate that are expected toapply to the period when the liability is settled.(i) No deferred tax liability shall be recognised for taxable temporary differences arising from:
? The initial recognition of goodwill; or? The initial recognition of an asset or liability in a transaction which: is not a business combination; and at thetime of the transaction, affects neither accounting profit nor taxable profit (tax loss)(ii) An entity shall recognise a deferred tax liability for all taxable temporary differences associated withinvestments in subsidiaries, associates, and joint ventures, except to the extent that both of the followingconditions are satisfied:
? The Company is able to control the timing of the reversal of the temporary difference; and? It is probable that the temporary difference will not reverse in the foreseeable future.(c) Recognition of deferred tax liabilities or assets involved in special transactions or events(i) Deferred tax liabilities or assets related to business combinationFor the taxable temporary difference or deductible temporary difference arising from a business combination notunder common control, a deferred tax liability or a deferred tax asset shall be recognised, and simultaneously,goodwill recognised in the business combination shall be adjusted based on relevant deferred tax expense(income).(ii) Items directly recognised in equityCurrent tax and deferred tax related to items that are recognised directly in equity shall be recognised in equity.
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Such items include: other comprehensive income generated from fair value fluctuation of investments in otherdebt obligations; an adjustment to the opening balance of retained earnings resulting from either a change inaccounting policy that is applied retrospectively or the correction of a prior period (significant) error; amountsarising on initial recognition of the equity component of a compound financial instrument that contains bothliability and equity component.(iii) Unused tax losses and unused tax creditsUnsused tax losses and unused tax credits generated from daily operation of the Company itselfDeductible loss refers to the loss calculated and permitted according to the requirement of tax law that can beoffset against taxable income in future periods. The criteria for recognising deferred tax assets arising from thecarryforward of unused tax losses and tax credits are the same as the criteria for recognising deferred tax assetsarising from deductible temporary differences. The Company recognises a deferred tax asset arising from unusedtax losses or tax credits only to the extent that there is convincing other evidence that sufficient taxable profit willbe available against which the unused tax losses or unused tax credits can be utilised by the Company. Incometaxes in current profit or loss shall be deducted as well.Unsused tax losses and unused tax credits arising from a business combinationUnder a business combination, the acquiree’s deductible temporary differences which do not satisfy the criteria atthe acquisition date for recognition of deferred tax asset shall not be recognised. Within 12 months after theacquisition date, if new information regarding the facts and circumstances exists at the acquisition date and theeconomic benefit of the acquiree’s deductible temporary differences at the acquisition is expected to be realised,the Company shall recognise acquired deferred tax benefits and reduce the carrying amount of any goodwillrelated to this acquisition. If goodwill is reduced to zero, any remaining deferred tax benefits shall be recognisedin profit or loss. All other acquired deferred tax benefits realised shall be recognised in profit or loss.(iv) Temporary difference generated in consolidation eliminationWhen preparing consolidated financial statements, if temporary difference between carrying value of the assetsand liabilities in the consolidated financial statements and their taxable bases is generated from elimination ofinter-company unrealized profit or loss, deferred tax assets or deferred tax liabilities shall be recognised in theconsolidated financial statements, and income taxes expense in current profit or loss shall be adjusted as wellexcept for deferred tax related to transactions or events recognised directly in equity and business combination.(v) Share-based payment settled by equityIf tax authority permits tax deduction that relates to share-based payment, during the period in which the expensesare recognised according to the accounting standards, the Company estimates the tax base in accordance withavailable information at the end of the accounting period and the temporary difference arising from it. Deferredtax shall be recognised when criteria of recognition are satisfied. If the amount of estimated future tax deduction
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exceeds the amount of the cumulative expenses related to share-based payment recognised according to theaccounting standards, the tax effect of the excess amount shall be recognised directly in equity.
3.30 Leases
(1) Accounting treatment of operating leases
a) When the Company acts as a lessee under an operating lease, the rental expense of the operating lease ischarged to current profit or loss on a straight-line basis or based on the usage of the leasehold property in eachperiod of the lease term. If the lessor provides a rent-free period, the Company apportions the total rent on astraight-line basis or by other reasonable method over the entire lease term without deducting the rent-free period,and recognizes the rental expense and the corresponding liability during the rent-free period. If the lessor bearscertain expenses of the lessee, the Company apportions the balance of the rental expense over the lease term aftersuch expenses are deducted from the total rental expense.The initial direct costs are included in current profit or loss. If the agreement agrees to contingent rentals, they areincluded in current profit or loss when they are actually incurred.b) When the Company acts as a lessor under an operating lease, the rent received is recognized as income over thelease term using the straight-line method. If the lessor provides a rent-free period, the lessor allocates the totalrentals over the entire lease term without deducting the rent-free period by the straight-line method or otherreasonable method, and the lessor also recognizes rental income during the rent-free period. If certain expenses ofthe lessee are borne, the Company allocates the balance of rental income over the lease term after such expensesare deducted from the gross rental income.The initial direct costs are included in current profit or loss. Larger amounts are capitalized and recognized incurrent profit or loss on the same basis as rental income throughout the term of the operating lease. Contingentrentals, if agreed, are recognized in current income when they are actually incurred.
(2) Accounting treatment of finance leases
a) When the Company is a lessee under a finance lease, the lower of the fair value of the leasehold property andthe present value of the minimum lease payments at the commencement date of the lease is recorded as the valueof the leasehold property, and the minimum lease payments are recorded as the value of the long-term accountpayable, and the difference is recorded as unrecognized financing expense. The effective interest rate method isused to apportion the amount over each period of the lease term and is recognized as current financing expenses,which are included in financial expenses.The initial direct costs incurred are included in the value of the leasehold property.When depreciating financing leasehold property, the Company adopts a depreciation policy consistent with that ofits own depreciable assets, and the depreciation period is determined by the lease contract. If it may be reasonablyascertained that the Company will obtain ownership of the leasehold property at the end of the lease term, the lifeof the leasehold property at the commencement date of the lease term is used as the depreciation period; if it is not
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reasonably certain that the Company will obtain ownership of the leasehold property at the end of the lease term,the shorter of the lease term and the life of the leasehold property is used as the depreciation period.b) When the Company acts as a financing lessor, the sum of the minimum lease receivable and the initial directcosts as of the lease commencement date is recorded as the recorded value of the finance lease receivable in thelong-term receivables on the balance sheet, and the unguaranteed residual value is also recorded. The differencebetween the sum of the minimum lease receivable, the initial direct costs and the unguaranteed residual value andthe sum of their present values is recognized as unrealized financing income and recognized as rental receipt usingthe effective interest method in each period of the lease term.
3.31 Changes in Significant Accounting Policies and Accounting Estimates
(1) Changes in accounting polices
√ Applicable □ Not applicable
| Contents of changes in accounting policies and reasons thereof | Approval procedures | Note |
| On 7 December 2018, the Ministry of Finance revised and issued the Accounting Standards for Business Enterprises No.21-Leases (CK(2018)No.35) (hereinafter referred to as the new standards governing leases) and required those enterprises both listed in domestic and aboard and those enterprises overseas listed with International Financial Reporting Standards or Accounting Standards for Business Enterprises for preparation of financial statements to implement it since 1 January 2019, required other enterprises carrying out the Accounting Standards for Business Enterprises to implement it since 1 January 2021. | Reviewed and approved on the 7th Meeting of the 9th Board of Directors and the 5th Meeting of the 9th Supervisory Committee | For details, please refer to the announcement on changes in accounting policies disclosed on http://www.cninfo.com.cn dated 30 April 2021. |
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Consolidated Balance Sheet
Unit: RMB
| Item | 31 December 2020 | 1 January 2021 | Adjusted |
| Current assets: | |||
| Monetary assets | 5,971,212,569.66 | 5,971,212,569.66 | |
| Settlement reserve | |||
| Interbank loans granted | |||
| Held-for-trading financial assets | 203,877,915.51 | 203,877,915.51 | |
| Derivative financial assets | |||
| Notes receivable | |||
| Accounts receivable | 67,933,735.91 | 67,933,735.91 | |
| Accounts receivable financing | 1,673,510,794.51 | 1,673,510,794.51 | |
| Prepayments | 55,575,543.21 | 51,399,808.11 | -4,175,735.10 |
| Premiums receivable | |||
| Reinsurance receivables | |||
| Receivable reinsurance contract reserve | |||
| Other receivables | 33,451,121.48 | 33,451,121.48 | |
| Including: Interest receivable | |||
| Dividends receivable | |||
| Financial assets purchased under resale agreements | |||
| Inventories | 3,416,880,808.96 | 3,416,880,808.96 | |
| Contract assets | |||
| Assets held for sale | |||
| Current portion of non-current assets | |||
| Other current assets | 97,412,681.26 | 97,412,681.26 | |
| Total current assets | 11,519,855,170.50 | 11,515,679,435.40 | -4,175,735.10 |
| Non-current assets: | |||
| Loans and advances to customers | |||
| Investments in debt |
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| obligations | |||
| Investments in other debt obligations | |||
| Long-term receivables | |||
| Long-term equity investments | 4,915,575.83 | 4,915,575.83 | |
| Investments in other equity instruments | |||
| Other non-current financial assets | |||
| Investment property | 4,392,943.54 | 4,392,943.54 | |
| Fixed assets | 1,797,789,271.62 | 1,797,789,271.62 | |
| Construction in progress | 279,169,201.60 | 279,169,201.60 | |
| Productive living assets | |||
| Oil and gas assets | |||
| Right-of-use assets | 0.00 | 57,402,412.53 | 57,402,412.53 |
| Intangible assets | 934,711,977.79 | 934,711,977.79 | |
| Development costs | |||
| Goodwill | 478,283,495.29 | 478,283,495.29 | |
| Long-term prepaid expense | 64,591,933.65 | 64,591,933.65 | |
| Deferred income tax assets | 96,972,421.95 | 96,972,421.95 | |
| Other non-current assets | 5,943,717.02 | 5,943,717.02 | |
| Total non-current assets | 3,666,770,538.29 | 3,724,172,950.82 | 57,402,412.53 |
| Total assets | 15,186,625,708.79 | 15,239,852,386.22 | 53,226,677.43 |
| Current liabilities: | |||
| Short-term borrowings | 70,665,500.00 | 70,665,500.00 | |
| Borrowings from the central bank | |||
| Interbank loans obtained | |||
| Held-for-trading financial liabilities | |||
| Derivative financial liabilities | |||
| Notes payable | 140,614,535.60 | 140,614,535.60 | |
| Accounts payable | 505,206,561.86 | 505,206,561.86 | |
| Advances from customers |
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| Contract liabilities | 1,206,573,886.26 | 1,206,573,886.26 | |
| 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 | 498,129,114.76 | 498,129,114.76 | |
| Taxes payable | 349,142,692.10 | 349,142,692.10 | |
| Other payables | 1,396,599,161.14 | 1,396,599,161.14 | |
| Including: Interest payable | |||
| Dividends payable | |||
| Handling charges and commissions payable | |||
| Reinsurance payables | |||
| Liabilities directly associated with assets held for sale | |||
| Current portion of non-current liabilities | |||
| Other current liabilities | 320,792,383.03 | 320,792,383.03 | |
| Total current liabilities | 4,487,723,834.75 | 4,487,723,834.75 | |
| Non-current liabilities: | |||
| Insurance contract reserve | |||
| Long-term borrowings | 60,117,638.89 | 60,117,638.89 | |
| Bonds payable | |||
| Including: Preferred shares | |||
| Perpetual bonds | |||
| Lease liabilities | 0.00 | 53,226,677.43 | 53,226,677.43 |
| Long-term payables | |||
| Long-term employee benefits payable | |||
| Provisions |
~ 126 ~
| Deferred income | 75,111,997.53 | 75,111,997.53 | |
| Deferred income tax liabilities | 114,821,451.24 | 114,821,451.24 | |
| Other non-current liabilities | |||
| Total non-current liabilities | 250,051,087.66 | 303,277,765.09 | 53,226,677.43 |
| Total liabilities | 4,737,774,922.41 | 4,791,001,599.84 | 53,226,677.43 |
| Owners’ equity: | |||
| Share capital | 503,600,000.00 | 503,600,000.00 | |
| Other equity instruments | |||
| Including: Preferred shares | |||
| Perpetual bonds | |||
| Capital reserves | 1,295,405,592.25 | 1,295,405,592.25 | |
| Less: Treasury stock | |||
| Other comprehensive income | |||
| Specific reserve | |||
| Surplus reserves | 256,902,260.27 | 256,902,260.27 | |
| General reserve | |||
| Retained earnings | 7,987,380,161.21 | 7,987,380,161.21 | |
| Total equity attributable to owners of the Company as the parent | 10,043,288,013.73 | 10,043,288,013.73 | |
| Non-controlling interests | 405,562,772.65 | 405,562,772.65 | |
| Total owners’ equity | 10,448,850,786.38 | 10,448,850,786.38 | |
| Total liabilities and owners’ equity | 15,186,625,708.79 | 15,239,852,386.22 | 53,226,677.43 |
| Item | 31 December 2020 | 1 January 2021 | Adjusted |
| Current assets: |
~ 127 ~
| Monetary assets | 4,287,808,756.66 | 4,287,808,756.66 | |
| Held-for-trading financial assets | 203,877,915.51 | 203,877,915.51 | |
| Derivative financial assets | |||
| Notes receivable | |||
| Accounts receivable | 494,976.27 | 494,976.27 | |
| Accounts receivable financing | 1,399,214,331.97 | 1,399,214,331.97 | |
| Prepayments | 11,737,580.47 | 7,561,845.37 | -4,175,735.10 |
| Other receivables | 141,378,010.40 | 141,378,010.40 | |
| Including: Interest receivable | |||
| Dividends receivable | |||
| Inventories | 2,976,360,208.66 | 2,976,360,208.66 | |
| Contract assets | |||
| Assets held for sale | |||
| Current portion of non-current assets | |||
| Other current assets | 9,734,249.41 | 9,734,249.41 | |
| Total current assets | 9,030,606,029.35 | 9,026,430,294.25 | -4,175,735.10 |
| Non-current assets: | |||
| Investments in debt obligations | |||
| Investments in other debt obligations | |||
| Long-term receivables | |||
| Long-term equity investments | 1,118,213,665.32 | 1,118,213,665.32 | |
| Investments in other equity instruments | |||
| Other non-current financial assets | |||
| Investment property | 4,392,943.54 | 4,392,943.54 | |
| Fixed assets | 1,322,818,855.86 | 1,322,818,855.86 | |
| Construction in progress | 139,865,487.21 | 139,865,487.21 | |
| Productive living assets |
~ 128 ~
| Oil and gas assets | |||
| Right-of-use assets | 0.00 | 52,729,370.65 | 52,729,370.65 |
| Intangible assets | 369,163,089.18 | 369,163,089.18 | |
| Development costs | |||
| Goodwill | |||
| Long-term prepaid expense | 44,072,241.78 | 44,072,241.78 | |
| Deferred income tax assets | 30,716,488.80 | 30,716,488.80 | |
| Other non-current assets | 75,999.80 | 75,999.80 | |
| Total non-current assets | 3,029,318,771.49 | 3,082,048,142.14 | 52,729,370.65 |
| Total assets | 12,059,924,800.84 | 12,108,478,436.39 | 48,553,635.55 |
| Current liabilities: | |||
| Short-term borrowings | |||
| Held-for-trading financial liabilities | |||
| Derivative financial liabilities | |||
| Notes payable | 74,535.60 | 74,535.60 | |
| Accounts payable | 397,554,006.51 | 397,554,006.51 | |
| Advances from customers | |||
| Contract liabilities | 1,130,074,436.39 | 1,130,074,436.39 | |
| Employee benefits payable | 127,974,331.78 | 127,974,331.78 | |
| Taxes payable | 200,876,134.49 | 200,876,134.49 | |
| Other payables | 524,000,730.59 | 524,000,730.59 | |
| Including: Interest payable | |||
| Dividends payable | |||
| Liabilities directly associated with assets held for sale | |||
| Current portion of non-current liabilities | |||
| Other current liabilities | 160,738,917.51 | 160,738,917.51 | |
| Total current liabilities | 2,541,293,092.87 | 2,541,293,092.87 | |
| Non-current liabilities: | |||
| Long-term borrowings |
~ 129 ~
| Bonds payable | |||
| Including: Preferred shares | |||
| Perpetual bonds | |||
| Lease liabilities | 0.00 | 48,553,635.55 | 48,553,635.55 |
| Long-term payables | |||
| Long-term employee benefits payable | |||
| Provisions | |||
| Deferred income | 31,601,732.51 | 31,601,732.51 | |
| Deferred income tax liabilities | 19,407,895.89 | 19,407,895.89 | |
| Other non-current liabilities | |||
| Total non-current liabilities | 51,009,628.40 | 99,563,263.95 | 48,553,635.55 |
| Total liabilities | 2,592,302,721.27 | 2,640,856,356.82 | 48,553,635.55 |
| Owners’ equity: | |||
| Share capital | 503,600,000.00 | 503,600,000.00 | |
| Other equity instruments | |||
| Including: Preferred shares | |||
| Perpetual bonds | |||
| Capital reserves | 1,247,162,107.35 | 1,247,162,107.35 | |
| Less: Treasury stock | |||
| Other comprehensive income | |||
| Specific reserve | |||
| Surplus reserves | 251,800,000.00 | 251,800,000.00 | |
| Retained earnings | 7,465,059,972.22 | 7,465,059,972.22 | |
| Total owners’ equity | 9,467,622,079.57 | 9,467,622,079.57 | |
| Total liabilities and owners’ equity | 12,059,924,800.84 | 12,108,478,436.39 | 48,553,635.55 |
~ 130 ~
by RMB52,729,370.65, increased lease liabilities by RMB48,553,635.55 and decreased prepayments by RMB4,175,735.10.
(4) Retroactive Adjustments to Comparative Data of Prior Years when First Execution of any NewStandards Governing Leases since 2021
□ Applicable √ Not applicable
4. Taxation
4.1 Main Taxes and Tax Rate
| Category of taxes | Basis of tax assessment | Tax rate |
| VAT | VAT are paid on added value of product sales | 13%, 9%, 6% |
| Consumption tax | Consumption taxes are paid onsales volume of taxable consumer goods | Sales of wine RMB1 per 1000 ml or per kg to calculate the amount of consumption tax, a flat rate, 20% of the annual turnover to calculate the amount of consumption tax at valorem. |
| Urban maintenance and construction tax | Urban maintenance and construction taxes are paid on turnover taxes | 7%、5% |
| Education expenses surcharge | Educational surcharges are paid on turnover taxes | 3% |
| Local education surcharge | Local educational surcharges are paid on turnover taxes | 2% |
| Enterprise income tax | Business taxes are calculated and paid on taxable revenues | 25% |
| Name of the entities | Income tax rate |
| Anhui Longrui Glass Co., Ltd | 15% |
| Anhui Ruisiweier Technology Co., Ltd | 15% |
| Wuhan Yashibo Technology Co., Ltd | 2.5% |
| Bozhou Gujing hotel Co., Ltd | 2.5% |
| Hubei Junlou Cultural Tourism Co., Ltd. | The portion of the taxable income which does not exceed RMB1 million: 2.5% The portion of the taxable income which is more than RMB1 million but not more than RMB3 million: 10% |
| Hubei Yellow Crane Tower Beverage Co., Ltd. | 2.5% |
~ 131 ~
| Hubei Xinjia Testing Technology Co., Ltd. | The portion of the taxable income which does not exceed RMB1 million: 2.5% The portion of the taxable income which is more than RMB1 million but not more than RMB3 million: 10% |
| Item | Ending balance | Beginning balance |
| Cash on hand | 175,509.59 | 178,127.77 |
| Cash in bank | 12,139,953,541.32 | 5,936,406,199.84 |
~ 132 ~
| Item | Ending balance | Beginning balance |
| Other monetary assets | 4,175,438.94 | 34,628,242.05 |
| Total | 12,144,304,489.85 | 5,971,212,569.66 |
| Item | Ending balance | Beginning balance |
| Financial assets at fair value through profit or loss | 209,115,157.91 | 203,877,915.51 |
| Including: bank financial products | - | |
| Fund investment | 209,115,157.91 | 203,877,915.51 |
| Total | 209,115,157.91 | 203,877,915.51 |
| Aging | Ending balance | Beginning balance |
| Within one year | 65,490,049.59 | 64,157,166.51 |
| Of which:1-6 months | 53,061,182.15 | 61,367,773.81 |
| 7-12 months | 12,428,867.44 | 2,789,392.70 |
| 1-2 years | 876,218.55 | 4,953,687.55 |
| 2-3 years | 445,069.62 | 142,796.00 |
| Over 3 years | 980,982.55 | - |
| Subtotal | 67,792,320.31 | 69,253,650.06 |
| Less: Bad debt provision | 2,443,194.41 | 1,319,914.15 |
~ 133 ~
| Aging | Ending balance | Beginning balance |
| Total | 65,349,125.90 | 67,933,735.91 |
| Category | Ending balance | ||||
| Carrying amount | Bad debt provision | Carrying value | |||
| Amount | Proportion (%) | Amount | Withdrawal proportion (%) | ||
| Bad debt provision withdrawn separately | |||||
| Bad debt provision withdrawn by group | 67,792,320.31 | 100.00 | 2,443,194.41 | 3.60 | 65,349,125.90 |
| Of which: Group 1 | |||||
| Group 2 | 67,792,320.31 | 100.00 | 2,443,194.41 | 3.60 | 65,349,125.90 |
| Total | 67,792,320.31 | 100.00 | 2,443,194.41 | 3.60 | 65,349,125.90 |
| Category | Beginning balance | ||||
| Carrying amount | Bad debt provision | Carrying value | |||
| Amount | Proportion (%) | Amount | Withdrawal proportion (%) | ||
| Bad debt provision withdrawn separately | - | - | - | - | - |
| Bad debt provision withdrawn by group | 69,253,650.06 | 100.00 | 1,319,914.15 | 1.91 | 67,933,735.91 |
| Of which: Group 1 | - | - | - | - | - |
| Group 2 | 69,253,650.06 | 100.00 | 1,319,914.15 | 1.91 | 67,933,735.91 |
| Total | 69,253,650.06 | 100.00 | 1,319,914.15 | 1.91 | 67,933,735.91 |
| Aging | Ending balance | ||
| Carrying amount | Bad debt provision | Withdrawal proportion (%) | |
| Within one year | 65,490,049.59 | 1,152,055.19 | 1.76 |
| Of which:1-6 months | 53,061,182.15 | 530,611.82 | 1.00 |
~ 134 ~
| Aging | Ending balance | ||
| Carrying amount | Bad debt provision | Withdrawal proportion (%) | |
| 7-12 months | 12,428,867.44 | 621,443.37 | 5.00 |
| 1-2 years | 876,218.55 | 87,621.86 | 10.00 |
| 2-3 years | 445,069.62 | 222,534.81 | 50.00 |
| Over 3 years | 980,982.55 | 980,982.55 | 100.00 |
| Total | 67,792,320.31 | 2,443,194.41 | 3.60 |
| Aging | Beginning balance | ||
| Carrying amount | Bad debt provision | Withdrawal proportion (%) | |
| Within one year | 64,157,166.51 | 753,147.38 | 1.17 |
| Of which:1-6 months | 61,367,773.81 | 613,677.74 | 1.00 |
| 7-12 months | 2,789,392.70 | 139,469.64 | 5.00 |
| 1-2 years | 4,953,687.55 | 495,368.77 | 10.00 |
| 2-3 years | 142,796.00 | 71,398.00 | 50.00 |
| Over 3 years | - | - | - |
| Total | 69,253,650.06 | 1,319,914.15 | 1.91 |
| Category | Beginning amount | Changes in the Reporting Period | Ending balance | |||
| Business combination | Withdrawal | Recovery or reversal | Write-off | |||
| Accounts receivable with insignificant amount but bad debt provision withdrawn separately | - | - | - | - | - | - |
| Group 2: Bad debt provision withdrawn by aging group | 1,319,914.15 | 1,166,733.53 | 43,453.27 | 2,443,194.41 | ||
| Total | 1,319,914.15 | 1,166,733.53 | 43,453.27 | 2,443,194.41 | ||
| Entity name | Ending balance | Proportion to total ending balance of accounts receivable (%) | Ending balance of bad debt provision |
~ 135 ~
| Entity name | Ending balance | Proportion to total ending balance of accounts receivable (%) | Ending balance of bad debt provision |
| No. 1 | 11,747,565.00 | 17.33 | 117,475.65 |
| No. 2 | 10,243,957.73 | 15.11 | 493,138.43 |
| No. 3 | 4,766,144.95 | 7.03 | 47,661.45 |
| No. 4 | 2,784,090.69 | 4.11 | 27,840.91 |
| No. 5 | 2,498,381.20 | 3.69 | 24,983.81 |
| Total | 32,040,139.57 | 47.27 | 711,100.25 |
| Category | Ending balance | Beginning balance | ||||
| Carrying amount | Bad debt provision | Carrying value | Carrying amount | Bad debt provision | Carrying value | |
| Bank acceptance bills | 2,003,302,090.64 | 2,003,302,090.64 | 1,673,510,794.51 | - | 1,673,510,794.51 | |
| Commercial acceptance bills | - | - | - | |||
| Total | 2,003,302,090.64 | 2,003,302,090.64 | 1,673,510,794.51 | - | 1,673,510,794.51 | |
| Items | Pledged amount |
| Bank acceptance bills | 24,300,000.00 |
| Total | 24,300,000.00 |
| Items | Amount of derecognition | Amount of recognition |
| Bank acceptance bills | 1,348,049,640.36 | - |
| Total | 1,348,049,640.36 | - |
~ 136 ~
the bill ownership have been transferred, so need to be derecogised.
(3) The company has no notes receivable transferred to accounts receivable due to drawers’ inability of fulfillmentat 31 December 2021
(4) Notes receivable by bad debt provision method
| Category | Ending balance | ||||
| Carrying amount | Bad debt provision | Carrying value | |||
| Amount | Proportion (%) | Amount | Withdrawal proportion (%) | ||
| Bad debt provision withdrawn separately | - | - | - | - | - |
| Bad debt provision withdrawn by group | 2,003,302,090.64 | 100.00 | 2,003,302,090.64 | ||
| Of which: Group 1 | |||||
| Group 2 | 2,003,302,090.64 | 100.00 | 2,003,302,090.64 | ||
| Total | 2,003,302,090.64 | 100.00 | 2,003,302,090.64 | ||
| Aging | Ending balance | Beginning balance | ||
| Amount | Proportion (%) | Amount | Proportion (%) | |
| Within one year | 112,456,597.78 | 99.19 | 50,894,162.75 | 99.02 |
| 1 to 2 years | 912,996.56 | 0.80 | 505,645.36 | 0.98 |
| 2 to 3 years | 6,000.00 | 0.01 | - | - |
| Over 3 years | - | - | - | - |
~ 137 ~
| Aging | Ending balance | Beginning balance | ||
| Amount | Proportion (%) | Amount | Proportion (%) | |
| Total | 113,375,594.34 | 100.00 | 51,399,808.11 | 100.00 |
| Entity name | Ending balance | Proportion of the balance to the total prepayment (%) |
| No. 1 | 24,114,779.80 | 21.27 |
| No. 2 | 8,655,660.98 | 7.63 |
| No. 3 | 5,336,595.80 | 4.71 |
| No. 4 | 4,342,303.58 | 3.83 |
| No. 5 | 3,700,289.11 | 3.26 |
| Total | 46,149,629.27 | 40.70 |
| Item | Ending balance | Beginning balance |
| Interest receivable | - | - |
| Dividends receivable | - | - |
| Other receivables | 86,173,732.22 | 33,451,121.48 |
| Total | 86,173,732.22 | 33,451,121.48 |
| Aging | Ending balance | Beginning balance |
| Within one year | 83,426,906.55 | 31,014,800.18 |
| Of which:1-6 months | 76,350,461.06 | 29,186,461.60 |
| 7-12 months | 7,076,445.49 | 1,828,338.58 |
| 1-2 years | 3,406,781.00 | 2,842,287.06 |
| 2-3 years | 1,596,075.56 | 523,089.00 |
| Over 3 years | 43,189,137.94 | 42,535,188.41 |
| Subtotal | 131,618,901.05 | 76,915,364.65 |
| Less: Bad debt provision | 45,445,168.83 | 43,464,243.17 |
~ 138 ~
| Aging | Ending balance | Beginning balance |
| Total | 86,173,732.22 | 33,451,121.48 |
| Nature | Ending balance | Beginning balance |
| Investment in securities | 38,857,584.88 | 40,807,394.41 |
| Deposit and guarantee | 47,596,554.26 | 5,266,477.91 |
| Borrowing for business trip expenses | 300,260.03 | 795,646.51 |
| Rent, utilities and gasoline charges | 8,820,226.93 | 8,962,876.17 |
| Other | 36,044,274.95 | 21,082,969.65 |
| Subtotal | 131,618,901.05 | 76,915,364.65 |
| Less: Bad debt provision | 45,445,168.83 | 43,464,243.17 |
| Total | 86,173,732.22 | 33,451,121.48 |
| Stage | Carrying amount | Bad debt provision | Carrying value |
| Stage 1 | 92,761,316.17 | 6,587,583.95 | 86,173,732.22 |
| Stage 2 | |||
| Stage 3 | 38,857,584.88 | 38,857,584.88 | - |
| Total | 131,618,901.05 | 45,445,168.83 | 86,173,732.22 |
| Category | Carrying amount | 12-month expected credit losses rate (%) | Bad debt provision | Carrying value |
| Bad debt provision withdrawn separately | ||||
| Bad debt provision withdrawn by group | 92,761,316.17 | 7.10 | 6,587,583.95 | 86,173,732.22 |
| Of which: Group 1 | ||||
| Group 2 | 92,761,316.17 | 7.10 | 6,587,583.95 | 86,173,732.22 |
| Total | 92,761,316.17 | 7.10 | 6,587,583.95 | 86,173,732.22 |
| Aging | Ending balance |
~ 139 ~
| Carrying amount | Bad debt provision | Withdrawal proportion (%) | |
| Within one year | 83,426,906.55 | 1,117,315.00 | 1.34 |
| Of which:1-6 months | 76,350,461.06 | 763,492.73 | 1.00 |
| 7-12 months | 7,076,445.49 | 353,822.27 | 5.00 |
| 1-2 years | 3,406,781.00 | 340,678.10 | 10.00 |
| 2-3 years | 1,596,075.56 | 798,037.79 | 50.00 |
| Over 3 years | 4,331,553.06 | 4,331,553.06 | 100.00 |
| Total | 92,761,316.17 | 6,587,583.95 | 7.10 |
| Category | Carrying amount | 12-month expected credit losses rate (%) | Bad debt provision | Carrying value |
| Bad debt provision withdrawn separately | 38,857,584.88 | 100.00 | 38,857,584.88 | - |
| Bad debt provision withdrawn by group | - | |||
| Of which: Group 1 | - | |||
| Group 2 | - | |||
| Total | 38,857,584.88 | 100.00 | 38,857,584.88 | - |
| Name | Ending balance | |||
| Carrying amount | Bad debt provision | Withdrawal proportion (%) | Withdrawal reason | |
| Hengxin Securities Co., Ltd. | 28,966,894.41 | 28,966,894.41 | 100.00 | The enterprise enters the bankruptcy liquidation procedure |
| Jianqiao Securities Co., Ltd. | 9,890,690.47 | 9,890,690.47 | 100.00 | The enterprise enters the bankruptcy liquidation procedure |
| Total | 38,857,584.88 | 38,857,584.88 | 100.00 | -- |
| Stage | Carrying amount | Bad debt provision | Carrying value |
~ 140 ~
| Stage 1 | 36,107,970.24 | 2,656,848.76 | 33,451,121.48 |
| Stage 2 | - | - | - |
| Stage 3 | 40,807,394.41 | 40,807,394.41 | - |
| Total | 76,915,364.65 | 43,464,243.17 | 33,451,121.48 |
| Category | Carrying amount | 12-month expected credit losses rate (%) | Bad debt provision | Carrying value |
| Bad debt provision withdrawn separately | ||||
| Bad debt provision withdrawn by group | 36,107,970.24 | 7.36 | 2,656,848.76 | 33,451,121.48 |
| Of which: Group 1 | ||||
| Group 2 | 36,107,970.24 | 7.36 | 2,656,848.76 | 33,451,121.48 |
| Total | 36,107,970.24 | 7.36 | 2,656,848.76 | 33,451,121.48 |
| Aging | Beginning balance | ||
| Carrying amount | Bad debt provision | Withdrawal proportion (%) | |
| Within one year | 31,014,800.18 | 383,281.55 | 1.24 |
| Of which:1-6 months | 29,186,461.60 | 291,864.62 | 1.00 |
| 7-12 months | 1,828,338.58 | 91,416.93 | 5.00 |
| 1-2 years | 2,842,287.06 | 284,228.71 | 10.00 |
| 2-3 years | 523,089.00 | 261,544.50 | 50.00 |
| Over 3 years | 1,727,794.00 | 1,727,794.00 | 100.00 |
| Total | 36,107,970.24 | 2,656,848.76 | 7.36 |
| Category | Carrying amount | 12-month expected credit losses rate (%) | Bad debt provision | Carrying value |
| Bad debt provision withdrawn separately | 40,807,394.41 | 100.00 | 40,807,394.41 | - |
| Bad debt provision withdrawn by group | - | - | - | - |
| Of which: Group 1 | - | - | - | - |
~ 141 ~
| Category | Carrying amount | 12-month expected credit losses rate (%) | Bad debt provision | Carrying value |
| Group 2 | - | - | - | - |
| Total | 40,807,394.41 | 100.00 | 40,807,394.41 | - |
| Name | Beginning balance | |||
| Carrying amount | Bad debt provision | Withdrawal proportion (%) | Withdrawal reason | |
| Hengxin Securities Co., Ltd. | 28,966,894.41 | 28,966,894.41 | 100.00 | The enterprise enters the bankruptcy liquidation procedure |
| Jianqiao Securities Co., Ltd. | 11,840,500.00 | 11,840,500.00 | 100.00 | The enterprise enters the bankruptcy liquidation procedure |
| Total | 40,807,394.41 | 40,807,394.41 | 100.00 | -- |
| Category | Beginning balance | Changes in the Reporting Period | Ending balance | ||
| Withdrawal | Recovery or reversal | Write-off | |||
| Bad debt provision withdrawn separately | 40,807,394.41 | - | 1,949,809.53 | 38,857,584.88 | |
| Bad debt provision withdrawn by group | 2,656,848.76 | 3,930,735.19 | 6,587,583.95 | ||
| Total | 43,464,243.17 | 3,930,735.19 | 1,949,809.53 | 45,445,168.83 | |
| Entity name | Nature | Ending balance | Aging | Proportion of the balance to the total other receivables (%) | Bad debt provision |
| No. 1 | Deposit | 42,020,000.00 | Within 6 months | 31.93 | 420,200.00 |
| No. 2 | Securities investment | 28,966,894.41 | Over 3 years | 22.01 | 28,966,894.41 |
~ 142 ~
| Entity name | Nature | Ending balance | Aging | Proportion of the balance to the total other receivables (%) | Bad debt provision |
| No. 3 | Securities investment | 9,890,690.47 | Over 3 years | 7.51 | 9,890,690.47 |
| No. 4 | Other | 6,534,593.50 | Within 6 months | 4.96 | 65,345.94 |
| No. 5 | Other | 6,147,036.14 | Within 6 months | 4.67 | 61,470.36 |
| Total | -- | 93,559,214.52 | 71.08 | 39,404,601.18 |
| Item | Ending balance | ||
| Carrying amount | Falling price reserves | Carrying value | |
| Raw materials and package materials | 154,374,930.07 | 18,882,888.72 | 135,492,041.35 |
| Semi-finished goods and work in process | 3,310,434,002.43 | - | 3,310,434,002.43 |
| Finished goods | 534,600,583.37 | 10,594,276.72 | 524,006,306.65 |
| Total | 3,999,409,515.87 | 29,477,165.44 | 3,969,932,350.43 |
| Item | Beginning balance | ||
| Carrying amount | Falling price reserves | Carrying value | |
| Raw materials and package materials | 191,873,650.49 | 13,274,081.73 | 178,599,568.76 |
| Semi-finished goods and work in process | 2,861,343,683.53 | - | 2,861,343,683.53 |
| Finished goods | 387,506,042.80 | 10,568,486.13 | 376,937,556.67 |
~ 143 ~
| Total | 3,440,723,376.82 | 23,842,567.86 | 3,416,880,808.96 |
| Items | Beginning balance | Increase | Decrease | Ending balance | ||
| Withdrawal | Business combination | Reversal or recovery | Other | |||
| Raw materials and package materials | 13,274,081.73 | 8,134,202.39 | 2,525,395.40 | 18,882,888.72 | ||
| Finished goods | 10,568,486.13 | 23,183.00 | 2,607.59 | 10,594,276.72 | ||
| Total | 23,842,567.86 | 23,183.00 | 8,136,809.98 | 2,525,395.40 | 29,477,165.44 | |
| Item | Ending balance | Beginning balance |
| Pledge-style repo of treasury bonds | 10,000,000.00 | - |
| Deductible tax | 35,885,171.92 | 77,848,744.83 |
| Accrued Interests on deposits | 10,584,824.30 | 19,563,936.43 |
| Total | 56,469,996.22 | 97,412,681.26 |
| Investees | Beginning balance | Changes in the Reporting Period | ||||
| Additional investments | Reduced investments | Profit and loss on investments confirmed according to equity law | Adjustment of other comprehensive income | Changes in other equity | ||
| I. Associated enterprises | ||||||
| Beijing Guge Trading Co., Ltd. | 4,915,575.83 | - | - | 60,287.04 | - | - |
| Total | 4,915,575.83 | - | - | 60,287.04 | - | - |
| Investees | Changes in the Reporting Period | Ending balance | Balance of |
~ 144 ~
| Declaration of cash dividends or distribution of profit | Withdrawal of impairment provision | Other | impairment provision | ||
| I. Associated enterprises | |||||
| Beijing Guge Trading Co., Ltd. | - | - | - | 4,975,862.87 | - |
| Total | - | - | - | 4,975,862.87 | - |
| Item | Ending balance | Beginning balance |
| Anhui Mingguang Rural Commercial Bank Co., Ltd. | 54,910,856.74 | - |
| Total | 54,910,856.74 | - |
| 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 income | Reason for other comprehensive income transferred to retained earnings |
| Anhui Mingguang Rural Commercial Bank Co., Ltd. | 809,860.62 | 809,860.62 | Assigned to measure in fair value and the changes included in other comprehensive income according to the holding purpose of the management |
| Items | Building and plants | Land use rights | Total |
| I. Original carrying value |
~ 145 ~
| Items | Building and plants | Land use rights | Total |
| 1. Beginning balance | 8,680,555.75 | 2,644,592.00 | 11,325,147.75 |
| 2. Increase during the Reporting Period | - | - | - |
| 3. Decrease during the Reporting Period | - | - | - |
| 4. Ending balance | 8,680,555.75 | 2,644,592.00 | 11,325,147.75 |
| II. Accumulated depreciation and amortization: | |||
| 1. Beginning balance | 6,176,477.79 | 755,726.42 | 6,932,204.21 |
| 2. Increase during the Reporting Period | 130,557.96 | 28,013.28 | 158,571.24 |
| (1) Withdrawal or amortization | 130,557.96 | 28,013.28 | 158,571.24 |
| 3. Decrease during the Reporting Period | |||
| 4. Ending balance | 6,307,035.75 | 783,739.70 | 7,090,775.45 |
| III. Impairment provision | |||
| 1. Beginning balance | - | - | - |
| 2. Increase during the Reporting Period | - | - | - |
| 3. Decrease during the Reporting Period | - | - | - |
| 4. Ending balance | - | - | - |
| IV. Carrying value | |||
| 1. Ending carrying value | 2,373,520.00 | 1,860,852.30 | 4,234,372.30 |
| 2. Beginning carrying value | 2,504,077.96 | 1,888,865.58 | 4,392,943.54 |
| Item | Ending balance | Beginning balance |
| Fixed assets | 1,829,551,984.09 | 1,797,789,271.62 |
| Disposal of fixed assets | - | |
| Total | 1,829,551,984.09 | 1,797,789,271.62 |
| Items | Buildings and constructions | Machinery equipments | Vehicles | Office equipment and other | Total |
| I. Original carrying value | |||||
| 1. Beginning balance | 2,110,023,036.54 | 1,137,831,234.61 | 63,055,889.31 | 202,211,609.80 | 3,513,121,770.26 |
| 2. Increase during the Reporting Period | 106,966,334.19 | 67,167,821.39 | 10,037,666.02 | 40,438,838.52 | 224,610,660.12 |
~ 146 ~
| Items | Buildings and constructions | Machinery equipments | Vehicles | Office equipment and other | Total |
| (1) Acquisition | 395,492.59 | 12,587,735.69 | 1,687,942.42 | 7,692,169.96 | 22,363,340.66 |
| (2) Transfer from construction in progress | 0.00 | 7,829,813.95 | 0.00 | 7,611,275.72 | 15,441,089.67 |
| (3) Enterprise combination increase | 106,180,428.27 | 41,102,879.77 | 8,269,210.78 | 7,457,866.91 | 163,010,385.73 |
| (4) Other increase | 390,413.33 | 5,647,391.98 | 80,512.82 | 17,677,525.93 | 23,795,844.06 |
| 3. Decrease during the Reporting Period | 49,046,254.38 | 24,000,847.17 | 2,070,578.87 | 7,298,861.18 | 82,416,541.60 |
| (1) Disposal or scrap | 37,622,502.94 | 12,586,744.17 | 2,070,578.87 | 1,200,943.05 | 53,480,769.03 |
| (2) Other decrease | 11,423,751.44 | 11,414,103.00 | 0.00 | 6,097,918.13 | 28,935,772.57 |
| 4. Ending balance | 2,167,943,116.35 | 1,180,998,208.83 | 71,022,976.46 | 235,351,587.14 | 3,655,315,888.78 |
| II. Accumulated depreciation | |||||
| 1. Beginning balance | 887,885,451.17 | 652,893,081.63 | 54,246,302.02 | 115,239,124.54 | 1,710,263,959.36 |
| 2. Increase during the Reporting Period | 58,432,549.95 | 74,926,291.05 | 9,315,451.02 | 35,157,392.56 | 177,831,684.58 |
| (1) Withdrawal | 40,853,347.04 | 54,410,088.52 | 2,991,694.26 | 17,872,169.15 | 116,127,298.97 |
| (2) Enterprise combination increase | 17,200,513.98 | 15,123,646.39 | 6,249,135.23 | 4,805,171.31 | 43,378,466.91 |
| (3) Other increase | 378,688.93 | 5,392,556.14 | 74,621.53 | 12,480,052.10 | 18,325,918.70 |
| 3. Decrease during the Reporting Period | 39,415,962.42 | 18,989,073.56 | 1,766,170.03 | 6,954,931.84 | 67,126,137.85 |
| (1) Disposal or scrap | 35,345,372.01 | 10,573,387.77 | 1,766,170.03 | 1,115,289.34 | 48,800,219.15 |
| (2) Other decrease | 4,070,590.41 | 8,415,685.79 | 0.00 | 5,839,642.50 | 18,325,918.70 |
| 4. Ending balance | 906,902,038.70 | 708,830,299.12 | 61,795,583.01 | 143,441,585.26 | 1,820,969,506.09 |
| III. Impairment provision | |||||
| 1. Beginning balance | 2,804,324.86 | 1,674,420.09 | 7,047.07 | 582,747.26 | 5,068,539.28 |
| 2. Increase during the Reporting Period | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| (1) Withdrawal | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 3. Decrease during the Reporting Period | 0.00 | 232,441.13 | 7,047.07 | 34,652.48 | 274,140.68 |
| (1) Disposal or scrap | 0.00 | 232,441.13 | 7,047.07 | 34,652.48 | 274,140.68 |
| 4. Ending balance | 2,804,324.86 | 1,441,978.96 | 0.00 | 548,094.78 | 4,794,398.60 |
~ 147 ~
| Items | Buildings and constructions | Machinery equipments | Vehicles | Office equipment and other | Total |
| IV. Carrying value | |||||
| 1. Ending carrying value | 1,258,236,752.79 | 470,725,930.75 | 9,227,393.45 | 91,361,907.10 | 1,829,551,984.09 |
| 2. Beginning carrying value | 1,219,333,260.51 | 483,263,732.89 | 8,802,540.22 | 86,389,738.00 | 1,797,789,271.62 |
| Item | Original carrying value | Accumulated depreciation | Impairment provision | Carrying value | Note |
| Buildings and constructions | 8,137,031.10 | 5,246,394.21 | 2,804,324.86 | 86,312.03 | |
| Machinery equipments | 9,269,447.36 | 7,694,093.44 | 1,441,978.96 | 133,374.96 | |
| Vehicles | 0.00 | 0.00 | 0.00 | 0.00 | |
| Office equipment and others | 791,758.54 | 216,525.51 | 548,094.78 | 27,138.25 | |
| Total | 18,198,237.00 | 13,157,013.16 | 4,794,398.60 | 246,825.24 |
| Items | Carrying value | Reason |
| Buildings and constructions | 649,916,416.61 | In process |
| Total | 649,916,416.61 | -- |
| Item | Ending balance | Beginning balance |
| Construction in progress | 425,876,594.64 | 279,169,201.60 |
| Engineering materials | - | |
| Total | 425,876,594.64 | 279,169,201.60 |
| Item | Ending balance | Beginning balance | ||||
| Carrying amount | Depreciation reserve | Carrying value | Carrying amount | Depreciation reserve | Carrying value | |
~ 148 ~
| Suizhou new plant project | 211,480,987.42 | - | 211,480,987.42 | 135,930,812.66 | - | 135,930,812.66 |
| Smart park project | 98,042,609.99 | - | 98,042,609.99 | 54,494,827.90 | - | 54,494,827.90 |
| Brewing automatization technological improvement project | 66,427,530.42 | - | 66,427,530.42 | 42,832,649.99 | - | 42,832,649.99 |
| Liquid filling line renovation project | 14,835,486.72 | - | 14,835,486.72 | 14,835,486.72 | - | 14,835,486.72 |
| Gujing plant area 11# liquor warehouse | 19,382,788.21 | - | 19,382,788.21 | 11,166,144.14 | - | 11,166,144.14 |
| Experience center project | 2,219,508.43 | - | 2,219,508.43 | 8,064,287.27 | - | 8,064,287.27 |
| Gujing academy project | 6,441,931.82 | - | 6,441,931.82 | 5,538,005.31 | - | 5,538,005.31 |
| Other individual project | 7,045,751.63 | - | 7,045,751.63 | 6,306,987.61 | - | 6,306,987.61 |
| Total | 425,876,594.64 | - | 425,876,594.64 | 279,169,201.60 | - | 279,169,201.60 |
| Project | Budget (RMB’0,000) | Beginning balance | Increase during the Reporting Period | Amount transferred to fixed asset | Decrease during the Reporting Period | Ending balance |
| Suizhou new plant project | 60,000.00 | 135,930,812.66 | 75,550,174.76 | 0.00 | 0.00 | 211,480,987.42 |
| Smart park project | 828,965.74 | 54,494,827.90 | 44,923,928.88 | 1,376,146.79 | 0.00 | 98,042,609.99 |
| Brewing automatization technological improvement project | 27,430.00 | 42,832,649.99 | 31,294,651.73 | 7,699,771.30 | 0.00 | 66,427,530.42 |
| Liquid filling line renovation project | 4,000.00 | 14,835,486.72 | 0.00 | 0.00 | 0.00 | 14,835,486.72 |
| Gujing plant area 11# liquor warehouse | 9,000.00 | 11,166,144.14 | 8,216,644.07 | 0.00 | 0.00 | 19,382,788.21 |
| Experience center project | 2,950.00 | 8,064,287.27 | 7,123,208.78 | 0.00 | 12,967,987.62 | 2,219,508.43 |
~ 149 ~
| Gujing academy project | 49,900.00 | 5,538,005.31 | 903,926.51 | 0.00 | 0.00 | 6,441,931.82 |
| Other individual project | 2,994.65 | 6,306,987.61 | 8,214,735.67 | 6,365,171.58 | 1,110,800.07 | 7,045,751.63 |
| Total | 985,240.39 | 279,169,201.60 | 176,227,270.40 | 15,441,089.67 | 14,078,787.69 | 425,876,594.64 |
| Project | Proportion of project input to budgets (%) | Schedule (%) | Cumulative amount of interest capitalization | Of which: Interest capitalized during the reporting period | Interest capitalization during the Reporting Period (%) | Source of funds |
| Suizhou new plant project | 35.25 | 35.25 | 833,750.01 | 833,750.01 | 3.45- | Self-owned fund and borrowings |
| Smart park project | 1.20 | 5.00 | - | - | - | Self-owned fund and raised fund |
| Brewing automatization technological improvement project | 82.27 | 97.00 | - | - | - | Self-owned fund |
| Liquid filling line renovation project | 38.83 | 95.00 | - | - | - | Self-owned fund |
| Gujing plant area 11# liquor warehouse | 21.54 | 97.00 | - | - | - | Self-owned fund |
| Experience center project | 66.96 | 91.00 | - | - | - | Self-owned fund |
| Gujing academy project | 1.29 | 2.00 | - | - | - | Self-owned fund |
| Other individual project | 88.00 | 88.00 | - | - | - | Self-owned fund |
| Total | -- | -- | -- | -- | -- | -- |
~ 150 ~
5.14 Right-of-use Assets
| Items | Buildings and constructions | Machinery equipments | Total |
| I. Original carrying value | |||
| 1. Beginning balance | 56,071,482.96 | 1,330,929.57 | 57,402,412.53 |
| 2. Increase during the Reporting Period | |||
| 3. Decrease during the Reporting Period | |||
| 4. Ending balance | 56,071,482.96 | 1,330,929.57 | 57,402,412.53 |
| II. Accumulated depreciation | |||
| 1. Beginning balance | |||
| 2. Increase during the Reporting Period | 6,999,510.76 | 221,821.48 | 7,221,332.24 |
| (1) Withdrawal | 6,999,510.76 | 221,821.48 | 7,221,332.24 |
| 3. Decrease during the Reporting Period | |||
| (1) Disposal | |||
| 4. Ending balance | 6,999,510.76 | 221,821.48 | 7,221,332.24 |
| III. Impairment provision | |||
| 1. Beginning balance | |||
| 2. Increase during the Reporting Period | |||
| (1) Withdrawal | |||
| 3. Decrease during the Reporting Period | |||
| (1) Disposal | |||
| 4. Ending balance | |||
| IV. Carrying value | |||
| 1. Ending carrying value | 49,071,972.20 | 1,109,108.09 | 50,181,080.29 |
| 2. Beginning carrying value | 56,071,482.96 | 1,330,929.57 | 57,402,412.53 |
| Item | Land use rights | Software | Patents and trademark | Total |
~ 151 ~
| Item | Land use rights | Software | Patents and trademark | Total |
| I. Original carrying value | ||||
| 1. Beginning balance | 846,743,730.35 | 125,206,832.57 | 215,006,066.19 | 1,186,956,629.11 |
| 2. Increase during the Reporting Period | 98,580,103.19 | 2,468,867.94 | 38,039,080.00 | 139,088,051.13 |
| (1) Acquisition | 53,623,208.85 | 2,468,867.94 | - | 56,092,076.79 |
| (2) Transfer from construction in progress | ||||
| (3) Enterprise combination increase | 44,956,894.34 | - | 38,039,080.00 | 82,995,974.34 |
| 3. Decrease during the Reporting Period | 2,640,707.04 | - | 2,640,707.04 | |
| (1) Disposal | - | - | - | |
| (2) Other decrease | 2,640,707.04 | - | 2,640,707.04 | |
| 4. Ending balance | 945,323,833.54 | 125,034,993.47 | 253,045,146.19 | 1,323,403,973.20 |
| II. Accumulated amortization: | ||||
| 1. Beginning balance | 158,016,689.40 | 48,008,475.16 | 46,219,486.76 | 252,244,651.32 |
| 2. Increase during the Reporting Period | 13,291,667.01 | 11,529,765.44 | 23,320,984.35 | 48,142,416.80 |
| (1) Withdrawal | 9,959,352.12 | 11,529,765.44 | 31,904.35 | 21,521,021.91 |
| (2) Enterprise combination increase | 3,332,314.89 | - | 23,289,080.00 | 26,621,394.89 |
| 3. Decrease during the Reporting Period | - | - | ||
| (1) Disposal | ||||
| 4. Ending balance | 171,308,356.41 | 59,538,240.60 | 69,540,471.11 | 300,387,068.12 |
| III. Impairment provision | ||||
| 1. Beginning balance | - | - | - | - |
| 2. Increase during the Reporting Period | - | - | - | - |
| 3. Decrease during the Reporting Period | - | - | - | - |
| 4. Ending balance | - | - | - | - |
| IV. Carrying value | ||||
| 1. Ending carrying value | 774,015,477.13 | 65,496,752.87 | 183,504,675.08 | 1,023,016,905.08 |
| 2. Beginning carrying value | 688,727,040.95 | 77,198,357.41 | 168,786,579.43 | 934,711,977.79 |
~ 152 ~
(2) No Intangible Assets used for mortgage or guarantee at 30 June 2021
(3) No Land use rights without certificate of title at 30 June 2021
5.16 Goodwill
(1) Original carrying value of goodwill
| Investees or matters that goodwill arising from | Beginning balance | Increase | Decrease | Ending balance | ||
| Formed by business combination | Other | Disposal | Other | |||
| Yellow Crane Tower Distillery Co., Ltd. | 478,283,495.29 | - | - | - | - | 478,283,495.29 |
| Anhui Mingguang Distillery Co., Ltd. | 60,686,182.07 | 60,686,182.07 | ||||
| Total | 478,283,495.29 | 60,686,182.07 | - | - | - | 538,969,677.36 |
| Item | Beginning balance | Increase | Decrease | Ending balance | |
| Amortization | Other decrease | ||||
| Experience center | 25,368,080.45 | 12,967,987.62 | 5,672,214.27 | 317,922.04 | 32,345,931.76 |
| Sewage treatment project | 2,844,754.10 | 461,311.48 | - | 2,383,442.62 | |
| Yellow Crane Tower chateau and museum | 7,937,278.72 | 1,709,659.36 | - | 6,227,619.36 | |
| Gujing party building cultural center | 3,545,454.55 | 590,909.09 | - | 2,954,545.46 | |
| Yantai wine museum project | 937,109.64 | 244,463.38 | - | 692,646.26 | |
| Other individual project with insignificant amounts | 23,959,256.19 | 4,163,190.98 | 6,945,396.06 | - | 21,177,051.11 |
| Total | 64,591,933.65 | 17,131,178.60 | 15,623,953.64 | 317,922.04 | 65,781,236.57 |
| Item | Ending balance | Beginning balance | ||
| Deductible temporary differences | Deferred tax assets | Deductible temporary differences | Deferred tax assets | |
| Asset impairment provision | 34,271,564.04 | 8,567,891.01 | 28,911,107.14 | 7,211,407.41 |
| Credit impairment provision | 47,888,363.24 | 11,972,177.58 | 44,784,157.32 | 11,179,541.79 |
~ 153 ~
| Item | Ending balance | Beginning balance | ||
| Deductible temporary differences | Deferred tax assets | Deductible temporary differences | Deferred tax assets | |
| Unrealized intergroup profit | 38,407,786.77 | 9,601,946.69 | 31,616,173.72 | 7,904,043.43 |
| Deferred income | 95,344,263.32 | 23,836,065.83 | 75,111,997.53 | 18,270,618.94 |
| Deductible losses | 23,924,111.57 | 5,981,027.89 | 43,272,801.87 | 10,777,899.23 |
| Carry-over of payroll payables deductible during the next period | 21,874,338.70 | 5,468,584.68 | ||
| Accrued expenses | 267,449,330.17 | 66,862,332.54 | 144,731,955.22 | 36,160,326.47 |
| Total | 507,285,419.11 | 126,821,441.54 | 390,302,531.50 | 96,972,421.95 |
| Item | Ending balance | Beginning balance | ||
| Taxable temporary differences | Deferred tax liabilities | Taxable temporary differences | Deferred tax liabilities | |
| Difference in accelerated depreciation of fixed assets | 64,071,828.33 | 16,017,957.08 | 73,753,668.04 | 18,438,417.01 |
| Assets appreciation arising from business combination not under the same control | 563,136,495.64 | 140,784,123.91 | 381,654,221.40 | 95,413,555.35 |
| Changes in fair value of investments in other equity instruments | 1,062,158.94 | 265,539.74 | ||
| Changes in fair value of trading financial assets | 9,115,157.91 | 2,278,789.48 | 3,877,915.51 | 969,478.88 |
| Total | 637,385,640.82 | 159,346,410.21 | 459,285,804.95 | 114,821,451.24 |
| Item | Ending balance | Beginning balance |
| Prepayments for equipment and constructions | 2,007,300.00 | 5,943,717.02 |
| Total | 2,007,300.00 | 5,943,717.02 |
| Category | Ending balance | Beginning balance |
~ 154 ~
| Category | Ending balance | Beginning balance |
| Credit borrowings | 70,665,500.00 | |
| Mortgage borrowings | 72,000,000.00 | |
| Accrued interest | 231,000.00 | |
| Total | 72,231,000.00 | 70,665,500.00 |
| Category | Ending balance | Beginning balance |
| Bank acceptance bills | 17,730,000.00 | 140,540,000.00 |
| Commercial acceptance bills | - | 74,535.60 |
| Total | 17,730,000.00 | 140,614,535.60 |
| Item | Ending balance | Beginning balance |
| Payments for goods | 324,028,348.71 | 299,936,875.62 |
| Payments for constructions and equipment | 95,487,400.59 | 135,720,442.04 |
| Other | 49,722,843.32 | 69,549,244.20 |
| Total | 469,238,592.62 | 505,206,561.86 |
| Item | Ending balance | Reason |
| No. 1 | 2,902,005.29 | Final payment |
| No. 2 | 2,252,093.02 | Final payment |
| No. 3 | 2,116,587.78 | Final payment |
| No. 4 | 490,485.32 | Quality guarantee deposit |
| No. 5 | 244,551.74 | Payment for equipment |
| Total | 8,005,723.15 | -- |
~ 155 ~
| Item | Ending balance | Beginning balance |
| Payment for goods | 2,213,592,055.02 | 1,206,573,886.26 |
| Total | 2,213,592,055.02 | 1,206,573,886.26 |
| Item | Beginning balance | Increase | Decrease | Ending balance |
| I. Short-term employee benefits | 496,473,581.57 | 1,353,623,407.43 | 1,488,413,900.62 | 361,683,088.38 |
| II. Post-employment benefits-defined contribution plans | 1,655,533.19 | 62,083,389.53 | 63,249,314.47 | 489,608.25 |
| III. Termination benefits | - | |||
| IV. Other benefits due within one year | - | |||
| Total | 498,129,114.76 | 1,415,706,796.96 | 1,551,663,215.09 | 362,172,696.63 |
| Item | Beginning balance | Increase | Decrease | Ending balance |
| I. Salaries, bonuses, allowances and subsidies | 418,034,813.69 | 1,185,787,528.46 | 1,322,087,726.77 | 281,734,615.38 |
| II. Employee benefits | - | 48,058,819.80 | 48,058,819.80 | 0.00 |
| III. Social insurance | 486,019.58 | 27,203,382.29 | 27,186,976.35 | 502,425.52 |
| Of which: Health insurance | 486,019.58 | 26,186,276.42 | 26,173,119.43 | 499,176.57 |
| Injury insurance | - | 1,017,105.87 | 1,013,856.92 | 3,248.95 |
| IV. Housing accumulation fund | 4,342,621.32 | 41,362,968.43 | 41,031,668.65 | 4,673,921.10 |
| V. Labor union funds and employee education funds | 70,812,311.30 | 16,128,670.23 | 14,960,192.03 | 71,980,789.50 |
| VI. Enterprise annuity | 2,797,815.68 | 35,082,038.22 | 35,088,517.02 | 2,791,336.88 |
| Total | 496,473,581.57 | 1,353,623,407.43 | 1,488,413,900.62 | 361,683,088.38 |
| Item | Beginning balance | Increase | Decrease | Ending balance |
| 1. Basic endowment insurance | 1,655,533.19 | 60,103,063.02 | 61,303,035.87 | 455,560.34 |
~ 156 ~
| Item | Beginning balance | Increase | Decrease | Ending balance |
| 2. Unemployment insurance | - | 1,980,326.51 | 1,946,278.60 | 34,047.91 |
| Total | 1,655,533.19 | 62,083,389.53 | 63,249,314.47 | 489,608.25 |
| Item | Ending balance | Beginning balance |
| VAT | 142,144,490.50 | 93,836,793.23 |
| Consumption tax | 180,631,030.63 | 144,069,975.35 |
| Enterprise income tax | 173,355,594.61 | 78,334,425.91 |
| Individual income tax | 6,960,546.44 | 2,966,503.37 |
| Urban maintenance and construction tax | 16,625,998.59 | 12,449,531.95 |
| Stamp duty | 3,381,966.09 | 909,983.20 |
| Educational surcharge | 16,137,203.65 | 11,829,108.81 |
| Other | 10,598,549.68 | 4,746,370.28 |
| Total | 549,835,380.19 | 349,142,692.10 |
| Item | Ending balance | Beginning balance |
| Interest payable | - | - |
| Dividends payable | - | - |
| Other payables | 1,794,127,565.68 | 1,396,599,161.14 |
| Total | 1,794,127,565.68 | 1,396,599,161.14 |
| Item | Ending balance | Beginning balance |
| Security deposit and guarantee | 1,672,608,979.39 | 1,280,042,883.26 |
| Warranty | 44,076,391.82 | 41,210,694.26 |
| Personal housing fund paid by company | 4,673,921.10 | 4,342,621.32 |
| Other | 72,768,273.37 | 71,002,962.30 |
| Total | 1,794,127,565.68 | 1,396,599,161.14 |
~ 157 ~
Other payables balance aging over one year are mainly security deposit and warranty not yet matured.
5.27 Other Current Liabilities
| Item | Ending balance | Beginning balance |
| Accrued expenses | 387,541,979.94 | 164,008,324.26 |
| The VAT tax liability has not yet occurred and needs to be recognized as the value-added tax of the output tax in the subsequent periods | 287,677,808.45 | 156,784,058.77 |
| Total | 675,219,788.39 | 320,792,383.03 |
| Item | Ending balance | Beginning balance |
| Credit Loan | 80,000,000.00 | 60,000,000.00 |
| Accrued interest | 125,972.22 | 117,638.89 |
| Guarantee loan | 70,000,000.00 | - |
| Total | 150,125,972.22 | 60,117,638.89 |
| Item | Ending balance | Beginning balance |
| Lease liabilities | 47,677,911.46 | 53,226,677.43 |
| Total | 47,677,911.46 | 53,226,677.43 |
| Item | Beginning balance | Increase | Decrease | Ending balance | Reason |
| Government grants | 75,111,997.53 | 23,071,549.92 | 2,839,284.13 | 95,344,263.32 | Grants received from government |
| Total | 75,111,997.53 | 23,071,549.92 | 2,839,284.13 | 95,344,263.32 | -- |
| Item | Beginning balance | Increase during the Reporting Period | Recognized in other income during the Reporting Period | Other changes | Ending balance | Related to assets/related to income |
| Subsidy for Suizhou new factory infrastructure | 35,338,000.00 | 35,338,000.00 | Related to assets | |||
| Refund of Land payment | 22,032,186.60 | 22,208,000.00 | 265,135.86 | 43,975,050.74 | Related to assets |
~ 158 ~
| Funds for strategic emerging industry agglomeration development base | 2,375,360.02 | 311,359.98 | 2,064,000.04 | Related to assets | ||
| Comprehensive subsidy fund for air pollution prevention and control | 2,379,469.47 | 145,928.39 | 2,233,541.08 | Related to assets | ||
| Instrument subsidy | 1,681,178.20 | 119,531.68 | 1,561,646.52 | Related to assets | ||
| Subsidy funds for strong manufacturing province and private economy development projects in 2019 | 1,558,837.69 | 155,581.14 | 1,403,256.55 | Related to assets | ||
| Anhui province subsidy of innovative province construction capacity for independent innovation | 1,217,575.00 | 365,272.50 | 852,302.50 | Related to assets | ||
| Funds for research projects of koji-making Technology | 1,130,000.00 | - | 1,130,000.00 | Related to assets | ||
| Subsidy for technical transformation of No.2 boiler | 981,481.48 | 111,111.12 | 870,370.36 | Related to assets | ||
| Equipment subsidy | 795,911.83 | 144,706.83 | 651,205.00 | Related to assets | ||
| Gujing Zhangji wine cellar optimization and reconstruction project | 787,708.47 | 23,749.98 | 763,958.49 | Related to assets | ||
| Subsidy for key technical cooperation project on the authenticity of important food isotopes | 600,000.00 | 600,000.00 | - | Related to assets | ||
| Subsidy for food safety improvement project | 551,724.25 | 68,965.50 | 482,758.75 | Related to assets | ||
| Anhui province development of direct funds of service industry | 502,439.24 | 146,341.44 | 356,097.80 | Related to assets | ||
| Specific funds for side management of power demand | 372,000.00 | 72,000.00 | 300,000.00 | Related to assets | ||
| Automation of check and storage, on-line monitoring of product quality | 171,875.00 | 46,875.00 | 125,000.00 | Related to assets | ||
| Motor and boiler energy-saving technical transformation project | 137,500.28 | 68,749.98 | 68,750.30 | Related to assets | ||
| Wine production system technical transformation | 2,410,208.51 | 114,743.94 | 2,295,464.57 | Related to assets | ||
| Intelligent solid brewing technology innovation project | 88,541.49 | 15,625.02 | 72,916.47 | Related to assets | ||
| Specific funds for transformation of | 232,500.00 | 20,000.00 | 212,500.00 | Related to assets |
~ 159 ~
| gas-fired boilers in 2017 | ||||||
| Recognition awards for Industrial enterprise technical transformation investments | 631,049.92 | 43,605.77 | 587,444.15 | Related to assets | ||
| Total | 75,111,997.53 | 23,071,549.92 | 2,839,284.13 | - | 95,344,263.32 | —— |
| Item | Beginning balance | Changes during the Reporting Period (+,-) | Ending balance | ||||
| New issues | Bonus issues | Capitalization of reserves | Others | Subtotal | |||
| The sum of shares | 503,600,000.00 | 25,000,000.00 | - | - | - | - | 528,600,000.00 |
| Item | Beginning balance | Increase | Decrease | Ending balance |
| Capital premium (share premium) | 1,262,552,456.05 | 4,929,342,074.85 | - | 6,191,894,530.90 |
| Other capital reserves | 32,853,136.20 | - | - | 32,853,136.20 |
| Total | 1,295,405,592.25 | 4,929,342,074.85 | - | 6,224,747,667.10 |
| 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 | 1,062,158.94 | 265,539.74 | 477,971.52 | 318,647.68 | 477,971.52 | |||
| Of which: Changes | ||||||||
~ 160 ~
| caused by remeasurements on defined benefit schemes | ||||||||
| Other comprehensive income that will not be reclassified to profit or loss under the equity method | ||||||||
| Changes in fair value of other equity instrument investment | 1,062,158.94 | 265,539.74 | 477,971.52 | 318,647.68 | 477,971.52 | |||
| Changes in the fair value arising from changes in own credit risk | ||||||||
| II. Other comprehensive income that may subsequently be reclassified to profit or loss | ||||||||
| Of which: Other comprehensive income that will be reclassified to profit or loss under the equity method | ||||||||
| Changes in the fair value of investments in other debt obligations | ||||||||
| Other comprehensive income arising from the reclassification of financial assets | ||||||||
| Credit impairment allowance for investments in other debt obligations | ||||||||
| Reserve for |
~ 161 ~
| cash flow hedges | ||||||||
| Differences arising from translation of foreign currency-denominated financial statements | ||||||||
| Total of other comprehensive income | 1,062,158.94 | 265,539.74 | 477,971.52 | 318,647.68 | 477,971.52 |
| Item | Beginning balance | Increase | Decrease | Ending balance |
| Statutory surplus reserve | 256,902,260.27 | - | - | 256,902,260.27 |
| Total | 256,902,260.27 | - | - | 256,902,260.27 |
| Item | Reporting Period | Same period of last year |
| Beginning balance of retained earnings before adjustments | 7,987,380,161.21 | 6,888,203,911.92 |
| Total beginning balance of retained earnings before adjustment (increase+, decrease-) | - | |
| Beginning balance of retained earnings after adjustments | 7,987,380,161.21 | 6,888,203,911.92 |
| Add: Net profit attributable to owners of the Company as the parent | 1,378,803,828.46 | 1,854,576,249.29 |
| Dividend of ordinary shares payable | 755,400,000.00 | 755,400,000.00 |
| Ending retained earnings | 8,610,783,989.67 | 7,987,380,161.21 |
| Item | Reporting Period | Same period of last year | ||
| Operating revenue | Costs of sales | Operating revenue | Costs of sales | |
| Main operations | 6,962,693,789.52 | 1,637,770,675.38 | 5,495,370,627.67 | 1,301,529,714.81 |
| Other operations | 44,802,678.22 | 16,047,671.93 | 24,250,372.95 | 12,395,877.67 |
| Total | 7,007,496,467.74 | 1,653,818,347.31 | 5,519,621,000.62 | 1,313,925,592.48 |
| Item | Reporting Period | Same period of last year |
| Consumption tax | 879,116,923.82 | 731,743,604.96 |
| Urban maintenance and construction tax and educational surcharge | 159,895,059.56 | 129,960,286.58 |
| Land use tax | 9,091,340.70 | 6,984,861.27 |
~ 162 ~
| Item | Reporting Period | Same period of last year |
| Property tax | 9,172,552.52 | 8,847,804.72 |
| Stamp duty | 5,877,488.03 | 4,724,705.33 |
| Other | 6,657,887.42 | 5,735,777.86 |
| Total | 1,069,811,252.05 | 887,997,040.72 |
| Item | Reporting Period | Same period of last year |
| Employment benefits | 385,703,329.21 | 269,309,951.20 |
| Travel fees | 79,727,177.78 | 55,722,038.26 |
| Advertisement fees | 467,467,773.39 | 453,767,973.19 |
| Transportation charges | 0.00 | 24,048,795.64 |
| Comprehensive promotion costs | 685,618,164.57 | 475,881,977.13 |
| Service fees | 359,748,787.06 | 299,367,311.62 |
| Other | 50,000,363.92 | 39,951,590.23 |
| Total | 2,028,265,595.93 | 1,618,049,637.27 |
| Item | Reporting Period | Same period of last year |
| Employee benefits | 284,582,789.99 | 253,062,668.21 |
| Office fees | 25,800,540.36 | 22,537,545.08 |
| Maintenance expenses | 33,180,815.29 | 26,618,712.24 |
| Depreciation | 41,487,748.11 | 36,411,144.00 |
| Amortization of intangible assets | 17,277,135.76 | 12,940,993.85 |
| Pollution discharge | 10,238,085.66 | 7,786,943.40 |
| Travel expenses | 5,959,737.83 | 3,183,652.98 |
| Water and electricity charges | 3,949,046.33 | 3,790,246.91 |
| Other | 45,251,494.37 | 29,355,766.48 |
| Total | 467,727,393.70 | 395,687,673.15 |
| Item | Reporting Period | Same period of last year |
| Labor cost | 13,713,853.14 | 11,741,116.01 |
| Direct input costs | 2,156,217.53 | 383,301.13 |
~ 163 ~
| Item | Reporting Period | Same period of last year |
| Depreciation expense | 1,666,681.97 | 1,658,315.10 |
| Other | 2,424,593.62 | 1,471,650.74 |
| Total | 19,961,346.26 | 15,254,382.98 |
| Item | Reporting Period | Same period of last year |
| Interest expenses | 4,457,905.49 | 28,973,275.97 |
| Less: Interest income | 72,689,006.99 | 96,891,173.45 |
| Net interest expenses | -68,231,101.50 | -67,917,897.48 |
| Net foreign exchange losses | -171,646.25 | 13,095.11 |
| Bank charges and others | -287,369.98 | -303,665.57 |
| Total | -68,690,117.73 | -68,208,467.94 |
| Item | Reporting Period | Same period of last year | Related to assets /income |
| I. Government grants recorded to other income | |||
| Of which: Government grant related to deferred income | 2,839,284.13 | 2,264,012.84 | Related to assets |
| Government grant recorded to current profit or loss | 31,862,128.69 | 12,710,340.82 | Related to income |
| Total | 34,701,412.82 | 14,974,353.66 | -- |
| Item | Reporting Period | Same period of last year |
| Investment income from long-term equity investments under equity method | 60,287.04 | -53,631.34 |
| Dividend income from holding of other equity instrument investments | 809,860.62 | |
| Investment income from disposal of financial assets at fair value through other comprehensive income | -6,415,106.49 | |
| Investment income from holding of trading financial assets | 1,625.42 | |
| Other | 421,221.91 | 18,539,603.54 |
~ 164 ~
| Total | -5,122,111.50 | 18,485,972.20 |
| Sources | Reporting Period | Same period of last year |
| Trading financial assets | ||
| Of which: Changes in fair value of designated as trading financial assets | 5,237,242.40 | -3,596,160.61 |
| Total | 5,237,242.40 | -3,596,160.61 |
| Item | Reporting Period | Same period of last year |
| Bad debt of notes receivable | -14,753.46 | |
| Bad debt of accounts receivable | 34,837.84 | -414,861.96 |
| Bad debt of other receivables | 1,911,127.85 | 41,170.85 |
| Total | 1,945,965.69 | -388,444.57 |
| Item | Reporting Period | Same period of last year |
| I. Inventory falling price loss | 2,464,519.26 | -5,693,185.77 |
| II. Impairment loss of fixed assets | ||
| Total | 2,464,519.26 | -5,693,185.77 |
| Item | Reporting Period | Same period of last year |
| Gains/losses from disposal of fixed assets, construction in progress, productive biological assets and intangible assets not classified as held for sale | 1,014,902.90 | 77,867.25 |
| Of which: Fixed assets | 1,014,902.90 | 77,867.25 |
| Total | 1,014,902.90 | 77,867.25 |
| Item | Reporting Period | Same period of last year | Recognized in current non-recurring profit or loss |
| Gains from damage or scrapping of non-current asset | 588.35 |
~ 165 ~
| Item | Reporting Period | Same period of last year | Recognized in current non-recurring profit or loss |
| Government grants irrelevant to daily operation activities | 14,857.64 | 6,377.80 | 14,857.64 |
| Income from penalties and compensation | 17,701,583.38 | 14,641,373.42 | 17,701,583.38 |
| Sales of wastes | 3,289,554.24 | 3,144,859.28 | 3,289,554.24 |
| Other | 4,701,120.05 | 2,781,962.69 | 4,701,120.05 |
| Total | 25,707,115.31 | 20,575,161.54 | 25,707,115.31 |
| Item | Reporting Period | Same period of last year | Related to assets/related to income |
| Other rewards | 14,857.64 | 6,377.80 | Related to income |
| Total | 14,857.64 | 6,377.80 | -- |
| Item | Reporting Period | Same period of last year | Recognized in current non-recurring profit or loss |
| Loss from damage or scrapping of non-current assets | 3,132,257.94 | 2,296,765.56 | 3,132,257.94 |
| Other | 122,820.97 | 21,976,890.93 | 122,820.97 |
| Total | 3,255,078.91 | 24,273,656.49 | 3,255,078.91 |
| Item | Reporting Period | Same period of last year |
| Current tax expenses | 464,320,327.02 | 405,227,638.33 |
| Deferred tax expenses | 14,410,399.64 | -34,592,116.09 |
| Total | 478,730,726.66 | 370,635,522.24 |
| Item | Reporting Period |
| Profit before taxation | 1,899,296,618.19 |
| Current income tax expense accounted at applicable tax rate of the Company as the parent | 474,824,154.55 |
| Influence of applying different tax rates by subsidiaries | -4,370,924.92 |
~ 166 ~
| Influence of income tax before adjustment | 10,929,022.12 |
| Influence of non-taxable income | |
| Influence of non-deductable costs, expenses and losses | 1,183,384.24 |
| Influence of deductable losses of unrecognized deferred income tax at the beginning of the Reporting Period | |
| Influence of deductable temporary difference or deductable losses of unrecognized deferred income tax in the Reporting Period | |
| Influence of development expense deduction | -3,834,909.33 |
| Tax rate adjustment to the beginning balance of deferred income tax assets/liabilities | |
| Income tax credits | |
| Total | 478,730,726.66 |
| Item | Reporting Period | Same period of last year |
| Security deposit, guarantee and warranty | 101,445,152.98 | 118,873,747.83 |
| Government grants | 51,606,278.86 | 11,109,436.15 |
| Interest income | 81,668,119.12 | 88,199,155.94 |
| Release of restricted monetary assets | 1,331,277,878.92 | 1,085,000,000.00 |
| Other | 32,873,232.20 | 20,568,195.39 |
| Total | 1,598,870,662.08 | 1,323,750,535.31 |
| Item | Reporting Period | Same period of last year |
| Cash paid in sales and distribution expenses and general and administrative expense | 856,443,548.71 | 1,031,070,499.98 |
| Security deposit, guarantee and warranty | 90,125,562.91 | |
| Time deposits or deposits pledged for the issuance of notes payable | 884,394.71 | 30,000,000.00 |
| Structured time deposits that cannot be withdrawn in advance | 3,498,000,000.00 | 400,000,000.00 |
| Others | 70,912,886.51 | 23,665,514.20 |
| Total | 4,516,366,392.84 | 1,484,736,014.18 |
~ 167 ~
| Item | Reporting Period | Same period of last year |
| Rental fee | 8,235,784.88 | |
| Total | 8,235,784.88 |
| Supplementary information | Reporting Period | Same period of last year |
| 1. Reconciliation of net profit to net cash flows generated from operating activities: | ||
| Net profit | 1,420,565,891.53 | 1,006,441,526.93 |
| Add: Provisions for impairment of assets | -4,410,484.95 | 6,081,630.34 |
| Depreciation of fixed assets, investment properties, oil and gas assets and productive biological assets | 116,285,870.21 | 107,774,202.21 |
| Depreciation of right-of-use assets | 7,221,332.24 | |
| Amortization of intangible assets | 21,521,021.91 | 17,144,478.37 |
| Amortization of long-term deferred expenses | 15,623,953.64 | 12,662,778.88 |
| Losses from disposal of fixed assets, intangible assets and other long-term assets (gains: negative) | -1,014,902.90 | -77,867.25 |
| Losses on scrapping of fixed assets (gains: negative) | 3,132,257.94 | 2,296,177.21 |
| Losses on changes in fair value (gains: negative) | -5,237,242.40 | 3,596,160.61 |
| Finance costs (gains: negative) | -171,646.25 | 290,708.33 |
| Investment losses (gains: negative) | 5,122,111.50 | -18,485,972.20 |
| Decreases in deferred tax assets (increase: negative) | -29,849,019.59 | -31,454,590.26 |
| Increases in deferred tax liabilities (decrease: negative) | 44,524,958.97 | -3,137,525.83 |
| Decreases in inventories (increase: negative) | -553,051,541.47 | 88,585,890.97 |
| Decreases in operating receivables (increase: negative) | -437,729,347.99 | -350,818,607.86 |
| Increases in operating payables (decrease: negative) | 1,829,040,435.66 | 415,739,110.19 |
| Amortization of deferred income | ||
| Other*1 | -2,167,606,515.79 | 1,085,000,000.00 |
| Net cash flows from operating activities | 263,967,132.26 | 2,341,638,100.64 |
| 2. Significant investing and financing activities without involvement of cash receipts and payments |
~ 168 ~
| Supplementary information | Reporting Period | Same period of last year |
| Conversion of debt into capital | - | |
| Current portion of convertible corporate bonds | - | |
| Fixed assets acquired under finance leases | - | |
| 3. Net increase/decrease of cash and cash equivalents: | ||
| Ending balance of cash | 9,642,389,098.14 | 5,398,187,475.71 |
| Less: Beginning balance of cash | 5,636,903,693.74 | 2,944,749,918.09 |
| Add: Ending balance of cash equivalents | ||
| Less: Beginning balance of cash equivalents | ||
| Net increase in cash and cash equivalents | 4,005,485,404.40 | 2,453,437,557.62 |
| Amount | |
| Cash or cash equivalents paid during the Reporting Period for the business combination occurring during the Reporting Period | 200,200,000.00 |
| Including: | -- |
| Less: Cash and cash equivalents held by subsidiaries on the purchase date | 135,013,666.90 |
| Including: | -- |
| Add: Cash or cash equivalents paid during the Reporting Period for the business combination occurring during previous period | |
| Including: | -- |
| Net cash paid for acquisition of subsidiaries | 65,186,333.10 |
| Item | Reporting Period | Same period of last year |
| I. Cash | 9,642,389,098.14 | 5,398,187,475.71 |
| Including: Cash on hand | 175,509.59 | 254,747.79 |
| Bank deposit on demand | 9,641,953,541.32 | 5,397,660,747.68 |
| Other monetary assets on demand | 260,047.23 | 271,980.24 |
| II. Cash equivalents | ||
| Of which: Bond investments maturing within three months | ||
| III. Ending balance of cash and cash equivalents | 9,642,389,098.14 | 5,398,187,475.71 |
| Of which: cash and cash equivalents with restriction to use in the | - | - |
~ 169 ~
| Item | Reporting Period | Same period of last year |
| subsidies of the Company as the parent or Group |
| Item | Ending carrying value | Reason |
| Cash and cash equivalents | 2,501,915,391.71 | Structured deposit which cannot be withdrawn in advance as well as security deposit |
| Accounts receivable financing | 24,300,000.00 | Pledged for issuance of bank acceptance bills |
| Total | 2,526,215,391.71 | -- |
| Item | Amount | Item presented in the statement of financial position | Recognized in current profit or loss or as deduct of related cost | Presented item recorded to current profit or loss or as deduct of related cost | |
| Reporting Period | Same period of last year | ||||
| Suizhou new plant infrastructure subsidy | 35,338,000.00 | Deferred income | - | - | Other income |
| Refund for land payment | 43,975,050.74 | Deferred income | 265,135.86 | 275,103.09 | Other income |
| Funds for strategic emerging industry agglomeration development base | 2,064,000.04 | Deferred income | 311,359.98 | 111,360.00 | Other income |
| Comprehensive subsidy fund for air pollution prevention and control | 2,232,287.08 | Deferred income | 145,928.39 | 131,500.02 | Other income |
| Equipment subsidy | 1,561,646.52 | Deferred income | 119,531.68 | 76,329.89 | Other income |
| Subsidy funds for strong manufacturing province and private economy development projects in 2019 | 1,404,510.55 | Deferred income | 155,581.14 | 156,208.20 | Other income |
| Subsidy for the construction of independent innovation capacity of Anhui Province | 852,302.50 | Deferred income | 365,272.50 | 365,272.50 | Other income |
~ 170 ~
| Research funds of intelligent koji making technology | 1,130,000.00 | Deferred income | - | - | Other income |
| Subsidy for technical transformation of No.2 boiler | 870,370.36 | Deferred income | 111,111.12 | - | Other income |
| Equipment subsidy | 651,205.00 | Deferred income | 144,706.83 | 102,807.24 | Other income |
| Optimization and reconstruction project of Gujing Zhangji liquor store | 763,958.49 | Deferred income | 23,749.98 | 23,749.98 | Other income |
| Subsidy for key technology cooperation project of important food isotope authenticity | - | Deferred income | 600,000.00 | - | Other income |
| Subsidy for food safety improvement project | 482,758.75 | Deferred income | 68,965.50 | 68,965.50 | Other income |
| Anhui province development of direct funds of service industry | 356,097.80 | Deferred income | 146,341.44 | 146,341.44 | Other income |
| Specific funds for side management of power demand | 300,000.00 | Deferred income | 72,000.00 | 72,000.00 | Other income |
| Whole process online monitoring of hook and store automation and product quality | 125,000.00 | Deferred income | 46,875.00 | 46,875.00 | Other income |
| Electric motor and boiler energy saving technology transformation project | 68,750.30 | Deferred income | 68,749.98 | 68,749.98 | Other income |
| Wine production system technical transformation | 2,295,464.57 | Deferred income | 114,743.94 | 31,249.98 | Other income |
| Intelligent solid brewing technology innovation project | 72,916.47 | Deferred income | 15,625.02 | 15,625.02 | Other income |
| Enterprise development funds | - | Deferred income | 15,000.00 | Other income | |
| Internet of things traceability system project | - | Deferred income | 556,875.00 | Other income | |
| Specific fund for transformation of gas-fired boilers in 2017 | 212,500.00 | Deferred income | 20,000.00 | - | Other income |
| Recognition awards for industrial enterprise technical transformation investments | 587,444.15 | Deferred income | 43,605.77 | - | Other income |
| Total | 95,344,263.32 | - | 2,839,284.13 | 2,264,012.84 | -- |
~ 171 ~
| Item | Amount | Item presented in the statement of financial position | Recognized in current profit or loss or as deduct of related cost | Presented item recorded to current profit or loss or as deduct of related cost | |
| Reporting Period | Same period of last year | ||||
| Tax refund | 4,775,517.47 | Other income | 4,775,517.47 | 2,937,700.91 | Other income |
| Hubei University of Science and Technology Industrialization Funds | 9,541,000.00 | Other income | 9,541,000.00 | - | Other income |
| Manufacturing Power Province Construction Fund and Digital Economy Development Policy Incentives | 1,000,000.00 | Other income | 1,000,000.00 | - | Other income |
| 2020 Provincial Manufacturing High-Quality Development Projects Special Fund of Suizhou | 1,000,000.00 | Other income | 1,000,000.00 | - | Other income |
| Relocation Project Tax Incentives of State Treasury Section of Finance Bureau of the High-tech Industrial Park of Suizhou | 6,946,300.00 | Other income | 6,946,300.00 | - | Other income |
| Wuhan Financial Special Fund to Work for Training Subsidies | 664,500.00 | Other income | 664,500.00 | - | Other income |
| Financial Contribution Progress Award | 500,000.00 | Other income | 500,000.00 | - | Other income |
| 2021 Standardization Incentives of Bozhou Municipal Market Supervision and Administration Bureau | 400,000.00 | Other income | 400,000.00 | - | Other income |
| Wuhan 2021 Special Funds for Technological Transformation of Science and Technology and | 400,000.00 | Other income | 400,000.00 | - | Other income |
~ 172 ~
| Economic Information Bureau of Hanyang District | |||||
| VAT add-on deduction | 2,615,664.17 | Other income | 2,615,664.17 | 2,539,581.56 | Other income |
| Financial Support from the State Treasury Collection and Payment Center in Hanyang District, Wuhan | - | Other income | - | 2,364,000.00 | Other income |
| Unemployment Insurance Premium Refunds | Other income | 2,314,709.05 | Other income | ||
| Subsidy from the Social Security Bureau for Stabilization of Jobs | - | Other income | - | 910,749.30 | Other income |
| 2019 Manufacturing Power Province and Private Economic Development Policy Award Funds | - | Other income | - | 600,000.00 | Other income |
| Others | 4,019,147.05 | Other income | 4,019,147.05 | 1,043,600.00 | Other income |
| Other not related to daily operation | 14,857.64 | Non operating income | 14,857.64 | - | Non operating income |
| Discounted loans | 94,491.13 | Finance expense | 94,491.13 | - | Finance expense |
| Total | 31,971,477.46 | -- | 31,971,477.46 | 12,710,340.82 | -- |
| Name of acquiree | Time and place of gaining the equity | Cost of gaining the equity | Proportion of equity | Way to gain the equity | Purchase date | Recognition basis of purchase date | Income of acquiree from the purchase date to period-end | Net profits of acquiree from the purchase date to period-end |
| Anhui Mingguang Distillery Co., Ltd. | 2021.1.10 | 200,200,000.00 | 60% | Purchase | 2021.1.10 | Payment, transfer of share ownership, transfer of right to administer properties | 137,448,767.50 | 6,887,903.80 |
~ 173 ~
(2) Combination Cost and Goodwill
Unit: RMB
| Combination cost | Anhui Mingguang Distillery Co., Ltd. |
| Combination cost | |
| —Cash | 200,200,000.00 |
| Total combination cost | 200,200,000.00 |
| Less: share of fair value of gained identifiable net assets | 139,513,817.93 |
| Amount that the goodwill/combination cost is lower than the share of fair value of gained identifiable net assets | 60,686,182.07 |
| Item | Anhui Mingguang Distillery Co., Ltd. | |
| Fair value on purchase date | Carrying value on purchase date | |
| Monetary assets | 135,013,666.90 | 135,013,666.90 |
| Accounts receivable | 10,711,363.41 | 10,711,363.41 |
| Prepayments | 1,596,899.47 | 1,596,899.47 |
| Other receivables | 6,122,501.16 | 6,122,501.16 |
| Inventories | 281,633,786.01 | 211,852,592.58 |
| Other current assets | 2,546.37 | 2,546.37 |
| Investments in other equity instruments | 53,848,697.80 | 14,530,000.00 |
| Fixed assets | 119,631,918.83 | 72,638,969.35 |
| Construction in progress | 557,987.45 | 557,987.45 |
| Intangible assets | 56,327,165.76 | 9,123,081.42 |
| Long-term prepaid expense | 2,929,439.00 | 2,929,439.00 |
| Deferred income tax assets | 3,498,516.13 | 3,498,516.13 |
| Short-term borrowings | 94,000,000.00 | 94,000,000.00 |
| Accounts payable | 43,654,530.85 | 43,654,530.85 |
| Advances from customers | 53,061,162.81 | 53,061,162.81 |
| Employee benefits payable | 4,147,589.59 | 4,147,589.59 |
| Taxes payable | 38,825,770.24 | 38,825,770.24 |
| Other payables | 141,767,461.40 | 141,767,461.40 |
| Other current liabilities | 12,000,000.00 | 12,000,000.00 |
| Deferred income | 807,082.92 | 807,082.92 |
| Deferred income tax liabilities | 50,824,231.26 | 0.00 |
~ 174 ~
| Net assets | 232,786,659.22 | 80,313,965.43 |
| Non-controlling interests | 93,272,841.29 | 32,283,763.77 |
| Gained net assets | 139,513,817.93 | 48,030,201.66 |
| Name | Main operating place | Registration place | Nature of business | Holding percentage (%) | Way of gaining | |
| Directly | Indirectly | |||||
| Bozhou Gujing Sales Co., Ltd. | Anhui Bozhou | Anhui Bozhou | Commercial trade | 100.00 | - | Investment establishment |
| Anhui Longrui Glass Co., Ltd | Anhui Bozhou | Anhui Bozhou | Manufacture | 100.00 | - | Investment establishment |
| Bozhou Gujing Waste Reclamation Co., Ltd. (Cancelled) | Anhui Bozhou | Anhui Bozhou | Waste recycle | 100.00 | - | Investment establishment |
| Anhui Jinyunlai Culture & Media Co., Ltd. | Anhui Hefei | Anhui Hefei | Advertisement marketing | 100.00 | - | Investment establishment |
| Anhui Ruisiweier Technology Co., Ltd. | Anhui Bozhou | Anhui Bozhou | Technical research | 100.00 | - | Investment establishment |
| Shanghai Gujing Jinhao Hotel Management Co., Ltd. | Shanghai | Shanghai | Hotel management | 100.00 | - | Business combination under common control |
| Bozhou Gujing Hotel Co., Ltd | Anhui Bozhou | Anhui Bozhou | Hotel operating | 100.00 | - | Business combination under common control |
| Anhui Yuanqing Environmental Protection Co., Ltd. | Anhui Bozhou | Anhui Bozhou | Sewage treatment | 100.00 | - | Investment establishment |
| Anhui Gujing Yunshang E-commerce Co., Ltd | Anhui Hefei | Anhui Hefei | Electronic commerce | 100.00 | - | Investment establishment |
| Anhui Zhenrui Construction Engineering Co., Ltd | Anhui Bozhou | Anhui Bozhou | Construction | 52.00 | Investment establishment | |
~ 175 ~
| Name | Main operating place | Registration place | Nature of business | Holding percentage (%) | Way of gaining | |
| Directly | Indirectly | |||||
| Anhui RunAnXinKe Testing Technology Co., Ltd. | Anhui Bozhou | Anhui Bozhou | Food testing | 100.00 | - | Investment establishment |
| Anhui Jiudao Culture Media Co., Ltd. | Anhui Hefei | Anhui Hefei | Advertisement marketing | 100.00 | - | Investment establishment |
| Anhui Jiuan Mechanical Electrical Equipment Co., Ltd. | Anhui Bozhou | Anhui Bozhou | Construction installation | 100.00 | Investment establishment | |
| Anhui Jiuhao China Railway Construction Engineering Co., Ltd. | Anhui Bozhou | Anhui Bozhou | Construction | 52.00 | Investment establishment | |
| Anhui Mingguang Distillery Co., Ltd. | Anhui Chuzhou | Anhui Mingguang | Manufacture | 60.00 | Business combination not under common control | |
| Mingguang Tiancheng Ming Wine Sales Co., Ltd. | Anhui Chuzhou | Anhui Mingguang | Commercial trade | 60.00 | Business combination not under common control | |
| Fengyang Xiaogang Village Ming Wine Distillery Co., Ltd. | Anhui Chuzhou | Anhui Fengyang | Manufacture | 42.00 | Business combination not under common control | |
| Yellow Crane Tower Distillery Co., Ltd. | Hubei Wuhan | Hubei Wuhan | Manufacture | 51.00 | - | Business combination not under common control |
| Yellow Crane Tower Distillery (Xianning) Co., Ltd. | Hubei Xianning | Hubei Xianning | Manufacture | - | 51.00 | Business combination not under common control |
| Yellow Crane Tower Distillery (Suizhou) Co., Ltd. | Hubei Suizhou | Hubei Suizhou | Manufacture | - | 51.00 | Business combination not under common control |
| Hubei Junlou Cultural Tourism Co., Ltd. | Hubei Wuhan | Hubei Wuhan | Advertising marketing | - | 51.00 | Business combination not under common control |
| Hubei Yellow Crane Tower Beverage Co., Ltd | Hubei Xianning | Hubei Xianning | Manufacture | - | 51.00 | Investment establishment |
~ 176 ~
| Name | Main operating place | Registration place | Nature of business | Holding percentage (%) | Way of gaining | |
| Directly | Indirectly | |||||
| Wuhan Yashibo Technology Co., Ltd. | Hubei Wuhan | Hubei Wuhan | Technology development | - | 51.00 | Investment establishment |
| Hubei Xinjia Testing Technology Co., Ltd. | Hubei Xianning | Hubei Xianning | Food testing | - | 51.00 | Investment establishment |
| Wuhan Tianlong Jindi Technology Development Co., Ltd | Hubei Wuhan | Hubei Wuhan | Commercial trade | - | 51.00 | Business combination not under common control |
| Xianning Junhe Sales Co., Ltd | Hubei Xianning | Hubei Xianning | Commercial trade | - | 51.00 | Business combination not under common control |
| Wuhan Junya Sales Co., Ltd | Hubei Wuhan | Hubei Wuhan | Commercial trade | - | 51.00 | Investment establishment |
| Suizhou Junhe Commercial Co., Ltd. | Hubei Suizhou | Hubei Suizhou | Commercial trade | - | 51.00 | Investment establishment |
| 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 |
| Yellow Crane Tower Distillery Co., Ltd. | 49.00 | 44,387,465.24 | 449,950,237.89 |
| Name | Ending balance | |||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liability | Total liabilities | |
| Yellow Crane Tower Distillery Co., Ltd. | 750,411,154.65 | 924,490,280.52 | 1,674,901,435.17 | 449,940,812.14 | 306,694,831.42 | 756,635,643.56 |
| Name | Beginning balance | |||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liability | Total liabilities | |
~ 177 ~
| Name | Beginning balance | |||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liability | Total liabilities | |
| Yellow Crane Tower Distillery Co., Ltd. | 633,542,317.24 | 868,332,173.16 | 1,501,874,490.40 | 482,603,067.57 | 191,592,294.97 | 674,195,362.54 |
| Name | Reporting Period | |||
| Operating revenue | Net profit | Total comprehensive income | Cash flows from operating activities | |
| Yellow Crane Tower Distillery Co., Ltd. | 690,959,858.06 | 90,586,663.75 | 90,586,663.75 | 196,719,144.40 |
| Name | Same period of last year | |||
| Operating revenue | Net profit | Total comprehensive income | Cash flows from operating activities | |
| Yellow Crane Tower Distillery Co., Ltd. | 181,381,939.34 | -37,745,055.98 | -37,745,055.98 | -107,245,907.79 |
~ 178 ~
assets is derived from the counterparty’s breach of contract. The maximum risk exposure is equal to the carryingamount of these financial instruments.Cash and cash equivalent of the Company has lower credit risk, as they are mainly deposited in such financialinstitutions as commercial bank, of which the Company thinks with higher reputation and financial position.Notes receivable held by the Company are mainly bank acceptance bills, which have strong liquidity. TheCompany has formulated corresponding bill management and control procedures and has been effectivelyimplemented, which greatly ensures the safety of bill storage and use to ensure the low credit risks. The Companyonly conducts business with customers with good credit rating, and will continue to monitor the balance ofaccounts receivable to ensure that the Company avoids the risk of major bad debt losses. The company's largestcredit risk exposure is the book value of each financial asset (including derivative financial instruments) in thebalance sheet, and the overall credit risk evaluation is low.
8.2 Liquidity Risk
Liquidity risk is the risk of shortage of funds when fulfilling the obligation of settlement by delivering cash orother financial assets. The Company is responsible for the capital management of all of its subsidiaries, includingshort-term investment of cash surplus and dealing with forecasted cash demand by raising loans. The Company’spolicy is to monitor the demand for short-term and long-term floating capital and whether the requirement of loancontracts is satisfied so as to ensure to maintain adequate cash and cash equivalents.
8.3 Market Risk
The market risk of financial instruments refers to the risk that the fair value or future cash flows of financialinstruments will fluctuate due to changes in market prices. Market risks mainly include foreign exchange risk andinterest rate risk.
(1) Foreign currency risk
Foreign exchange risk refers to the risk of loss due to exchange rate fluctuations generally. The core business ofthe Company is on the mainland of China and trading with CNY. Foreign exchange risk is minimal.
(2) Interest rate risk
Interest rate risk refers to the risk that the fair value of financial instruments or future cash flows will fluctuate dueto changes in market interest rates. The Company's interest rate risk mainly comes from long-term and short-termbank borrowings. As of 30 June 2021, the Company has no liabilities calculated with floating interest rates.
(3) Other price risk
~ 179 ~
The Held-for-trading financial assets of the Company are measured by fair value. As a result of that, the Companybears the risk of the change of security market. To decrease the risk, the management decided that the Companyheld a combination of several equities and securities.
9. The Disclosure of Fair Value
The inputs used in the fair value measurement in its entirety are to be classified in the level of the hierarchy inwhich the lowest level input that is significant to the measurement is classified:
Level 1: Inputs consist of unadjusted quoted prices in active markets for identical assets or liabilitiesLevel 2: Inputs for the assets or liabilities (other than those included in Level 1) that are either directly orindirectly observable.Level 3: Inputs are unobservable inputs for the assets or liabilities
1. Assets and liabilities measured at fair value on 30 June 2021
| Item | Fair value on 30 June 2021 | |||
| Level 1 | Level 2 | Level 3 | 合计 | |
| 一、Recurring fair value measurements | -- | -- | -- | -- |
| （一）Held-for-trading financial assets | ||||
| 1. Financial assets at fair value through profit or loss | 209,115,157.91 | 209,115,157.91 | ||
| （1）Debt instruments | ||||
| （2）Bank financial products | ||||
| （3）Fund investment | 209,115,157.91 | 209,115,157.91 | ||
| 2. Financial assets designated to be measured at fair value through profit or loss | ||||
| （1）Debt instruments | ||||
| （2）Equity instrument investment | ||||
| （二）Receivables financing | - | - | 2,003,302,090.64 | 2,003,302,090.64 |
| （三）Investment in other equity instruments | 54,910,856.74 | 54,910,856.74 | ||
~ 180 ~
| Total assets measured at fair value on a recurring basis | - | 264,026,014.65 | 2,003,302,090.64 | 2,267,328,105.29 |
| 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 (%) |
~ 181 ~
| 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 (%) |
| Anhui Gujing Group Co., Ltd. | Anhui Bozhou | Beverages, construction materials, manufacturing plastic production | 1,000,000,000.00 | 53.89 | 53.89 |
| Name | Relationship with the Company |
| Anhui Hengxin Pawn Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Anhui Gujing Hotel Development Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Anhui Haochidian Catering Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Anhui Huixin Finance Investment Group Co., Ltd | An affiliate of the actual controller and controlling shareholder |
| Anhui Ruijing Business Travel (Group) Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Bozhou Hotel Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Anhui Jiuan Engineering Management Consulting Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Anhui Ruijing Business Travel (Group) Co., Ltd.Hefei Gujing Holiday Hotel | An affiliate of the actual controller and controlling shareholder |
| Anhui Gujing International Development Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Anhui Lejiu Home Tourism Management Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
~ 182 ~
| Anhui Gujing Health Industry Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Anhui Ruixin Pawn Co. Ltd. | An affiliate of the actual controller and controlling shareholder |
| Anhui Shenglong Commercial Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Anhui Youxin Financing Guarantee Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Anhui Zhongxin Finance Leasing Co. Ltd. | An affiliate of the actual controller and controlling shareholder |
| Bozhou Anxin Micro Finance Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Anhui Gujing Huishenglou Catering Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Hefei Longxin Business Management Consulting Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Anhui Lixin E-commerce Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Dazhongyuan Wine Valley Culture Tourism Development Co., Ltd. | An affiliate of the actual controller and controlling shareholder |
| Shanghai Beihai Hotel Co., Ltd | An affiliate of the actual controller and controlling shareholder |
| Nanjing Suning Real Estate Development Co., Ltd. | Enterprise controlled by Zhang Guiping, who is an independent director of the Company |
| Related party | Content | Reporting Period | Same period of last year |
| Anhui Gujing Hotel Development Co., Ltd. | Catering and accommodation service | 526,809.78 | 121,508.00 |
| Anhui Haochidian Catering Co., Ltd. | Purchase of materials | 13,998,153.74 | 8,757,860.85 |
| Anhui Haochidian Catering Co., Ltd. | Purchase of assets | 135,398.23 | |
| Anhui Haochidian Catering Co., Ltd. | Catering and accommodation service | 272,361.80 | 884,017.40 |
| Anhui Haochidian Catering Co., Ltd. | Labor service | 1,252,375.80 | 991,145.50 |
| Anhui Jiuan Engineering Management Consulting Co., Ltd. | Consultation and assurance | 1,762,765.33 | |
| Anhui Ruijing Business Travel (Group) Co., Ltd. | Catering and accommodation service | 251,426.22 | |
| Anhui Ruijing Business Travel (Group) Co., Ltd. | Purchase of materials | 46,390.00 | 525,535.82 |
~ 183 ~
| Bozhou Hotel Co., Ltd. | Catering and accommodation service | 2,767,466.43 | 1,439,005.95 |
| Bozhou Gujing Huishenglou Catering Co., Ltd. | Catering and accommodation service | 1,016,638.00 | 416,771.00 |
| Anhui Ruijing Business Travel (Group) Co., Ltd.Hefei Gujing Holiday Hotel | Purchase of materials | 511,520.21 | 149,618.90 |
| Anhui Ruijing Business Travel (Group) Co., Ltd.Hefei Gujing Holiday Hotel | Catering and accommodation service | 79,499.36 | 63,570.78 |
| Anhui Gujing International Development Co., Ltd. | Labor service | 103,773.58 | |
| Anhui Gujing Group Co., Ltd. | Purchase of materials | 56,952.00 | |
| Anhui Gujing Health Industry Co., Ltd. | Purchase of materials | 191,893.81 | |
| Anhui Gujing Hotel Development Co., Ltd. | Labor service | 3,413.21 | |
| Dazhongyuan Wine Valley Culture Tourism Development Co., Ltd. | Purchase of materials and labor service | 201,143.63 | |
| Anhui Lejiu Home Tourism Management Co., Ltd. | Purchase of materials and labor service | 99,546.43 | |
| Total | -- | 22,620,804.90 | 14,005,756.86 |
| Related party | Content | Reporting Period | Same period of last year |
| Anhui Gujing Group Co., Ltd. | Catering and accommodation service | 64,573.00 | 28,125.00 |
| Anhui Gujing Group Co., Ltd. | Sales of small materials | 17,892.09 | 35,549.10 |
| Anhui Gujing Health Industry Co., Ltd. | Sales of liquor | -690,974.69 | 5,738,435.24 |
| Anhui Gujing Health Industry Co., Ltd. | Catering and accommodation service | 1,250.00 | |
| Anhui Gujing Hotel Development Co., Ltd. | Sales of liquor | 104,830.09 | 94,938.00 |
| Anhui Gujing Hotel Development Co., Ltd. | Utilities | 117,827.75 | |
| Anhui Haochidian Catering Co., Ltd. | Sales of liquor | 19,115.04 | 48,584.08 |
| Anhui Hengxin Pawn Co., Ltd. | Sales of liquor | 5,925.67 | 6,244.25 |
| Anhui Huixin Finance Investment Group Co., Ltd | Sales of liquor | 20,692.03 | 21,225.67 |
| Anhui Jiuan Engineering Management Consulting Co., Ltd. | Catering and accommodation service | 630.00 | |
| Anhui Jiuan Engineering Management Consulting Co., Ltd. | Sales of liquor | 3,568.14 | |
| Anhui Lejiu Home Tourism Management Co., Ltd. | Utilities | 3,433.85 | 51,180.85 |
| Anhui Lejiu Home Tourism Management Co., Ltd. | Sales of liquor | 4,890.26 | 4,539.82 |
| Anhui Ruijing Business Travel (Group) Co., Ltd. | Catering and | 38,145.75 |
~ 184 ~
| accommodation service | 600.00 | ||
| Anhui Ruijing Business Travel (Group) Co., Ltd. | Sales of liquor | 587,517.41 | 251,495.58 |
| Anhui Ruixin Pawn Co. Ltd. | Sales of liquor | 3,703.54 | 3,512.39 |
| Anhui Shenglong Commercial Co., Ltd. | Catering and accommodation service | 2,470.00 | 3,800.00 |
| Anhui Shenglong Commercial Co., Ltd. | Sales of liquor | 624,187.6 | 1,450,295.22 |
| Anhui Youxin Financing Guarantee Co., Ltd. | Sales of liquor | 1,712.39 | 3,122.12 |
| Anhui Zhongxin Finance Leasing Co. Ltd. | Sales of liquor | 8,147.79 | 8,115.92 |
| Bozhou Anxin Micro Finance Co., Ltd. | Sales of liquor | 7,407.08 | 8,506.19 |
| Bozhou Hotel Co., Ltd. | Sales of liquor | 32,973.46 | 50,575.23 |
| Bozhou Gujing Huishenglou Catering Co., Ltd. | Sales of liquor | 30,106.20 | 68,654.87 |
| Hefei Gujing Holiday Hotel Co., Ltd. | Sales of liquor | 44,442.47 | 14,336.28 |
| Hefei Longxin Business Management Consulting Co., Ltd | Sales of liquor | 509.73 | |
| Anhui Gujing Health Industry Co., Ltd. | Labor service | 232,430.19 | |
| Anhui Gujing Health Industry Co., Ltd. | Sales of small materials | 1,314.60 | |
| Anhui Lejiu Home Tourism Management Co., Ltd. | Labor service | 7,620.00 | |
| Anhui Lixin E-commerce Co., Ltd. | Sales of liquor | 7,461.93 | |
| Bozhou Ruineng Thermal Power Co., Ltd. | Sales of liquor | 74,150.45 | |
| Dazhongyuan Wine Valley Culture Tourism Development Co., Ltd. | Sales of small materials | 2,631.13 | |
| Dazhongyuan Wine Valley Culture Tourism Development Co., Ltd. | Catering and accommodation service | 420.00 | |
| Dazhongyuan Wine Valley Culture Tourism Development Co., Ltd. | Labor service | 2,889.91 | |
| Dazhongyuan Wine Valley Culture Tourism Development Co., Ltd. | Sales of liquor | 88,799.29 | |
| Shanghai Beihai Hotel Co., Ltd | Sales of liquor | 8,601.77 | |
| Anhui Gujing International Development Co., Ltd. | Sales of small materials | 5,437.89 | |
| Anhui Gujing International Development Co., Ltd. | Catering and accommodation service | 2,820.00 | |
| Anhui Gujing International Development Co., Ltd. | Sales of liquor | 1,700,563.88 | |
| Total | -- | 1,053,726.65 | 10,028,226.85 |
| Name of lessee | Category of leased assets | The lease income confirmed in the Reporting Period | The lease income confirmed in the same period of last year |
~ 185 ~
| Anhui Gujing Hotel Development Co., Ltd. | Houses and buildings | 543,941.93 | 417,153.83 |
| Total | -- | 543,941.93 | 417,153.83 |
| Name of lessor | Category of leased assets | The lease fee confirmed in the Reporting Period | The lease fee confirmed in the same period of last year |
| Anhui Gujing Group Co., Ltd. | Houses and buildings | 594,333.78 | 749,786.08 |
| Nanjing Suning Real Estate Development Co., Ltd. | Houses and buildings | 1,290,102.21 | - |
| Total | -- | 1,884,435.99 | 749,786.08 |
| Item | Related party | Ending balance | Beginning balance |
| Contract liabilities | Anhui Gujing Health Industry Co., Ltd. | 608,339.50 | 658,339.50 |
| Contract liabilities | Anhui Ruijing Business Travel (Group) Co., Ltd. | 600,828.67 | 342,484.96 |
| Contract liabilities | Anhui Gujing International Development Co., Ltd. | 186,083.60 | 186,083.60 |
| Contract liabilities | Bozhou Gujing Huishenglou Catering Co., Ltd. | 15,300.00 | |
| Accounts payable | Anhui Gujing Group Co., Ltd. | 4,804,012.50 | |
| Accounts payable | Anhui Haochidian Catering Co., Ltd. | 2,723,533.27 | 2,479,131.69 |
| Accounts payable | Anhui Ruijing Business Travel (Group) Co., Ltd. | 86,129.55 | - |
| Other payables | Anhui Gujing Group Co., Ltd. | 98,817.71 | 1,050,004.75 |
| Other payables | Anhui Ruijing Business Travel (Group) Co., Ltd. | 115,533.60 | 114,660.00 |
| Other payables | Anhui Gujing Hotel Development Co., Ltd. | 100,000.00 | 100,000.00 |
~ 186 ~
issued RMB25,000,000 ordinary shares (A shares) to specific targets on 23 June 2021 at an issuing price ofRMB200.00 per share, raising total proceeds of RMB5,000,000,000.00. After deducting the expenses related tothe issue of RMB45,657,925.15 (excluding VAT), the actual net proceeds raised were RMB4,954,342,074.85.RSM (special ordinary partnership) has audited the availability of the funds raised from the non-public offering ofshares of the Company on 29 June 2021 and issued Capital Verification Report R.C.Y.Z [2021] No. 518Z0050.The above shares were registered with the Shenzhen Branch of CSDC on 12 July 2021 and listed on the ShenzhenStock Exchange on 22 July 2021.
13. Other Significant Events
Segment InformationThe Company did not determine the operating segment in accordance with the internal organizational structure,management requirements, and internal reporting system, so there was no need to disclose segment informationreport based on the operating segments.
14. Notes of Main Items in the Financial Statements of the Company as the Parent
14.1 Accounts Receivable
(1) Disclosure by aging
| Aging | Ending balance | Beginning balance |
| Within one year | 1,179,822.50 | 494,976.27 |
| Of which:1-6 months | 1,179,822.50 | 494,976.27 |
| 7-12 months | - | |
| 1-2 years | - | |
| 2-3 years | - | |
| Over 3 years | - | |
| Subtotal | 1,179,822.50 | 494,976.27 |
| Less: Bad debt provision | 0.00 | |
| Total | 1,179,822.50 | 494,976.27 |
| Item | Ending balance | ||||
| Carrying amount | Bad debt provision | Carrying value | |||
| Amount | Proportion (%) | Amount | Withdrawal proportion (%) | ||
~ 187 ~
| Bad debt provision withdrawn separately | - | - | - | - | - |
| Bad debt provision withdrawn by group | 1,179,822.50 | 100.00 | 1,179,822.50 | ||
| Of which: Group 1 | 1,179,822.50 | 100.00 | 1,179,822.50 | ||
| Group 2 | |||||
| Total | 1,179,822.50 | 100.00 | 1,179,822.50 |
| Item | Beginning balance | ||||
| Carrying amount | Bad debt provision | Carrying value | |||
| Amount | Proportion (%) | Amount | Withdrawal proportion (%) | ||
| Bad debt provision withdrawn separately | - | - | - | - | - |
| Bad debt provision withdrawn by group | 494,976.27 | 100.00 | - | - | 494,976.27 |
| Of which: Group 1 | 494,976.27 | 100.00 | - | - | 494,976.27 |
| Group 2 | - | - | - | - | - |
| Total | 494,976.27 | 100.00 | - | - | 494,976.27 |
| Aging | Ending balance | ||
| Carrying amount | Bad debt provision | Withdrawal proportion (%) | |
| Related parties within the scope of consolidation | 1,179,822.50 | - | - |
| Total | 1,179,822.50 | - | - |
| Aging | Beginning balance | ||
| Carrying amount | Bad debt provision | Withdrawal proportion (%) | |
| Related parties within the scope of consolidation | 494,976.27 | - | - |
| Total | 494,976.27 | - | - |
~ 188 ~
On 30 June 2021, there was no account receivable with bad debt provision withdrawn by group 2.On 31 December 2020, there was no account receivable with bad debt provision withdrawn by group 2.
(3) Changes of bad debt provision during the Reporting Period
On 30 June 2021, there was no change of bad debt provision.
(4) On 30 June 2021, top five ending balances by entity
| Entity name | Balance | Proportion of the balance to the total accounts receivable (%) | Bad debt provision |
| No. 1 | 1,179,822.50 | 100.00 | - |
| No. 2 | - | ||
| No. 3 | - | ||
| No. 4 | - | ||
| No. 5 | - | ||
| Total | 1,179,822.50 | 100.00 | - |
| Item | Ending balance | Beginning balance |
| Interest receivable | - | - |
| Dividends receivable | - | - |
| Other receivables | 278,778,850.21 | 141,378,010.40 |
| Total | 278,778,850.21 | 141,378,010.40 |
| Aging | Ending balance | Beginning balance |
| Within one year | 278,055,345.82 | 140,143,887.64 |
| Of which:1-6 months | 275,854,845.98 | 139,805,782.01 |
| 7-12 months | 2,200,499.84 | 338,105.63 |
| 1-2 years | 1,060,089.23 | 1,322,306.20 |
| 2-3 years | 650,079.20 | 244,089.00 |
| Over 3 years | 38,863,584.88 | 41,333,188.41 |
| Subtotal | 318,629,099.13 | 183,043,471.25 |
~ 189 ~
| Aging | Ending balance | Beginning balance |
| Less: Bad debt provision | 39,850,248.92 | 41,665,460.85 |
| Total | 278,778,850.21 | 141,378,010.40 |
| Nature | Ending balance | Beginning balance |
| Related parties within the scope of consolidation | 231,295,793.74 | 133,696,578.89 |
| Security investment | 38,857,584.88 | 40,807,394.41 |
| Security deposit and guarantee | 43,727,658.09 | 1,879,230.29 |
| Rent, water, electricity and gas | 1,363,672.14 | 1,275,238.93 |
| Other | 3,384,390.28 | 5,385,028.73 |
| Total | 318,629,099.13 | 183,043,471.25 |
| Stage | Carrying amount | Bad debt provision | Carrying value |
| Stage 1 | 279,771,514.25 | 992,664.04 | 278,778,850.21 |
| Stage 2 | |||
| Stage 3 | 38,857,584.88 | 38,857,584.88 | |
| Total | 318,629,099.13 | 39,850,248.92 | 278,778,850.21 |
| Category | Carrying amount | 12-month expected credit losses rate (%) | Bad debt provision | Carrying value |
| Bad debt provision withdrawn separately | - | - | - | - |
| Bad debt provision withdrawn by group | 279,771,514.25 | 0.35 | 992,664.04 | 278,778,850.21 |
| Of which: Group 1 | 231,295,793.74 | 231,295,793.74 | ||
| Group 2 | 48,475,720.51 | 2.05 | 992,664.04 | 47,483,056.47 |
| Total | 279,771,514.25 | 0.35 | 992,664.04 | 278,778,850.21 |
| Aging | Ending balance |
~ 190 ~
| Carrying amount | Bad debt provision | Withdrawal proportion (%) | |
| Within one year | 46,759,552.08 | 555,615.51 | 1.19 |
| Of which:1-6 months | 44,559,052.24 | 445,590.52 | 1.00 |
| 7-12 months | 2,200,499.84 | 110,024.99 | 5.00 |
| 1-2 years | 1,060,089.23 | 106,008.93 | 10.00 |
| 2-3 years | 650,079.20 | 325,039.60 | 50.00 |
| Over 3 years | 6,000.00 | 6,000.00 | 100.00 |
| Total | 48,475,720.51 | 992,664.04 | 2.05 |
| Category | Carrying amount | 12-month expected credit losses rate (%) | Bad debt provision | Carrying value |
| Bad debt provision withdrawn separately | 38,857,584.88 | 100.00 | 38,857,584.88 | - |
| Bad debt provision withdrawn by group | - | |||
| Of which: Group 1 | - | |||
| Group 2 | - | |||
| Total | 38,857,584.88 | 100.00 | 38,857,584.88 | - |
| Name | Ending balance | |||
| Carrying amount | Bad debt provision | Withdrawal proportion (%) | Withdrawal reason | |
| Hengxin Securities Co., Ltd. | 28,966,894.41 | 28,966,894.41 | 100.00 | The enterprise enters the bankruptcy liquidation procedure |
| Jianqiao Securities Co., Ltd. | 9,890,690.47 | 9,890,690.47 | 100.00 | The enterprise enters the bankruptcy liquidation procedure |
| Total | 38,857,584.88 | 38,857,584.88 | 100.00 | -- |
| Stage | Carrying amount | Bad debt provision | Carrying value |
| Stage 1 | 142,236,076.84 | 858,066.44 | 141,378,010.40 |
~ 191 ~
| Stage | Carrying amount | Bad debt provision | Carrying value |
| Stage 2 | - | - | - |
| Stage 3 | 40,807,394.41 | 40,807,394.41 | - |
| Total | 183,043,471.25 | 41,665,460.85 | 141,378,010.40 |
| Category | Carrying amount | 12-month expected credit losses rate (%) | Bad debt provision | Carrying value |
| Bad debt provision withdrawn separately | - | - | - | - |
| Bad debt provision withdrawn by group | 142,236,076.84 | 0.60 | 858,066.44 | 141,378,010.40 |
| Of which: Group 1 | 133,696,578.89 | - | - | 133,696,578.89 |
| Group 2 | 8,539,497.95 | 10.05 | 858,066.44 | 7,681,431.51 |
| Total | 142,236,076.84 | 0.60 | 858,066.44 | 141,378,010.40 |
| Aging | Beginning balance | ||
| Carrying amount | Bad debt provision | Withdrawal proportion (%) | |
| Within one year | 6,447,308.75 | 77,997.31 | 1.21 |
| Of which:1-6 months | 6,109,203.12 | 61,092.03 | 1.00 |
| 7-12 months | 338,105.63 | 16,905.28 | 5.00 |
| 1-2 years | 1,322,306.20 | 132,230.63 | 10.00 |
| 2-3 years | 244,089.00 | 122,044.50 | 50.00 |
| Over 3 years | 525,794.00 | 525,794.00 | 100.00 |
| Total | 8,539,497.95 | 858,066.44 | 10.05 |
| Category | Carrying amount | 12-month expected credit losses rate (%) | Bad debt provision | Carrying value |
| Bad debt provision withdrawn separately | 40,807,394.41 | 100.00 | 40,807,394.41 | - |
| Bad debt provision withdrawn | - | - | - | - |
~ 192 ~
| Category | Carrying amount | 12-month expected credit losses rate (%) | Bad debt provision | Carrying value |
| by group | ||||
| Of which: Group 1 | - | - | - | - |
| Group 2 | - | - | - | - |
| Total | 40,807,394.41 | 100.00 | 40,807,394.41 | - |
| Name | Beginning balance | |||
| Carrying amount | Bad debt provision | Withdrawal proportion (%) | Withdrawal reason | |
| Hengxin Securities Co., Ltd. | 28,966,894.41 | 28,966,894.41 | 100.00 | The enterprise enters the bankruptcy liquidation procedure |
| Jianqiao Securities Co., Ltd. | 11,840,500.00 | 11,840,500.00 | 100.00 | The enterprise enters the bankruptcy liquidation procedure |
| Total | 40,807,394.41 | 40,807,394.41 | 100.00 | -- |
| Category | Beginning balance | Changes in the Reporting Period | Ending balance | ||
| Withdrawal | Reversal or recovery | Write-off | |||
| Bad debt provision withdrawn separately | 40,807,394.41 | - | 1,949,809.53 | 38,857,584.88 | |
| Bad debt provision withdrawn by group | 858,066.44 | 134,597.60 | 992,664.04 | ||
| Total | 41,665,460.85 | 134,597.60 | 1,949,809.53 | 39,850,248.92 | |
| No. | Nature | Ending balance | Aging | Proportion of the balance to the total other receivables (%) | Bad debt provision |
| No. 1 | Related party within the | 90,000,000.00 | Within 6 months | 28.25 | - |
~ 193 ~
| No. | Nature | Ending balance | Aging | Proportion of the balance to the total other receivables (%) | Bad debt provision |
| scope of consolidation | |||||
| No. 2 | Related party within the scope of consolidation | 79,101,073.03 | Within 6 months | 24.83 | - |
| No. 3 | Related party within the scope of consolidation | 50,469,478.21 | Within 6 months | 15.84 | - |
| No. 4 | Cash deposit | 42,020,000.00 | Within 6 months | 13.19 | 420,200.00 |
| No. 5 | Securities Investment | 28,966,894.41 | Over 3 years | 9.09 | 28,966,894.41 |
| Total | -- | 290,557,445.65 | 91.20 | 29,387,094.41 |
| Item | Ending balance | Beginning balance | ||||
| Carrying amount | Depreciation reserve | Carrying value | Carrying amount | Depreciation reserve | Carrying value | |
| Investment in subsidiaries | 1,312,692,241.38 | 1,312,692,241.38 | 1,118,213,665.32 | - | 1,118,213,665.32 | |
| Total | 1,312,692,241.38 | 1,312,692,241.38 | 1,118,213,665.32 | - | 1,118,213,665.32 | |
| Investees | Beginning balance | Increase during the Reporting Period | Decrease during the Reporting Period | Ending balance | Impairment provision during the Reporting Period | Provision for impairment at 30 June 2021 |
| Bozhou Gujing Sales Co., Ltd. | 68,949,286.89 | - | - | 68,949,286.89 | - | |
| Anhui Longrui Glass Co., Ltd. | 85,267,453.06 | - | - | 85,267,453.06 | - | |
| Shanghai Gujing Jinhao Hotel Management Co., Ltd. | 49,906,854.63 | - | - | 49,906,854.63 | - |
~ 194 ~
| Investees | Beginning balance | Increase during the Reporting Period | Decrease during the Reporting Period | Ending balance | Impairment provision during the Reporting Period | Provision for impairment at 30 June 2021 |
| BozhouGujing Hotel Co., Ltd. | 648,646.80 | - | - | 648,646.80 | - | |
| Anhui Ruisiweier Technology Co., Ltd. | 40,000,000.00 | - | - | 40,000,000.00 | - | |
| Anhui Yuanqing Environmental Protection Co., Ltd. | 16,000,000.00 | - | - | 16,000,000.00 | - | |
| Anhui Gujing Yunshang E-commerce Co., Ltd. | 5,000,000.00 | - | - | 5,000,000.00 | - | |
| Anhui Zhenrui Construction Engineering Co., Ltd. | 10,000,000.00 | - | 10,000,000.00 | - | - | |
| Yellow Crane Tower Distillery Co., Ltd. | 816,000,000.00 | - | - | 816,000,000.00 | - | |
| Anhui Jinyunnlai Cultural Media Co., Ltd. | 15,000,000.00 | - | - | 15,000,000.00 | - | |
| Bozhou Gujing Waste Recycling Co., Ltd. | 1,441,423.94 | - | 1,441,423.94 | - | - | |
| Anhui RunanXinke Testing Technology Co., Ltd. | 10,000,000.00 | - | 10,000,000.00 | - | ||
| Anhui Mingguang Distillery Co., Ltd. | - | 200,200,000.00 | - | 200,200,000.00 | - | |
| Anhui Jiuhao China Railway Construction Engineering Co., Ltd. | - | 5,720,000.00 | - | 5,720,000.00 | - | |
| Total | 1,118,213,665.32 | 205,920,000.00 | 11,441,423.94 | 1,312,692,241.38 | - |
| Item | Reporting Period | Same period of last year |
~ 195 ~
| Operating revenue | Cost of sales | Operating revenue | Cost of sales | |
| Main operations | 3,545,448,721.46 | 1,360,995,592.21 | 3,264,418,953.05 | 1,298,189,995.07 |
| Other operations | 50,784,414.00 | 27,316,859.36 | 32,698,219.44 | 18,869,268.55 |
| Total | 3,596,233,135.46 | 1,388,312,451.57 | 3,297,117,172.49 | 1,317,059,263.62 |
| Item | Reporting Period | Same period of last year |
| Investment income from long-term equity investments under cost method | 2,228,838.58 | |
| Gains on disposal of financial assets at fair value through other comprehensive income | -6,415,106.49 | - |
| Investment income from trading financial assets during the holding period | 1,625.42 | |
| Other investment income | 411,771.02 | 12,434,590.21 |
| Total | -3,772,871.47 | 12,434,590.21 |
| Item | Amount | Note |
| Gains/losses on the disposal of non-current assets | -2,117,355.04 | |
| Government grants recognised in current profit or loss | 34,716,270.46 | |
| Gain/loss from change of fair value of trading financial assets and liabilities, and derivative financial assets and liabilities, and investment gains from disposal of trading financial assets and liabilities, and derivative financial assets and liabilities, and investment in other debt obligations, other than valid hedging related to the Company’s common businesses | 6,470,100.21 | |
| Depreciation reserves returns of receivables and contract assets with separate depreciation test | 1,949,809.53 | |
| Other non-operating income and expense other than the above | 25,569,436.70 | |
| Less: Income tax effects | 16,593,381.40 |
~ 196 ~
| Non-controlling interests effects | 9,476,312.99 | |
| Total | 40,518,567.47 | -- |
| Profit as of Reporting Period | Weighted average ROE (%) | EPS (Yuan/share) | |
| EPS-basic | EPS-diluted | ||
| Net profit attributable to ordinary shareholders of the Company | 12.85 | 2.74 | 2.74 |
| Net profit attributable to ordinary shareholders of the Company after deduction of non-recurring profit and loss | 12.47 | 2.66 | 2.66 |