读取中,请稍候

00-00 00:00:00
--.--
0.00 (0.000%)
昨收盘:0.000今开盘:0.000最高价:0.000最低价:0.000
成交额:0成交量:0买入价:0.000卖出价:0.000
市盈率:0.000收益率:0.00052周最高:0.00052周最低:0.000
京东方B:2018年年度报告(英文版) 下载公告
公告日期:2019-03-26

ANNUAL REPORT 2018

March 2019

BOE Technology Group Co., Ltd. Annual Report 2018

Part I Important Notes, Table of Contents and Definitions

The Board of Directors (or the “Board”), the Supervisory Committee as well as the directors,supervisors and senior management of BOE Technology Group Co., Ltd. (hereinafter referredto as the “Company”) hereby guarantee the factuality, accuracy and completeness of thecontents of this Report and its summary, and shall be jointly and severally liable for anymisrepresentations, misleading statements or material omissions therein.Mr. Wang Dongsheng, the Company’s legal representative, Mr. Chen Yanshun, president ofthe Company’s Execution Committee (Chief Executive Officer), Ms. Sun Yun, the Company’sChief Financial Officer, and Ms. Yang Xiaoping, head of the Company’s financial department(equivalent to financial manager) hereby guarantee that the Financial Statements carried inthis 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 andforecasts and promises.The Board has approved a final dividend plan for the Reporting Period. Based on theCompany’s total shares of 34,798,398,763, a cash dividend of RMB0.30 (tax inclusive) per 10shares is to be distributed to all the shareholders, with no bonus issue from either profit orcapital reserves.This Report has been prepared as per the Chinese Accounting Standards for BusinessEnterprises and other relevant regulations. KPMG Huazhen LLP has issued an independentauditor’s report with unmodified unqualified opinion for the Company.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.

BOE Technology Group Co., Ltd. Annual Report 2018

Table of Contents

Part I Important Notes, Table of Contents and Definitions ...... 2

Part II Corporate Information and Key Financial Information ...... 6

Part III Business Summary ...... 12

Part IV Operating Performance Discussion and Analysis ...... 15

Part V Significant Events ...... 33

Part VI Share Changes and Shareholder Information ...... 53

Part VII Preferred Shares ...... 63

Part VIII Directors, Supervisors, Senior Management and Staff ...... 64

Part IX Corporate Governance ...... 80

Part X Corporate Bonds ...... 88

Part XI Financial Statements ...... 93

Part XII Documents Available for Reference ...... 99

BOE Technology Group Co., Ltd. Annual Report 2018

Definitions

TermDefinition
“BOE”, the “Company”, the “Group” or “we”BOE Technology Group Co., Ltd. and its consolidated subsidiaries, except where the context otherwise requires
The cninfo websitehttp://www.cninfo.com.cn/
CSRCThe China Securities Regulatory Commission
The Stock Listing RulesThe Stock Listing Rules of the Shenzhen Stock Exchange (Revised in November 2018)
SZSE, the Stock ExchangeThe Shenzhen Stock Exchange
The Articles of AssociationThe Articles of Association of BOE Technology Group Co., Ltd.
The Company LawThe Company Law of the People’s Republic of China
The Securities LawThe Securities Law of the People’s Republic of China
OASIS HospitalOASIS International Hospital
KPMGKPMG Huazhen LLP
IHS MarkitInformation Handling Services, Inc. & Markit Ltd.
AMOLEDActive-matrix Organic Light Emitting Diode
AMQLEDActive Matrix Quantum-dot Light Emitting Diode
OLEDOrganic Light Emitting Diode
VR/ARVirtual Reality /Augmented Reality
IoTInternet of Things
AIArtificial Intelligence
IFIIFI CLAIMS Patent Services
IECInternational Electrotechnical Commission
LCDLiquid Crystal Display
LTPSLow Temperature Poly-silicon
FPXDFlat Panel X-ray Detector
TDDITouch and Display Driver Integration
WQHDWide Quad High Definition, i.e. 2560×1440 definition
COF+COBChip On Film + Chip On Board
WXGAWide Extended Graphics Array, i.e. 1280×800 definition
WUXGAWidescreen Ultra eXtended Graphics Array, i.e. 1920×1200 definition

BOE Technology Group Co., Ltd. Annual Report 2018

OGM Tilt Active PenOne Glass of Metal-mesh Tilt Active Pen
MSMX-rayMetal-Silicon-Metal X-ray
d-PCRDigital Polymerase Chain Reaction
ITUInternational Telecommunication Union
ICTInformation and Communication Technology
The “Reporting Period” or “Current Period”The period from 1 January 2018 to 31 December 2018
RMB, RMB’0,000Expressed in the Chinese currency of Renminbi, expressed in tens of thousands of Renminbi

BOE Technology Group Co., Ltd. Annual Report 2018

Part II Corporate Information and Key Financial Information

I Corporate Information

Stock nameBOE-A, BOE-BStock code000725, 200725
Changed stock name (if any)N/A
Stock exchange for stock listingShenzhen Stock Exchange
Company name in Chinese京东方科技集团股份有限公司
Abbr.京东方
Company name in English (if any)BOE TECHNOLOGY GROUP CO., LTD.
Abbr. (if any)BOE
Legal representativeWang Dongsheng
Registered address10 Jiuxianqiao Road, Chaoyang District, Beijing, P.R.China
Zip code100015
Office address12 Xihuan Middle Road, Beijing Economic-Technological Development Area, P.R.China
Zip code100176
Company websitewww.boe.com
Email addressweb.master@boe.com.cn

II Contact Information

ItemBoard SecretarySecurities Representative
NameLiu Hongfeng--
Office Address12 Xihuan Middle Road, Beijing Economic-Technological Development Area, P.R.China--
Tel.010-64318888 ext.--
Fax010-64366264--
E-mail addressliuhongfeng@boe.com.cn--

III Media for Information Disclosure and Place where this Report Is Lodged

Newspapers designated by the Company for information disclosureChina Securities Journal, Shanghai Securities News, Securities Times, Ta Kung Pao (HK)
Website designated by CSRC for publication of this Reporthttp://www.cninfo.com.cn/
Place where this Report is lodgedBoard Secretary’s Office

BOE Technology Group Co., Ltd. Annual Report 2018

IV Changes to Company Registered Information

Unified social credit codeNo change
Change to principal activity of the Company since going public (if any)No change
Every change of controlling shareholder since incorporation (if any)No change

V Other Information

The independent audit firm hired by the Company:

NameKPMG Huazhen LLP
Office address8/F, KPMG Tower, Oriental Plaza, 1 East Chang An Avenue, Beijing, P.R.China
Accountants writing signaturesZhang Huan and Liu Jingyuan

The independent sponsor hired by the Company to exercise constant supervision over the Company in the Reporting Period:

□ Applicable √ Not applicableThe independent financial advisor hired by the Company to exercise constant supervision over the Company in the Reporting Period:

□ Applicable √ Not applicable

VI Key Financial Information

Indicate by tick mark whether there is any retrospectively restated datum in the table below.√ Yes □ NoReason for retrospective restatement: accounting policy changes

Item201820172018-over-2017 change (%)2016
BeforeAfterAfterBeforeAfter
Operating revenue (RMB)97,108,864,935.0093,800,479,215.0093,800,479,215.003.53%68,895,658,963.0068,895,658,963.00
Net profit attributable to the listed company’s shareholders (RMB)3,435,127,975.007,567,682,493.007,567,682,493.00-54.61%1,882,571,674.001,882,571,674.00
Net profit attributable to the listed company’s shareholders before exceptional items1,517,702,353.006,679,211,138.006,679,211,138.00-77.28%12,534,878.0012,534,878.00

BOE Technology Group Co., Ltd. Annual Report 2018

(RMB)
Net cash generated from/used in operating activities (RMB)25,684,047,196.0026,266,986,015.0026,726,929,655.00-3.90%10,073,287,120.0010,813,865,197.00
Basic earnings per share (RMB/share)0.100.220.22-54.55%0.050.05
Diluted earnings per share (RMB/share)0.100.220.22-54.55%0.050.05
Weighted average return on equity (%)4.00%9.25%9.25%-5.25%2.40%2.40%
Item31 December 201831 December 2017Change of 31 December 2018 over 31 December 2017 (%)31 December 2016
BeforeAfterAfterBeforeAfter
Total assets (RMB)304,028,491,385.00256,108,741,849.00256,108,741,849.0018.71%205,135,011,042.00205,135,011,042.00
Equity attributable to the listed company’s shareholders (RMB)85,856,748,703.0084,809,816,377.0084,809,816,377.001.23%78,699,988,493.0078,699,988,493.00

Reason for accounting policy changes and situation for accounting error corrects:

According to relevant interpretations of stipulated in CK [2018] No.15, the Group will adjust the government subsidies receivedrelated to assets from “cash inflows from investing activities” to “cash inflows from operating activities” and present.

VII Accounting Data Differences under China’s Accounting Standards for BusinessEnterprises (CAS) and International Financial Reporting Standards (IFRS) and ForeignAccounting Standards

1. Net Profit and Equity under CAS and IFRS

□ Applicable √ Not applicableNo difference for the Reporting Period.

2. Net Profit and Equity under CAS and Foreign Accounting Standards

□ Applicable √ Not applicableNo difference for the Reporting Period.

BOE Technology Group Co., Ltd. Annual Report 2018

VIII Key Financial Information by Quarter

Unit: RMB

ItemQ1Q2Q3Q4
Operating revenue21,566,813,037.0021,907,091,929.0025,990,508,323.0027,644,451,646.00
Net profit attributable to the listed company’s shareholders2,018,692,554.00956,513,946.00403,860,235.0056,061,240.00
Net profit attributable to the listed company’s shareholders before exceptional items1,238,599,228.00264,421,249.00362,034,925.00-347,353,049.00
Net cash generated from/used in operating activities7,198,088,816.004,241,517,030.006,857,996,566.007,386,444,784.00

Indicate by tick mark whether any of the quarterly financial data in the table above or their summations differs materially from whathave been disclosed in the Company’s quarterly or interim reports.√ Yes □ NoReclassification of the net profit attributable to the listed company’s shareholders before exceptional items according to the auditeddata

IX Exceptional Gains and Losses

√ Applicable □ Not applicable

Unit: RMB

Item201820172016Note
Gain or loss on disposal of non-current assets (inclusive of impairment allowance write-offs)-21,684,121.00-87,930,698.00-46,754,352.00N/A
Tax rebates, reductions and exemptions given with ultra vires approval or in lack of official approval documents0.000.000.00N/A
Government subsidies charged to current profit or loss (exclusive of government subsidies given in the Company’s ordinary course of business at fixed quotas or amounts as per the government’s uniform standards)2,073,709,661.00962,283,001.001,914,531,603.00N/A
Capital occupation charges on non-financial enterprises that are charged to current profit or loss0.000.000.00N/A
Gain equal to the amount by which investment costs for the Company to obtain subsidiaries, associates and joint ventures are lower than the Company’s enjoyable fair value of identifiable net assets of investees when making investments0.000.00105,228,293.00N/A
Gain or loss on non-monetary asset swaps0.000.000.00N/A

BOE Technology Group Co., Ltd. Annual Report 2018

Gain or loss on investments or assets entrusted to other entities for management0.000.000.00N/A
Allowance for asset impairments due to acts of God such as natural disasters0.000.000.00N/A
Gain or loss on debt restructuring0.000.000.00N/A
Restructuring costs in staff arrangement, integration, etc.0.000.000.00N/A
Gain or loss on the over-fair value amount as a result of transactions with distinctly unfair prices0.000.000.00N/A
Current profit or loss on subsidiaries obtained in business combinations involving enterprises under common control from the period-beginning to combination dates, net0.000.000.00N/A
Gain or loss on contingencies that do not arise in the Company’s ordinary course of business0.000.000.00N/A
Gain or loss on fair-value changes in trading financial assets and liabilities & investment income from disposal of trading financial assets and liabilities and available-for-sale financial assets (exclusive of effective portion of hedges that arise in the Company’s ordinary course of business)315,279,377.00134,810,181.00149,197,609.00N/A
Reversed portion of impairment allowance for accounts receivable which are tested individually for impairment1,779,710.002,616,024.0024,547,083.00N/A
Gain or loss on loan entrustments0.000.000.00N/A
Gain or loss on fair-value changes in investment property of which subsequent measurement is carried out using the fair value method0.000.000.00N/A
Effects of all adjustments required by taxation, accounting and other applicable laws and regulations on current profit or loss0.000.000.00N/A
Income from charges on entrusted management0.000.000.00N/A
Non-operating income and expense other than the above63,734,628.0046,503,917.0040,206,943.00N/A
Other gains and losses that meet the definition of exceptional gain/loss0.000.000.00N/A
Less: Income tax effects328,634,385.00126,533,931.00305,399,453.00N/A
Non-controlling interests effects (net of tax)182,810,608.0043,277,139.0011,520,930.00N/A
Total1,917,425,622.00888,471,355.001,870,036,796.00--

Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or listed in the Explanatory

BOE Technology Group Co., Ltd. Annual Report 2018

Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Gain/LossItems:

□ Applicable √ Not applicableNo such cases for the Reporting Period.

BOE Technology Group Co., Ltd. Annual Report 2018

Part III Business Summary

I Principal Activity of the Company in the Reporting Period

Is the Company subject to any disclosure requirements for special industries?No.Founded in April 1993, BOE Technology Group Co., Ltd. (“BOE”) is an IoT company providing intelligent interface products andservices for information interaction and human health. In order to further promote the IoT transformation, satisfy different IoTapplication needs, and sharpen its competitive edges in market segments, BOE has restructured itself in 2018 into three majorbusiness divisions with seven business groups. Meanwhile, to further strengthen core marketing and technology abilities, as well asstimulate faster growth in the three business divisions of interface devices (D), smart IoT (S) and Smart Medicine and Engineering(H), specialized organizations have been set up, including the B2B Chief Sales Platform Officer, the OMO Chief Sales PlatformOfficer, the Branding and Global Market Center, the Information Technology Development Center, and the IoT AI&Big DataCenter.1. Interface Devices (D)Division D consists of the Display and Sensor BG, and the Sensor and Application Solution BG. The Display and Sensor BG designsand manufactures related devices with a B2B model. The display device business offers TFT-LCD, AMOLED, Microdisplay andother intelligent interface devices for smartphones, tablet PCs, laptops, monitors, TVs, vehicles, electronic signs, tiled display screens,industrial control, wearable devices, VR/AR devices, electronic tags, white goods, healthcare, mobile payment, etc. And the sensordevice business provides integrated design and manufacturing services of sensor devices for use in medical detection, householddetection, communication and transportation, smart homes, etc. The Sensor and Application Solution BG provides sensor systemsolutions for B2B customers of medical imaging, microfluidics, smart screens, new antennas, home security, Mini LED and the like,with products including flat panel X-ray detectors (FPXD), digital microfluidic chips, PDLC glass, identification systems, etc.2. Smart IoT (S)Division S is divided into the Intelligent Manufacturing Service BG, the IoT Solution BG and the Digital Art IoT Platform BG. TheIntelligent Manufacturing Service BG designs and manufactures, for its global B2B partners, the most competitive whole-widgetsmart manufacturing solutions of TVs, monitors, whiteboards, electronic signs, commercial display products, electronic tags, mobileterminals, among others. The IoT Solution BG offers software-and-hardware integrated solutions like supermarket retail solutions,marketing solutions, imaging solutions, smart conference solutions, context interaction solutions, handler advertisement solutions,education signal transmission solutions and smart microgrid solutions for B2B customers in IoT market segments such as smart retail,smart finance, digital hospitals, smart business offices, smart homes, smart transportation, smart education and smart energy. TheDigital Art IoT Platform BG with a B2C IoT platform model is committed to brightening everyday life with the beauty of art andoffering the best user experience. The featured product, BOE iGallery, integrates terminal products with an App, as well as voiceinteraction and other information technologies with digital art, providing users with various services including artistic appreciation,art knowledge, art mall and visual aesthetics. It helps introduce art to everyone and unveils more beauty of art.3. Smart Medicine and Engineering (H)Division H includes the Mobile Healthcare IoT Platform BG and the Smart Healthcare Service BG. The Mobile Healthcare IoTPlatform BG with a B2C IoT platform model, integrating smart terminals and apps, as well as based on AI and big data algorithms,enables users to enjoy personalized healthcare services without leaving home, including vital signs monitoring and analysis, AI-baseddisease risk prediction, health courses from experts, online diagnosis and registration for medical examination. The Smart Healthcare

BOE Technology Group Co., Ltd. Annual Report 2018

Service BG covers digital hospitals, digital human body, regenerative medicine, healthcare parks, etc. It offers B2C customersonline-and-offline integrated professional healthcare services focused on digital medical care and supplemented by smart nursinghome and healthcare park integrated solutions, as well as by industrial park operations and the like.

II Significant Changes in Major Assets

1. Significant Changes in Major Assets

Major assetsMain reason for significant changes
Equity assetsConsolidation of associate/joint venture
Fixed assetsTransfer of new project into fixed assets in the Reporting Period
Intangible assetsIncrease in business combinations in the Reporting Period

2. Major Assets Overseas

□ Applicable √ Not applicable

III Core Competitiveness Analysis

Is the Company subject to any disclosure requirements for special industries?No.1. The Company firmly promoted and implemented innovation and transformation and further improved global competitivenessIn 2018, BOE firmly promoted and implemented the development strategy of IoT transformation. Three major business divisions,namely interface devices, smart IoT and smart healthcare engineering, realized fast development, which further improved its globalmarket competitiveness.Interface devices: Construction of the new line of both Display and Sensor BG proceeded in order, and the first TFT-LCD ProductionLine of the highest generation in the world-- the 10.5

th

Generation BOE Hefei TFT-LCD Production Line realized mass production,and the product yield was improved steadily; The main structure of the 6

th

Generation Mianyang Flexible AMOLED Production LineProject was capped three months in advance, and it is predicted that products can be shipped as scheduled in 2019; The mainstructure of Wuhan 10.5 Generation TFT-LCD Production Line was capped in November; The main structure of KunmingMicro-OLED Production Line was capped in September. As for the Sensor and Application Solution BG, the first type of Flow Cellsequencing chip of micro-fluidic chip business start being shipped; Samples of the smart window products have been delivered to theclient.Smart IoT: As for the smart manufacturing business group, the structure of Suzhou Smart Factory update project was capped inDecember; Construction of Chongqing Smart Factory has been realized as well as mass production of electronic tags; IoT SolutionBG has expanded smart retail of electronic tags in Chinese market and explored over 60 famous retail brand clients. The Digital ArtIoT Platform BG launched successfully the new generation of Painted Screen S2 and M2 integrated with the smart voice technologyand launched the APP 3.0 with annual new registered users of about 123,000.Smart Medicine and Engineering: The first type of BOE brand product - Smart Sleep Instrument was launched successfully by theMobile Healthcare IoT Platform BG; Products such as the dynamic ECG recorder, body fat scale, sphygmomanometer and smartwatch realized sales on the market; BOE mobile healthcare APP 3.0 was launched. Smart Healthcare Service BG officially opened

BOE Technology Group Co., Ltd. Annual Report 2018

Hefei Digital Hospital, the first digital hospital independently planned and constructed by BOE, in December; Construction ofChengdu BOE Hospital was officially commenced in December, and construction is proceeded in order; Layout of the Life Scienceand Technology Industry Base was made quickly, and the cooperative agreement was signed in November.2. The Company stuck to client orientation and further increased its market shares.Under the guide of IoT ecological chain construction strategy of "Ecoresystem: Open and Connected", BOE stuck to taking clients'application scene as the starting point and design and create the best user experience to provide clients with exciting products andservices. Thus, BOE has become the first supplier of domestic and overseas famous brands. It realized a further increase in marketshare in subdivided markets in 2018. According to IHS Markit data, the shipment of BOE display screens in 2018 wasranking the 1

st

in the world; Five major display screens ranked the 1

st

respectively in terms of their market share. The shipment of completedisplayers enjoyed a year-on-year growth of 30%, ranking the 2

nd

in the word from the 4

th

last year; The shipment of innovativeapplications enjoyed a year-on-year growth of nearly 110%, including five subdivided markets (i.e. electronic label, connection,electronic tag, wearing and VR/AR) whose market share became more than 20%; Shipment of flexible OLED provided for first-tierbrand clients realized great breakthrough (2.7 million pieces). Shipment quantity of smart service products was improved steadily.Shipment of complete machine of TV / displayers realized 18 million sets, ranking the 3

rd

and 4

th

place in the world respectively.3. The Company reinforced independent innovation and further promoted innovation ability."Respecting technology and insisting on innovation" is one of the key cultural factors of BOE. In 2018, BOE continuously stuck toenhance technology R & D and kept enhancing independent innovation ability to keep foresight and primacy of technologies andproducts. In terms of the technology and product, flexible OLED technology continued to make new breakthrough, put forwardvarious types of products with free form and bezel-less display were launched. 6.18-inch WQHD flexible products realized 1mmdynamic warping; TFT-LCD technology strength was improved. The first type of non-notch bezel-less product in the world madewith LTPS COF+COB technology, 8-inch WXGA TDDI, 10.1-inch WUXGA TDDI, active-pen-based 13.3-inch OGM Tiltsucceeded in mass production and shipment, and the thinnest 3.9mm 23.8-inch Ultra Slim MNT products succeeded in massproduction; Sensor technology realized new breakthrough, MSMX-ray mass production assessment sample was released initially inthe world, and the liquid crystal molecule antenna project succeeded in the commissioning test of connecting the satellite initially. Asfor the glass-based d-PCR chip used for inspection of genetic mutation positions, development of the first sample machine featuringintegration, full automation and portability in the world was finished; Application of IoT AI products realized the breakthrough.Independently developed natural language processing algorithm in the art filed was successfully applied to BOE painted screen S2product. AI technologies such as face recognition and OCR have been applied to BOE products such as AI digital signboard andsmart high-speed photographic instrument; Healthcare engineering integration has realized the technology breakthrough. Clinic-levelserum-free heat diaphragm cultivation system was established, and the first multi-functional orthopaedic robot in the world and theAI general practitioner were developed successfully. In terms of patents, 9,585 patents were applied in the whole year, and 4,800patents were recognized in the whole year, including 1,600 patents recognized by America. More than 20 external technical standardswere prepared and revised in the whole year.4. The Company further improved operational efficiency via strengthening lean management.BOE continuously optimized the procedure of production bottleneck. The completion rate of the displayer production plan was up to99%, and the mass production capacity in the whole year increased by 5%. In terms of yield, the comprehensive yield of Fuzhou 8.5

th

generation TFT-LCD production made the best record of BOE 8.5

th

generation TFT-LCD production line. Among those products,yield of 43-inch FHD kept exceeding 98% for successive 7 months, creating the highest level in the industry. In terms of qualitycontrol, the rank of client-end quality of displayer business was improved continuously. Product quality of major clients ranked thefirst, and there were 15 major clients.

BOE Technology Group Co., Ltd. Annual Report 2018

Part IV Operating Performance Discussion and Analysis

I Overview

In 2018, the global economic environment was complicated. China's economic development entered into a new normal featuring aslower growth speed, structure optimization and driving force shift, transforming from an economy that is based on high-speedgrowth to one that relies on high-quality development; the fourth industrial revolution represented by IoT, AI, big data and lifescience and technology has come. Cross-field integration trend was obvious, and software-hardware integration and applicationintegration and other innovative driving forces promoted the industry upgrading. The semi-conductor display industry entered intothe adjustment phase in the second half of last year. Demands were weak in five major markets of the smart phone display screen,table PCs display screen, laptop display screen, monitors’ display screen and TV display screen. As a result, prices of products of allsizes, especially TV display screen, were adjusted greatly. The expansion of flexible AMOLED markets was not realized as expected,and the fast release of production capacity made market competition fiercer.2018 was a key year of BOE’s innovative transformation towards an IoT company. The Company innovatively put forward thestrategic thought of "Three Aspects of Rebalance" (i.e. realizing rebalance of heavy assets and light assets under the new normal ofeconomy of China; realizing rebalance of market opportunity and capacity rebuilding under the fourth industrial revolution; realizingrebalance of trade under the global political and economic new pattern) for deep thinking, divided the three major business divisionsof Interface devices, smart IoT and Smart Medicine and Engineering into seven business groups (i.e. Display and Sensor BG, Sensorand Application Solution BG, Intelligent Manufacturing Service BG, IoT Solution BG, digital artbusiness group, Mobile HealthcareIoT Platform BG, Smart Healthcare Service BG) to meet demands of subdivided application supermarkets under the IoT context.Besides, BOE established B2B Chief Sales Platform Officer and OMO Chief Sales Platform Officer, enhanced client exploration andmaintenance, established brand and global market promotion center, strengthened brand and market promotion, subdivided ITorganization into CIO organization and information technology research development center to further improve informationtechnology capacity. While perfecting the new system, BOE seized market opportunities, deeply explored subdivided markets,strengthened technical development, adjusted product structure, and enhanced lean management. As a result, for the year underreview, BOE recorded operating revenue of about RMB97.1 billion and a net profit attributable to the listed company’s shareholdersof about RMB3.44 billion. Its operating performance still ranked among the top in the industry.(I) The three major business divisions of D, S and H maintained fast development.The shipment of complete display panels was ranking the first place in the world; Five major products of smart phone LCD, tablePCs display screen, laptop display screen, displayer display screen and TV display screen realized the continuous improvement inmarket share, ranking the first place in the world. The first TFT-LCD Production Line of the highest generation in the world-- the10.5

th

Generation BOE Hefei TFT-LCD Production Line realized fast improvement of the capacity and yield; The first AMOLED(flexible) production in the Mainland of China - Chengdu 6

th

generation of AMOLED (flexible) production line realized steadyimprovement of yield and supply for first-tire brand manufacturers; Planning and construction of Chongqing 6

th

generation ofAMOLED (flexible) production, Mianyang 6

th

AMOLED (flexible) production line proceeded as scheduled; BOE announced toinvest in the 4

th

AMOLED (flexible) production line - Fuzhou 6

th

generation of AMOLED (flexible) production line, furtherimproving the capacity of BOE in supplying interface devices. Shipment quantity of smart service products was improved steadily.Shipment of complete machine of TV / displayers realized 18 million sets, ranking the 3

rd

and 4

th

place in the world respectively.Layout of the Life Science and Technology Industry Base was made quickly.(II) Progress was made in innovation subdivision and application market exploration.A significant growth was made in shipment and revenue of innovative products of Display and Sensor BG; Sensor and Application

BOE Technology Group Co., Ltd. Annual Report 2018

Solution BG realized a year-on-year growth of 200% of revenue and annual shipment growth of about 350% of the X-ray flat paneldetector; Digital Art IoT Platform BG realized new users of about 123,000, enjoying a year-on-year growth of 6 times. Its platformworks realized one million pieces, realizing work promotion quantity of more than five million times. What's more, it alsoestablished ITU international standards for digital artwork image display system, promoted AI voice painted screen, enhancingmarket influences and establishing its ecology in the industry preliminarily; In terms of commercial display products, manybenchmark projects have been finished and realized year-on-year growth of one time of revenue; Its smart retail electronic tagbusiness occupied 50% of the market share, serving about 17,000 stores in 61 countries and regions. Quantity of stores newlydeveloped in China increased quickly; Smart sleep instrument, portable ECG monitor and body fat scale and other products havebeen launched on the market successively; Mobile healthcare APP 3.0 was launched successfully; The independently planned andconstructed Hefei BOE Hospital was put into use.(III) Technical innovation ability kept improving.The number of patent applications kept growing rapidly, and 9,585 new patents were applied for in the whole year, including 38% ofoverseas patents applied for. More than 4,000 patents in key fields such as OLED, sensing, AI, big data, etc. were applied for. Morethan 4,800 patents were recognized, including over 1,600 patents recognized by America; IFI Claims showed that the quantity ofpatents of BOE recognized by America ranked the 17

th

place in 2018 from the 21

st

place in 2017.

II Core Business Analysis

1. Overview

See “I Overview” above.

2. Revenue and Cost Analysis(1) Breakdown of Operating Revenue

Unit: RMB

Item20182017Change (%)
Operating revenueAs % of total operating revenue (%)Operating revenueAs % of total operating revenue (%)
Total97,108,864,935.00100%93,800,479,215.00100%3.53%
By operating division
Interface devices86,688,426,362.0089.27%85,149,888,634.0090.78%1.81%
Smart IoT17,499,500,352.0018.02%15,620,915,713.0016.65%12.03%
Smart Medicine and Engineering1,151,844,468.001.19%1,023,905,566.001.09%12.50%
Others3,569,024,583.003.68%2,225,609,340.002.37%60.36%
Offset-11,799,930,830.00-12.15%-10,219,840,038.00-10.90%15.46%
By product category
Interface devices86,688,426,362.0089.27%85,149,888,634.0090.78%1.81%

BOE Technology Group Co., Ltd. Annual Report 2018

Smart IoT17,499,500,352.0018.02%15,620,915,713.0016.65%12.03%
Smart Medicine and Engineering1,151,844,468.001.19%1,023,905,566.001.09%12.50%
Others3,569,024,583.003.68%2,225,609,340.002.37%60.36%
Offset-11,799,930,830.00-12.15%-10,219,840,038.00-10.90%15.46%
By operating segment
Mainland China42,942,349,994.0044.22%44,077,183,105.0046.99%-2.57%
Other regions in Asia44,256,356,951.0045.57%44,260,377,203.0047.19%-0.01%
Europe3,488,264,284.003.59%2,185,981,332.002.33%59.57%
America6,354,884,816.006.54%3,198,611,737.003.41%98.68%
Other regions67,008,890.000.07%78,325,838.000.08%-14.45%

(2) Operating Division, Product Category or Operating Segment Contributing over 10% of OperatingRevenue or Operating Profit

√ Applicable □ Not applicableIs the Company subject to any disclosure requirements for special industries?No.

Unit: RMB

ItemOperating revenueCost of salesGross profit marginYoY change in operating revenue (%)YoY change in cost of sales (%)YoY change in gross profit margin (%)
By operating division
Interface devices86,688,426,362.0070,337,005,047.0018.86%1.81%9.71%-5.85%
Smart IoT17,499,500,352.0015,568,843,342.0011.03%12.03%7.65%3.62%
By product category
Interface devices86,688,426,362.0070,337,005,047.0018.86%1.81%9.71%-5.85%
Smart IoT17,499,500,352.0015,568,843,342.0011.03%12.03%7.65%3.62%
By operating segment
Mainland China42,942,349,994.0034,091,195,752.0020.61%-2.57%-2.42%-0.12%
Other regions in Asia44,256,356,951.0035,351,920,958.0020.12%-0.01%16.75%-11.47%

Core business data of the prior year restated according to the changed statistical caliber for the Reporting Period:

□ Applicable√ Not applicable

BOE Technology Group Co., Ltd. Annual Report 2018

(3) Whether Revenue from Physical Sales Is Higher than Service Revenue

√ Yes □ No

Operating divisionItemUnit20182017Change (%)
TFT-LCDUnit salesK m242,23231,84032.64%
OutputK m242,54831,92133.29%
InventoryK m22,2291,57641.44%

Reason for any over 30% YoY movements in the data above√ Applicable □ Not applicableThere was newly invested operating production line in 2018, so the scale of unit sales, output, and inventory increased.

(4) Execution Progress of Major Signed Sales Contracts in the Reporting Period

□ Applicable √ Not applicable

(5) Breakdown of Cost of Sales

By operating division

Unit: RMB

By operating divisionItem20182017Change (%)
Cost of salesAs % of total cost of sales (%)Cost of salesAs % of total cost of sales (%)
Interface devicesMaterials, labor costs, depreciation, etc.70,337,005,047.0090.98%64,109,601,840.0091.22%9.71%
Smart IoTMaterials, labor costs, depreciation, etc.15,568,843,342.0020.14%14,462,597,072.0020.58%7.65%
Smart Medicine and EngineeringMaterials, labor costs, depreciation, etc.470,618,522.000.61%416,009,475.000.59%13.13%
OthersMaterials, labor costs, depreciation, etc.31,925,209.000.04%33,582,463.000.05%-4.93%
OffsetMaterials, labor costs, depreciation, etc.-9,102,167,832.00-11.77%-8,739,313,265.00-12.43%4.15%

Notes:

Naught

BOE Technology Group Co., Ltd. Annual Report 2018

(6) Changes in the Scope of Consolidated Financial Statements for the Reporting Period

√ Yes □ NoThe scope of the consolidated financial statements for this Reporting Period has changed. And the relevant data exclusive of the fivenew subsidiaries are as follows:

ItemOperating revenueCost of salesGross profit marginYoY change in operating revenue (%)YoY change in cost of sales (%)YoY change in gross profit margin (%)
By operating division
Interface devices86,664,251,766.0070,336,983,512.0018.84%1.78%9.71%-5.87%
Smart IoT16,011,738,858.0014,397,600,486.0010.08%2.50%-0.45%2.67%
Smart Medicine and Engineering1,151,844,468.00470,618,522.0059.14%12.50%13.13%-0.23%
Others3,569,024,583.0031,925,209.0099.11%60.36%-4.93%0.61%
Offset-11,808,786,670.00-9,089,456,972.0023.03%15.55%4.01%8.54%
By product category
Interface devices86,664,251,766.0070,336,983,512.0018.84%1.78%9.71%-5.87%
Smart IoT16,011,738,858.0014,397,600,486.0010.08%2.50%-0.45%2.67%
Smart Medicine and Engineering1,151,844,468.00470,618,522.0059.14%12.50%13.13%-0.23%
Others3,569,024,583.0031,925,209.0099.11%60.36%-4.93%0.61%
Offset-11,808,786,670.00-9,089,456,972.0023.03%15.55%4.01%8.54%
By operating segment
China42,842,333,600.0034,083,202,913.0020.45%-2.80%-2.44%-0.29%
Other regions in Asia44,256,356,951.0035,351,920,958.0020.12%-0.01%16.75%-11.47%
Europe2,067,488,748.001,483,689,598.0028.24%-5.42%-22.54%15.85%
America6,354,884,816.005,184,770,075.0018.41%98.68%68.77%14.46%
Other regions67,008,890.0044,087,213.0034.21%-14.45%-44.08%34.86%

BOE Technology Group Co., Ltd. Annual Report 2018

(7) Major Changes to the Business Scope or Product or Service Range in the Reporting Period

□ Applicable √ Not applicable

(8) Major Customers and Suppliers

Major customers:

Total sales to top five customers (RMB)40,553,307,887.00
Total sales to top five customers as % of total sales of the Reporting Period (%)41.76%
Total sales to related parties among top five customers as % of total sales of the Reporting Period (%)0.00%

Information about top five customers:

No.CustomerSales revenue contributed for the Reporting Period (RMB)As % of total sales revenue (%)
1Customer A16,287,833,781.0016.77%
2Customer B6,769,290,102.006.97%
3Customer C6,269,586,375.006.46%
4Customer D5,970,890,673.006.15%
5Customer E5,255,706,956.005.41%
Total--40,553,307,887.0041.76%

Other information about major customers:

□ Applicable √ Not applicableMajor suppliers:

Total purchases from top five suppliers (RMB)12,012,203,637.00
Total purchases from top five suppliers as % of total purchases of the Reporting Period (%)15.54%
Total purchases from related parties among top five suppliers as % of total purchases of the Reporting Period (%)0.00%

Information about top five suppliers:

No.SupplierPurchase in the Reporting Period (RMB)As % of total purchases (%)
1Supplier A5,242,835,526.006.78%
2Supplier B2,462,004,223.003.19%
3Supplier C1,491,595,035.001.93%
4Supplier D1,478,433,702.001.91%
5Supplier E1,337,335,151.001.73%
Total--12,012,203,637.0015.54%

BOE Technology Group Co., Ltd. Annual Report 2018

Other information about major suppliers:

□ Applicable √ Not applicable

3. Expense

Unit: RMB

Item20182017Change (%)Reason for any significant change
Selling expense2,891,056,969.002,591,925,798.0011.54%No
Administrative expense4,959,184,197.004,068,775,945.0021.88%No
Finance costs3,196,695,890.001,948,024,860.0064.10%The increase of interest expense due to the new project being converted to operation and the increase of the net exchange losses.
R&D expense5,039,927,435.003,177,767,395.0058.60%The strengthening of R&D of the Company

4. R&D Expense

√ Applicable □ Not applicableDetails about R&D input:

Item20182017Change (%)
Number of R&D personnel19,62717,14114.50%
R&D personnel as % of total employees28.73%27.42%1.31%
R&D expense (RMB)7,238,202,290.006,972,095,396.003.82%
R&D expense as % of operating revenue7.45%7.43%0.02%
Capitalized R&D expense (RMB)2,198,274,855.001,893,143,576.0016.12%
Capitalized R&D expense as % of total R&D expense30.37%27.15%3.22%

Reasons for any significant YoY change in the percentage of R&D expense in operating revenue:

□ Applicable √ Not applicableReason for any sharp variation in the percentage of capitalized R&D expense and rationale:

□ Applicable √ Not applicable

5. Cash Flows

BOE Technology Group Co., Ltd. Annual Report 2018

Unit: RMB

Item20182017Change (%)
Subtotal of cash generated from operating activities115,069,347,790.00112,394,636,782.002.38%
Subtotal of cash used in operating activities89,385,300,594.0085,667,707,127.004.34%
Net cash generated from/used in operating activities25,684,047,196.0026,726,929,655.00-3.90%
Subtotal of cash generated from investing activities68,276,730,240.0032,887,925,278.00107.60%
Subtotal of cash used in investing activities115,340,265,598.0092,409,894,695.0024.81%
Net cash generated from/used in investing activities-47,063,535,358.00-59,521,969,417.00——
Subtotal of cash generated from financing activities42,994,273,471.0066,143,493,674.00-35.00%
Subtotal of cash used in financing activities27,427,703,081.0033,218,121,485.00-17.43%
Net cash generated from/used in financing activities15,566,570,390.0032,925,372,189.00-52.72%
Net increase in cash and cash equivalents-4,562,591,063.00-1,441,522,805.00——

Explanation of why any of the data above varies significantly:

√ Applicable □ Not applicableCash generated from investing activities increases 107.60% compared with that of last year, which is mainly caused by disinvestmentdue to maturity of financial products.Net cash generated from financing activities decreases 52.72%compared with that of last year, which is mainly due to the decrease inspecial borrowings for new projects.Reason for any big difference between the net operating cash flow and the net profit for this Reporting Period√ Applicable □Not applicableMainly because the depreciation amount of equipment in the display industry is high, causing a gap between net cash generated fromoperating activities and net profit.

III Analysis of Non-Core Businesses

√ Applicable □ Not applicable

Unit: RMB

ItemAmountAs % of total profitSource/ReasonExceptional or recurrent
Investment income306,887,579.007.44%Gains on financial productsNo
Gain/loss on changes in fair value2,061,153.000.05%N/ANo
Asset impairments1,239,588,763.0030.07%Amount provided for inventory falling price impairment according to market conditionsNo
Non-operating income169,429,515.004.11%Governmental subsidies received in the Reporting PeriodNo
Non-operating expense55,310,251.001.34%Loss on retirement of fixed assetsNo

BOE Technology Group Co., Ltd. Annual Report 2018

IV Analysis of Assets and Liabilities

1. Significant Changes in Asset Composition

Unit: RMB

Item31 December 201831 December 2017Change in percentage (%)Reason for any significant change
AmountAs % of total assetsAmountAs % of total assets
Monetary capital51,481,539,711.0016.93%57,128,659,576.0022.31%-5.38%N/A
Accounts receivable19,880,680,518.006.54%15,513,763,252.006.06%0.48%N/A
Inventories11,985,398,172.003.94%8,957,719,381.003.50%0.44%N/A
Investment property1,283,867,651.000.42%1,296,662,205.000.51%-0.09%N/A
Long-term equity investments2,389,166,886.000.79%6,928,854,415.002.71%-1.92%Consolidation of associate/joint venture
Fixed assets128,157,730,995.0042.15%88,625,296,761.0034.60%7.55%The newly established project was converted into fixed assets
Construction in progress56,423,354,887.0018.56%50,761,250,426.0019.82%-1.26%N/A
Short-term borrowings5,449,954,885.001.79%3,249,736,430.001.27%0.52%N/A
Long-term borrowings94,780,077,864.0031.17%78,973,633,010.0030.84%0.33%N/A
Other current assets12,463,073,779.004.10%15,924,433,978.006.22%-2.12%The decrease of due finance products during the Reporting Period.
Accounts payable22,213,956,616.007.31%16,205,788,698.006.33%0.98%N/A
Other accounts payable22,956,979,828.007.55%16,122,413,130.006.30%1.25%The increase of engineering equipment payables and deferred VAT of imported equipment
Current portion of non-current liabilities5,597,563,204.001.84%9,109,708,511.003.56%-1.72%Returning the bank loans.

BOE Technology Group Co., Ltd. Annual Report 2018

2. Assets and Liabilities at Fair Value

√ Applicable □ Not applicable

Unit: RMB

ItemBeginning amountGain/loss on fair-value changes in the Reporting PeriodCumulative fair-value changes charged to equityImpairment allowance for the Reporting PeriodPurchased in the Reporting PeriodSold in the Reporting PeriodEnding amount
Financial assets
1. Financial assets at fair value through profit/loss (excluding derivative financial assets)0.000.000.000.000.000.000.00
2.Derivative financial assets0.000.000.000.000.000.000.00
3.Available-for-sale financial assets527,750,536.000.00-26,756,143.000.000.008,952,172.00391,502,549.00
Subtotal of financial assets527,750,536.000.00-26,756,143.000.000.008,952,172.00391,502,549.00
Investment property0.000.000.000.000.000.000.00
Productive living assets0.000.000.000.000.000.000.00
Others0.000.000.000.000.000.000.00
Total of the above527,750,536.000.00-26,756,143.000.000.008,952,172.00391,502,549.00
Financial liabilities73,061,153.00-2,061,153.000.000.000.000.0071,000,000.00

Significant changes to the measurement attributes of the major assets in the Reporting Period:

□ Yes √ No

BOE Technology Group Co., Ltd. Annual Report 2018

3. Restricted Asset Rights as at the Period-End

ItemEnding carrying valueReason for restriction
Monetary capital8,130,843,191.00As pledge for guarantee and as security deposits
Notes receivable208,324,414.00Endorsed and transferred with right of recourse, as pledge for opening notes payable
Inventories0.00N/A
Fixed assets98,251,866,706.00As mortgage for guarantee
Intangible assets1,216,927,485.00As mortgage for guarantee
Investment property217,435,561.00As mortgage for guarantee
Construction in progress34,117,974,254.00As mortgage for guarantee
Total142,143,371,611.00--

V Investments Made

1. Total Investment Amount

√ Applicable □ Not applicable

Investments made in this Reporting Period (RMB)Investments made in the prior year (RMB)Change (%)
183,852,785.005,781,001,277.00-96.82%

2. Major Equity Investments Made in the Reporting Period

□ Applicable √ Not applicable

3. Major Non-Equity Investments Ongoing in the Reporting Period

□ Applicable √ Not applicable

BOE Technology Group Co., Ltd. Annual Report 2018

4. Financial Investments

(1) Securities Investments

√ Applicable □ Not applicable

Unit: RMB

Variety of securitiesCode of securitiesName of securitiesInitial investment costAccounting measurement modelBeginning carrying valueProfit/loss on fair value changes in this Reporting PeriodCumulative fair value changes charged to equityPurchased in this Reporting PeriodSold in this Reporting PeriodProfit/loss in this Reporting PeriodEnding carrying valueAccounting titleSource of investment funds
Domestic/overseas stockHK00903TPV Technology134,658,158.00Fair value method21,584,703.000.00-2,430,028.000.000.00205,417.0025,613,279.00Available-for-sale financial assetSelf-owned funds
Domestic/overseas stockSH600658Electronic Zone90,160,428.00Fair value method108,996,372.000.0037,320,319.000.000.003,711,768.0083,995,943.00Available-for-sale financial assetSelf-owned funds
Domestic/overseas stockHK01963Bank of Chongqing120,084,375.00Fair value method130,968,760.000.00-21,379,310.000.000.003,074,294.0098,705,065.00Available-for-sale financial assetSelf-owned funds
FundsBLKBlackRock Global Allocation FundA2 USD0.00Fair value method6,347,799.000.000.000.006,179,429.002,605,529.000.00Available-for-sale financial assetSelf-owned funds
Domestic/overseas stockHK06066China Securities70,041,364.00Fair value method65,856,319.000.00-25,628,789.000.000.001,949,454.0044,412,575.00Available-for-sale financial assetSelf-owned funds

BOE Technology Group Co., Ltd. Annual Report 2018

Domestic/overseas stockHK01518New Century Healthcare140,848,850.00Fair value method178,837,871.000.00-14,939,595.000.00709,430.001,142,810.00125,909,255.00Available-for-sale financial assetSelf-owned funds
Domestic/overseas stockHK00948Z-Obee Holdings Ltd.0.00Fair value method246,566.000.000.000.00290,658.00303,894.000.00Available-for-sale financial assetSelf-owned funds
Other securities investments held at the period-end0.00--0.000.000.000.000.000.000.00----
Total555,793,175.00--512,838,390.000.00-27,057,403.000.007,179,517.0012,993,166.00378,636,117.00----
Disclosure date of the announcement about the board’s consent for the securities investmentN/A
Disclosure date of the announcement about the general meeting’s consent for the securities investment (if any)N/A

(2) Investments in Derivative Financial Instruments

□ Applicable √ Not applicableNo such cases in the Reporting Period.

5. Use of Funds Raised

□ Applicable √ Not applicableNo such cases in the Reporting Period

BOE Technology Group Co., Ltd. Annual Report 2018

VI Sale of Major Assets and Equity Interests

1. Sale of Major Assets

□ Applicable √ Not applicableNo such cases in the Reporting Period.

2. Sale of Major Equity Interests

□ Applicable √ Not applicable

VII Major Subsidiaries

√ Applicable □ Not applicableMajor fully/majority-owned subsidiaries and those minority-owned subsidiaries with an over 10% effect on the Company’s net profit:

Unit: RMB

NameRelationship with the CompanyPrincipal activityRegistered capitalTotal assetsNet assetsOperating revenueOperating profitNet profit
Hefei BOE Optoelectronics Technology Co., Ltd.SubsidiaryInvestment construction, R&D, Production, and sales of relevant products of TFT-LCD and its matching products.9,000,000,000.0015,097,057,224.0012,165,750,288.0012,500,784,859.002,167,001,130.001,891,628,081.00
Chongqing BOE Optoelectronics Technology Co., Ltd.SubsidiaryR&D, Production, and sales of semi-conductor display device, complete machine, and relevant products; import and export business and technology consulting of goods.19,226,000,000.0039,526,605,610.0025,347,764,127.0018,275,745,890.002,125,872,574.001,839,819,172.00

BOE Technology Group Co., Ltd. Annual Report 2018

Subsidiaries obtained or disposed in this Reporting Period□ Applicable √ Not applicableInformation about major majority- and minority-owned subsidiaries:

Naught

VIII Structured Bodies Controlled by the Company

□ Applicable √ Not applicable

IX Prospects

At present, IoT is at the key layout stage of industrial ecology, and in-depth exploration, expansion and extension of industries for application scenes will significantly promote explosive growthof the market scale. It is predicted that the market scale of global IoT will be up to USD 14.2 trillion in 2030, mainly involving smart manufacturing, smart city, smart healthcare, smart retail,smart logistics and smart traffic.From the perspective of industry chain, IoT can be simply divided into four layers, namely perception and control, network, platform service and application service. Along with thedevelopment of IoT, the market scale of each layer will keep increasing, and the increase structure transforms from layout of infrastructure at the base layer to the field of professional serviceand application scenes. In 2030, the market scale proportion of platform service and application service will be more than 70% in total, and that of the perception and control layer as theinfrastructure will decrease to 18%.In 2019, BOE will further implement the basic business steadily, optimize and upgrade comprehensive smart products and explore the IoT system and professional service business vigorously topromote the anti-risk ability and the profitability further.(I) Interface devices (D)The business focus of the Display and Sensor BG in 2019: Accelerate flexible upgrade and expand application of products; Promote 8425 plan ("8425" means promotion of 8K, popularizationof 4K, replacement of 2K and good service of 5G) and build up a win-win industry ecology.Sensor and Application Solution BG will stick to innovative transformation, carry out in-depth development in the medical and home furniture fields to provide clients with sensor solutionsfeaturing rich categories and outstanding performance.(II) Smart IoT (S)The Intelligent Manufacturing Service BG will serve subdivided application scene solutions to provide the eco-partners with ICT terminal products.IoT Solution BG will develop business office, smart education, digital hospital, smart energy, smart traffic and smart home furniture comprehensively as well as carry out in-depth developmentin the retail and smart finance fields to provide the whole world with system integration solutions.

BOE Technology Group Co., Ltd. Annual Report 2018

The Digital Art IoT Platform BG will further optimize the platform function and enrich terminal product clusters to forge a digital art platform providing the best user experience.(III) Smart Medicine and Engineering (H)The Mobile Healthcare IoT Platform BG will launch types of mobile healthcare equipment, perfect platform functions and optimize user experience to provide millions of VIP with personal,convenient, safe and reliable healthcare services.The Healthcare Service BG will devote itself to the operation of Hefei BOE Hospital, and promote healthcare industry base in Chengdu, Beijing, etc. steadily at the same time.

BOE Technology Group Co., Ltd. Annual Report 2018

X Communications with the Investment Community such as Researches, Inquiries andInterviews

1. During the Reporting Period

√ Applicable □ Not applicable

DateWay of communicationType of communication partyIndex to main information communicated
10 January 2018One-on-one meetingInstitutionMain contents: 1. the main situations of the industry 2. main operating information of the Company 3. innovations of technology and products 4. future strategy layout For details, see www.cninfo.com.cn
15 January 2018One-on-one meetingInstitution
16 January 2018One-on-one meetingInstitution
17 January 2018One-on-one meetingInstitution
19 January 2018By phoneInstitution
22 January 2018One-on-one meetingInstitution
24 January 2018One-on-one meetingInstitution
25 January 2018One-on-one meetingInstitution
1 March 2018One-on-one meetingInstitution
7 March 2018One-on-one meetingInstitution
8 March 2018One-on-one meetingInstitution
9 March 2018One-on-one meetingInstitution
12 March 2018One-on-one meetingInstitution
13 March 2018One-on-one meetingInstitution
14 March 2018One-on-one meetingInstitution
15 March 2018One-on-one meetingInstitution
16 March 2018One-on-one meetingInstitution
20 March 2018One-on-one meetingInstitution
21 March 2018One-on-one meetingInstitution
22 March 2018One-on-one meetingInstitution
23 March 2018By phoneInstitution
26 March 2018By phoneInstitution
29 March 2018By phoneInstitution
25 April 2018One-on-one meetingInstitutionMain contents: 1. the performance in 2017, the performance in the first quarter of 2018 of the Company, and the main situations of the industry
26 April 2018One-on-one meetingInstitution
3 May 2018One-on-one meetingInstitution
4 May 2018By phoneInstitution

BOE Technology Group Co., Ltd. Annual Report 2018

5 June 2018One-on-one meetingInstitution2. main operating information of the Company 3. innovations of technology and products 4. future strategy layout For details, see www.cninfo.com.cn
11 June 2018One-on-one meetingInstitution
12 June 2018By phoneInstitution
19 June 2018By phoneInstitution
20 June 2018One-on-one meetingInstitution
29 June 2018One-on-one meetingInstitution
3 July 2018One-on-one meetingInstitution
4 July 2018One-on-one meetingInstitution
5 July 2018One-on-one meetingInstitution
29 August 2018One-on-one meetingInstitutionMain contents: 1. the interim performance in 2018 of the Company, and the main situations of the industry 2. main operating information of the Company 3. innovations of technology and products 4. future strategy layout For details, see www.cninfo.com.cn
3 September 2018One-on-one meetingInstitution
12 September 2018One-on-one meetingInstitution
13 September 2018One-on-one meetingInstitution
13 September 2018By phoneInstitution
20 September 2018One-on-one meetingInstitution
28 September 2018One-on-one meetingInstitution
29 October 2018By phoneInstitutionMain contents: 1. the performance in the third quarter of 2018 of the Company, and the main situations of the industry 2. main operating information of the Company 3. innovations of technology and products 4. future strategy layout For details, see www.cninfo.com.cn
30 October 2018One-on-one meetingInstitution
31 October 2018One-on-one meetingInstitution
2 November 2018One-on-one meetingInstitution
12 November 2018By phoneInstitution
19 November 2018By phoneInstitution
23 November 2018One-on-one meetingInstitution
26 November 2018One-on-one meetingInstitution
27 November 2018One-on-one meetingInstitution
28 November 2018One-on-one meetingInstitution
29 November 2018One-on-one meetingInstitution
5 December 2018One-on-one meetingInstitution
6 December 2018One-on-one meetingInstitution
Times of visit74
Number of visiting institutions802
Number of visiting individuals47
Number of other visitors0
Significant undisclosed information disclosed, revealed or leakedNo

BOE Technology Group Co., Ltd. Annual Report 2018

Part V Significant Events

I Profit Distributions to Ordinary Shareholders (in the Form of Cash and/or Stock)

How the profit distribution policy, especially the cash dividend policy, for ordinary shareholders was formulated, executed or revised in the Reporting Period:

□ Applicable √ Not applicableThe profit distributions to ordinary shareholders, either in the form of cash or stock, in the past three years (including the Reporting Period) are summarized as follows:

For 2016, based on the total shares of 34,885,942,533, the Company distributed, with the undistributed profit, a cash dividend of RMB0.30 (tax inclusive) per 10 shares to all its shareholders,with the total distributed amount reaching RMB1,046,578,275.99, representing 70.08% of the total undistributed profit. And no bonus share was granted, nor was any capital reserve convertedinto share capital.For 2017, based on the total shares of 34,798,398,763, the Company distributed, with the undistributed profit, a cash dividend of RMB0.50 (tax inclusive) per 10 shares to all its shareholders,with the total distributed amount reaching RMB1,739,919,938.15, representing 98.56% of the total undistributed profit. And no bonus share was granted, nor was any capital reserve convertedinto share capital.For 2018, based on the total shares of 34,798,398,763, the Company distributed, with the undistributed profit, a cash dividend of RMB0.30 (tax inclusive) per 10 shares to all its shareholders,with the total distributed amount reaching RMB1,043,951,962.89, representing 44% of the total undistributed profit. And no bonus share was granted, nor was any capital reserve converted intoshare capital.Cash dividend for ordinary shareholders in the past three years (including the Reporting Period):

Unit: RMB

YearCash dividends (tax inclusive) (A)Net profit attributable to ordinary shareholders of the listed company in consolidated statements for the year (B)A as % of B (%)Cash dividends in other forms (such as share repurchase) (C)C as % of B (%)Total cash dividends (including those in other forms) (D)D as % of B (%)
20181,043,951,962.893,435,127,975.0030.39%0.000.00%0.000.00%
20171,739,919,938.157,567,682,493.0022.99%0.000.00%0.000.00%
20161,046,578,275.991,882,571,674.0055.59%0.000.00%0.000.00%

BOE Technology Group Co., Ltd. Annual Report 2018

Indicate by tick mark whether the Company fails to put forward a cash dividend proposal for the ordinary shareholders despite the facts that the Company has made profits in the ReportingPeriod and the profits of the Company as the parent distributable to the ordinary shareholders are positive.□ Applicable √ Not applicable

II Final Dividend Plan for the Reporting Period

√Applicable □ Not applicable

Bonus shares for every 10 shares (share)0
Dividend for every 10 shares (RMB) (tax inclusive)0.30
Additional shares to be converted from capital reserve for every 10 shares (share)0
Total shares as the basis for the profit distribution proposal (share)34,798,398,763
Cash dividends (RMB) (tax inclusive)1,043,951,962.89
Cash dividends in other forms (such as share repurchase) (RMB)0.00
Total cash dividends (including those in other forms) (RMB)1,043,951,962.89
Attributable profit (RMB)2,392,243,713.00
Total cash dividends (including those in other forms) as % of total profit distribution (%)100%
Cash dividend policy adopted
If the Company is in a growth stage and has any plan for significant expenditure, in profit distribution, the proportion of cash dividends shall be 20% or above.
Details about the proposal for profit distribution and converting capital reserve into share capital
Based on the total shares of 34,798,398,763, the Company planned to distribute a cash dividend of RMB0.30 (tax inclusive) per 10 shares to the shareholders, with no share dividend converted either from retained earnings or from capital reserves. The said proposal is in compliance with the Company’s Articles of Association and relevant approval procedure, and the independent directors have expressed their independent opinion on the proposal, which fully protects the legal rights and interests of the minority investors.

BOE Technology Group Co., Ltd. Annual Report 2018

III Fulfillment of Commitments

1. Commitments of the Company’s Actual Controller, Shareholders, Related Parties and Acquirers, as wellas the Company Itself and other Entities Fulfilled in the Reporting Period or Ongoing at the Period-end

□ Applicable √ Not applicableNo such cases in the Reporting Period.

2. Where there had been an earnings forecast for an asset or project and the Reporting Period was stillwithin the forecast period, explain why the forecast has been reached for the Reporting Period.

□Applicable √ Not applicable

IV Occupation of the Company’s Capital by the Controlling Shareholder or Its RelatedParties for Non-Operating Purposes

□ Applicable √ Not applicableNo such cases in the Reporting Period.

V Explanations Given by the Board of Directors, the Supervisory Board and the IndependentDirectors (if any) Regarding the Independent Auditor's “Modified Opinion” on the FinancialStatements of the Reporting Period

□ Applicable √ Not applicable

VI YoY Changes to Accounting Policies, Estimates and Methods

√ Applicable □ Not applicableChanges in accounting policies and reasons:

The Ministry of Finance issued the following interpretations and revisions of Accounting Standards for Business Enterprises(hereinafter referred to as “ASBE”) in 2017 and 2018:

Notice on Revision and Issuing of Financial Statement Formats for General Enterprises in 2018 (CK [2018] No.15) and relevantinterpretationsThe Group begins to implement above-mentioned interpretations and revisions of ASBE from 1 January 2018 and adjusts relevantcontents of accounting policies.The main effects of adopting above-mentioned interpretations and revisions of ASBE by the Group are as follows:

(a) Interpretation No.9- 12The Group adjusts relevant accounting policies in accordance with regulations stipulated in Interpretation No.9-12 governing theaccounting treatment of net investment losses under the equity method, depreciation and amortization method for fixed assets andintangible assets, and identification and disclosure of related parties the key management personnel serves.The adoption of interpretation No.9-12 makes significant effects on the Company’s financial situation and operating results.(b) Presentation of Financial StatementsThe Group prepares the 2018 Financial Statements in accordance with the financial statement formats stipulated in CK [2018] No.15

BOE Technology Group Co., Ltd. Annual Report 2018

and relevant interpretations and adjusts the presentation of comparative financial statements by retrospective adjustment method.

VII Retrospective Restatements due to Correction of Material Accounting Errors in theReporting Period

□ Applicable √ Not applicableNo such cases in the Reporting Period.

VIII YoY Changes to the Scope of the Consolidated Financial Statements

√Applicable □ Not applicableDuring the Reporting Period, the Group incorporated 6 new subsidiaries, that is, Beijing BOE Sensor Technology Co., Ltd.,Mianyang BOE Optoelectronics Co., Ltd., SES Imagotag SA, Beijing BOE Yiyun Technology Co., Ltd, Wuhan BOE OptoelectronicsTechnology Co., Ltd., and Chongqing BOE Display Technology Co., Ltd, with the Company respectively holding 100%, 81.35%,73.93%, 95.92%, 14.58% and 38.46% interests in them.

IX Engagement and Disengagement of Independent Auditor

Current independent auditor:

Name of the domestic independent auditorKPMG Huazhen (LLP)
The Company’s payment to the domestic independent auditor (RMB’0,000)990
How many consecutive years the domestic independent auditor has provided audit service for the Company14 years
Names of the certified public accountants from the domestic independent auditor writing signatures on the auditor’s reportZhanghuan and Liu Jingyuan
How many consecutive years the certified public accountants from the domestic independent auditor have provided audit service for the CompanyZhanghuan 2 years and Liu Jingyuan 1year
Name of the foreign independent auditor (if any)N/A
The Company’s payment to the foreign independent auditor (RMB’0,000) (if any)N/A
How many consecutive years the foreign independent auditor has provided audit service for the Company (if any)N/A
Names of the certified public accountants from the foreign independent auditor writing signatures on the auditor’s report (if any)N/A
How many consecutive years the certified public accountants from the foreign independent auditor have provided audit service for the Company (if any)N/A

Indicate by tick mark whether the independent auditor was changed for the Reporting Period.□ Yes √ NoIndependent auditor, financial advisor or sponsor engaged for internal control audit√ Applicable □ Not applicable

BOE Technology Group Co., Ltd. Annual Report 2018

The Company hired KPMG Huazhen LLP as the internal control auditor for the Current Year at the cost of RMB2.70 million.

X Possibility of Listing Suspension or Termination after Disclosure of this Report

□ Applicable √ Not applicable

XI Insolvency and Reorganization

□ Applicable √ Not applicableNo such cases in the Reporting Period.

XII Major Legal Matters

√Applicable □ Not applicable

General informationInvolved amount (RMB’0,000)ProvisionProgressDecisions and effectsExecution of decisionsDisclosure dateIndex to disclosed information
Disputes case of sales contract that BOE Technology (HK) Limited sued LeTV Mobile Intelligent Information Technology (Beijing) Co., Ltd, LeTV Holdings (Beijing) Co., Ltd., Le Sai Mobile Technology (Beijing) Co., Ltd. and Mr. JiaYueting28,471.43NoThe Company received the (2018) MXZ No. 132 written verdict on 9 July 2018 by the Supreme Court with regard to the jurisdiction objection put forward by LeTV Mobile, which rejected the appeal of LeTV Mobile, remaining the original verdict. This case is waiting to the notice for the first instance of Beijing High People’s CourtUnknownN/A29 August 2017For details, see Interim Report 2017 of BOE Technology Group Co., Ltd. disclosed on www.cninfo.com.cn. on 29 August 2017
Litigations for 2018 (including carryforwards in previous years )7,848.35NoN/AN/AN/AN/AN/A

XIII Punishments and Rectifications

□ Applicable √ Not applicableNo such cases in the Reporting Period.

BOE Technology Group Co., Ltd. Annual Report 2018

XIV Credit Quality of the Company as well as Its Controlling Shareholder and ActualController

□ Applicable √ Not applicable

XV Equity Incentive Plans, Employee Stock Ownership Plans or Other Incentive Measuresfor Employees

□ Applicable √ Not applicableNo such cases in the Reporting Period.

XVI Major Related-Party Transactions

1. Continuing Related-Party Transactions

□ Applicable √ Not applicableNo such cases in the Reporting Period.

2. Related-Party Transactions Regarding Purchase or Sales of Assets or Equity Interests

□ Applicable √ Not applicableNo such cases in the Reporting Period.

3. Related Transactions Regarding Joint Investments in Third Parties

□ Applicable √ Not applicableNo such cases in the Reporting Period.

4. Credits and Liabilities with Related Parties

□ Applicable √ Not applicableNo such cases in the Reporting Period.

BOE Technology Group Co., Ltd. Annual Report 2018

5. Other Major Related-Party Transactions

√Applicable □ Not applicableNaughtIndex to the public announcements about the said related-party transactions disclosed

Title of public announcementDisclosure dateDisclosure website
Announcement on Investment and Construction of Project of the 6th generation AMOLED (flexible) production line in Chongqing and Related-Party Transactions9 March 2018www.cninfo.com.cn
Announcement on the Prediction of 2018 Annual Routine Connected Transaction24 April 2018www.cninfo.com.cn
Announcement on Equity Participation on Beijing Electronic Control Industrial Investment Co., Ltd and Related-Party Transactions31 July 2018www.cninfo.com.cn

XVII Major Contracts and Execution thereof

1. Entrustment, Contracting and Leases

(1) Entrustment

□ Applicable √ Not applicableNo such cases in the Reporting Period.

(2) Contracting

□ Applicable √ Not applicableNo such cases in the Reporting Period.

(3) Leases

√ Applicable □ Not applicableNotes to lease1. The fixed assets leased in through financing by the Group are the youth apartment used as staff dormitory.2. The Group sold and leased back part of the machinery equipment and construction in progress. The sale of assets and leasetransactions are related to each other, and there is almost no doubt that the Group will repurchase them after expiry of the lease.

The project whose profit and loss brought for the Company can reach above 10% of the total profits during the Reporting Period□ Applicable √ Not applicableNo such cases in the Reporting Period.

BOE Technology Group Co., Ltd. Annual Report 2018

2. Major guarantees

√ Applicable □ Not applicable

(1) Guarantees

Unit: RMB'0,000

Guarantees provided by the Company as the parent and its subsidiaries for external parties (exclusive of those for subsidiaries)
ObligorDisclosure date of the guarantee line announcementLine of guaranteeActual occurrence dateActual guarantee amountType of guaranteeTerm of guaranteeHaving expired or notGuarantee for a related party or not
N/A
Total approved line for such guarantees in the Reporting Period (A1)0Total actual amount of such guarantees in the Reporting Period (A2)0
Total approved line for such guarantees at the end of the Reporting Period (A3)0Total actual balance of such guarantees at the end of the Reporting Period (A4)0
Guarantees provided by the Company as the parent for its subsidiaries
ObligorDisclosure date of the guarantee line announcementLine of guaranteeActual occurrence dateActual guarantee amountType of guaranteeTerm of guaranteeHaving expired or notGuarantee for a related party or not
Hefei BOE Optoelectronics Technology Co., Ltd.14 August 2014752,86412 March 201529,817Joint-liability23 July 2010 to 23 July 2019NotNot
Hefei XinSheng Optoelectronics Technology Co., Ltd.14 August 20141,269,69215 January 2015737,794Joint-liability6 January 2014 to 6 January 2022NotNot

BOE Technology Group Co., Ltd. Annual Report 2018

Ordos YuanSheng Optoelectronics Co., Ltd.2 April 2013479,43422 May 2013129,220Joint-liability17 June 2013 to 9 June 2021NotNot
Ordos YuanSheng Optoelectronics Co., Ltd.14 August 2014479,43430 September 2014129,220Pledge17 June 2013 to 9 June 2021NotNot
Ordos YuanSheng Optoelectronics Co., Ltd.30 November 2016549,51615 March 2017433,045Joint-liability17 March 2017 to 17 March 2025NotNot
Chengdu BOE Optoelectronics Technology Co., Ltd.25 April 20172,299,70630 August 20171,618,603Joint-liability6 September 2017 to 6 September 2027NotNot
Chengdu BOE Optoelectronics Technology Co., Ltd.25 April 2017450,00030 August 2017231,850Joint-liabilityOpening date of the letter of guarantee to 31 July 2023NotNot
Chongqing BOE Optoelectronics Technology Co., Ltd.14 August 20141,456,03929 September 2014735,697Joint-liability5 November 2014 to 5 November 2022NotNot
Hefei BOE Display Technology Co., Ltd.1 December 20161,682,01530 August 20171,576,091Joint-liability7 September 2017 to 7 September 2025NotNot
Hefei BOE Display Technology Co., Ltd.1 December 2016450,00021 December 2017286,000Joint-liabilityOpening date of the letter of guarantee to 31 March 2024NotNot
Fuzhou BOE Optoelectronics Technology Co., Ltd.10 December 20151,336,8148 November 20161,176,459Joint-liability19 December 2016 to 19 December 2024NotNot
Fuzhou BOE Optoelectronics Technology Co., Ltd.10 December 2015300,0008 November 2016180,000Joint-liabilityOpening date of the letter of guarantee to 28 December 2023NotNot
Mianyang BOE Optoelectronics Co., Ltd.18 May 20182,119,47118 September 2018815,138Joint-liability26 September 2018 to 26 September 2028NotNot
Mianyang BOE Optoelectronics Co., Ltd.18 May 2018460,00022 June 2018296,000Joint-liabilityOpening date of the letter of guarantee to 31 OctoberNotNot

BOE Technology Group Co., Ltd. Annual Report 2018

2027
Total approved line for such guarantees in the Reporting Period (B1)2,579,471Total actual amount of such guarantees in the Reporting Period (B2)1,108,497
Total approved line for such guarantees at the end of the Reporting Period (B3)13,605,551Total actual balance of such guarantees at the end of the Reporting Period (B4)8,245,714
Guarantees provided between subsidiaries
ObligorDisclosure date of the guarantee line announcementLine of guaranteeActual occurrence dateActual guarantee amountType of guaranteeTerm of guaranteeHaving expired or notGuarantee for a related party or not
OrdosYuanSheng Optoelectronics Co., Ltd.2 April 2013479,43422 May 2013129,220Pledge17 June 2013 to 9 June 2021NotNot
Huanda Trading (Hebei) Co., Ltd.N/A14,60024 May 201714,540Joint-liability15 June 2017 to 16 January 2029NotNot
Guangtai Solar Energy Technology (Suzhou) Co., LtdN/A5,45020 December 20175,240Joint-liability20 December 2017 to 6 April 2027NotNot
Yangyuan Photovoltaic Power Generation (Huanggang) Co., LtdN/A4,55211 September 20174,552Joint-liability11 September 2017 to 11 September2027NotNot
Yaoguang New Energy (Shouguang) Co., LtdN/A4,19231 October 20174,192Joint-liability31 October 2017 to 31 October 2027NotNot
Suzhou Industrial Park Taijing Photovoltaic Co., LtdN/A3,4841 December 20173,484Joint-liability1 December 2017 to 1 December 2027NotNot
Qingmei Solar Energy Technology (Lishui) Co., LtdN/A4,67821 December 20174,678Joint-liability21 December 2017 to 21 December 2027NotNot
Qinghong Solar Energy Technology (Jinhua) Co., LtdN/A2,37421 December 20172,374Joint-liability21 December 2017 to 21 December 2027NotNot

BOE Technology Group Co., Ltd. Annual Report 2018

Qinghui Solar Energy Technology (Jinhua) Co., LtdN/A3,66615 December 20173,666Joint-liability15 December 2017 to 15 December 2027NotNot
Rongke New Energy (Hefei) Co., LtdN/A1,40018 December 20171,393Joint-liability18 December 2017 to 18 December 2029NotNot
Tianchi New Energy (Hefei) Co., LtdN/A1,10018 December 20171,093Joint-liability18 December 2017 to 18 December 2029NotNot
Qinghao Solar Energy Technology (Jinhua) Co., LtdN/A89018 December 2017884Joint-liability18 December 2017 to 18 December 2029NotNot
Xiangqing Solar Energy Technology (Dongyang) Co., LtdN/A3,47618 December 20173,259Joint-liability18 December 2017 to 18 December 2029NotNot
Qingyue Solar Energy Technology (Wuyi) Co., LtdN/A96018 December 2017900Joint-liability18 December 2017 to 18 December2029NotNot
Qingyou Solar Energy Technology (Longyou) Co., LtdN/A2,21018 December 20172,204Joint-liability18 December 2017 to 18 December 2029NotNot
Qingfan Solar Energy Technology (Quzhou) Co., LtdN/A1,85518 December 20171,739Joint-liability18 December 2017 to 18 December 2029NotNot
Anhui BOE Energy Investment Co., LtdN/A13,57527 December 201713,485Joint-liability27 December 2017 to 27 December 2029NotNot
Taihang Electric Power Technology (Ningbo) Co., LtdN/A60019 December 2017544Joint-liability19 December 2017 to 18 December 2025NotNot
Guoji Energy (Ningbo) Co., LtdN/A2,74019 December 20172,563Joint-liability19 December 2017 to 18 December 2025NotNot
Hexu Technology (Hefei) Co., LtdN/A53818 May 2018538Joint-liability18 May 2018 to 10 May 2028NotNot
Chenneng Technology (Hefei) Co., LtdN/A1,06818 May 20181,068Joint-liability18 May 2018 to 10 May 2028NotNot

BOE Technology Group Co., Ltd. Annual Report 2018

Hongyang Solar Energy Power Generation (Anji) Co., LtdN/A3,50014 December 20173,500Joint-liability14 December 2017 to 13 December 2025NotNot
Ke’enSolar Energy Power Generation (Pingyang) Co., LtdN/A2,40014 December 20172,245Joint-liability14 December 2017 to 13 December 2025NotNot
Dongze Photovoltaic Power Generation (Wenzhou) Co., LtdN/A2,10014 December 20171,965Joint-liability14 December 2017 to 13 December 2025NotNot
Aifeisheng Investment and Management (Wenzhou) Co, LtdN/A1,40014 December 20171,310Joint-liability14 December 2017 to 13 December 2025NotNot
Junlong New Energy Technology (Huaibin) Co., LtdN/A8,45925 April 20188,262Joint-liability25 April 2018 to 25 April 2030NotNot
Hengchuan New Energy Technology (Hong’an) Co., LtdN/A6,89231 January 20186,570Joint-liability31 January 2018 to 31 January 2030NotNot
Anhui BOE Energy Investment Co., LtdN/A2,06025 April 20181,760Joint-liability25 April 2018 to 25 April 2030NotNot
Shaoxing Guangnian New Energy Co., Ltd.N/A16,00013 December 201816,000Joint-liability13 December 2018 to 12 December 2030NotNot
Shaoxing Xuhui New Energy Co., Ltd.N/A4,50013 December 20184,500Joint-liability13 December 2018 to 12 December 2030NotNot
Hefei BOE Hospital Co., Ltd27 April 2018130,00027 April 201866,000Joint-liability27 April 2018 to 27 April 2033NotNot
BOE Technology (HK) LimitedN/A110,64731 October 2017110,647Pledge12 December 2017 to 7 December 2020NotNot
Total approved line for such guarantees in the Reporting Period (C1)130,000Total actual amount of such guarantees in the Reporting Period (C2)185,271
Total approved line for such guarantees at the end of the Reporting Period (C3)361,366Total actual balance of such guarantees at the end of the Reporting Period (C4)295,156

BOE Technology Group Co., Ltd. Annual Report 2018

Total guarantee amount (total of the three kinds of guarantees above)
Total guarantee line approved in the Reporting Period (A1+B1+C1)2,709,471Total actual guarantee amount in the Reporting Period (A2+B2+C2)1,293,768
Total approved guarantee line at the end of the Reporting Period (A3+B3+C3)13,966,917Total actual guarantee balance at the end of the Reporting Period (A4+B4+C4)8,540,870
Total actual guarantee amount (A4+B4+C4) as % of the Company’s net assets99.48%
Of which:
Balance of guarantees provided for shareholders, actual controller and their related parties (D)0
Balance of debt guarantees provided directly or indirectly for obligors with an over 70% debt/asset ratio (E)204,059
Amount by which the total guarantee amount exceeds 50% of the Company’s net assets (F)4,248,032
Total of the three amounts above (D+E+F)4,248,032
Joint responsibilities possibly borne or already borne in the Reporting Period for undue guarantees (if any)N/A
Provision of external guarantees in breach of the prescribed procedures (if any)N/A

Compound guarantees:

None.

(2) Irregularities in Provision of Guarantees

□ Applicable √ Not applicableNo such cases in the Reporting Period.

BOE Technology Group Co., Ltd. Annual Report 2018

3. Cash Entrusted to Other Entities for Management(1) Cash Entrusted for Wealth Management

√ Applicable □ Not applicableOverviews of cash entrusted for wealth management during the Reporting Period

Unit: RMB'0,000

TypeSource of capitalAmountUndue amountUnrecovered overdue amount
Bank’s wealth management product and structured depositsSelf-owned funds1,257,000551,0000
Total1,257,000551,0000

Note: The amount in the table above refers to the highest single-day balance of cash entrusted for wealth management during theReporting Period.Particulars of entrusted cash management with single significant amount or low security, bad liquidity, and no capital preservation□ Applicable √ Not applicableWhether there is the case where the principal cannot be recovered at maturity or other case which may cause impairment forentrusted asset management□ Applicable √ Not applicable

(2) Entrusted Loans

□ Applicable √ Not applicableNo such cases in the Reporting Period.

4. Other Major Contracts

□ Applicable √ Not applicableNo such cases in the Reporting Period.

XVIII Corporate Social Responsibility (CSR)

1. Measures Taken to Fulfill CSR Commitment

BOE discloses its Corporate Social Responsibility Report every year. As of 2018, BOE had consecutively disclosed SocialResponsibility Report for 9 years. Please view and download such report via official website of BOE www.boe.com

BOE Technology Group Co., Ltd. Annual Report 2018

2. Measures Taken for Targeted Poverty Alleviation

(1) Plans

In response to the national targeted poverty alleviation policy, BOE will carry forward the non-profit educational projects, such asincluding “Light Up Your Growth”, “Dream Space”, and “BOE Summer Camp” with educational poverty alleviation as the direction.

(2) Summary of the Related Work Done in the Reporting Period

In 2018, BOE donated RMB1.5 million to China Voluntary Service Fund for education, culture, public welfare program, and etc.With regard to educational poverty alleviation, BOE put RMB432,015 to subsidize the poor students, and improve educationalresources in the poor areas. For example, BOE carried forward various educational poverty alleviation projects, like “Light Up YourGrowth”, “Summer Camp with Dream” and “Rain and Dew Plan”, etc. For voluntary service, BOE put RMB41,345 in 2018 toestablish voluntary service system covering all entities, and also organized the activity of “donating old things to offer the love”, andparticipated the voluntary labor. BOE volunteers practiced what they preached to actively help the vulnerable groups and spread loveand faith.

(3) Results

IndicatorMeasurement unitQuantity/Progress
1. General results————
Of which: 1. capitalRMB’0,000123.74
2. Itemized results————
2.1 Out of poverty by education————
Of which: 2.1.1 invested amounts to subsidize poor studentsRMB’0,00043.2
2.1.2 numbers of poor students subsidizedPerson1,474
2.2 Other Items————
Of which: 2.2.1 numbers of itemsNumber11
2.2.2 invested amountsRMB’0,00080.53
3. Accolades received (for what and at what level)————

(4) Subsequent Plans

In 2019, BOE will continuously carry forward the educational poverty alleviation project focused on “Light Up Your Growth”,carrying out summer camp activities, materials support, and voluntary activities, etc, taking the location of BOE production line asthe main place to carry out these activities and gradually expand coverage scale of projects; meanwhile, taking the BOE employeesvolunteers system as the platform to continuously conduct activities of helping the poor and various donations.

3. Issues Related to Environmental Protection

Indicate by tick mark whether the Company or any of its subsidiaries is identified as a major polluter by the environmental protectionauthorities.

BOE Technology Group Co., Ltd. Annual Report 2018

Yes

Name of polluterName of major pollutantsWay of dischargeNumber of discharge outletsDistribution of discharge outletsDischarge concentrationDischarge standards implementedTotal dischargeApproved total dischargeExcessive discharge
Beijing BOE Optoelectronics Technology Co., Ltd.CODStandard emission after being treated by sewage treatment system2South gate of factory, northwest corner of factory101.25mg/L500mg/L286.21t702.68tNone
Ammonia nitrogen16.68 mg/L45 mg/L46.04t55.93t
The 4.5th generation TFT-LCD production line of Chengdu BOE Optoelectronics Technology Co., Ltd.CODStandard emission after being treated by sewage treatment system1North side of factory134.8mg/L500mg/L136.58t490.51tNone
Ammonia nitrogen19.7mg/L45mg/L19.96t25.249t
Hefei BOE Optoelectronics Technology Co., Ltd.CODStandard emission after being treated by sewage treatment system1Northwest corner of factory56.49 mg/L380mg/L237.69t1059tNone
Ammonia nitrogen7.02 mg/L30mg/L29.61t99.2t
Beijing BOE Display Technology Co., Ltd.CODStandard emission after being treated by sewage treatment system1East gate of factory118.37 mg/L500mg/l608.35t1618.8tNone
Ammonia nitrogen11.71 mg/L45mg/l60.16t134.4tNone
Hefei Xinsheng Optoelectronics Technology Co., Ltd.CODStandard emission after being treated by sewage treatment system1Northeast gate of factory65 mg/L380 mg/L397.11t1621.97tNone
Ammonia nitrogen14.65 mg/L30 mg/L89.82t128.08t
Erdos Yuansheng Optoelectronics Co., Ltd.CODStandard emission after being treated by sewage treatment system1North side of factory34mg/L500mg/L114t713.81tNone
Ammonia nitrogen3.1mg/L_11t76.82t

BOE Technology Group Co., Ltd. Annual Report 2018

The 6th generation flexible AMOLED production line of Chengdu BOE Optoelectronics Technology Co., Ltd.CODStandard emission after being treated by sewage treatment system1North side of factory12.77 mg/L500mg/L56.90t2004.15tNone
Ammonia nitrogen1.33mg/L45 mg/L8.623t216.81t
Chongqing BOE Optoelectronics Technology Co., Ltd.CODStandard emission after being treated by sewage treatment system1South side of factory103.51 mg/L400mg/L566.557t727.080tNone
Ammonia nitrogen3.58 mg/L45 mg/L19.706t79.424t
Hefei BOE Display Technology Co., Ltd.CODStandard emission after being treated by sewage treatment system1North side of factory53.52mg/L400mg/L483.21t1189.88tNone
Ammonia nitrogen7.84 mg/L35 mg/L60.19t118.98t
Fuzhou BOE Optoelectronics Technology Co., Ltd.CODStandard emission after being treated by sewage treatment system1Northeast side of factory79.95mg/L500mg/L461.84t510.355tNone
Ammonia nitrogen4.44mg/L45mg/L25.15t68.055t
BOE Technology Group Co., Ltd.CODStandard emission after being treated by sewage treatment system1East side of factory102mg/L500mg/L2.05t11.1145tNone
Ammonia nitrogen15.8 mg/L45 mg/L0.32t0.3415t
BOE (Heibei) Mobile Display Technology Co., Ltd.CODDischarged into sewage treatment plant through municipal pipes2Southeast side of factory14 mg/L500mg/L1.60t13.5545tNone
Ammonia nitrogen1.12 mg/L45 mg/L0.13t1.01t
CODNorth side of factory125 mg/L500mg/L5.01t74.937t
Ammonia nitrogen22.4 mg/L45 mg/L0.90t6.744t

Construction of pollution prevention equipment and operation conditionDuring report period, the Company did not have important environmental problem. The Company built strict environmentalmanagement system, and established internal organizational structure to supervise overall environmental performance of theCompany, formulated environmental management regulations and targets, carried out regular supervision for the environmental

BOE Technology Group Co., Ltd. Annual Report 2018

management condition of subordinate enterprises to promote the implementation of environmental management work.Currently, the waste water which is generated by each subordinate enterprise of the Company can be divided in to industrial wastewater and household waste water. Rain water-waste water shunting system is adopted for drainage system to drain water separatelyaccording to different natures. After collecting, the rain water is discharged into rain water pipeline of factory; after the rain water iscollected by rain water pipe network, the rain water is discharged. After being treated by sewage treatment system in factory,industrial waste water is discharged into sewage treatment factory through municipal pipe network for intense treatment. Householdwaste water comprises household fecal waste water and canteen oily waste water etc, after pretreatment, the waste water isdischarged into municipal sewage treatment factory. All industrial and household waste water is not discharged directly, and theconcentration and total amount of drainage satisfy the requirements of national and local relevant standards.In additional, the exhaust gas which is emitted by each subordinate enterprise mainly comes from technology exhaust gas duringproduction process, generally including general exhaust gas, acid exhaust gas, alkaline exhaust gas, special exhaust gas and organicexhaust gas etc. Various exhaust gas can be emitted after being treated by independent emission treatment system. The emissionconcentration and total amount satisfy the national and local relevant standards.“4R concept” for the use of materials has been used by the Company since 2007, that is recycle (Recycle), reduction (Reduce),renewal (Renew) and responsibility (responsibly). The Company promises that the used materials are all in accordance withrequirements of national relevant environmental regulations and the registration, assessment, permission and restriction system ofchemicals. In additional, the Company promotes the recycle of package materials constantly. The waste materials which aregenerated by each subordinate enterprise can be divided into general industrial solid waste, hazardous waste materials and householdwaste materials, and they all handed over to qualified recycler for regular treatment.The Company focuses on the recycle of water resource and advanced cleaning methods such as adverse cleaning etc are adopted forprocessing equipment. Most high purity water and chemicals are recycled, reducing the consumption of high purity water, chemicaland other materials maximally and reducing the discharge of waste water and waste materials.At present, each subordinate enterprise formulates various management methods such as water pollution management, air pollutionmanagement standard, hazardous waste materials management standard, energy management standard etc. The methods specify theoperation and maintenance regulations and requirements of pollutant treatment system, establish regular monitoring and supervisingmechanism, in order to ensure the continuous stable operation of each system.In recent years, the environmental emission index of the Company is up to national standards such as Sewage ComprehensiveDischarge Standard, Air Pollutant Comprehensive Emission Standard, Industrial Enterprise Environmental Noise Emission Standardwithin Factory Boundary, etc and local standards. The Company will continue to promote the environmental management, devote toforging green factory and improve environmental management level constantly.Environmental Impact Assessment on Construction Project and Other Administrative Licenses for Environmental ProtectionAt present, corresponding environmental impact assessments have been conducted for all construction projects under the control ofthe Company in conformity with applicable national and local laws and regulations, and corresponding administrative licenses havealso been obtained.Contingency Plan for Emergent Environmental IncidentsThe Company has formulated and filed corresponding contingency plan for emergent environmental incidents in the environmentalprotection agency according to relevant local requirements. However, such contingency plan consists of comprehensive plan, specialplan and on-site disposal plan, and involves various aspects such as waste water, exhaust gas, hazardous wastes and dangerouschemicals etc. Meanwhile, drills must be conducted regularly.Self-monitoring PlanCurrently, major pollutant-discharging units subordinated to the Company have worked out corresponding self-monitoring planaccording to relevant requirements put forward by the local environmental protection agency. The self-monitoring plans respectivelyformulated by Beijing BOE Display Technology Co., Ltd. and Beijing BOE Optoelectronics Technology Co., Ltd. have been

BOE Technology Group Co., Ltd. Annual Report 2018

published via the company’s official website.Other environment information that should be disclosedNoOther related environment protection informationNo

XIX Other Significant Events

√ Applicable □Not applicable1. The Company issued Pre-disclosure Announcement on Stock Reduction of Shareholders with More than 5% Stocks(Announcement No.: 2017-061) and Pre-disclosure Announcement on Stock Reduction of Shareholders with More than 5% Stocks(Announcement No.: 2017-062) on 22 November 2017 and 25 November 2017 respectively; shareholders of the Company as HefeiJianxiang Investment Co., Ltd. and Chongqing Yufu Photovoltaic Industry Investment Co., Ltd. planned to reduce no more than 1.00%of general capital of the Company by means of centralized competitive bidding within 3 months after 15 working days since theissuance of each Announcement. Aforementioned stock reduction plans were completed by 15 January 2018 and 19 January 2018respectively.2. The Company issued the Announcement on Acquisition of SES-imagotag Stocks (Announcement No.: 2017-036) on 17 June 2017.The Company proposed to purchase more than 50.01% of SES stocks and realize consolidation of financial statements with SES byvirtue of BOE SPV, which is a joint venture invested and established by BOE’s wholly-owned subsidiary and investment platformdesignated by SES management layer. By 16 March 2018, BOE SPV acquired 10,789,186 shares of SES stock in total by means ofblock transactions and general offer, occupying 79.94% of SES’ outstanding capital stocks with total consideration of 323,675,580Euros. For more information, please refer to the Announcement on Completing Acquisition of SES-imagotag Stocks (AnnouncementNo.: 2018-017) issued by the Company on 17 March 2018.3. The wholly-owned subsidiary, BOE Technology (Hong Kong) Co., Ltd., filed lawsuits to Beijing Municipal Higher People's Courtagainst following Defendants: Letv Mobile Intelligent Information Technology (Beijing) Co.,Ltd. (referred to as “Letv Mobilehereinafter”) , TV Plus Holdings (Beijing) Limited, Leseil Mobile Technology (Beijing) Co.,Ltd. and JiaYueting, with the totalamount of claims being about US$41.84 million. Beijing Municipal Higher People's Court issued Notice of Case Acceptance andCivil Ruling Paper for property preservation on 6 July 2017 and 31 July 2017 respectively. Letv Mobile raised the jurisdictionobjection to Beijing Municipal Higher People's Court, which was rejected, and also instituted an appeal to the Supreme People'sCourt for verdict on jurisdiction objection. At present, it has been waiting for final verdict of the Supreme People's Court. Forreceivables corresponding to aforementioned amount of claims, the Company has counted provision for bad debts as per regulationsin accounting standard accordingly; therefore, it has uncertain influences on the Company.4. The corporate bonds (Phase I) of BOE Technology Group Co., Ltd. issued to public qualified investors from 21 March 2016 to 22March 2016 reached 3 full years by 21 March 2019. According to regulations, the interest should be paid once per year during theinterest-bearing period. The Company issued Announcement on Payment “16BOE01” Interest 2017 (Announcement No.: 2018-016)on 16 March 2018, in which the interest should be paid as per the standard of RMB31.5 (tax-inclusive) for every 10 bonds.5. The Company issued Announcement on 2017 Implementation of Annual Interest Distribution (Announcement No. 2018-046) on20 June 2018. The annual interest distribution plan 2017 was reviewed and adopted in 2017 Annual General Meeting held on 28 May2018. According to the distribution plan, the Company shall allocated annual corporate benefits in 2017 by means of RMB0.5 forevery 10 shares (where, the B-share benefit distribution shall be completed with Hong Kong dollar as per conversion rate from RMBto HKD published by People’s Bank of China on the first working day after Shareholders Meeting of the Company) withoutdistributing bonus share or transferring shares in the name of public reserve funds.

BOE Technology Group Co., Ltd. Annual Report 2018

Overview of significant eventsDisclosure dateIndex to disclosure website for interim report
Announcement on Investment and Construction of Project of the 6th generation AMOLED (flexible) production line in Chongqing and Related-party Transactions9 March 2018www.cninfo.com.cn
Announcement on Investment and Construction of Project of Wuhan Gaoshidai Production Line of Thin Film Transistor LCD and its Auxiliary Products9 March 2018www.cninfo.com.cn
Announcement on Project of Investment into BOE (Suzhou) Industrial Park9 March 2018www.cninfo.com.cn
Announcement on Equity Participation on Beijing Electronic Control Industrial Investment Co., Ltd and Related-Party Transactions31 July 2018www.cninfo.com.cn
Announcement on Signature of Cooperation Agreement and Supplemental Agreement about Project of Life Science and Technology Industrial Base9 November 2018www.cninfo.com.cn
Announcement on Signature of Investment Framework Agreement27 December 2018www.cninfo.com.cn

XX Significant Events of Subsidiaries

□ Applicable √ Not applicable

BOE Technology Group Co., Ltd. Annual Report 2018

Part VI Share Changes and Shareholder Information

I. Share Changes

1. Share Changes

Unit: share

ItemBeforeIncrease/decrease (+/-)After
NumberPercentageNew issuesBonus sharesBonus issue from profitOtherSubtotalNumberPercentage
I. Restricted shares1,789,9180.01%000746,475746,4752,536,3930.01%
1. Shares held by the state00.00%0000000.00%
2. Shares held by state-owned corporations00.00%0000000.00%
3. Shares held by other domestic investors1,789,9180.01%000746,475746,4752,536,3930.01%
Among which: shares held by domestic corporations00.00%0000000.00%
Shares held by domestic individuals1,789,9180.01%000746,475746,4752,536,3930.01%
4. Shares held by foreign investors00.00%0000000.00%
Among which: Shares held by foreign corporations00.00%0000000.00%
Shares held by foreign individuals00.00%0000000.00%
II. Non-restricted shares34,796,608,84599.99%000-746,475-746,47534,795,862,37099.99%
1. RMB ordinary shares33,860,495,35797.30%000-746,475-746,47533,859,748,88297.30%
2. Domestically listed foreign shares936,113,4882.69%00000936,113,4882.69%

BOE Technology Group Co., Ltd. Annual Report 2018

3. Overseas listed foreign shares00.00%0000000.00%
4. Other00.00%0000000.00%
III. Total shares34,798,398,763100.00%0000034,798,398,763100.00%

Reasons for share changes:

□ Applicable √ Not applicableApproval of share changes:

□ Applicable √ Not applicableTransfer of share ownership:

□ Applicable √ Not applicableProgress on any share repurchase:

□ Applicable √ Not applicableProgress on reducing the repurchased shares by means of centralized bidding:

□ Applicable √ Not applicableEffects of share changes on the basic and diluted earnings per share, equity per share attributable to the Company’s ordinary shareholders and other financial indicators of the prior year and theprior accounting period, respectively:

□ Applicable √ Not applicableOther information that the Company considers necessary or is required by the securities regulator to be disclosed:

□ Applicable √ Not applicable

2. Changes in Restricted Shares

√ Applicable □ Not applicable

Unit: Share

BOE Technology Group Co., Ltd. Annual Report 2018

Name of the shareholdersRestricted shares amount at the period-beginRestricted shares relieved of the periodRestricted shares increased of the periodRestricted shares amount at the period-endRestricted reasonsRestricted shares relieved date
Shares locked by senior executives1,789,9180746,4752,536,393Capital increase--
Total1,789,9180746,4752,536,393----

II. Issuance and Listing of Securities

1. Securities (Exclusive of Preferred Shares) Issued in the Reporting Period

□ Applicable √ Not applicable

2. Changes to Total Shares, Shareholder Structure and Asset and Liability Structures

□ Applicable √ Not applicable

3. Existing Staff-Held Shares

□ Applicable √ Not applicable

III Shareholders and Actual Controller

1. Total Number of Shareholders and Their Shareholdings

Unit: share

Number of ordinary shareholders at the Period-end1,437,415(including 1,397,946 A-shareholders and 39,469 B-shareholders)Number of ordinary shareholders at the month-end prior to the disclosure of this Report1,567,375(including 1,527,778 A-shareholders and 39,597 B-shareholders)
5% or greater shareholders or top 10 shareholders
Name of shareholderNature ofShareholdingTotal shares held atIncrease/decrease inRestricted sharesUnrestricted sharesShares in pledge or frozen

BOE Technology Group Co., Ltd. Annual Report 2018

shareholderpercentagethe period-endthe Reporting PeriodheldheldStatusShares
Beijing State-owned Capital Operation and Management CenterState-owned legal person11.68%4,063,333,333004,063,333,333N/A0
Chongqing Ezcapital Opto-electronics Industry Investment Co., Ltd.State-owned legal person7.62%2,653,000,041-173,500,02902,653,000,041N/A0
Hefei Jianxiang Investment Co., Ltd.State-owned legal person7.21%2,510,142,953-173,500,00002,510,142,953N/A0
Beijing Yizhuang Investment Holdings Co., LtdState-owned legal person3.57%1,241,423,641001,241,423,641N/A0
Beijing BOE Investment & Development Co., Ltd.State-owned legal person2.36%822,092,18000822,092,180N/A0
Hong Kong Securities Clearing Company Ltd.Foreign legal person1.39%483,208,36540,681,1130483,208,365N/A0
Beijing Electronics Holdings Co., Ltd.State-owned legal person0.79%273,735,58300273,735,583N/A0
Central Huijin Assets Management Co., LtdState-owned legal person0.71%248,305,30000248,305,300N/A0
China Life Insurance Company Ltd.-dividends-individual dividends-005L-FH002 ShenState-owned legal person0.42%144,840,42745,490,4870144,840,427N/A0
China Securities Finance Corporation LimitedState-owned legal person0.38%132,480,249-56,087,9930132,480,249N/A0
Strategic investors or general corporations becoming top-ten shareholders due to placing of new shares (if any) (see Note 3)Naught
Related or acting-in-concert parties among the1. Beijing State-owned Capital Operation and Management Center held 100% equities of Beijing Electronics Holdings Co., Ltd.

BOE Technology Group Co., Ltd. Annual Report 2018

shareholders above2. Beijing Electronics Holdings Co., Ltd. held 66.25% equities of Beijing BOE Investment & Development Co., Ltd. and was its controlling shareholder. 3. After the non-public issuing of BOE in 2014, Hefei Jianxiang Investment Co., Ltd. and Chongqing Ezcapital Opto-electronics Industry Investment Co., Ltd, by entering into Implementation Protocol of Voting Right respectively, agreed to maintain all of the shares held by them respectively unanimous with Beijing BOE Investment & Development Co., Ltd. when executing the voting rights of the shareholders. 4. After the non-public issuing of the Company in 2014, Beijing State-owned Capital Operation and Management Center handed over 70% of the shares directly held by it to Beijing Electronics Holdings Co., Ltd. for management through Stock Management Protocol, and Beijing Electronics Holdings Co., Ltd. gained the incidental shareholders’ rights except for disposing right and usufruct of the shares, of which the rest 30% voting right maintained unanimous with Beijing Electronics Holdings Co., Ltd. through the agreement according to Implementation Protocol of Voting Right. 5. Except for the above relationships, the Company does not know any other connected party or acting-in-concert party among the top 10 shareholders.
Shareholdings of the top ten unrestricted shareholders
Name of shareholderNumber of unrestricted shares held at the period-endShares by type
TypeShares
Beijing State-owned Capital Operation and Management Center4,063,333,333RMB ordinary share4,063,333,333
Chongqing Ezcapital Opto-electronics Industry Investment Co., Ltd.2,653,000,041RMB ordinary share2,653,000,041
Hefei Jianxiang Investment Co., Ltd.2,510,142,953RMB ordinary share2,510,142,953
Beijing Yizhuang Investment Holdings Co., Ltd1,241,423,641RMB ordinary share1,241,423,641
Beijing BOE Investment & Development Co., Ltd.822,092,180RMB ordinary share822,092,180
Hong Kong Securities Clearing Company Ltd.483,208,365RMB ordinary share483,208,365
Beijing Electronics Holdings Co., Ltd.273,735,583RMB ordinary share273,735,583
Central Huijin Assets Management Co., Ltd248,305,300RMB ordinary share248,305,300
China Life Insurance Company Ltd.-dividends-individual144,840,427RMB ordinary share144,840,427

BOE Technology Group Co., Ltd. Annual Report 2018

dividends-005L-FH002 Shen
China securities Finance Corporation Limited132,480,249RMB ordinary share132,480,249
Related or acting-in-concert parties among top 10 unrestricted public shareholders, as well as between top 10 unrestricted public shareholders and top 10 shareholders1. Beijing State-owned Capital Operation and Management Center held 100% equities of Beijing Electronics Holdings Co., Ltd. 2. Beijing Electronics Holdings Co., Ltd. held 66.25% equities of Beijing BOE Investment & Development Co., Ltd. and was its controlling shareholder. 3. After the non-public issuing of BOE in 2014, Hefei Jianxiang Investment Co., Ltd. and Chongqing Ezcapital Opto-electronics Industry Investment Co., Ltd., by entering into Implementation Protocol of Voting Right respectively, agreed to maintain all of the shares held by them respectively unanimous with Beijing BOE Investment & Development Co., Ltd. when executing the voting rights of the shareholders. 4. After the non-public issuing of the Company in 2014, Beijing State-owned Capital Operation and Management Center handed over 70% of the shares directly held by it to Beijing Electronics Holdings Co., Ltd. for management through Stock Management Protocol, and Beijing Electronics Holdings Co., Ltd. gained the incidental shareholders’ rights except for disposing right and usufruct of the shares, of which the rest 30% voting right maintained unanimous with Beijing Electronics Holdings Co., Ltd. through the agreement according to Implementation Protocol of Voting Right. 5. Except for the above relationships, the Company does not know any other connected party or acting-in-concert party among the top 10 shareholders.
Top 10 ordinary shareholders involved in securities margin trading (if any) (see note 4)None

Indicate by tick mark whether any of the top 10 ordinary shareholders or the top 10 unrestricted ordinary shareholders of the Company conducted any promissory repo during the ReportingPeriod.□ Yea √ NoNo such cases in the Reporting Period.

2. Controlling Shareholder

Nature of the controlling shareholder: Controlled by a local state-owned legal personType of the controlling shareholder: legal person

BOE Technology Group Co., Ltd. Annual Report 2018

Name of controlling shareholderLegal representative/person in chargeDate of establishmentUnified social credit codePrincipal activity
Beijing Electronics Holdings Co., Ltd.Wang Yan8 April 199791110000633647998HOperation and management of state-owned assets within authorization; communications equipments, audio & visual products for broadcasting and television; computer and its supporting equipments and the applied products; electronic raw material and components; home electric appliances and electronic products; electronic surveying instruments and meters; mechanical and electric equipments; electronic transportation products and investment in business fields other than electronics and its management; development of real estate, lease and sales of commodity apartments; property management.
Controlling shareholder’s holdings in other listed companies at home or abroad in the Reporting PeriodBeijing Electronic Shareholding Co., Ltd. held 508,801,304 shares of A share of Electronic City (Stock Code: 600658), which was of 45.49% of the total shares amount of Electronic City; it held 42,287,460 shares of A share of NAURA Technology Group Co., Ltd. (original Beijing Sevenstar Electronics Co., Ltd. ) (Stock Code: 002371), which accounted for 9.23% of the total shares of NAURA Technology Group Co., Ltd. Beijing Electronic Shareholding Co., Ltd. held 178,175,721 shares of A share of NAURA Technology Group Co., Ltd. through holding the wholly-owned subsidiary Beijing Seven Star Huadian Technology Group Co., Ltd, which covered 38.90% of the total shares amount of NAURA Technology Group Co., Ltd.

Change of the controlling shareholder in the Reporting Period:

□ Applicable √ Not applicableNo such cases in the Reporting Period.

BOE Technology Group Co., Ltd. Annual Report 2018

3. Actual Controller and Its Acting-in-Concert Parties

Nature of the actual controller: Local institution for state-owned assets managementType of the actual controller: legal person

Name of actual controllerLegal representative/person in chargeDate of establishmentUnified social credit codePrincipal activity
Beijing Electronics Holdings Co., Ltd.Wang Yan8 April 199791110000633647998HOperation and management of state-owned assets within authorization; communications equipments, audio & visual products for broadcasting and television; computer and its supporting equipments and the applied products; electronic raw material and components; home electric appliances and electronic products; electronic surveying instruments and meters; mechanical and electric equipments; electronic transportation products and investment in business fields other than electronics and its management; development of real estate, lease and sales of commodity apartments; property management.
Other listed companies at home or abroad controlled by the actual controller in the Reporting PeriodBeijing Electronic Shareholding Co., Ltd. held 508,801,304 shares of A share of Electronic City (Stock Code: 600658), which was of 45.49% of the total shares amount of Electronic City; it held 42,287,460 shares of A share of NAURA Technology Group Co., Ltd. (original Beijing Sevenstar Electronics Co., Ltd. ) (Stock Code: 002371), which accounted for 9.23% of the total shares of NAURA Technology Group Co., Ltd. Beijing Electronic Shareholding Co., Ltd. held 178,175,721 shares of A share of NAURA Technology Group Co., Ltd. through holding the wholly-owned subsidiary Beijing Seven Star Huadian Technology Group Co., Ltd, which covered 38.90% of the total shares amount of NAURA Technology Group Co., Ltd.

Change of the actual controller during the Reporting Period:

□ Applicable √ Not applicableNo such cases in the Reporting Period.

BOE Technology Group Co., Ltd. Annual Report 2018

Ownership and control relations between the actual controller and the Company:

Notes: 1. Beijing Intelligent Kechuang Technology Development Co., Ltd. (Intelligent Kechuang) is used as a platform for theCompany to implement equity incentives for its core technical and managerial personnel, who are the 20 nominal shareholders ofIntelligent Kechuang. The ratios of their capital contributions to Intelligent Kechuang do not represent their actual equity percentage.The equities of Intelligent Kechuang are jointly owned by the awardees of the Company’s equity incentive plans. The capitalcontribution ratios of the said 20 people are as follows: Wang Dongsheng 20%, Jiang Yukun 10%, Liang Xinqing 10%, ZhaoCaiyong 6.667%, Shi Dong 6.667%, Chen Yanshun 6.667%, Song Ying 6.667%, Han Guojian 6.667%, Gong Xiaoqing 3.333%,Wang Yanjun 3.333%, Wang Jiaheng 3.333%, Liu Xiaodong 3.333%, Ren Jianchang 1.667%, Sun Jiping 1.667%, Zhang Peng1.667%, Wang Aizhen 1.667%, Mu Chengyuan 1.667%, Xu Yan 1.667%, Hua Yulun 1.667% and Zhong Huifeng 1.667%.2. When the Company completed a private offering of shares in 2014, Beijing State-Owned Capital Operation and ManagementCenter transferred its 70% stake directly held in the Company to Beijing Electronics Holding Co., Ltd. for managing through aShares Management Agreement, and Beijing Electronics Holding Co., Ltd. obtained the shareholder’s rights other than the disposaland earnings rights attached to the 70% stake; and Beijing State-Owned Capital Operation and Management Center agreed in aVoting Rights Exercise Agreement to align itself with Beijing Electronics Holding Co., Ltd. when exercising its voting rights of theremaining 30% stake directly held by it in the Company.Indicate by tick mark whether the actual controller controls the Company via trust or other ways of asset management.□ Applicable √ Not applicable

BOE Technology Group Co., Ltd. Annual Report 2018

4. Other 10% or Greater Corporate Shareholders

√ Applicable □ Not applicable

Name of corporate shareholderLegal representative/person in chargeDate of establishmentRegistered capitalPrincipal activity
Beijing State-owned Capital Management Administrative CenterZhang Guilin30 December 2008RMB35,000 millionInvestment and investment management; assets management; organize the reorganization as well as the merger and acquisition of the enterprise assets.

5. Limitations on Shareholding Decrease by the Company’s Controlling Shareholder, Actual Controller,Reorganizer and Other Commitment Makers

□ Applicable √ Not applicable

BOE Technology Group Co., Ltd. Annual Report 2018

Part VII Preferred Shares

□ Applicable √ Not applicableNo preferred shares in the Reporting Period.

BOE Technology Group Co., Ltd. Annual Report 2018

Part VIII Directors, Supervisors, Senior Management and Staff

I Change in Shareholdings of Directors, Supervisors and Senior Management

NameOffice titleIncumbent/FormerGenderAgeStart of tenureEnd of tenureBeginning shareholding (share)Increase in the Reporting Period (share)Decrease in the Reporting Period (share)Other increase/decrease (share)Ending shareholding (share)
Wang DongshengChairman of the BoardIncumbentMale6120 May 201619 May 2019299,905000299,905
Xie XiaomingVice Chairman of the BoardIncumbentMale5920 May 201619 May 20197,6800007,680
Chen YanshunVice Chairman of the Board, Chief of Executive Committee, CEOIncumbentMale5220 May 201619 May 2019260,000340,00000600,000
Wang ChenyangDirectorIncumbentMale4928 May 201819 May 201900000
Liu XiaodongDirector, vice chairman of Executive Committee, President and Chief Operations OfficerIncumbentMale5420 May 201619 May 2019250,000000250,000
Song JieDirectorIncumbentMale5120 May 201619 May 201900000
Sun YunDirector,executive vice president, CFOIncumbentFemale4820 May 201619 May 2019155,98168,00000223,981

BOE Technology Group Co., Ltd. Annual Report 2018

Li YantaoDirectorIncumbentMale3728 May 201819 May 201900000
Lyu TingjieIndependent directorIncumbentMale6320 May 201619 May 201900000
Wang HuachengIndependent directorIncumbentMale5520 May 201619 May 201900000
Hu XiaolinIndependent directorIncumbentMale4020 May 201619 May 201900000
Li XuanIndependent directorIncumbentMale5019 August 201619 May 201900000
Yang XiangdongChairman of the Supervisory CommitteeIncumbentMale5730 March 201819 May 201900000
Xu TaoSupervisorIncumbentMale5420 May 201619 May 201900000
Chen ZhaozhenSupervisorIncumbentMale3528 May 201819 May 2019090000900
Zhao WeiSupervisorIncumbentMale5020 May 201619 May 201900000
Shi HongSupervisorIncumbentFemale3620 May 201619 May 201900000
Zhuang HaoyuSupervisorIncumbentMale3420 May 201619 May 201900000
Miao ChuanbinEmployee supervisorIncumbentMale4519 May 201619 May 201901,800001,800
Xu YangpingEmployee supervisorIncumbentMale4419 May 201619 May 201900000
He DaopinEmployee supervisorIncumbentMale4919 May 201619 May 201900000
Dong YoumeiExecutive vice presidentIncumbentFemale5520 May 201619 May 2019200,00026,40000226,400
Yao XiangjunExecutive vice president, Co-chief Operations OfficerIncumbentMale4120 May 201619 May 2019100,000000100,000
Zhang ZhaohongExecutive vice president, Co-chief Operations OfficerIncumbentMale4820 May 201619 May 2019150,000178,70000328,700
Zhong HuifengExecutive viceIncumbentMale4820 May 201619 May 2019150,000000150,000

BOE Technology Group Co., Ltd. Annual Report 2018

president, Chief Human Resource Officer
Feng LiqiongExecutive vice president, lead counselIncumbentFemale4620 May 201619 May 2019150,00050,00000200,000
Yue ZhanqiuSenior vice president, Chief Information OfficerIncumbentMale5120 May 201619 May 2019150,00070,00000220,000
Xie ZhongdongSenior vice president,Chief Risk Officer and Auditor GeneralIncumbentMale4820 May 201619 May 2019110,00090,00000200,000
Feng QiangSenior vice presidentIncumbentMale4220 May 201619 May 2019100,00020,00000120,000
Yang AnleSenior vice president, Chief Investment OfficerIncumbentMale4820 May 201619 May 2019100,00050,00000150,000
Tong GuanshanSenior vice presidentIncumbentMale5020 May 201619 May 201900000
Jing LinfengSenior vice presidentIncumbentMale4020 May 201619 May 2019100,00045,00000145,000
Liu HongfengVice president, Secretary of the BoardIncumbentMale4020 May 201619 May 2019100,00054,50000154,500
Wang JingDirectorFormerFemale4720 May 201611 May 201800000
Zhang JinsongDirectorFormerMale4620 May 201630 March 201800000
Chen MingChairman of the Supervisory CommitteeFormerMale6120 May 20161 March 201800000
Mu ChengyuanSupervisor, Secretary of SupervisoryFormerMale5120 May 201630 March 20182,9910002,991

BOE Technology Group Co., Ltd. Annual Report 2018

Committee
Total------------2,386,557995,300003,381,857

II Change of Directors, Supervisors and Senior Management

√Applicable □ Not applicable

NameOffice titleType of changeDate of changeReason for change
Chen MingChairman of Supervisory CommitteeLeft1 March 2018Resignation
Zhang JinsongDirectorLeft30 March 2018Resignation
Mu ChengyuanSupervisor, Secretary of Supervisory CommitteeLeft30 March 2018Resignation
Wang JingDirectorLeft11 May 2018Resignation
Yang XiangdongChairman of Supervisory CommitteeAppointed and dismissed30 March 2018Elected
Li YantaoDirectorAppointed and dismissed28 May 2018Elected
Chen ZhaozhenSupervisorAppointed and dismissed28 May 2018Elected
Wang ChenyangDirectorAppointed and dismissed28 May 2018Elected

BOE Technology Group Co., Ltd. Annual Report 2018

III Biographical Information

Professional backgrounds, major work experience and current duties in the Company of the incumbent directors, supervisors andsenior management

DirectorMr. Wang Dongsheng, Master of Engineering, financial experts and system engineering experts, founder of BOE, ever took theposts of Chairman of 1

st

and 2

nd

Board of Directors as well as president, and Chairman of the 3

rd

Board of Directors of the Company,as well as Chief of Executive Committee, CEO, the Chairman of the 4

th

Board of Directors of the Company and Chief of ExecutiveCommittee, the Chairman of the 5

th

Board of Directors of the Company and Chief of Execution Committee and Chairman of the 6

th

Board of Directors, Chief of Execution Committee of the Company, and the Chairman of the 7

th

Board of Directors, Chief ofExecution Committee of the Company.Now he takes the posts of Chairman of the 8

th

Board of Directors, meanwhile Vice President of China Optics and OptoelectronicsManufactures Association and Chairman of China Optics and Optoelectronics Manufactures Association LCB, etc.Mr. Wang Dongsheng led the incorporation of BOE in 1993, and made BOE become a leading enterprise in the field of globaldisplay. He first put forward the concept of semiconductor display industry in the global industry. Also in 2010, he put forward lifeprinciple of display industry which was known as” Mr. Wang Principle”.Mr. Wang Dongsheng once was awarded "China Top Ten Mergers and Acquisitions Personage”, “Chinese Top Ten SmartfortunePersonage”, “China's information industry leader”,” The most influential leader of listed companies” , “The National May 1 LaborMedal” and other honorary titles.

Mr. Xie Xiaoming, MBA, a senior engineer at professor grade. He had ever taken the posts of Director of 821 Workshop of BeijingTube Factory, Plant Manager of First Branch Factory of Beijing Tube Factory, Deputy GM of Beijing Orient Electronics Group Co.,Ltd, General Manager and Director of Beijing Yandong Microelectronics Co., Ltd, Director of Beijing Dongguang Micro ElectronicsCo., Ltd, Party Secretary of Beijing Semiconductor Devices Fifth Factory, and Vice Chairman of the 7

th

Board of Directors.Now he takes the posts of Vice Chairman of the 8

th

Board of Director of the Company, Vice President of Beijing Electronics HoldingCo., Ltd, Chairman of Beijing Yandong Microelectronics Co., Ltd.

Mr. Chen Yanshun, Master of Economics, senior accountant, he had served in the Company from the year of 1993, has taken theposts of Secretary of the Board of the 1

st

Board of Directors of the Company, Secretary of the 2

nd

Board of Directors and VicePresident, Executive Director of the 3

rd

Board of Directors and Senior Vice President, Executive Director of the 4

th,

th

and the 6

th

Board of Directors and President, and Vice Chairman of the 7

th

Board of Directors and President, and Chairman of the Board ofBeijing BOE Vision-electronic Technology Co., Ltd, Beijing BOE Optoelectronics Technology Co., Ltd, Hefei BOE OptoelectronicsTechnology Co., Ltd, Ordos Yuansheng Optoelectronics Co., Ltd., Chongqing BOE Optoelectronics Technology Co., Ltd. andBeijing Intelligent Kechuang Technology Development Co., Ltd.Now he takes the posts of Vice Chairman of the 8

th

Board of Directors of the Company and Chief of Executive Committee (CEO),Chairman of the Board of Hefei Xinsheng Optoelectronics Technology Co., Ltd., Beijing·Matsushita Color CRT Co., Ltd, BOEOptoelectronics Technology Co., Ltd. and BOE Technology (Hong Kong) Co., Ltd., and Director of BOE Health InvestmentManagement Co., Ltd.

Mr. Wang Chenyang, Master of Arts, senior political division. He has served as principal staff member and vice consultant ofDivision of Publicity & Education &Political and Legislative Affairs of Organization Department in Beijing Municipal Committee,division-head level and deputy-bureau level cadre in the General Office of Beijing Municipal Government.

BOE Technology Group Co., Ltd. Annual Report 2018

Now he takes the posts of Director of the 8

th

Board of Directors of the Company and Deputy GM of Beijing State-owned CapitalManagement Center.

Mr. Liu Xiaodong, Bachelor’ degree, Engineer, he ever worked in Research Institute of Beijing Information Optics Apparatus. Hesuccessively took the posts of Director, Deputy General Manager and Secretary of CPC of Beijing Matsushita Color CRT Co., Ltd.,Vice President of the Company and concurrently Director and General Manager of Beijing BOE Optoelectronics Technology Co.,Ltd., Director and General Manager of Hefei BOE Optoelectronics Technology Co., Ltd. Chairman of the Board of Beijing BOEVision-electronic Technology Co., Ltd. and GM of Hefei Xinsheng Optoelectronics Technology Co., Ltd., Deputy Chairman of theBoard of Chongqing BOE Optoelectronics Technology Co., Ltd., President of Beijing BOE Multimedia Science and Technology Co.,Ltd. and Beijing BOE Technology Wisdom Commerce Co., Ltd, Director of the 7

th

Board of Directors, Executive Vice President andCOO of the CompanyNow he takes the posts of Director of the 8

th

Board of Director, Executive Vice President, President and COO of the Company,Chairman of Mianyang BOE Optoelectronics Technology Co., Ltd., Chongqing BOE Display Technology Co., Ltd., Wuhan BOEOptoelectronics Technology Co., Ltd., Kunming BOE Display Technology Co., Ltd. and Beijing BOE Sensor Technology Co., Ltd.,Director of Hefei Xinsheng Optoelectronics Technology Co., Ltd, and TPV Display Technology (China) Co., Ltd.

Mr. Song Jie, Senior Economist, MBA of Peking University, Countries travelled visiting scholar of University of Sydney from Feb,2005 to Mar. 2006. He once worked as Assistant Engineer of Design Institute Wire Plant of Shougang Corporation, Officer ofProject examination and approval of Beijing Economic and Technological Development Zone Management Committee, Officer ofForeign Investment Service Center, the Director of Yi Da Tong Paging Center, Deputy General Manager of Chinese Human GenomeResearch Center, Beijing (SinoGenoMax Co., Ltd.), Project Manager of East Zone Sewage project of Beijing Yizhuang InvestmentHoldings Co., Limited, Director of the 7

th

Board of Directors of the Company.Now he is the Director of the 8

th

Board of Directors of the Company, Manager of Department of Investment Development of BeijingYizhuang Investment Holdings Co., Limited.

Ms. Sun Yun, Master of Business, a Senior Accountant. She successively took the posts of Deputy Chief, Chief of FinanceDepartment of the Company, as well as Deputy CFO and Chief Auditor of the Company.Now she is Director of the 8

th

Board of Directors, Executive Vice President and CFO of the Company, Director of Beijing BOE LandCo., Ltd., Director of Beijing Yinghe Century Science & Technology Development Co., Ltd., Director of Beijing·Matsushita ColorCRT Co., Ltd.

Mr. Li Yantao, bachelor of engineering, MBA in Financial Accounting of Tsinghua University-Chinese University of Hong Kong(be reading). He once worked as an engineer of Module Technology Department and Section Chief of Public Relations ofAdministrative Security Department in Beijing BOE Optoelectronics Technology Co., Ltd., Section Chief of Tender Approval ofCommerce Group, noviate vice minister of Engineering Cost Control Department and Bidding Contract Management Section ofEngineering Cost Control Department in Beijing BOE Display Technology Co., Ltd., Secretary of Youth League Committee, ministerof Corporate Culture/Party Work Department of Corporate Culture Centre and Chief of Corporate Culture Section and Group WorkSection, Vice Minister (Assistant Director Level) of Planning & Coordination Department and Director of Office for Promotion ofMajor Projects, Minister of Market & New Business Planning Department, Head of Planning & Coordination Centre (DeputyDirector Level) and Minister of Market Insight Department, Minister of Strategic Planning Department, Minister of PerformanceManagement Department, Minister of Office for Promotion of Major Projects and Minister of Knowledge Management & TrainingDepartment in the Company.Now he serves as the Director of the 8

th

Directors of the Board of the Company, Director of Strategic Development Department ofBeijing Electronics Holdings Co., Ltd., Director and GM of Beijing Electronic Control Industry Investment Co., Ltd. and Director of

BOE Technology Group Co., Ltd. Annual Report 2018

Office for Promotion of Old Industrial Base Transformation in Beijing Electronics City.

Independent DirectorMr. Lyu Tingjie, Doctor Degree, Professor and Doctorial Tutor, Assistant, Lecturer, Associate Professor, Professor, Doctorial Tutor,Vice Dean, Standing vice President and President, and Assistant Principal of Beijing University of Posts and Telecommunications.Social part-time job: Executive Director of Union International Telecommunications, Vice Chairman of Information EconomySociety of China, Deputy Director of the Ministry of Education Electronic Commerce Teaching Committee, Standing Director ofChina Institute of Communications (Director of the Communication Management Branch) Standing Director of China Association ofCommunication Enterprises, Standing Director of Chinese Research Council of Technical Economy (Director of CommunicationsTechnology and Economy), Member of Ministry of Industry and Information Science Committee and Telecom Economic ExpertsCommittee. He was once the Independent Director of the 7

th

Board of Directors of the CompanyNow he is the independent director of the 8

th

Board of Directors of the Company. He has been working in Beijing University of Postsand Telecommunications since May 1985, and he acts as the Independent Director of Gohigh Data Networks Technology Co., Ltd,Shenzhen Ai Shide Co., Ltd. and China Unicom.

Mr. Wang Huacheng, Doctoral Candidate Degree, Professor Doctoral Supervisor, In July 1985, graduate from Department ofFinance, Renmin University of China, obtained bachelor of economics degree, in July 1988, graduated from Department ofAccounting, Renmin University of China, obtained master's degree in economics, in July 1998,graduated from Department ofAccounting, Renmin University of China, obtained PhD degree. Since September 1988, worked as a teacher in Renmin University ofChina, He successively worked as teaching assistant, lecturer, associate professor, professor, PhD supervisor, social appointments:

Director of the institute of Chinese accounting. He once was the Independent Director of the 7

th

Board of Directors of the CompanyNow he is the Independent Director of the 8

th

Board of Directors of the Company, HXB and China Railway ConstructionCorporation Limited.

Mr. Hu Xiaolin, doctor, associate professor of Tsinghua University, artificial intelligence professor.Now he serves as Senior Member of Institute of Electrical and Electronics Engineers (IEEE), Editorial Board Member of IEEETransactions on Neural Networks and Learning Systems, Independent Director of 8th board of directors and Director of BeijingLingdongyin Technology Co., Ltd.

Mr. Li Xuan, doctor of laws, associate professor, graduate student tutor. He once worked as the Vice Dean and Vice President ofSchool of Law of Central University of Finance and Economics, Chief of Central University of Finance and Economics Legal AffairsOffice, Independent Director of Beijing Da Bei Nong Science and Technology Group Co., Ltd.Now he serves as the Independent Director of the 8th board of directors of the Company, Chief of Central University of Finance andEconomics Master of Laws (J.M) Education Center, Deputy Chief of Public Policy-Making Research Center of Central University ofFinance and Economics, Deputy Chief of Committee for Social and Legal Affairs of Beijing Municipal Committee of the CDL,Secretary General of Case Study Association of China Law Society, Executive Director of Law Society of China Law Society,Independent Director of China Shengmu Organic Milk Limited (listed in Hong Kong Exchange) and Independent Supervisor ofChina National Building Materials Company Limited (listed in Hong Kong Exchange), and part-time arbitrator and lawyer.

SupervisorMr. Yang Xiangdong, postgraduate. He once worked as chief of Technology Security Section, minister of Sales Department andminister of Materials Department in Beijing TV Accessories Third Factory, Deputy GM of Beijing Jile Electronics Group Co., Ltd.,Deputy GM of Beijing Sevenstar Electronics Co., Ltd., and Deputy GM of Beijing North Microelectronics Co., Ltd.

BOE Technology Group Co., Ltd. Annual Report 2018

Now he serves as the Chairman of the 8

th

Supervisory Committee (convener), Chairman of Supervisory Committee of BeijingZhaowei Electronic (Group) Co., Ltd., Chairman of Supervisory Committee of Beijing Yandong Microelectronics Co., Ltd.,Chairman of Supervisory Committee of Beijing Seven Star Huadian Technology Group Co., Ltd., supervisor of Beijing ElectronicsHolding & SK Technology Co., Ltd., supervisor of Beijing Electronics New Energy Technology (Jiangsu) Co., Ltd. and supervisorof BEST.

Mr. Xu Tao, master degree, Senior Accountant, Minister of Finance Department of Beijing TV Accessories Third Factory, ChiefAccountant and CFO of Beijing Jile Economics Group Co., Ltd, Minister of Finance Department of Beijing Electronics Holding Co.,Ltd. and Supervisor of the 7

th

Supervisory Committee of the Company.Currently, he serves as the Supervisor of the 8

th

Supervisory Committee of the Company, Director of the Financial/AccountingCenter of Beijing Electronics Holdings Co., Ltd. and Chairman of the Board of Beijing BOE Investment & Development Co., Ltd.

Mr. Chen Zhaozhen, Master of Science. He once worked as a technician and vice minister of Wafer Department and vice ministerof Strategic Development Department of Beijing Yandong Microelectronics Co., Ltd. and assistant minister of TechnologicalIndustry Department in Beijing Electronics Holdings Co., Ltd.Now he serves as a supervisor of the 8

th

Supervisory Committee of the Company and Deputy Director of Semiconductor Departmentin Beijing Electronics Holdings Co., Ltd.

Mr. Zhao Wei, Bachelor, Joined the Communist Party of China in 2001, he successively worked as Manager of FinancialDepartment of Hefei City Construction Investment Co., Ltd. Deputy Minister, Minister of Financial Department and Minister ofFinancing Department of Hefei City Construction Investment Co., Ltd, Supervisor of the 7

th

Supervisory Committee of the Companyand Member of CPC Committee, Director, Deputy GM of Hefei City Construction Investment Co., Ltd..Now he is the Supervisor of the 8

th

Supervisory Committee of the Company, Deputy Secretary of CPC Communist Party of Chinaand Director of Hefei New Municipal and Cultural District Investment Co., Ltd.

Ms. Shi Hong, Master of Economics, Senior Economist, Supervisor of the 7

th

Supervisory Committee of the Company.Now he is the Supervisor of the 8

th

Supervisory Committee of the Company, worked as Deputy Manager in Department of InvestmentDevelopment of Beijing Yizhuang Investment Holdings Limited. Member of Investment Decision Committee of China Reform FundManagement Co., Ltd. Director of Beijing Jinyuan Jingkai Limited Liability Company for Sewage Treatment and Supervisor ofBeijing Boda Xinyuan House Real Estate Development Co., Ltd..

Mr. Zhuang Haoyu, Bachelor, he once worked as Project Assistant, Investment Manager, Senior Investment Manager of BeijingIndustrial Development Investment Management Co., Ltd, and Supervisor of the 7

th

Supervisory Committee of the Company.Now he is Senior Investment Manager of SENSEGAIN ASSET MANAGEMENT Co., Ltd.

Mr. Miao Chuanbin, Master degree, once worked as Manager of Market Department Beijing Wireless Power Plant PutaiTechnology Company, Secretary of Party Committee Work Department and Deputy Secretary of Beijing Wireless Power Plan,Deputy General Manager of Beijing Ether-led Electronic Group Co., Ltd., Secretary of Party Committee Work Department,Enterprise Minister of Culture of Beijing Electronics Holdings Co., Ltd, Employee Supervisor of the 7

th

Supervisory Committee ofthe Company.Now he is the Employee Supervisor of the 8

th

Supervisory Committee of the Company, Vice Secretary of Party Committee, Secretaryof the Commission for Discipline Inspection, Union Chairman and Chief Officer of Culture, Deputy Chairman of Beijing Industry(National Defense) Labor Union, member of Beijing Electronic Union and member of the Commission for Discipline Inspection in

BOE Technology Group Co., Ltd. Annual Report 2018

Beijing Electronics Holding Co., Ltd.

Mr. Xu Yangping, Master of Civil and Commercial Law. He was former Deputy Minister, Minister of the Company’s LegalDepartment, and Employee Supervisor of the 7

th

Supervisory Committee of the Company.Now he acts as Employee Supervisor of the 8

th

Supervisory Committee of the Company, Minister and Deputy Director of theCompany’s Legal Department and Organization, Senior Chief Officer and the Director of Board of Directors of Gaochuang (Suzhou)Electronics Co., Ltd, Director of Beijing BOE Energy Technology Co., Ltd., Supervisor of Beijing BOE Vacuum Electric ApplianceCo., Ltd and Beijing BOE Technology Development Co., Ltd.

Mr. He Daopin, master. He once worked as Production Supervisor, Purchasing Supervisor, Financial Manager, Vice GeneralManager of Beijing Oriental Aristocratic Paper Co., Ltd., Vice General Manager, General Manager of Industrial Gas UnderwritingCompany of Business Department of Park of the Company, Management Representative of Business Department of Park, Chief ofHR and Administrative Department, Chief of Property Department and Chief of Labor Union, Deputy Chief, Chief of Party MassWork Department of the Company, Corporate Cultural Center.He now serves as Employee Supervisor of the 8th board of supervisors of the Company, Chairman of Labor Union of Beijing BOEDisplay Technology Co., Ltd., Secretary of Committee for Discipline Inspection, Deputy Chief of Party Mass Work Department,Chief of Corporate Cultural Center, Head of Corporate Culture of Beijing Area and DAS BG.

Senior ManagementMs. Dong Youmei, she successively took the posts of Deputy Chief of New Product Development Division of ShuguangElectronic Group Co., Ltd., Deputy Chief of Liquid Crystal Center in Tsinghua University, and Strategic Technical Officerof the Company, CTO and Executive Vice President of the Company.Now she serves as Executive Vice President of the Company and Member of Advisory Committee for the State Information.

Mr. Yao Xiangjun, MBA, Chinese CPA. He once worked as Minister and Chief Inspector of FinancingDepartment of the Company, CFO of Hefei BOE Optoelectronics Technology Co., Ltd., Director of Business PlanningCenter, Chief Strategic Officer of the Company, CEO of Intelligent System Business Group.Now he serves as Executive Vice President and Co-Chief Operating Officer of the Company, Director of SES-imgotag, andChairman of the Board of Beijing BOE Video Technology Co., Ltd., Beijing BOE Smart Commerce Co., Ltd., Beijing BOE YiyunTechnology Co., Ltd., and BOE Smart Retail (Hong Kong) Co., Limited.

Mr. Zhang Zhaohong, bachelor of inorganic nonmetallic materials, engineer. He joined in the Company in 1992, he once worked asChairman of the Board of Beijing BOE Optoelectronics Technology Co., Ltd., Chengdu BOE Optoelectronics Technology Co., Ltd.,Hefei BOE Optoelectronics Technology Co., Ltd., Beijing BOE Display Technology Co., Ltd., Erdos Yuansheng Optoelectronics Co.,Ltd., Fuzhou BOE Optoelectronics Technology Co., Ltd. and BOE (Hebei) Mobile Display Technology Co., Ltd., Director of WuhanBOE Optoelectronics Technology Co., Ltd., GM of Beijing BOE Display Technology Co., Ltd., Chinese GM of Beijing Asahi GlassCo., Ltd., GM of Chengdu BOE Optoelectronics Technology Co., Ltd. and Chief Operations Officer of BOE Display DeviceBusiness Group.Now he serves as the Executive Vice President and Co-Chief Operations Officer of the Company, Chairman of the Board of BOEHealth Investment Management Co., Ltd., and Vice President of Beijing BOE Sensor Technology Co., Ltd.

Mr. Zhong Huifeng, Master Degree, awarded certification on Secretary of the Board of Shenzhen Stock Exchange. He ever tookposts of Securities Affairs Representative and Manager of Security Department of the 2

nd

Board of Directors, Secretary to the Board

BOE Technology Group Co., Ltd. Annual Report 2018

of the 3

rd

, 4

th

and 5

th

Board of Directors of the Company, Employee Supervisor of the 6

th

Supervisory Committee and EmployeeSupervisor of the 7

th

Supervisory Committee, Supervisor of Beijing Orient Top Victory Electronics Co., Ltd.. and Vice Secretary ofthe CPC, Secretary of Discipline Inspection Commission and Principal of Labor Union of the Company, member of the ThirdNational Committee of China’s Defense of Posts and Telecommunications Union.Now he acts as Executive Vice President and CHO of the Company and President of BOE University.

Ms. Feng Liqiong, Bachelor Degree and Lawyer of the Company, she has served as Senior Vice President and Minister of LegalAffairs Department of the Company, and as Secretary of the 5

th

and 6

th

Board of Directors.Now she is Executive Vice President, Chief Counsel and Director of Beijing BOE Land Co., Ltd. and Beijing Yinghe Science &Century Technology Development Co., Ltd.

Mr. Yue Zhanqiu, obtained EMBA in CEIBS, Senior Accountant. He ever took post of Chief and Chief Accountant of FinanceSection of Power Business Department, Financial Manger of Beijing Huamin Smart Card System Co., Ltd., CFO of Beijing SevenStar Electronics Co., Ltd., CFO and Secretary to the Board of Beijing Seven Star Science & Technology Co., Ltd., and CFO, DeputyGeneral Manager, General Manager of Beijing BOE Optoelectronics Technology Co., Ltd..Now he acts as Senior Vice President and CIO of the Company.

Mr. Xie Zhongdong, Master, CIA. He has ever taken posts of Deputy Chief of Basic Construction Office in the Yi-Shu-Si WaterConservancy Administration of Huaihe Water Resources Commission under the Ministry of Water Resource of P.R.C, Chief andDeputy Auditor of Auditing & Supervision Division of the Company, Vice Chief and Chief of Auditing & Supervision Division ofBeijing BOE Optoelectronics Technology Co., Ltd.Now he acts as Senior Vice President, Chief Risk Control Officer and Chief Auditor of the Company, Vice President of BeijingInternal Audit Association, Supervisor of Beijing BOE Optoelectronics Technology Co., Ltd., Beijing BOE Display Technology Co.,Ltd., Erdos Yuansheng Optoelectronics Co., Ltd., Chongqing BOE Optoelectronics Technology Co., Ltd., Hefei BOEOptoelectronics Technology Co., Ltd., Chengdu BOE Optoelectronics Technology Co., Ltd., Chongqing BOE Display TechnologyCo., Ltd., Beijing BOE Sensor Technology Co., Ltd., Beijing BOE Video Technology Co., Ltd., Gaochuang (Suzhou) Electronics Co.,Ltd., Hefei BOE Video Technology Co., Ltd. and BOE Health Investment Management Co., Ltd.

Mr. Feng Qiang, MBA, master of engineering. He joined in the Company in 1998. He once worked as Vice General Manager ofScience & Technology Park Business Head Office of the Company, Executive Director and General Vice General Manager ofBeijing BOE Land Co., Ltd., Executive Director and Vice General Manager of Beijing Yinghe Century Land Co., Ltd.Now he works as Senior Vice President, Chief Executive Officer of Health Service Business Group of the Company, Chairman ofBeijing BOE Land Co., Ltd., Chairman of Beijing Yinghe Century Land Co., Ltd., Director of BOE Health Investment ManagementCo., Ltd., Chairman of the Board of BOE Regenerative Medical Technologies Co. Ltd. an General Manager of Beijing MatsushitaColor CRT Co., Ltd.

Mr. Yang Anle, master. He once worked as Deputy Chief of Financial Division of Beijing Electronic Tube Factory, Manager ofFinancial Department of Beijing BOE Investment & Development Co., Ltd., Chief Financial Officer of Beijing Dongdian IndustrialDevelopment Co., Ltd., Supervisor of the 2nd, 3rd, 4th Board of Supervisors of the Company, Employee Supervisor of 5th, 6thBoard of Supervisors.He now serves as Senior Vice President of the Company, Chief Investment Officer, Chairman of Beijing North Asahi ElectronicGlass Co., Ltd., Chairman of Beijing Rishen Electronic Precise Parts Co., Ltd., Chairman of Beijing Nittan Electronics Co., Ltd.,Director of Beijing BOE Optoelectronics Technology Co., Ltd., Director of Chengdu BOE Optoelectronics Technology Co., Ltd.,

BOE Technology Group Co., Ltd. Annual Report 2018

Director of Hefei BOE Optoelectronics Technology Co., Ltd., Director of Beijing BOE Display Technology Co., Ltd., Director ofErdos Yuansheng Optoelectronics Co., Ltd., Director of Chongqing BOE Optoelectronics Technology Co., Ltd., Director of HefeiBOE Display Technology Co., Ltd., Director of Fuzhou BOE Optoelectronics Technology Co., Ltd., Director of BOEOptoelectronics Technology Co., Ltd., Director of Hefei BOE Hospital Co., Ltd., and Director of Beijing BOE Vacuum Electric Co.,Ltd.

Mr. Tong Guanshan, doctor of computer science of University of Chicago (Ph.D.) and MBA of Massachusetts Institute ofTechnology (MBA). He once worked in IBM Global Headquarter. He was in charge of IBM global mergers and acquisitions,divestitures and strategic alliances and building of partnerships. He acted as leader for several research & development groups inIBM global research and development department.He now serves as Senior Vice President of the Company.

Mr. Jing Linfeng, bachelor. He once worked as the sales director of Beijing BOE Optoelectronics Technology Co., Ltd., GM of NBSBU, Chief Strategy Officer and CEO of Smart System Group in the Company.Now he serves as the Senior Vice President and CEO of IoT Solution BG in the Company, Chairman of the Board of Beijing BOEMultimedia Science and Technology Co., Ltd., Chairman of the Board of BOE Intelligent Technology Co., Ltd., Director ofSES-imagotag and Director of BOE Smart Retail (Hong Kong) Co., Limited.

Mr. Liu Hongfeng, master. He once worked as the Deputy Chief of the Finance Department of the Company, the Deputy Chief andChief of the BOD Office, the Securities Representative and the Secretary of the 7

th

Board of the Company.Now he is a vice president and the Board Secretary of the Company, as well as a director of Beijing Nissin Electronics PrecisionComponent Co., Ltd. and Supervisor of Beijing Yinghe Century Land Co., Ltd.

Offices held concurrently in shareholding entities:

√Applicable □Not applicable

NameShareholding entityOffice held in the shareholding entityStart of tenureEnd of tenureRemuneration or allowance from the shareholding entity
Xie XiaomingBeijing Electronics Holdings Co., Ltd.Vice president22 June 2011NaughtYes
Wang ChenyangBeijing State-owned Capital Management CenterVice GM19 November 2014NaughtYes
Wang JingBeijing State-owned Capital Management CenterVice GM26 January 2014NaughtYes
Zhang JinsongBeijing Electronics Holdings Co., Ltd.Director and GM31 July 2018NaughtYes
Zhang JinsongBeijing BOE Investment & Development Co., Ltd.Deputy Chairman of the Board23 December 20159 April 2018No
Song JieBeijing Yizhuang Investment Holdings LimitedManager of Investment Development Department23 August 2018NaughtYes

BOE Technology Group Co., Ltd. Annual Report 2018

Li YantaoBeijing Electronics Holdings Co., Ltd.Minister of Strategic Department12 August 2016NaughtYes
Yang XiangdongBeijing Electronics Holdings Co., Ltd.Full-time Chairman of the Dispatched Supervisory Committee17 April 2015NaughtNo
Chen ZhaozhenBeijing Electronics Holdings Co., Ltd.Deputy Director of Semiconductor Department1 March 201617 January 2019Yes
Mu ChengyuanBeijing Electronics Holdings Co., Ltd.Minister of Investment Securities Department1 June 20113 July 2018Yes
Mu ChengyuanBeijing BOE Investment & Development Co., Ltd.Director, Vice president14 December 20129 April 2018No
Xu TaoBeijing Electronics Holdings Co., Ltd.Finance Minister26 October 2012NaughtYes
Xu TaoBeijing BOE Investment & Development Co., Ltd.Chairman of the Board9 April 2018NaughtNo
Shi Hong,Beijing Yizhuang Investment Holdings LimitedDeputy Manager of Investment Development Department23 August 2018NaughtYes
Notes to post-holding in shareholder’s unitThe documents for holding the posts of shareholders entities haven’t listed the expiry date.

Offices held concurrently in other entities:

√Applicable □Not applicable

NameOther entityOffice held in the entityStart of tenureEnd of tenureRemuneration or allowance from the entity
Lyu TingjieBeijing University of Posts and TelecommunicationsDoctor Advisor----Yes
Wang HuachengRenmin University of ChinaDoctor Advisor----Yes
Hu XiaolinTsinghua UniversityAssociate professor----Yes
Li XuanThe Central University of Finance and EconomicsPost-graduate Tutor----Yes
Zhao WeiHefei New Municipal and Cultural District Investment Co., Ltd.Director and Deputy Secretary of CPC Communist Party of China5 September 2018--Yes
Notes to post-holding in other unitDue to the above personnel’s units were special, their start dates and ending dates of the office terms have not been fixed.

BOE Technology Group Co., Ltd. Annual Report 2018

Punishments imposed in the recent three years by the securities regulator on the incumbent directors, supervisors and seniormanagement as well as those who left in the Reporting Period:

□ Applicable √ Not applicable

IV Remuneration of Directors, Supervisors and Senior Management

Decision-making procedure, determination basis and actual payments of remuneration for directors, supervisors and seniormanagement:

(1) Determining Basis and Decision-making Procedure of Remuneration of Directors, Supervisors and Senior ManagementProposal on Principle of Recognition of Remunerations for Directors, Supervisors and Senior Management was reviewed andapproved by the 2005 Annual General Meeting held on 29 May 2006. The Proposal on Adjustment of Allowance for Directors andSupervisors of the Company was reviewed and approved at the 2

nd

Extraordinary General Meeting of 2013 held on 10 July 2013.(2) Up to the end of the Reporting Period, the current directors, supervisors and senior management drew their remuneration from theCompany totaled RMB66.4855 million (before tax). Allowance for independent directors is RMB150,000 (before tax) per year in2018. For details please referred to the statement below.Remuneration of directors, supervisors and senior management for the Reporting Period

Unit: RMB'0,000

NameOffice titleGenderAgeIncumbent/FormerTotal before-tax remuneration from the CompanyAny remuneration from related party
Wang DongshengChairman of the BoardMale61Incumbent401.1No
Xie XiaomingVice Chairman of the BoardMale59Incumbent0
Chen YanshunVice Chairman of the Board, Chief of Executive Committee, CEOMale52Incumbent585.89No
Wang ChenyangDirectorMale49Incumbent0
Liu XiaodongDirector, vice chairman of Executive Committee, President and Chief Operations OfficerMale54Incumbent545.74No
Song JieDirectorMale51Incumbent0
Sun YunDirector,executive vice president,CFOFemale48Incumbent397.89No
Li YantaoDirectorMale37Incumbent0
Lyu TingjieIndependent directorMale63Incumbent15
Wang HuachengIndependent directorMale55Incumbent15
Hu XiaolinIndependent directorMale40Incumbent15
Li XuanIndependent directorMale50Incumbent15
Yang XiangdongChairman of the Supervisory CommitteeMale57Incumbent0

BOE Technology Group Co., Ltd. Annual Report 2018

Xu TaoSupervisorMale54Incumbent0
Chen ZhaozhenSupervisorMale35Incumbent0
Zhao WeiSupervisorMale50Incumbent0
Shi HongSupervisorFemale36Incumbent4
Zhuang HaoyuSupervisorMale34Incumbent8
Miao ChuanbinEmployee supervisorMale45Incumbent142.15No
Xu YangpingEmployee supervisorMale44Incumbent114.62No
He DaopinEmployee supervisorMale49Incumbent81.51No
Dong Youmeiexecutive vice presidentFemale55Incumbent655.99No
Yao Xiangjunexecutive vice president, Co-chief Operations OfficerMale41Incumbent355.99No
Zhang Zhaohongexecutive vice president, Co-chief Operations OfficerMale48Incumbent615.35No
Zhong Huifengexecutive vice president, Chief Human Resource OfficerMale48Incumbent347.34No
Feng Liqiongexecutive vice president, lead counselFemale46Incumbent346.83No
Yue ZhanqiuSenior vice president, Chief Information OfficerMale51Incumbent303.83No
Xie ZhongdongSenior vice president,Chief Risk Officer and Auditor GeneralMale48Incumbent295.09No
Feng QiangSenior vice presidentMale42Incumbent274.31No
Yang AnleSenior vice president, Chief Investment OfficerMale48Incumbent338.92No
Tong GuanshanSenior vice presidentMale50Incumbent278.88No
Jing LinfengSenior vice presidentMale40Incumbent276.85No
Liu HongfengVice president, Secretary of the BoardMale40Incumbent218.27No
Wang JingDirectorFemale47Left0
Zhang JinsongDirectorMale46Left0
Chen MingChairman of the Supervisory CommitteeMale61Left0
Mu ChengyuanSupervisor, Secretary of Supervisory CommitteeMale51Left0
Total--------6,648.55--

Equity incentives for directors, supervisors and senior management in the Reporting Period:

□ Applicable √ Not applicable

BOE Technology Group Co., Ltd. Annual Report 2018

V Employees

1. Number, Functions and Educational Backgrounds of Employees

Number of in-service employees of the Company as the parent2,606
Number of in-service employees of major subsidiaries59,696
Total number of in-service employees68,175
Total number of paid employees in the Reporting Period68,175
Number of retirees to whom the Company as the parent or its major subsidiaries need to pay retirement pensions23
Functions
FunctionEmployees
Production40,325
Sales2,185
Technical22,272
Financial690
Administrative533
Manager1,812
Other358
Total68,175
Educational backgrounds
Educational backgroundEmployees
Doctor and post-doctorate401
Master8,878
Bachelor17,076
College17,882
Technical secondary school10,013
Other13,925
Total68,175

2. Employee Remuneration Policy

The Company has established the remuneration system based on the position, ability and business performance, paid attention to theexternal competitive compensation and internal fairness, strengthening the control of the group as well as considering the differenceamong all business groups and subsidiaries.

BOE Technology Group Co., Ltd. Annual Report 2018

3. Employee Training Plans

For the purpose that exploiting and inheriting the intelligent assets with BOE genes and forming the talent cultivation mode withBOE features, BOE University was set-up in July, 2015, which with the purpose of “Academic drive and professional guide” and avision of “being international competitive and respectful Industrial University”. And it undertakes the strategy and service as mainline, driving the development of the Company personnel training system’s further improvement and upgrade and forms trainingproducts line including four categories of leaders, managers, professionals and industry personnel as well as provides targetedsolutions for talent growth at different stages.Training organized and implemented by BOE in 2018 empowered aspects of the Group such as the leadership, management strength,expertise force and general professional capacities. Centering on the strategic transformation objective, BOE has designed andimplemented a series of strategic transformation talent cultivation projects, explored and cultivated a batch of backup young cadresand software-hardware professional technicians for the Group, promoting transformation development of the Group; As for businesspain points and demands, the Group designed and implemented a batch of performance improvement projects in the way of training+ tuition, directly promoting the implementation of technical improvement and marketing scheme by the business department andassisting in solving practical business problems; Focusing on cultivation of standardized talents, BOE sticks to promoting innovationof training contents and modes and has finished a new turn of project optimization, iteration and implementation, cultivating eligiblemanagement cadres, marketing operators, purchase professionals and industrial talents for each organization of the Group. Dataabout annual participation population, training class hours and training satisfaction kept increasing steadily.

4. Labor Outsourcing

□ Applicable √ Not applicable

BOE Technology Group Co., Ltd. Annual Report 2018

Part IX Corporate Governance

I General Information of Corporate Bonds

1. Standardized Operation and Perfection of Corporate Governance Structure of the Company in the Reporting PeriodThe Company has stringently followed laws and rules such as Company Law, Securities Laws, Code of Corporate Governance forListed Companies, etc., and requirements of Guidelines of the Shenzhen Stock Exchange for the Standardized Operation of CompaniesListed on the Main Board, to continuously improve the corporate governance of the Company, to perfect internal control system as wellas to promote corporate governance level of the Company.During Reporting Period, the Company’s board of directors, board of supervisors and senior executives strictly in line with therequirement of related laws and Company rules and regulations perform their obligations; ensure the standardization and effectivenessof corporate governance. During the Reporting Period, the Company revised the Articles of Association and Rules of Procedure of theBoard and newly set up Financing Business Management System, Implementing Rules for the Enterprise Annuity Plan Further promotethe standardization of the corporate governance level. During the Reporting Period, the Company continued to promote the Company’sgovernance in many ways. Actively arranged the Company's new directors, supervisors to join special training organized by theSecurities regulatory bureau of Beijing, regularly carry out the theme of the franco-prussian propaganda inside the Company. TheCompany preserved the related party fund transaction, external guarantee and regularly self-inspection of the shareholding and itschanges of the directors, supervisors and senior executives, through maintaining and perfecting the Shenzhen Stock Exchange InvestorsInteractive Platform to strengthen the communication of the investors.In the Reporting Period, corporate governance of the Company was perfected and operated normally, which was in total compliancewith various requirements on corporate governance of listed companies. No problems such as horizontal competition or illegalrelated-party transactions caused by partial restructuring or other reasons were found. The Company will continue to follow the conceptof “honesty, standard, transparency and responsibility”, regulate itself and continuously improve the level of governance.Main governance of the Company was as follows:

(1) About Shareholders and Shareholders’ General MeetingsAs per the Company’s Articles of Association, shareholders enjoyed rights and assumed obligations according to the shares they held.Organizing and convening procedures of the Company’s shareholders’ general meetings were in compliance with laws and regulations.The Company paid high attention to legal interests of its shareholders, especially its minority shareholders. Meanwhile, on the basis ofensuring legitimacy and validity of shareholders’ general meetings, actively provided conveniences including internet voting forminority shareholders’ joining the general meeting of the shareholders.(2) About Relationship between the Controlling Shareholder and the CompanyThe Company was independent from the controlling shareholder and the actual controller in terms of personnel, assets, financing,organization and business. The controlling shareholder and actual controller of the Company was able to strictly control its behaviors,with no direct or indirect intervention in the Company’s decision-making, production and operating activities by violating relevant laws,regulations and the Articles of Association, no behaviors in relation to occupying significant funds of the Company, and no behaviors inrelation to asking the Company to provide guarantees for it or other parties.(3) About Directors and the Board of DirectorsDuring the Reporting Period, the composition of the Board of Directors of the Company was in line with requirements of regulationsand the Company’s actual situation. All directors possessed necessary knowledge, skills and quality for duty performance. They allperformed their duties as stipulated in the Articles of Association honestly, faithfully and diligently. They learned about and kept aconstant focus on the Company’s production and operation, its financial status and influence and risks of significant events. They also

BOE Technology Group Co., Ltd. Annual Report 2018

took the initiative to search for information needed in their decision-making so as to ensure efficient operation and scientificdecision-making of the Board of Directors. Board sessions were organized and convened in strict compliance with the Articles ofAssociation and Rules of Procedure for the Board of Directors. There were three special committees under the Board of Directors,namely, the Execution Committee, the Nomination, Remuneration and Appraisal Committee and the Audit Committee. The Companyalso formulated rules of procedure for all the said special committees so that they could perform better.(4) About Supervisors and the Supervisory CommitteeIn the Reporting Period, by way of attending shareholders’ general meetings, sitting in on board sessions, checking the Company’scompliance with laws and finance periodically, issuing its opinions on relevant matters, etc., the Supervisory Committee supervised theCompany’s finance, duty performance of directors and senior management staffs, management and capital flows between the Companyand its related parties, and safeguarded the legitimate interests and rights of the Company and its shareholders. Sessions of theSupervisory Committee were organized and convened in strict compliance with the Articles of Association and the Rules of Procedurefor the Supervisory Committee so as to ensure the Supervisory Committee’s activities for duty performance were rightful and valid.(5) About Information Disclosure and TransparencyAccording to the Company Law, the Stock Listing Rules of the Shenzhen Stock Exchange, the Guidelines of the Shenzhen StockExchange for the Standardized Operation of Companies Listed on the Main Board, Companies Publicly Issuing Securities InformationDisclosure Standards on the Contents and Formats No.2 - Content And Format of the Annual Report (2014 revision), the Disclosure ofInformation A Business Memo No. 21 - Regular Report Disclosure Related Matters (2014 revision). The Articles of Association andManagement Methods for Information Disclosure and other requirements, the Company disclosed information in a timely and fairmanner and ensured the factuality, accuracy and completeness of the information disclosed.The Company attached importance to communication with investors through investor visits reception, investors interaction platform,online business performance explanation session, telephone and attending the investment strategy session organized by the securitiesbrokers, etc. Except for the aforesaid services, the Company’s senior management joined in the investor conference held by largeinternational investment institutions, actively communicated with the global institutional investors and discussed the situation anddevelopment strategy of the Company with investors and analyst, so as to promote the open, transparent, efficient and consistentcommunication between the Company, investors and analyst of securities, made them known more about the strategy, operation anddevelopment of the Company.Indicate by tick market whether there is any material incompliance with the regulatory documents issued by the CSRC governing thegovernance of listed companies.□ Yes √ NoNo such cases in the Reporting Period.

II The Company’s Independence from Its Controlling Shareholder in Business, Personnel,Asset, Organization and Financial Affairs

The Company was independent from the controlling shareholder and the actual controller in terms of business, personnel, assets,organization and financing, with independent & complete business and capability to operate independently.1. In business, the Company was independent from the controlling shareholder and the actual controller, with its own production andbusiness departments and management system, the Company had the capability to make its own decisions, assume sole responsibilityfor its profits and losses, and operate independently with independent and complete business.2. In personnel, the Company was completely independent in labor, staff and remunerations. The Company had its own operatingmanagement team. CEO, President, Chief Financial Officer, Secretary of the Board as well as other senior management staffs of theCompany all worked on full-time basis in the Company and did not hold any post in or receive any remuneration in the controlling

BOE Technology Group Co., Ltd. Annual Report 2018

shareholder unit.3. In assets, the Company had independent and complete assets. With clear ownership on its assets, the Company independentlyowned the production system, ancillary production system as well as supporting facilities for major businesses, as well as assets likeland use rights and intellectual property rights, etc.. Neither the controlling shareholder nor the actual controller appropriated anyassets of the Company.4. In organization, the Company had established its organization completely independent from the controlling shareholder and theactual controller, with independent and sound organs and corporate governance structure. The Company had not handled any officialaffairs jointly with the controlling shareholder or the actual controller. There were no subordinate relationships between thecontrolling shareholder & its functional departments and the Company & its functional departments.5. In financing, the Company had established independent financial departments, with full-time finance personnel. The Company hadalso formulated a standard and independent finance accounting system as well as financial measurement system, established thecorporate financial management archives and deployed relevant administrative personnel for them, opened independent account inbank, and paid tax independently.

III Horizontal Competition

□ Applicable √ Not applicable

IV Annual and Extraordinary General Meetings Convened during the Reporting Period

1. General Meeting Convened during the Reporting Period

MeetingTypeInvestor participation ratioDate of the meetingDisclosure dateIndex to disclosed information
The 1st Extraordinary General Meeting of 2018Extraordinary General Meeting35.21%30 March 201831 March 2018Announcement on Resolution of the 1st Extraordinary General Meeting of 2018 (2018-024) disclosed on China Securities Journal, Shanghai Securities News, Securities Times and Ta Kung Pao as well as http://www.cninfo.com.cn.
The 2017 Annual General MeetingAnnual General Meeting34.31%28 May 201829 May 2018Announcement on Resolution of the 2017 Annual General Meeting (018-045) disclosed on China Securities Journal, Shanghai Securities News, Securities Times and Ta Kung Pao as well as http://www.cninfo.com.cn.

BOE Technology Group Co., Ltd. Annual Report 2018

2. Extraordinary General Meetings Convened at the Request of Preferred Shareholders with ResumedVoting Rights

□ Applicable √ Not applicable

V Performance of Duty by Independent Directors in the Reporting Period

1. Attendance of Independent Directors at Board Meetings and General Meetings

Attendance of independent directors at board meetings and general meetings
Independent directorTotal number of board meetings the independent director was eligible to attendBoard meetings attended on siteBoard meetings attended by way of telecommunicationBoard meetings attended through a proxyBoard meetings the independent director failed to attendThe independent director failed to attend two consecutive board meetings (yes/no)General meetings attended
Lyu Tingjie1221000No2
Wang Huacheng1221000No2
Hu Xiaolin1221000No2
Li Xuan1211010No2

Why any independent director failed to attend two consecutive board meetings:

Not applicable.

2. Objections Raised by Independent Directors on Matters of the Company

Indicate by tick mark whether any independent directors raised any objections on any matter of the Company.□ Yes √ NoNo such cases in the Reporting Period.

3. Other Information about the Performance of Duty by Independent Directors

Indicate by tick mark whether any suggestions from independent directors were adopted by the Company.√ Yes □ NoSuggestions from independent directors adopted or not adopted by the CompanyThe Company has four current independent directors, who are experts and scholars in the fields of finance, law and industry. Duringthe Reporting Period, in accordance with Company Law, Securities Law, Stock Listing Rules, Guidance on Establishing IndependentDirector System for Listed Companies, Articles of Association and Independent Director System, the independent directors paidspecial attention to the standardized operation of the Company, performed their duties independently and diligently, issued manyprecious professional advice in terms of the perfection of systems and routine operating decision-making, etc., and issued their

BOE Technology Group Co., Ltd. Annual Report 2018

independent and fair opinion as independent directors on the related-party transactions, engagement of audit firm, decision of annualremuneration of senior management staffs, external guarantee and other events needing their opinion occurred in the ReportingPeriod, as well as played their due roles in perfecting the supervisory mechanism of the Company, protecting the legal right of theCompany and the whole shareholders.

VI Performance of Duty by Specialized Committees under the Board in the Reporting Period

1. Duty fulfillment of the Strategy Committee under Board of DirectorsIn the Reporting Period, the Strategy Committee under Board of Directors conscientiously controlled the strategic guidance, significantprojects, and production and operation activities. During the recess of the board session, the Strategy Committee was in charge ofworking out the operating strategies of the Company, planning its significant investment and financing projects, and monitoring itsmajor operation activities, which played an important role in ensuring the Company’s stable and smooth operation in the year.2. Duty fulfillment of the Audit Committee under Board of DirectorsIn the Reporting Period, the Audit Committee conscientiously performed its routine duties, and actively advanced the launch of theaudit work for Y2018. Before the periodic reports were submitted to the Board for review, the Audit Committee convened specialsessions to discuss the reports. At the sessions, the committee members listened to relevant reports, expressed their opinions and putforward constructive advices concerning the Company’s internal control, financial auditing and so on.The 2017 annual audit work on financial report of the Audit Committee was detailed as follows:

1) Before the audit, the Committee discussed and decided the schedule of audit work for the 2018 annual report with KPMG HuazhenCertified Public Accountants (LLP) (hereinafter referred to as “KPMG”);2) Before the presence of KPMG, the Committee reviewed the financial statements prepared by the Company and issued a writtenopinion;3) Upon the presence of KPMG, the Audit Committee convened meetings to communicate with KPMG, reviewed the Company’sfinancial statements following the preliminary audit opinion issued by KPMG, and issued the written opinion concerned. Before theBoard reviewed the annual report, the Committee reviewed the annual financial statements, the employment of the CPAs firm, etc., andmade resolutions for further review by the Board.4) In the audit process, the Committee issued a written Audit Urge Letter to KPMG, asking KPMG to finish the audit in an orderlymanner in strict accordance with the set schedule, so as to submit the annual audit report on time;The Audit Committee is of the opinion that the Financial Report is complete and factual with complete consolidated entities andstatements, an accurate consolidation basis, a steady and consistent accounting policy, proper application of the accounting policy andreasonable accounting estimates, which is in line with the Enterprise Accounting Standards and other regulations promulgated by theMinistry of Finance.3. Duty fulfillment of Nomination & Remuneration & Appraisal Committee under Board of DirectorsIn the Reporting Period, in accordance with relevant rules and laws, the Nomination & Remuneration & Appraisal Committeeconscientiously performed its duties endowed by the Board through strictly executing the appointment procedure of directors, andsenior management, as well as the appraisal procedure for directors and senior management staffs. And it reviewed the basicremuneration of senior managerial of the Company.

VII Performance of Duty by the Supervisory Committee

Indicate by tick mark whether the Supervisory Committee found any risk to the Company during its supervision in the ReportingPeriod.

BOE Technology Group Co., Ltd. Annual Report 2018

□ Yes √ NoThe Supervisory Committee raised no objections in the Reporting Period.

VIII Appraisal of and Incentive for Senior Management

According to the performance appraisal method of the Company, senior management sign an Annual Target Responsibility Paper with the Company which sets the annual operation targets, keyperformance indicators (KPI) as well as the evaluation, reward and punishment standards. As for the accomplishment of the targets, quarterly analyses, semi-annual reports and annual appraisalwill be conducted. The examination and evaluation results will determine the remunerations, position changes as well as the trainings to receive of senior management.

IX Internal Control

1. Material Internal Control Weaknesses Identified for the Reporting Period

□ Yes √ No

2. Internal Control Self-Evaluation Report

Disclosure date of the internal control self-evaluation report26 March 2019
Index to the disclosed internal control self-evaluation reportOn 26 March 2019, the Company disclosed 2018 Internal Control Appraisal Report, refer to www.cninfo.com.cn for details.
Evaluated entities’ combined assets as % of consolidated total assets98.00%
Evaluated entities’ combined operating revenue as % of consolidated operating revenue95.00%
Identification standards for internal control weaknesses
TypeWeaknesses in internal control over financial reportingWeaknesses in internal control not related to financial reporting
Nature standardThe nature standards of internal control deficiency evaluation over financial reporting determined by the Company are as follows:Evaluation standards for internal defects not related to financial reporting specified by the Company are as below: Material weakness:

BOE Technology Group Co., Ltd. Annual Report 2018

Material weakness: In case of the following situations, it will be deemed as that major defects (including but not limited to the following situations) may occur: (1) Directors, supervisors and Senior Management make the malpractices; (2) The enterprise corrects the released financial statements; (3) The certified public accountant finds that there is a material misstatement in the current financial report, but the internal control fails to find the misstatement in the process of operation; (4) Supervision of the risk control and audit committee and the internal audit organization for internal control is ineffective. Serious weakness refers to one or combination of several control items, and its severity and economic consequence are lower than those of the material weaknesses but may still affect the real and accurate objective of the financial report. The common weakness refers to other internal control weaknesses except for material weaknesses and serious weaknesses.(1) The business scope of the Company violates national laws and regulations seriously; (2) The decision-making procedure is not scientific, major decision errors are released, the development strategies of the Company are deviated from severely and major property losses are caused for the Company; (3) Safety and environmental accidents occur, resulting in major negative effects on the Company; (4) A lot of senior management personnel and key technicians leave the Company; (5) Important business lacks system control or the system is failure; (6) Material weaknesses or serious weaknesses are not corrected. Serious weakness refers to one or combination of several control items, and its severity and economic consequence are lower than those of the material weaknesses but may still affect the enterprise to deviate from the control goal. The common weakness refers to other internal control defects except for material weaknesses and Serious weakness.
Quantitative standardThe quantitative standards of internal control deficiency evaluation over financial reporting determined by the Company are as follows: Material weakness: The amount reported incorrectly is ≥1‰* total amount of assets of the Group Serious weakness: 0.5‰*total amount of assets of the Group ≤ the amount reported incorrectly<1‰*total amount of assets of the Group Common weakness: 0.1‰*total group assets ≤ the amountThe quantitative standards for internal control defects not related to financial reporting determined by the Company are consistent with those over the financial reporting. See the left side for details.

BOE Technology Group Co., Ltd. Annual Report 2018

reported incorrectly <0.5‰*total group assets
Number of material weaknesses in internal control over financial reporting0
Number of material weaknesses in internal control not related to financial reporting0
Number of serious weaknesses in internal control over financial reporting0
Number of serious weaknesses in internal control not related to financial reporting0

X Independent Auditor’s Report on Internal Control

√ Applicable □ Not applicable

Opinion paragraph in the independent auditor’s report on internal control
We believe that the Company and important subsidiaries make valid internal control on financial report in all significant aspects on 31 December 2018 according to the Basic Rules on Enterprise Internal Control and other relevant stipulations.
Independent auditor’s report on internal control disclosed or notDisclosed
Disclosure date26 March 2019
Index to such report disclosedThe Company disclosed the Audit Report on Internal Control on 26 March 2019, for details, please refer to http://www.cninfo.com.cn
Type of the auditor’s opinionStandard unqualified opinion
Material weaknesses in internal control not related to financial reportingNo

Indicate by tick mark whether any modified opinion is expressed in the independent auditor’s report on the Company’s internal control.□ Yes √ NoIndicate by tick mark whether the independent auditor’s report on the Company’s internal control is consistent with the internal control self-evaluation report issued by the Company’s Board.√ Yes □ No

BOE Technology Group Co., Ltd. Annual Report 2018

Part X Corporate Bonds

Does the Company have any corporate bonds publicly offered on the stock exchange, which were outstanding before the date of thisReport’s approval or were due but could not be redeemed in full?Yes

I. Basic Information of the Corporate Bonds

NameAbbr.CodeRelease dateDue dateBonds balance (RMB’0,000)Interest rateWay of redemption
2016 Public offering of the corporate bonds for the qualified investors of BOE Technology Group Co., Ltd. (Phase I)16BOE0111235821 March 201621 March 20211,000,0003.15%Paid for the interests by year and the principals once when expired.
Listed or transferred trading place of the Company bondsList on the SZSE.
Appropriate arrangement of the investorsthe qualified investors
Interest payment during the Reporting PeriodOn 21 March 2019, the Company completed the 2018 annual interest payout for the qualified investors of its 2016 corporate bonds and put-back.
Execution of the relevant regulations during the Reporting Period such as the affiliated option clause of the issuers or investors, special clauses such as the exchangeable regulations of the Company bonds (if applicable)The Company disclosed the following three announcements respectively on 31 January 2019, 1 February 2019 and 12 February 2019: The 1st Indicative Announcement on not Adjusting the Coupon Rate of “16BOE01” Corporate Bonds and Implementation Measures for Investor Put-back (announcement No.: 2019-001), The 2nd Indicative Announcement on not Adjusting the Coupon Rate of “16BOE01” Corporate Bonds and Implementation Measures for Investor Put-back (announcement No.: 2019-003), The 3rd Indicative Announcement on not Adjusting the Coupon Rate of “16BOE01” Corporate Bonds and Implementation Measures for Investor Put-back (announcement No.: 2019-004), and finally determined the put-back amount of “16BOE01” was 96,705,976 of RMB9,975,221,424.40 (interest included). The rest of bonds entrusted are 3,294,024. The Company has completed the payment of principal and current interest to investors holding “16BOE01” who applied for put-back effectively on 21 March 2019.

BOE Technology Group Co., Ltd. Annual Report 2018

II. List of the Bond Trustee and the Rating Organization

Bond trustee:
NameChina Securities Co., Ltd.Office addressRm. 2203, North Tower, Shanghai Securities Plaza, 528 Pudong Road South, ShanghaiContact personZhu Mingqiang, Han YongContact number021-68801565
Rating organization executed the tracking rating of the corporate bonds of the Reporting Period:
NameUnited Ratings Co., Ltd.Office address12/F, PICC Building, No.2 Jianwai Street, Chaoyang District, Beijing
Alternation reasons, execution process and influences on the investors’ interests etc. if there was alternation of the bond trustees and the credit rating agencies engaged by the Company during the Reporting Period (if applicable)Not applicable

III. List of the Usage of the Raised Funds of the Corporate Bonds

List of the usage of the raised funds and the execution process of the Company bondsThe Company executed the internal decision-making process strictly according to the applications committed by the prospectus as well as the review and approval regulations of the Board of Directors and meetings of shareholders of the Company.
Ending balance (RMB’0,000)2.58
Operating situation of the raised funds special accountThe Company signed the Agreement on the 2016 Public Offering of the Corporation Bonds Account for the Qualified Investors and the Funds Tripartite Authorities of BOE Technology Group Co., Ltd. with the Beijing Olympic Branch of Ping An Bank Co, Beijing Hepingli Branch of China CITIC Bank Corporation Limited and Beijing Branch of China Merchants Bank Co., Ltd., which set up the raise funds account that ensure the exclusive use of the special fund of the raise funds.
Whether the usage of the raised funds met with the usage, using plan and other agreements committed on the prospectusYes

IV. Rating Situation of the Corporate Bonds Information

On 23 June 2017, United Credit Ratings Co., Ltd. (hereinafter referred to as “United Ratings”) issued the Tracking Rating Report ofthe 2017 Corporate Bonds Credit Rating of BOE Technology Group Co., Ltd., with the issuers’ main body credit rating of AAA and

BOE Technology Group Co., Ltd. Annual Report 2018

AAA of the credit rating of the current corporate bonds. On 24 June 2017, the tracking rating report of the current bonds by theUnited Ratings will be disclosed on www.szse.cn and www.unitedratings.com.cn with the public disclosure date of www.szse.cn notlater than that of other trading places, media or other places.On 20 June 2018, United Ratings issued the Tracking Rating Report of the 2018 Corporate Bonds Credit Rating of BOE TechnologyGroup Co., Ltd., with the issuers’ main body credit rating of AAA and AAA of the credit rating of the current corporate bonds. On22 June 2018, the tracking rating report of the current bonds by the United Ratings will be disclosed on www.szse.cn and

www.unitedratings.com.cn with the public disclosure date of www.szse.cn not later than that of other trading places, media or other

places.Before 26 May 2019, United Ratings will issue the Tracking Rating Report of the 2019 Corporate Bonds Credit Rating of BOETechnology Group Co., Ltd. The Company will disclose the tracking rating analysis report on www.szse.cn in time. And pleaseinvestors pay attention to it.

V. Credit-adding Mechanism, Repayment Plan and Other Repayment Guarantee Measures ofthe Corporate Bonds

There was no guarantee of the corporate bonds of the Reporting Period.The profits from the issuers’ main business were the main resources of the debt service fund of the bonds of the Reporting Period.The debt repayment plan was as follows: during the duration period of the bonds of the Reporting Period, every 21 March of eachyear from Y2017 to Y2021 is the interest date of the last interest accrual year (if met with the legal holidays or rest days, shouldpostpone which to the subsequent first working day); if the investors executed the put-back right, the interest date of the part of theput-back bonds is every 21 March from Y2017 to Y2021 (if met with the legal holidays or rest days, should postpone which to thesubsequent first working day). The principal of the current bonds should be paid at one time when expired. The payment date of thecurrent bonds would be 21 March 2021 (if met with the legal holidays or rest days, should postpone which to the subsequent firstworking day); if the investors executed the put-back right, the payment date of the part of the put-back bonds would be 21 March2019 (if met with the legal holidays or rest days, should postpone which to the subsequent first working day).The repayment guarantee measures of the corporate bonds of the Reporting Period: to formulate the Meeting Regulations of theBondholders and the repayment guarantee measures; to formulate and strictly carry out the funds management plans; to fully exertthe functions of the bond trustees; to strictly disclose the information; at the same time, when expected to fail to repay the principalsand interest of the bonds on time or failed to repay the principals and interest of the bonds when expired, the Company will at leastadopt the measures of the execution of the capital expenditures projects such as to postpone the significant external investment andthe purchase as well as merger and so on that guarantee the repayment of the debts.During the Reporting Period, there was no alternation of the credit-adding mechanism, debt repayment plan and other repaymentguarantee measures of the corporate bonds.

VI. Convene Situation of the Bonds Holders Meeting during the Reporting Period

No such cases in the Reporting Period.

VII. List of the Duty Execution of the Bonds Trustee during the Reporting Period

As the bond trustee of the Reporting Period, China Securities Co., Ltd. constantly paid attention to the operating, finance and creditsituation of the Company strictly according to the relevant laws and regulations such as the Regulations of the Offering and Tradingof the Corporate Bonds, Professional Code of Conduct of the Bond Trustee of the Corporate Bonds and vigorously executed theresponsibilities as a trustee as well as maintained the legal interests of the bondholders; there was no any situation conflicted to the

BOE Technology Group Co., Ltd. Annual Report 2018

Company’s interests when executing the relevant responsibilities of the trustee.

VIII. The Major Accounting Data and the Financial Indicators of the Recent 2 Years of theCompany up the Period-end

Unit: RMB’0,000

Item20182017Change rate of the same period
EBITDA2,130,5342,416,492-11.83%
Current ratio1.602.01-20.40%
Asset-liability ratio60.41%59.28%1.13%
Quick ratio1.411.83-22.95%
Total debt ratio of EBITDA18.26%23.73%-5.47%
Times interest earned1.623.89-58.35%
Times interest earned of cash7.6611.03-30.55%
Times interest earned of EBITDA4.677.69-39.27%
Loan repayment rate100.00%100.00%0.00%
Interest coverage100.00%100.00%0.00%

Main reason of the above accounting data and the financial indicators with the YoY change exceeded 30%√ Applicable □ Not applicableEBITDA decreased of 58.35% over the same period of last year, which mainly due to decrease in profit before taxation in Y2018than that of Y2017.

IX. List of the Interest Payment of Other Bonds and Debt Financing Instruments during theReporting Period

No such cases in the Reporting Period.

X. List of the Acquired Bank Credit Lines, Usage and the Repayment of the Bank Loans

The Company operates normatively with good reputation and strong ability of profitability and debt payment. And the Companymaintained the long-term strategic partnerships with major cooperative banks. Up to 31 December 2018, the total amount of thecredit line of the major cooperative banks with the Company was of RMB40.7 billion with the used credit line of RMB16.4 billionand the unused amount of which was of RMB24.3 billion. The principal and the interest of bank loans were repaid on time. Therewas no default of bank loans for the Company in the Reporting Period.

XI. List of the Execution of the Agreements or the Commitments Related to the CompanyBonds Raising Specification during the Reporting Period

Up to the approval quotation date of the Annual Report, the Company strictly carried out each agreement and commitment of thecurrent bond prospectus, and there was no any situation of the inefficient execution of the relevant agreements or commitments

BOE Technology Group Co., Ltd. Annual Report 2018

according to the bond prospectus by the Company that caused the negative influences on the bonds investors.

XII. Significant Events Occurring during the Reporting Period

No such cases in the Reporting Period.

XIII. Whether there Was Guarantor of the Corporate Bonds

□ Yes √ No

BOE Technology Group Co., Ltd. Annual Report 2018

Part XI Financial Statements

I Independent Auditor’s Report

Type of the independent auditor’s opinionStandard unqualified audit opinion
Date of signing this report23 March 2019
Name of the independent auditorKPMG Huazhen Certified Public Accountants (LLP)
Reference number of auditor’s reportKPMGHZSZ No.1901566
Name of the certified public accountantsZhang Huan, Liu Jingyuan

AUDITORS’ REPORT

毕马威华振审字第1901566号All Shareholders of BOE Technology Group Co., Ltd.:

Opinion

We have audited the accompanying financial statements of BOE Technology Group Company Limited (“BOE”), which comprise theconsolidated and parent company’s balance sheet as at 31 December 2018, the consolidated and parent company’s income statement,the consolidated and parent company’s cash flow statement, and the consolidated and parent company’s statement of changes inshareholders’ equity for the year then ended, and notes to the financial statements.

In our opinion, the accompanying financial statements present fairly, in all material respects, the consolidated and parent company’sfinancial position of BOE as at 31 December 2018, and its consolidated and parent company’s financial performance and cash flowsof BOE for the year then ended in accordance with Accounting Standards for Business Enterprises issued by the Ministry of Financeof the People’s Republic of China.Basis for opinion

We conducted our audit in accordance with China Standards on Auditing for Certified Public Accountants (“CSAs”). Ourresponsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statementssection of our report. . We are independent of BOE in accordance with the China Code of Ethics for Certified Public Accountants(“the Code”), and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidencewe have obtained is sufficient and appropriate to provide a basis for our opinion.

BOE Technology Group Co., Ltd. Annual Report 2018

AUDITOR’S REPORT (continued)

毕马威华振审字第1901566号Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financialstatements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, andin forming our opinion thereon, and we do not provide a separate opinion on these matters.

Revenue recognition
Refer to the accounting policies set out in the notes to the financial statements “III. Significant accounting policies and accounting estimates” 23 and “V. Notes to the consolidated financial statements” 36.
The Key Audit MatterHow the matter was addressed in our audit
The revenue of BOE and its subsidiaries (“BOE Group”) is mainly derived from the sales of products relating to display device across the domestic and overseas market. The sales contracts/orders signed between BOE Group and its customers (mainly electronic equipment manufacturers) contain various trading terms. BOE Group judges the transfer timing of major risks and rewards according to the trading terms, and recognizes revenue accordingly. Depending on the trading terms, the income is usually recognized when the goods are delivered and received, or when they are received by the carrier. We identified the recognition of BOE Group’s revenue as a key audit matter because revenue, as one of BOE Group’s key performance indicators, involves various trading terms, and there is an inherent risk that revenue may not be recognized in a correct period.Our audit procedures to evaluate revenue recognition included the following: ? Evaluate the design and operation effectiveness of key internal controls related to revenue recognition; ? Check key sales contracts/orders on a sampling basis to identify relevant trading terms, and evaluate whether the accounting policies for revenue recognition of BOE Group meet the requirements of the Enterprise Accounting Standards; ? On a sampling basis and according to different trading terms, reconcile the revenue recorded in the current year to relevant supporting files such as relevant orders, shipping orders, sales invoices, customs declarations, delivery receipts, etc. to evaluate whether revenue is recognized in accordance with the accounting policy of BOE Group; ? On a sampling basis and according to different trading terms, cross check the revenue recorded before and after the balance sheet date against relevant supporting files such as relevant orders, shipping orders, sales invoices, customs declarations, delivery receipts, etc. to evaluate whether revenue is recorded in the appropriate period;

BOE Technology Group Co., Ltd. Annual Report 2018

Key Audit Matters (continued)

Revenue recognition
Refer to the accounting policies set out in the notes to the financial statements “III. Significant accounting policies and accounting estimates” 23 and “V. Notes to the consolidated financial statements” 36.
The Key Audit MatterHow the matter was addressed in our audit
? Select a sample based on the characteristics and nature of customer's transaction, and perform certification on the balance of accounts receivable as at the balance sheet date and the sales transaction amount during the current year; ? On a sampling basis, check the written-back of revenue after the balance sheet date (including sales discounts and sales returns, etc.) with relevant supporting documents to assess whether revenue is recorded in the appropriate period; ? Select revenue accounting entries that meet specific risk criteria and check related supporting documents.
Book value of fixed assets and construction in progress
Refer to the accounting policies set out in the notes to the financial statements “III. Significant accounting policies and accounting estimates” 14, 15 and “V. Notes to the consolidated financial statements” 10, 11.
The Key Audit MatterHow the matter was addressed in our audit
BOE Group continued to invest in building production lines of display device to expand its production capacity. As at 31 December 2018, the book value of fixed assets and construction in progress amounted to RMB 184.58 billion. The judgement made by the management on the following aspects will affect the book value of fixed assets and construction in progress, including: ? Determine which type of expenditures are qualified for capitalization; ? Determine the timing for transferring construction in progress to fixed assets and making depreciation; ? Estimate the useful life and residual value of corresponding fixed assets. We identified the book value of fixed assets and construction in progress of BOE Group as a key audit matter because the valuation of the book value of fixed assets and construction in progress involves significant judgement from the management and it is of importance to the consolidated financial statements.Our audit procedures to assess the book value of fixed assets and construction in progress included the following: ? Evaluate the design and operation effectiveness of key internal controls (including estimating useful life and residual values, etc.) related to the integrity, existence and accuracy of fixed assets and construction in progress; ? Check the physical status of construction in progress and fixed assets on a sampling basis; ? Check capital expenditures with relevant supporting documents (including purchase agreements/ orders, acceptance orders, engineering construction contracts, project progress reports, etc.) on a sampling basis; ? Assess whether the capitalized commissioning expenses for the current year are in compliance with relevant capitalization conditions; check the commissioning expenses with relevant supporting documents on a sampling basis; ? On the basis of sampling, assess the timing for transferring construction in progress to fixed assets, through the inspection of commissioning situation and the documents for transferring construction in progress to fixed assets; ? Based on our understanding of industry practices and actual operating conditions of assets, we evaluate the management's estimation of the useful life and residual value of fixed assets.

BOE Technology Group Co., Ltd. Annual Report 2018

AUDITORS’ REPORT (continued)

毕马威华振审字第1901566号

Other Information

BOE’s management is responsible for the other information. The other information comprises all the information included in 2018annual report of BOE, other than the financial statements and our auditor’s report thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusionthereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, considerwhether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit orotherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are requiredto report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with the AccountingStandards for Business Enterprises, and for the design, implementation and maintenance of such internal control necessary to enablethat the financial statements are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the ability of BOE to continue as a going concern,disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless BOE either intendsto liquidate or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the financial reporting process of BOE.

BOE Technology Group Co., Ltd. Annual Report 2018

AUDITORS’ REPORT (continued)

毕马威华振审字第1901566号

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from materialmisstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a highlevel of assurance, but is not a guarantee that an audit conducted in accordance with CSAs will always detect a material misstatementwhen it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they couldreasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with CSAs, we exercise professional judgement and maintain professional scepticism throughoutthe audit. We also:

(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and

perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resultingfrom error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internalcontrol.

(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in

the circumstances.

(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related

disclosures made by management.

(4) Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit

evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt onthe BOE’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to drawattention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate,to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report.However, future events or conditions may cause BOE to cease to continue as a going concern.

(5) Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether

the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

BOE Technology Group Co., Ltd. Annual Report 2018

AUDITORS’ REPORT (continued)

毕马威华振审字第1901566号

Auditor’s Responsibilities for the Audit of the Financial Statement (continued)

(6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within

BOE to express an opinion on the financial statements. We are responsible for the instruction, supervision and execution ofConch Group’s audit, and assume full responsibility for the audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit andsignificant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regardingindependence and communicate with them all relationships and other matters that may reasonably be thought to bear on ourindependence and, where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance inthe audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in ourauditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, wedetermine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably beexpected to outweigh the public interest benefits of such communication.

KPMG Huazhen LLP Certified Public Accountants

Registered in the People’s Republic of China

Zhang Huan (Engagement Partner)

Beijing, China Liu Jingyuan

23 March 2019

BOE Technology Group Co., Ltd. Annual Report 2018

Part XII Documents Available for Reference

(I) The financial statements signed and sealed by the Company’s legal representative, president of the Execution Committee (ChiefExecutive Officer), Chief Financial Officer and head of the financial department (equivalent to financial manager); and(II) The originals of all the documents and announcements that the Company disclosed on www.cninfo.com.cn during the ReportingPeriod.All the above mentioned documents are available at the Board Secretary’s Office of the Company.

Chairman of the Board (signature): Mr. Wang Dongsheng

Date of the Board’s approval of this Report: 23 March 2019

Page 1 of 7

BOE Technology Group Co., Ltd.

ENGLISH TRANSLATION OF FINANCIAL STATEMENTSFOR THE YEAR 1 JANUARY 2018 TO 31 DECEMBER 2018IF THERE IS ANY CONFLICT OF MEANING BETWEEN THE CHINESE VERSION

AND ENGLISH TRANSLATION, THE CHINESE VERSION WILL PREVAIL

Page 2 of 7

AUDITORS’ REPORT

毕马威华振审字第1901566号

All Shareholders of BOE Technology Group Co., Ltd.:

Opinion

We have audited the accompanying financial statements of BOE Technology Group Company Limited (“BOE”), whichcomprise the consolidated and parent company’s balance sheet as at 31 December 2018, the consolidated and parentcompany’s income statement, the consolidated and parent company’s cash flow statement, and the consolidated and parentcompany’s statement of changes in shareholders’ equity for the year then ended, and notes to the financial statements.

In our opinion, the accompanying financial statements present fairly, in all material respects, the consolidated and parentcompany’s financial position of BOE as at 31 December 2018, and its consolidated and parent company’s financialperformance and cash flows of BOE for the year then ended in accordance with Accounting Standards for BusinessEnterprises issued by the Ministry of Finance of the People’s Republic of China.

Basis for opinion

We conducted our audit in accordance with China Standards on Auditing for Certified Public Accountants (“CSAs”). Ourresponsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the FinancialStatements section of our report. . We are independent of BOE in accordance with the China Code of Ethics for CertifiedPublic Accountants (“the Code”), and we have fulfilled our other ethical responsibilities in accordance with the Code. Webelieve that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Page 3 of 7

AUDITOR’S REPORT (continued)

毕马威华振审字第1901566号

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financialstatements of the current period. These matters were addressed in the context of our audit of the financial statements as awhole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Revenue recognition
Refer to the accounting policies set out in the notes to the financial statements “III. Significant accounting policies and accounting estimates” 23 and “V. Notes to the consolidated financial statements” 36.
The Key Audit MatterHow the matter was addressed in our audit
The revenue of BOE and its subsidiaries (“BOE Group”) is mainly derived from the sales of products relating to display device across the domestic and overseas market. The sales contracts/orders signed between BOE Group and its customers (mainly electronic equipment manufacturers) contain various trading terms. BOE Group judges the transfer timing of major risks and rewards according to the trading terms, and recognizes revenue accordingly. Depending on the trading terms, the income is usually recognized when the goods are delivered and received, or when they are received by the carrier. We identified the recognition of BOE Group’s revenue as a key audit matter because revenue, as one of BOE Group’s key performance indicators, involves various trading terms, and there is an inherent risk that revenue may not be recognized in a correct period.Our audit procedures to evaluate revenue recognition included the following: ? Evaluate the design and operation effectiveness of key internal controls related to revenue recognition; ? Check key sales contracts/orders on a sampling basis to identify relevant trading terms, and evaluate whether the accounting policies for revenue recognition of BOE Group meet the requirements of the Enterprise Accounting Standards; ? On a sampling basis and according to different trading terms, reconcile the revenue recorded in the current year to relevant supporting files such as relevant orders, shipping orders, sales invoices, customs declarations, delivery receipts, etc. to evaluate whether revenue is recognized in accordance with the accounting policy of BOE Group; ? On a sampling basis and according to different trading terms, cross check the revenue recorded before and after the balance sheet date against relevant supporting files such as relevant orders, shipping orders, sales invoices, customs declarations, delivery receipts, etc. to evaluate whether revenue is recorded in the appropriate period;

Page 4 of 7

AUDITORS’ REPORT (continued)

毕马威华振审字第1901566号

Key Audit Matters (continued)

Revenue recognition
Refer to the accounting policies set out in the notes to the financial statements “III. Significant accounting policies and accounting estimates” 23 and “V. Notes to the consolidated financial statements” 36.
The Key Audit MatterHow the matter was addressed in our audit
? Select a sample based on the characteristics and nature of customer's transaction, and perform certification on the balance of accounts receivable as at the balance sheet date and the sales transaction amount during the current year; ? On a sampling basis, check the written-back of revenue after the balance sheet date (including sales discounts and sales returns, etc.) with relevant supporting documents to assess whether revenue is recorded in the appropriate period; ? Select revenue accounting entries that meet specific risk criteria and check related supporting documents.

Page 5 of 7

AUDITORS’ REPORT (continued)

毕马威华振审字第1901566号

Key Audit Matters (continued)

Book value of fixed assets and construction in progress
Refer to the accounting policies set out in the notes to the financial statements “III. Significant accounting policies and accounting estimates” 14, 15 and “V. Notes to the consolidated financial statements” 10, 11.
The Key Audit MatterHow the matter was addressed in our audit
BOE Group continued to invest in building production lines of display device to expand its production capacity. As at 31 December 2018, the book value of fixed assets and construction in progress amounted to RMB 184.58 billion. The judgement made by the management on the following aspects will affect the book value of fixed assets and construction in progress, including: ? Determine which type of expenditures are qualified for capitalization; ? Determine the timing for transferring construction in progress to fixed assets and making depreciation; ? Estimate the useful life and residual value of corresponding fixed assets. We identified the book value of fixed assets and construction in progress of BOE Group as a key audit matter because the valuation of the book value of fixed assets and construction in progress involves significant judgement from the management and it is of importance to the consolidated financial statements.Our audit procedures to assess the book value of fixed assets and construction in progress included the following: ? Evaluate the design and operation effectiveness of key internal controls (including estimating useful life and residual values, etc.) related to the integrity, existence and accuracy of fixed assets and construction in progress; ? Check the physical status of construction in progress and fixed assets on a sampling basis; ? Check capital expenditures with relevant supporting documents (including purchase agreements/ orders, acceptance orders, engineering construction contracts, project progress reports, etc.) on a sampling basis; ? Assess whether the capitalized commissioning expenses for the current year are in compliance with relevant capitalization conditions; check the commissioning expenses with relevant supporting documents on a sampling basis; ? On the basis of sampling, assess the timing for transferring construction in progress to fixed assets, through the inspection of commissioning situation and the documents for transferring construction in progress to fixed assets; ? Based on our understanding of industry practices and actual operating conditions of assets, we evaluate the management's estimation of the useful life and residual value of fixed assets.

Page 6 of 7

AUDITORS’ REPORT (continued)

毕马威华振审字第1901566号

Other Information

BOE’s management is responsible for the other information. The other information comprises all the information included in2018 annual report of BOE, other than the financial statements and our auditor’s report thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of assuranceconclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so,consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained inthe audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we arerequired to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with theAccounting Standards for Business Enterprises, and for the design, implementation and maintenance of such internal controlnecessary to enable that the financial statements are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the ability of BOE to continue as a goingconcern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unlessBOE either intends to liquidate or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the financial reporting process of BOE.

Page 7 of 7

AUDITORS’ REPORT (continued)

毕马威华振审字第1901566号

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from materialmisstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assuranceis a high level of assurance, but is not a guarantee that an audit conducted in accordance with CSAs will always detect amaterial misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individuallyor in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis ofthese financial statements.

As part of an audit in accordance with CSAs, we exercise professional judgement and maintain professional scepticismthroughout the audit. We also:

(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error,

design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,misrepresentations, or the override of internal control.

(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are

appropriate in the circumstances.

(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and

related disclosures made by management.

(4) Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the

audit evidence obtained, whether a material uncertainty exists related to events or conditions that may castsignificant doubt on the BOE’s ability to continue as a going concern. If we conclude that a material uncertaintyexists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statementsor, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor’s report. However, future events or conditions may cause BOE to cease tocontinue as a going concern.

(5) Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and

whether the financial statements represent the underlying transactions and events in a manner that achieves fairpresentation.

Page 8 of 7

AUDITORS’ REPORT (continued)

毕马威华振审字第1901566号

Auditor’s Responsibilities for the Audit of the Financial Statement (continued)

(6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities

within BOE to express an opinion on the financial statements. We are responsible for the instruction, supervision andexecution of Conch Group’s audit, and assume full responsibility for the audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of theaudit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirementsregarding independence and communicate with them all relationships and other matters that may reasonably be thought tobear on our independence and, where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of mostsignificance in the audit of the financial statements of the current period and are therefore the key audit matters. We describethese matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, inextremely rare circumstances, we determine that a matter should not be communicated in our report because the adverseconsequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

KPMG Huazhen LLP Certified Public Accountants

Registered in the People’s Republic of China

Zhang Huan (Engagement Partner)

Beijing, China Liu Jingyuan

23 March 2019

Page 1

BOE Technology Group Co., Ltd.Consolidated balance sheet as at 31 December 2018

(Expressed in Renminbi Yuan)

?Note31 December 2018?31 December 2017?1 January 2017
Assets??????
Current assets:??????
Cash at bank and on handV.151,481,539,711?57,128,659,576?58,152,817,223
Bills receivable and accounts receivableV. 220,537,462,095?16,347,031,379?17,561,628,267
PrepaymentsV. 3770,633,448?587,126,751?708,511,473
Other receivablesV. 42,454,174,971?818,024,132?1,028,210,989
InventoriesV. 511,985,398,172?8,957,719,381?7,833,138,532
Non-current assets due within one year?-?17,303,152?66,321,715
Other current assetsV. 612,463,073,779?15,924,433,978?5,691,200,226
?????
Total current assets?99,692,282,176?99,780,298,349?91,041,828,425
?
Non-current assets:??????
Available-for-sale financial assetsV. 7734,022,359?859,899,356?622,502,556
Long-term equity investmentsV. 82,389,166,886?6,928,854,415?1,356,111,395
Investment propertiesV. 91,283,867,651?1,296,662,205?1,192,932,896
Fixed assetsV. 10128,157,730,995?88,625,296,761?69,947,586,967
Construction in progressV. 1156,423,354,887?50,761,250,426?33,008,248,720
Intangible assetsV. 125,937,679,394?2,982,664,308?3,136,873,387
GoodwillV. 13904,370,509?197,963,688?197,963,688
Long?term deferred expensesV. 14360,640,853?379,829,430?344,891,227
Deferred tax assetsV. 15252,373,622?106,255,657?146,538,565
Other non-current assetsV. 167,893,002,053?4,189,767,254?4,139,533,216
?????
Total non-current assets?204,336,209,209?156,328,443,500?114,093,182,617
?
?????
Total assets?304,028,491,385?256,108,741,849?205,135,011,042

The notes on pages 21 to 145 form part of these financial statements.

Page 2

BOE Technology Group Co., Ltd.Consolidated balance sheet (continued) as at 31 December 2018

(Expressed in Renminbi Yuan)

?Note31 December 2018?31 December 2017?1 January 2017
Liabilities and shareholders’ equity??????
Current liabilities??????
Short-term loansV. 175,449,954,885?3,249,736,430?4,916,965,507
Bills payable and accounts payableV. 1822,805,065,888?16,749,587,533?14,475,878,126
Advances from customersV. 191,218,934,743?781,324,522?548,942,714
Employee benefits payableV. 202,224,931,171?2,217,066,944?1,542,852,266
Taxes payableV. 21970,108,298?775,621,146?656,351,894
Other payablesV. 2222,956,979,828?16,122,413,130?15,081,535,166
Non-current liabilities due within one yearV. 235,597,563,204?9,109,708,511?3,684,236,935
Other current liabilitiesV. 241,004,557,061?730,709,590?532,983,474
?????
Total current liabilities?62,228,095,078?49,736,167,806?41,439,746,082
?????
Non-current liabilities??????
Long-term loansV. 2594,780,077,864?78,973,633,010?49,885,166,211
Bonds payableV. 2610,288,666,233?9,966,467,496?9,956,719,508
Long-term payablesV. 271,416,092,239?1,176,250,982?1,261,446,565
ProvisionsV. 2816,457,010?16,457,010?16,457,010
Deferred incomeV. 292,187,558,533?2,261,955,307?2,494,122,929
Deferred tax liabilitiesV. 151,419,373,545?563,302,910?448,625,054
Other non-current liabilitiesV. 3011,334,873,322?9,130,244,495?7,616,672,523
?????
Total non-current liabilities?121,443,098,746?102,088,311,210?71,679,209,800
?
?????
Total liabilities?183,671,193,824?151,824,479,016?113,118,955,882

The notes on pages 21 to 145 form part of these financial statements.

Page 3

BOE Technology Group Co., Ltd.Consolidated balance sheet (continued) as at 31 December 2018

(Expressed in Renminbi Yuan)

?Note31 December 2018?31 December 2017?1 January 2017
Liabilities and shareholders’ equity (continued)??????
Shareholders’ equity??????
Share capitalV. 3134,798,398,763?34,798,398,763?35,153,067,743
Capital reserveV. 3238,213,100,596?38,585,515,122?39,031,357,529
Less: Treasury shares?-?-?314,350,824
Other comprehensive incomeV. 33(125,258,252)?150,602,933?75,718,703
Surplus reserveV. 341,152,626,310?889,640,475?743,139,855
Retained earningsV. 3511,817,881,286?10,385,659,084?4,011,055,487
?????
Total equity attributable to shareholders of the Company?85,856,748,703?84,809,816,377?78,699,988,493
?????
Non-controlling interests?34,500,548,858?19,474,446,456?13,316,066,667
?????
Total shareholders’ equity?120,357,297,561?104,284,262,833?92,016,055,160
?
?????
Total liabilities and shareholders’ equity?304,028,491,385?256,108,741,849?205,135,011,042

These financial statements were approved by the Board of Directors of the Company on 23 March 2019.

?

Wang Dongsheng Chairman of the BoardChen Yanshun Chief Executive OfficerSun Yun Chief Financial OfficerYang Xiao Ping Financial Officer(Company stamp)
(Signature and stamp)(Signature and stamp)(Signature and stamp)(Signature and stamp)

The notes on pages 21 to 145 form part of these financial statements.

Page 4

BOE Technology Group Co., Ltd.Company balance sheet as at 31 December 2018

(Expressed in Renminbi Yuan)

?Note31 December 2018?31 December 2017?1 January 2017
Assets??????
Current assets:??????
Cash at bank and on handXIV. 13,829,814,050?2,990,801,501?7,649,349,412
Bills receivable and accounts receivableXIV. 238,452,623?39,897,385?246,051,213
Prepayments?25,020,734?10,315,083?7,462,061
Other receivablesXIV. 32,015,828,460?1,835,131,720?2,658,651,974
Inventories?9,289,141?12,751,847?12,069,865
Non-current assets due within one year?450,000,000?3,648,840,000?-
Other current assetsXIV. 447,805,096?61,082,075?25,504,074
?????
Total current assets?6,416,210,104?8,598,819,611?10,599,088,599
???????
Non-current assets:??????
Available-for-sale financial assetsXIV. 5128,297,254?149,269,107?177,166,908
Long-term equity investmentsXIV. 6143,499,733,485?121,193,680,391?99,918,451,449
Investment properties?290,253,475?292,544,063?164,540,581
Fixed assets?969,371,352?982,985,346?862,860,227
Construction in progress?251,314,313?274,400,649?468,494,838
Intangible assets?514,186,496?530,490,988?624,007,700
Long?term deferred expenses?99,701,797?112,776,691?98,745,001
Deferred tax assetsXIV. 7290,794,548?150,206,185?47,679,645
Other non-current assets?284,243,667?480,909,226?4,010,146,153
?????
Total non-current assets?146,327,896,387?124,167,262,646?106,372,092,502
?
?????
Total assets?152,744,106,491?132,766,082,257?116,971,181,101

The notes on pages 21 to 145 form part of these financial statements.

Page 5

BOE Technology Group Co., Ltd.Company balance sheet as at 31 December 2018

(Expressed in Renminbi Yuan)

?Note31 December 2018?31 December 2017?1 January 2017
Liabilities and shareholders’ equity??????
Current liabilities??????
Short-term loans?1,000,000,000?-?-?
Bills payable and accounts payable?35,322,286?50,152,503?34,015,337
Advances from customers?1,577,035,515?1,375,022,585?1,093,593,891
Employee benefits payableXIV. 8201,139,261?283,000,193?169,917,103
Taxes payable?250,558,556?119,584,927?80,897,741
Other payablesXIV. 98,209,736,090?10,032,392,970?11,079,505,355
Non-current liabilities due within one year?2,590,000,000?4,031,840,000?100,000,000
Total current liabilities?13,863,791,708?15,891,993,178?12,557,929,427
?????
Non-current liabilities??????
Long-term loansXIV. 1026,520,000,000?23,943,000,000?18,922,400,000
Bonds payable?9,976,533,425?9,966,467,496?9,956,719,508
Deferred incomeXIV. 115,523,949,841?130,652,127?148,987,694
Other non-current liabilities?20,954,104,125?7,600,000,000?-
?????
Total non-current liabilities?62,974,587,391?41,640,119,623?29,028,107,202
?
?????
Total liabilities?76,838,379,099?57,532,112,801?41,586,036,629

The notes on pages 21 to 145 form part of these financial statements.

Page 6

BOE Technology Group Co., Ltd.Company balance sheet as at 31 December 2018

(Expressed in Renminbi Yuan)

?Note31 December 2018?31 December 2017?1 January 2017
Liabilities and shareholders’ equity (continued)??????
Shareholders’ equity??????
Share capital? V. 3134,798,398,763?34,798,398,763?35,153,067,743
Capital reserveXIV. 1237,590,966,191?37,588,541,593?38,157,600,408
Less: Treasury shares?-?-?314,350,824
Other comprehensive incomeXIV. 13(28,507,585)?192,097,489?152,323,461
Surplus reserve? V. 341,152,626,310?889,640,475?743,139,855
Retained earningsXIV. 142,392,243,713?1,765,291,136?1,493,363,829
?????
Total shareholders’ equity?75,905,727,392?75,233,969,456?75,385,144,472
?
?????
Total liabilities and shareholders’ equity?152,744,106,491?132,766,082,257?116,971,181,101

These financial statements were approved by the Board of Directors of the Company on 23 March 2019.

Wang Dongsheng Chairman of the BoardChen Yanshun Chief Executive OfficerSun Yun Chief Financial OfficerYang Xiao Ping Financial Officer(Company stamp)
(Signature and stamp)(Signature and stamp)(Signature and stamp)(Signature and stamp)

The notes on pages 21 to 145 form part of these financial statements.

Page 7

BOE Technology Group Co., Ltd.Consolidated income statement for the year ended 31 December 2018

(Expressed in Renminbi Yuan)

?Note2018?2017
I. Operating incomeV. 3697,108,864,935?93,800,479,215
???
II. Less: Operating costsV. 3677,306,224,288?70,282,477,585
Taxes and surchargesV. 37778,606,126?708,381,529
Selling and distribution expensesV. 382,891,056,969?2,591,925,798
Administrative expensesV. 394,959,184,197?4,068,775,945
Research and development costsV. 405,039,927,435?3,177,767,395
Finance expensesV. 413,196,695,890?1,948,024,860
Including: Interest expense?3,265,732,314?2,479,336,159
Interest income?748,004,557?665,076,391
Impairment LossV. 421,239,588,763?2,229,524,682
Add: Other incomeV. 432,000,573,631?732,550,112
Investment incomeV. 44306,887,579?115,602,683
Including: (Losses) / Gains from investment in associates and joint ventures?(13,925,731)?169,034
Gains from changes in fair valueV. 452,061,153?32,048,211
Gains/ (Losses) from disposal of assetsV. 461,067,273?(69,145)
???
III. Operating profit?4,008,170,903?9,673,733,282
???
Add: Non-operating incomeV. 47169,429,515?180,418,858
Less: Non-operating expensesV. 4755,310,251?113,080,601
???
IV.Total profit?4,122,290,167?9,741,071,539
???
Less: Income tax expensesV. 481,242,416,094?1,880,659,980
???
V. Net profit?2,879,874,073?7,860,411,559
?

The notes on pages 21 to 145 form part of these financial statements.

Page 8

BOE Technology Group Co., Ltd.Consolidated income statement for the year ended 31 December 2018(continued)

(Expressed in Renminbi Yuan)

?Note2018?2017
?????
VI. Other comprehensive income, net of taxV. 33(249,814,869)?44,387,083
Other comprehensive income (net of tax) attributable to shareholders of the Company?(275,861,185)?74,884,230
Items that may be reclassified to profit or loss????
1 Share of other comprehensiveincome of the equity-accounted investeethat may be reclassified to profit or loss?(202,998,615)?76,051,151
2 Gains or losses arising from changes in fair value of available-for-sale financial assets?(136,009,652)?12,910,506
3 Translation differences arising from translation of foreign currency financial statements?63,147,082?(14,077,427)
Other comprehensive income (net of tax) attributable to non-controlling interests?26,046,316?(30,497,147)
?
???
VII. Total comprehensive income for the year?2,630,059,204?7,904,798,642
???
Total comprehensive income attributable to shareholders of the Company?3,159,266,790?7,642,566,723
Total comprehensive income attributable to minority shareholders(529,207,586)?262,231,919
VIII.Earnings per share????
(1) Basic earnings per shareV. 490.10?0.22
(2) Diluted earnings per shareV. 490.10?0.22

These financial statements were approved by the Board of Directors of the Company on 23 March 2019.

?

Wang Dongsheng Chairman of the BoardChen Yanshun Chief Executive OfficerSun Yun Chief Financial OfficerYang Xiao Ping Financial Officer(Company stamp)
(Signature and stamp)(Signature and stamp)(Signature and stamp)(Signature and stamp)

The notes on pages 21 to 145 form part of these financial statements.

Page 9

BOE Technology Group Co., Ltd.Company income statement for the year ended 31 December 2018

(Expressed in Renminbi Yuan)

?Note2018?2017
I. Operating incomeXIV. 154,048,349,688?2,815,561,521
???
II. Less: Operating costs?51,274,428?29,212,906
Taxes and surchargesXIV. 1644,129,874?39,649,316
Selling and distribution expenses?561,601?2,224,628
Administrative expenses?744,597,442?692,418,475
Research and development costs?1,247,889,953?1,027,250,122
Finance expensesXIV. 171,014,420,709?505,879,539
Including: Interest expense?1,055,792,484?556,880,963
Interest income?44,583,524?58,850,619
Add: Other incomeXIV. 18995,284,363?23,513,456
Investment incomeXIV. 19928,309,899?950,279,403
Including: (Losses) / Gains from investment in associates and joint ventures?(12,001,705)?169,034
Losses from disposal of intangible assets-?(157,430)
???
III.Operating profit?2,869,069,943?1,492,561,964
???
Add: Non-operating incomeXIV. 204,336,405?3,552,572
Less: Non-operating expensesXIV. 208,668,410?18,008,134
???
IV.Total profit?2,864,737,938?1,478,106,402
???
Less: Income tax expensesXIV. 21234,879,588?13,100,199
???
V. Net profit?2,629,858,350?1,465,006,203

The notes on pages 21 to 145 form part of these financial statements.

Page 10

BOE Technology Group Co., Ltd.Company income statement for the year ended 31 December 2018(continued)

(Expressed in Renminbi Yuan)

?Note2018?2017
VI. Other comprehensive income, net of taxXIV. 13(220,605,074)?39,774,028
Items that may be reclassified to profit or loss???
1 Share of other comprehensiveincome of the equity-accounted investeethat may be reclassified to profit or loss?(202,778,999)?76,051,151
2 Gains or losses arising from changes in fair value of available-for-sale financial assets?(17,826,075)?(36,277,123)
???
VII. Total comprehensive income for the year?2,409,253,276?1,504,780,231

These financial statements were approved by the Board of Directors of the Company on 23 March 2019.

Wang Dongsheng Chairman of the BoardChen Yanshun Chief Executive OfficerSun Yun Chief Financial OfficerYang Xiao Ping Financial Officer(Company stamp)
(Signature and stamp)(Signature and stamp)(Signature and stamp)(Signature and stamp)

The notes on pages 21 to 145 form part of these financial statements.

Page 11

BOE Technology Group Co., Ltd.Consolidated cash flow statement for the year ended 31 December 2018

(Expressed in Renminbi Yuan)

?Note2018?2017
I. Cash flows from operating activities:????
Proceeds from sale of goods and rendering of services?105,589,411,120?102,954,356,249
Refund of taxes?6,513,812,910?8,111,061,033
Government grants2,195,202,400994,782,926
Proceeds from other operating activities?770,921,360?334,436,574
???
Sub-total of cash inflows?115,069,347,790?112,394,636,782
???
Payment for goods and services?(75,700,548,251)?(73,250,817,397)
Payment to and for employees?(9,162,421,738)?(8,015,171,249)
Payment of various taxes?(1,619,256,288)?(2,480,139,386)
Payment for other operating activities?(2,903,074,317)?(1,921,579,095)
???
Sub-total of cash outflows?(89,385,300,594)?(85,667,707,127)
?
???
Net cash flow from operating activitiesV. 50(1)25,684,047,196?26,726,929,655

The notes on pages 21 to 145 form part of these financial statements.

Page 12

BOE Technology Group Co., Ltd.Consolidated cash flow statement for the year ended 31 December 2018(continued)

(Expressed in Renminbi Yuan)

?Note2018?2017
II. Cash flows from investing activities:????
Proceeds from disposal of investments?59,211,537,932?29,310,620,000
Investment returns received?356,050,182?114,521,291
Net proceeds from disposal of fixed assets, intangible assets and other long-term assets?98,644,621?6,906,760
Net amount received from subsidiaries? V. 50(2)6,801,508,810?-
Proceeds from other investing activities?1,808,988,695?3,455,877,227
???
Sub-total of cash inflows?68,276,730,240?32,887,925,278
???
Cash paid for acquisition of fixed assets,intangible assets and other long-term assets?(54,520,544,965)?(47,741,900,710)
Payment for acquisition of investments?(60,819,720,633)?(44,667,993,985)
???
Sub-total of cash outflows?(115,340,265,598)?(92,409,894,695)
?
???
Net cash flow from investing activities?(47,063,535,358)?(59,521,969,417)
???
III. Cash flows from financing activities:????
Proceeds from investors?4,294,161,400?9,851,250,000
Including: Cash received from minority shareholders of subsidiaries?4,294,161,400?9,851,250,000
Proceeds from borrowings?38,368,279,407?53,106,623,454
Net amount of monetary movements for pledging loans?176,637,743?-
Proceeds from other financing activities?155,194,921?3,185,620,220
???
Sub-total of cash inflows?42,994,273,471?66,143,493,674

The notes on pages 21 to 145 form part of these financial statements.

Page 13

BOE Technology Group Co., Ltd.Consolidated cash flow statement for the year ended 31 December 2018(continued)

(Expressed in Renminbi Yuan)

?Note2018?2017
III. Cash flows from financing activities (continued):????
Repayments of borrowings?(21,274,318,530)?(18,337,522,432)
Payment for dividends or interest?(5,806,323,938)?(3,860,122,769)
Including: Dividends paid to non- controlling shareholders by subsidiaries?(4,319,286)?(7,359,220)
Net amount of monetary movements for pledging loans?-?(3,435,366,588)
Payment for other financing activities?(347,060,613)?(7,585,109,696)
???
Sub-total of cash outflows?(27,427,703,081)?(33,218,121,485)
?
???
Net cash flow from financing activities?15,566,570,390?32,925,372,189
???
IV. Effect of foreign exchange rate changes on cash and cash equivalents?1,250,326,709?(1,571,855,232)
?
???
V. Decrease in cash and cash equivalentsV. 50(1)(4,562,591,063)?(1,441,522,805)
???
Add: Cash and cash equivalents at the beginning of the year?47,913,287,583?49,354,810,388
???
VI. Cash and cash equivalents at the end of the yearV. 50(3)43,350,696,520?47,913,287,583

These financial statements were approved by the Board of Directors of the Company on 23 March 2019.

?

Wang Dongsheng Chairman of the BoardChen Yanshun Chief Executive OfficerSun Yun Chief Financial OfficerYang Xiao Ping Financial Officer(Company stamp)
(Signature and stamp)(Signature and stamp)(Signature and stamp)(Signature and stamp)

The notes on pages 21 to 145 form part of these financial statements.

Page 14

BOE Technology Group Co., Ltd.Company cash flow statement for the year ended 31 December 2018

(Expressed in Renminbi Yuan)

?Note2018?2017
I. Cash flows from operating activities:????
Proceeds from sale of goods and rendering of services?4,053,318,155?2,646,300,929
Tax refund23,508,537-
Proceeds from other operating activities?1,705,344,020?34,989,298
???
Sub-total of cash inflows?5,782,170,712?2,681,290,227
???
Payment for goods and services?(976,219,250)?(538,392,970)
Payment to and for employees?(957,780,812)?(702,175,894)
Payment of various taxes?(284,079,728)?(127,394,546)
Payment for other operating activities?(102,575,476)?(5,016,674,918)
???
Sub-total of cash outflows?(2,320,655,266)?(6,384,638,328)
?
???
Net cash flow from operating activitiesXIV. 22 (1)3,461,515,446?(3,703,348,101)
???
II. Cash flows from investing activities:????
Investment returns received?506,145,151-
Cash received in return for investment?971,599,836?1,949,256,701
Net proceeds from disposal of fixed assets6,384,696?773,888
Proceeds from other investing activities?3,333,764,245?1,280,375,880
Sub-total of cash inflows?4,817,893,928?3,230,406,469

The notes on pages 21 to 145 form part of these financial statements.

Page 15

BOE Technology Group Co., Ltd.Company cash flow statement for the year ended 31 December 2018(continued)

(Expressed in Renminbi Yuan)

??2018?2017
II. Cash flows from investing activities: (continued):????
Cash paid for acquisition of fixed assets,intangible assets and other long-term assets?(295,214,844)?(137,047,424)
Payment for acquisition of investments?(22,553,409,200)?(21,200,608,757)
Payment for other investing activities?(257,000,000)?(800,000,000)
???
Sub-total of cash outflows?(23,105,624,044)?(22,137,656,181)
?
???
Net cash flow from investing activities?(18,287,730,116)?(18,907,249,712)
???
III. Cash flows from financing activities:????
Proceeds from borrowings?11,367,000,000?9,933,000,000
Proceeds from other financing activities?19,698,642,218?11,300,000,000
???
Sub-total of cash inflows?31,065,642,218?21,233,000,000
???
Repayments of borrowings?(4,597,640,000)?(980,560,000)
Payment for dividends and interest?(2,795,130,756)?(1,562,806,447)
Payment for other financing activities?(8,150,000,000)?(609,376,971)
???
Sub-total of cash outflows?(15,542,770,756)?(3,152,743,418)
?
???
Net cash flow from financing activities?15,522,871,462?18,080,256,582

The notes on pages 21 to 145 form part of these financial statements.

Page 16

BOE Technology Group Co., Ltd.Company cash flow statement for the year ended 31 December 2018(continued)

(Expressed in Renminbi Yuan)

?Note2018?2017
IV. Effect of foreign exchange rate changes on cash and cash equivalents?142,355,757(27,557,680)
?
???
V. Net Increase/(Decrease) in cash and cash equivalentsXIV. 22 (1)839,012,549?(4,557,898,911)
???
Add: Cash and cash equivalents at the beginning of the year?2,990,801,501?7,548,700,412
???
VI. Cash and cash equivalents at the end of the yearXIV. 22 (2)3,829,814,050?2,990,801,501

These financial statements were approved by the Board of Directors of the Company on 23 March 2019.

?

Wang Dongsheng Chairman of the BoardChen Yanshun Chief Executive OfficerSun Yun Chief Financial OfficerYang Xiao Ping Financial Officer(Company stamp)
(Signature and stamp)(Signature and stamp)(Signature and stamp)(Signature and stamp)

The notes on pages 21 to 145 form part of these financial statements.

Page 17

BOE Technology Group Co., Ltd.Consolidated statement of changes in shareholders’ equityfor the year ended 31 December 2018

(Expressed in Renminbi Yuan)

??Equity attributable to shareholders of the Company????
?NoteShare capital?Capital reserve?Less: Treasury shares?Other comprehensive income?Surplus reserve?Retained earnings?Sub-total?Non-controlling interests?Total shareholders’ equity
I. Balance at the beginning of the year?34,798,398,763?38,585,515,122?-?150,602,933?889,640,475?10,385,659,084?84,809,816,377?19,474,446,456?104,284,262,833
II. Changes in equity during the year?
(1) Total comprehensive income?-?-?-?(275,861,185)?-?3,435,127,975?3,159,266,790?(529,207,586)?2,630,059,204
(2) Shareholders’ contributions and decrease of capital??
1. Contribution by non-controlling interests?-?-?-?-?-?-?-?4,494,161,400?4,494,161,400
2. Business combinations involving entities not under common control?-?-?-?-?-?-?-?11,541,782,339?11,541,782,339
3. Equity movements arising from investment increase in non-wholly owned subsidiariesV. 32?-?3,754,159?-?-?-?-?3,754,159?(3,402,793)?351,366
?
Appropriation of profitsV. 35?-?-?-?-?262,985,835?(262,985,835)?-?-?-
1. Appropriation for surplus reserve?-?-?-?-?-?(1,739,919,938)?(1,739,919,938)?(18,316,894)?(1,758,236,832)
2. Distributions to shareholders?
(4) Others 1. Equity changes arising from acquisition of non-controlling interestsV. 32?-(378,593,283)----(378,593,283)(458,914,064)(837,507,347)
2. OthersV. 32?-2,424,598----?2,424,598-2,424,598
???
III. Balance at the end of the year?34,798,398,763?38,213,100,596?-?(125,258,252)?1,152,626,310?11,817,881,286?85,856,748,703?34,500,548,858?120,357,297,561

These financial statements were approved by the Board of Directors of the Company on 23 March 2019.

?

Wang DongshengChairman of the Board

Wang Dongsheng Chairman of the BoardChen Yanshun Chief Executive OfficerSun Yun Chief Financial OfficerYang Xiao Ping Financial Officer(Company stamp)
(Signature and stamp)(Signature and stamp)(Signature and stamp)(Signature and stamp)

The notes on pages 21 to 145 form part of these financial statements.

Page 18

BOE Technology Group Co., Ltd.Consolidated statement of changes in shareholders’ equityfor the year ended 31 December 2017

(Expressed in Renminbi Yuan)

??Equity attributable to shareholders of the Company????
?NoteShare capital?Capital reserve?Less: Treasury shares?Other comprehensive income?Surplus reserve?Retained earnings?Sub-total?Non-controlling interests?Total shareholders’ equity
???????????????????
I. Balance at the beginning of the year?35,153,067,743?39,031,357,529?314,350,824?75,718,703?743,139,855?4,011,055,487?78,699,988,493?13,316,066,667?92,016,055,160
II. Changes in equity during the year??????????????????
(1) Total comprehensive income?-?-?-?74,884,230?-?7,567,682,493?7,642,566,723?262,231,919?7,904,798,642
(2) Shareholders’ contributions and decrease of capital??????????????????
1. Equity movements arising from investment increase in non-wholly owned subsidiaries?-?123,216,408?-?-?-?-?123,216,408?5,903,507,090?6,026,723,498
2. Repurchase of treasury shares?-?-?609,376,971?-?-?-?(609,376,971)?-?(609,376,971)
3. Written off treasury shares?(354,668,980)?(569,058,815)?(923,727,795)?-?-?-?-?-?-
Appropriation of profitsV. 35?????????????????
1. Appropriation for surplus reserve?-?-?-?-?146,500,620?(146,500,620)?-?-?-
2. Distributions to shareholders?-?-?-?-?-?(1,046,578,276)?(1,046,578,276)?(7,359,220)?(1,053,937,496)
???????????????????
III. Balance at the end of the year?34,798,398,763?38,585,515,122?-?150,602,933?889,640,475?10,385,659,084?84,809,816,377?19,474,446,456?104,284,262,833

These financial statements were approved by the Board of Directors of the Company on 23 March 2019.

?

Wang Dongsheng Chairman of the BoardChen Yanshun Chief Executive OfficerSun Yun Chief Financial OfficerYang Xiao Ping Financial Officer(Company stamp)
(Signature and stamp)(Signature and stamp)(Signature and stamp)(Signature and stamp)

The notes on pages 21 to 145 form part of these financial statements.

Page 19

BOE Technology Group Co., Ltd.Company statement of changes in shareholders’ equityfor the year ended 31 December 2018

(Expressed in Renminbi Yuan)

??Share capital?Capital reserve?Less: Treasury shares?Other comprehensive income?Surplus reserve?Retained earnings?Total shareholders’ equity
???????????????
I. Balance at the beginning of the year?34,798,398,763?37,588,541,593?-?192,097,489?889,640,475?1,765,291,136?75,233,969,456
II. Changes in equity during the year?
(1) Total comprehensive income?-?-?-?(220,605,074)?-?2,629,858,350?2,409,253,276
(2) Profit appropriation?
1. Appropriation for surplus reserve?-?-?-?-?262,985,835?(262,985,835)?-
2. Distributions to shareholders?-?-?-?-?-?(1,739,919,938)?(1,739,919,938)
(3) Others?-?2,424,598?-?-?-?-?2,424,598
???????????????
III. Balance at the end of the year?34,798,398,763?37,590,966,191?-?(28,507,585)?1,152,626,310?2,392,243,713?75,905,727,392

These financial statements were approved by the Board of Directors of the Company on 23 March 2019.

?

Wang Dongsheng Chairman of the BoardChen Yanshun Chief Executive OfficerSun Yun Chief Financial OfficerYang Xiao Ping Financial Officer(Company stamp)
(Signature and stamp)(Signature and stamp)(Signature and stamp)(Signature and stamp)

The notes on pages 21 to 145 form part of these financial statements.

Page 20

BOE Technology Group Co., Ltd.Company statement of changes in shareholders’ equity (continued)for the year ended 31 December 2017

(Expressed in Renminbi Yuan)

??Share capital?Capital reserve?Less: Treasury shares?Other comprehensive income?Surplus reserve?Retained earnings?Total shareholders’ equity
???????????????
I. Balance at the beginning of the year?35,153,067,743?38,157,600,408?314,350,824?152,323,461?743,139,855?1,493,363,829?75,385,144,472
II. Changes in equity during the year??????????????
(1) Total comprehensive income?-?-?-?39,774,028?-?1,465,006,203?1,504,780,231
(2) Shareholders’ contributions and decrease of capital??????????????
1. Repurchase of treasury shares?-?-?609,376,971?-?-?-?(609,376,971)
2. Written off treasury shares?(354,668,980)?(569,058,815)?(923,727,795)?-?-?-?-
Appropriation of profits??????????????
1. Appropriation for surplus reserve?-?-?-?-?146,500,620?(146,500,620)?-
2. Distributions to shareholders?-?-?-?-?-?(1,046,578,276)?(1,046,578,276)
???????????????
III. Balance at the end of the year?34,798,398,763?37,588,541,593?-?192,097,489?889,640,475?1,765,291,136?75,233,969,456

These financial statements were approved by the Board of Directors of the Company on 23 March 2019.

?

Wang Dongsheng Chairman of the BoardChen Yanshun Chief Executive OfficerSun Yun Chief Financial OfficerYang Xiao Ping Financial Officer(Company stamp)
(Signature and stamp)(Signature and stamp)(Signature and stamp)(Signature and stamp)

The notes on pages 21 to 145 form part of these financial statements.

Page 21

BOE Technology Group Co., Ltd.Notes to the financial statements

(Expressed in Renminbi Yuan unless otherwise indicated)

I. Company status

BOE Technology Group Company Limited (the “Company”) is a company limited by shares established on 9 April 1993 inBeijing, with its head office located at Beijing. The parent of the Company and the Company’s ultimate holding company isBeijing Electronics Holdings Co., Ltd. (“Electronics Holdings”).

The Company and its subsidiaries (referred to as “the Group”) comprise three main business segments: Display device andsensor device business, Smart system business and Healthcare service business. For information about the subsidiaries of theCompany, refer to Note VII. During the reporting period, the information about increases and decreases in the Group’ssubsidiaries is disclosed in Note VI.

II. Basis of preparation

The financial statements have been prepared on the going concern basis.

III. Significant accounting policies and accounting estimates

1 Statement of compliance

The financial statements have been prepared in accordance with the requirements of Accounting Standards for BusinessEnterprises or referred to as China Accounting Standards (“CAS”). These financial statements present truly and completelythe consolidated financial position and financial position of the Company as at 31 December 2018, and the consolidatedfinancial performance and financial performance and the consolidated cash flows and cash flows of the Company for the yearthen ended.

These financial statements also comply with the disclosure requirements of “Regulation on the Preparation of InformationDisclosures by Companies Issuing Securities, No. 15: General Requirements for Financial Reports” as revised by the ChinaSecurities Regulatory Commission (“CSRC”) in 2014.

2 Accounting period

The accounting period is from 1 January to 31 December.

3 Operating cycle

The Company takes the period from the acquisition of assets for processing to until the ultimate realisation of cash or cashequivalents as a normal operating cycle. The operating cycle of the Company is usually less than 12 months.

Page 22

4 Functional currency

The Company’s functional currency is Renminbi and these financial statements are presented in Renminbi. Functionalcurrency is determined by the Company and its subsidiaries on the basis of the currency in which major income and costs aredenominated and settled. Some of the Company’s subsidiaries have functional currencies that are different from theCompany’s functional currency. Their financial statements have been translated based on the accounting policy set out inNote III.8.

5 Accounting treatments for business combinations involving entities under common control and not under common control

(1) Business combinations involving entities under common control

A business combination involving entities under common control is a business combination in which all of the combiningentities are ultimately controlled by the same party or parties both before and after the business combination, and that controlis not transitory. The assets acquired and liabilities assumed are measured based on their carrying amounts in the consolidatedfinancial statements of the ultimate controlling party at the combination date. The difference between the carrying amount ofthe net assets acquired and the consideration paid for the combination (or the total par value of shares issued) is adjustedagainst share premium in the capital reserve, with any excess adjusted against retained earnings. Any costs directlyattributable to the combination are recognized in profit or loss when incurred. The combination date is the date on which onecombining entity obtains control of other combining entities.

(2) Business combinations involving entities not under common control

A business combination involving entities not under common control is a business combination in which all of the combiningentities are not ultimately controlled by the same party or parties both before and after the business combination. Where (1)the aggregate of the acquisition-date fair value of assets transferred (including the acquirer’s previously held equity interest inthe acquiree), liabilities incurred or assumed, and equity securities issued by the acquirer, in exchange for control of theacquiree, exceeds (2) the acquirer’s interest in the acquisition-date fair value of the acquiree’s identifiable net assets, thedifference is recognized as goodwill (see Note III.18). If (1) is less than (2), the difference is recognized in profit or loss forthe current period. Acquisition-related costs are expensed when incurred. The acquiree’s identifiable asset, liabilities andcontingent liabilities, if the recognition criteria are met, are recognized by the Group at their acquisition-date fair value. Theacquisition date is the date on which the acquirer obtains control of the acquiree.

For a business combination involving entities not under common control and achieved in stages, the Group remeasures itspreviously-held equity interest in the acquiree to its acquisition-date fair value and recognizes any resulting differencebetween the fair value and the carrying amount as investment income for the current period. In addition, any amountrecognized in other comprehensive income that may be reclassified to profit or loss, in prior reporting periods relating to thepreviously-held equity interest, and any other changes in the owners’ equity under equity accounting, are transferred toinvestment income in the period in which the acquisition occurs (see Note III.12(2)(b)).

Page 23

6 Consolidated financial statements

(1) General principles

The scope of consolidated financial statements is based on control and the consolidated financial statements comprise theCompany and its subsidiaries. Control exists when the investor has all of following: power over the investee; exposure, orrights, to variable returns from its involvement with the investee and has the ability to affect those returns through its powerover the investee. When assessing whether the Group has power, only substantive rights (held by the Group and other parties)are considered. The financial position, financial performance and cash flows of subsidiaries are included in the consolidatedfinancial statements from the date that control commences until the date that control ceases.

Non-controlling interests are presented separately in the consolidated balance sheet within shareholders’ equity. Net profit orloss attributable to non-controlling shareholders is presented separately in the consolidated income statement below the netprofit line item. Total comprehensive income attributable to non-controlling shareholders is presented separately in theconsolidated income statement below the total comprehensive income line item.

When the amount of loss for the current period attributable to the non-controlling shareholders of a subsidiary exceeds thenon-controlling shareholders’ share of the opening owners’ equity of the subsidiary, the excess is still allocated against thenon-controlling interests.

When the accounting period or accounting policies of a subsidiary are different from those of the Company, the Companymakes necessary adjustments to the financial statements of the subsidiary based on the Company’s own accounting period oraccounting policies. Intra-group balances and transactions, and any unrealised profit or loss arising from intra-grouptransactions, are eliminated when preparing the consolidated financial statements. Unrealised losses resulting fromintra-group transactions are eliminated in the same way as unrealised gains, unless they represent impairment losses that arerecognized in the financial statements.

(2) Subsidiaries acquired through a business combination

Where a subsidiary was acquired during the reporting period, through a business combination involving enterprises undercommon control, the financial statements of the subsidiary are included in the consolidated financial statements based on thecarrying amounts of the assets and liabilities of the subsidiary in the financial statements of the ultimate controlling party as ifthe combination had occurred at the date that the ultimate controlling party first obtained control. The opening balances andthe comparative figures of the consolidated financial statements are also restated.

Where a subsidiary was acquired during the reporting period, through a business combination not involving enterprises undercommon control, the identifiable assets and liabilities of the acquired subsidiaries are included in the scope of consolidationfrom the date that control commences, based on the fair value of those identifiable assets and liabilities at the acquisitiondate.

(3) Disposal of subsidiaries

When the Group loses control over a subsidiary, any resulting disposal gains or losses are recognized as investment incomefor the current period. The remaining equity investment is re-measured at its fair value at the date when control is lost, anyresulting gains or losses are also recognized as investment income for the current period.

Page 24

When the Group loses control of a subsidiary in multiple transactions in which it disposes of its long-term equity investmentin the subsidiary in stages, the following are considered to determine whether the Group should account for the multipletransactions as a bundled transaction:

- arrangements are entered into at the same time or in contemplation of each other;- arrangements work together to achieve an overall commercial effect;- the occurrence of one arrangement is dependent on the occurrence of at least one other arrangement;- one arrangement considered on its own is not economically justified, but it is economically

justified when considered together with other arrangements.

If each of the multiple transactions does not form part of a bundled transaction, the transactions conducted before the loss ofcontrol of the subsidiary are accounted for in accordance with the accounting policy for partial disposal of equity investmentin subsidiaries where control is retained (see Note III.6(4)).

If each of the multiple transactions forms part of a bundled transaction which eventually results in the loss of control in thesubsidiary, these multiple transactions are accounted for as a single transaction. In the consolidated financial statements, thedifference between the consideration received and the corresponding proportion of the subsidiary’s net assets (calculatedcontinuously from the acquisition date) in each transaction prior to the loss of control shall be recognized in othercomprehensive income and transferred to profit or loss when the parent eventually loses control of the subsidiary.

(4) Changes in non-controlling interests

Where the Company acquires a non-controlling interest from a subsidiary’s non-controlling shareholders or disposes of aportion of an interest in a subsidiary without a change in control, the difference between the proportion interests of thesubsidiary’s net assets being acquired or disposed and the amount of the consideration paid or received is adjusted to thecapital reserve (share premium) in the consolidated balance sheet, with any excess adjusted to retained earnings.

7 Cash and cash equivalents

Cash and cash equivalents comprise cash on hand, deposits that can be readily withdrawn on demand, and short-term, highlyliquid investments that are readily convertible into known amounts of cash and are subject to an insignificant risk of changein value.

8 Foreign currency transactions and translation of foreign currency financial statements

When the Group receives capital in foreign currencies from investors, the capital is translated to Renminbi at the spotexchange rate at the date of the receipt. Other foreign currency transactions are, on initial recognition, translated to Renminbiat the rates that approximate the spot exchange rates on the dates of the transactions.

Monetary items denominated in foreign currencies are translated to Renminbi at the spot exchange rate at the balance sheetdate. The resulting exchange differences are generally recognized in profit or loss, unless they arise from the re-translation ofthe principal and interest of specific borrowings for the construction of qualifying assets (see Note III.16). Non-monetaryitems that are measured at historical cost in foreign currencies are translated to Renminbi using the exchange rate at thetransaction date. Non-monetary items that are measured at fair value in foreign currencies are translated using the exchangerate at the date the fair value is determined. The resulting exchange differences are recognized in profit or loss, except for thedifferences arising from the re-translation of available-for-sale financial assets, which are recognized in other comprehensiveincome.

Assets and liabilities of foreign operation are translated to Renminbi at the spot exchange rate at the balance sheet date.Equity items, excluding “retained earnings and translation differences with respect to a foreign operation in othercomprehensive income”, are translated to Renminbi at the spot exchange rates at the transaction dates. Income and expensesof foreign operations are translated to Renminbi at the rates that approximate the spot exchange rates at the transaction dates.The resulting translation differences are recognized in other comprehensive income. The translation differences accumulatedin shareholders’ equity with respect to a foreign operation are transferred to profit or loss in the period when the foreignoperation is disposed.

Page 25

9 Financial instruments

Financial instruments include cash at bank and on hand, investments in debt and equity securities other than those classifiedas long-term equity investments (see Note III.12), receivables, payables, loans and borrowings, debentures payable and sharecapital.

(1) Recognition and measurement of financial assets and financial liabilities

A financial asset or financial liability is recognized in the balance sheet when the Group becomes a party to the contractualprovisions of a financial instrument.

The Group classifies financial assets and liabilities into different categories at initial recognition based on the purpose ofacquiring assets or assuming liabilities: financial assets and financial liabilities at fair value through profit or loss, loans andreceivables, held-to-maturity investments, available-for-sale financial assets and other financial liabilities.

Financial assets and financial liabilities are measured initially at fair value. For financial assets and financial liabilities at fairvalue through profit or loss, any related directly attributable transaction costs are charged to profit or loss; for other categoriesof financial assets and financial liabilities, any related directly attributable transaction costs are included in their initial costs.Subsequent to initial recognition, financial assets and liabilities are measured as follows:

- Financial assets and financial liabilities at fair value through profit or loss (including financial assets or financial

liabilities held for trading)

Subsequent to initial recognition, financial assets and financial liabilities at fair value through profit or loss are measuredat fair value, and changes therein are recognized in profit or loss.

- Receivables

Receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an activemarket.

Subsequent to initial recognition, receivables are measured at amortized cost using the effective interest method.

Page 26

- Held-to-maturity investments

Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturitythat the Group has the positive intention and ability to hold to maturity.

Subsequent to initial recognition, held-to-maturity investments are measured at amortized cost using the effective interestmethod.

- Available-for-sale financial assets

Available-for-sale financial assets include non-derivative financial assets that are designated upon initial recognition asavailable for sale and other financial assets which do not fall into any of the above categories.

Available-for-sale investments in equity instruments whose fair value cannot be measured reliably are measured at costsubsequent to initial recognition. Other available-for-sale financial assets are measured at fair value subsequent to initialrecognition and changes therein are recognized in other comprehensive income, except for impairment losses and foreignexchange gains and losses from monetary financial assets which are recognized directly in profit or loss. Dividendincome is recognized in profit or loss when the investee approves the dividends. Dividend income is recognized in profitor loss when the investee approves the dividends. Interest is recognized in profit or loss using the effective interestmethod (see Note III.23 (4)).

- Other financial liabilities

Financial liabilities other than the financial liabilities at fair value through profit or loss are classified as other financialliabilities.

Other financial liabilities include liabilities arising from financial guarantee contracts. Financial guarantees are contractsthat require the Group (i.e. the guarantor) to make specified payments to reimburse the beneficiary of the guarantee (theholder) for a loss the holder incurs because a specified debtor fails to make payment when due in accordance with theterms of a debt instrument. Where the Group issues a financial guarantee, subsequent to initial recognition, the guaranteeis measured at the higher of the amount initially recognized less accumulated amortisation and the amount of a provisiondetermined in accordance with the principles for contingent liabilities (see Note III.22).

Liabilities other than those arising from financial guarantee contracts are measured at amortized cost using the effectiveinterest method.

(2) Presentation of financial assets and financial liabilities

Financial assets and financial liabilities are generally presented separately in the balance sheet, and are not offset. However, afinancial asset and a financial liability are offset and the net amount is presented in the balance sheet when both of thefollowing conditions are satisfied:

- the Group currently has a legally enforceable right to set off the recognized amounts;- the Group intends either to settle on a net basis, or to realise the financial asset and settle the financial liability

simultaneously.

Page 27

(3) Derecognition of financial assets and financial liabilities

A financial asset is derecognized when one of the following conditions is met:

- the Company’s contractual rights to the cash flows from the financial asset expire;- the financial asset has been transferred and the Group transfers substantially all of the risks and rewards of ownership of the

financial asset; or- the financial asset has been transferred, although the Group neither transfers nor retains substantially all of the risks and

rewards of ownership of the financial asset, it does not retain control over the transferred asset.

Where a transfer of a financial asset in its entirety meets the criteria for derecognition, the difference between the twoamounts below is recognized in profit or loss:

- the carrying amount of the financial asset transferred;- the sum of the consideration received from the transfer and any cumulative gain or loss that has been recognized directly in

shareholders’ equity.

The Group derecognizes a financial liability (or part of it) only when its contractual obligation (or part of it) is discharged orcancelled or expires.

(4) Impairment of financial assets

The carrying amounts of financial assets (other than those at fair value through profit or loss) are reviewed at each balancesheet date to determine whether there is objective evidence of impairment. If any such evidence exists, an impairment loss isrecognized.

Objective evidence that a financial asset is impaired includes but is not limited to:

(a) significant financial difficulty of the issuer or obligor;(b) a breach of contract by the borrower, such as a default or delinquency in interest or principal payments;(c) it becoming probable that the borrower will enter bankruptcy or other financial reorganisation;(d) the disappearance of an active market for that financial asset because of financial difficulties faced by the issuer;(e) significant changes with an adverse effect that have taken place in the technological, market, economic or legal

environment in which the issuer operates, indicating that the cost of an investment in an equity instrument may not berecovered by the investor;(f) a significant (i.e. a decline of 50%) or prolonged decline in the fair value (i.e. a decline persisting for nine months) o

an investment in an equity instrument below its cost.

Page 28

For the calculation method of impairment of receivables, refer to Note III.10. The impairment of other financial assets ismeasured as follows:

- Held-to-maturity investments

Held-to-maturity investments are assessed for impairment on an individual basis as follows.

Where impairment is assessed on an individual basis, an impairment loss in respect of a held-to-maturity investment iscalculated as the excess of its carrying amount over the present value of the estimated future cash flows (excluding futurecredit losses that have not been incurred) discounted at the original effective interest rate. Impairment losses arerecognized in profit or loss.

If, after an impairment loss has been recognized on held-to-maturity investments, there is a recovery in the value of thefinancial asset which can be related objectively to an event occurring after the impairment was recognized, the previouslyrecognized impairment loss is reversed through profit or loss. A reversal of an impairment loss will not result in theasset’s carrying amount exceeding what the amortized cost would have been had no impairment loss been recognized inprior years.

- Available-for-sale financial assets

Available-for-sale financial assets are assessed for impairment on an individual basis and on a collective group basis asfollows. When an available-for-sale financial asset is impaired, the cumulative loss arising from a decline in fair valuethat has been recognized directly in shareholders’ equity is reclassified to profit or loss even though the financial asset hasnot been derecognized.

If, after an impairment loss has been recognized on an available-for-sale debt instrument, the fair value of the debtinstrument increases in a subsequent period and the increase can be objectively related to an event occurring after theimpairment loss was recognized, the impairment loss is reversed through profit or loss. An impairment loss recognizedfor an investment in an equity instrument classified as available-for-sale is not reversed through profit or loss. Theimpairment loss on an investment in an unquoted equity instrument whose fair value cannot be reliably measured is notreversed.

(5) Equity instrument

The consideration received from the issuance of equity instruments net of transaction costs is recognized in shareholders’equity. Consideration and transaction costs paid by the Company for repurchasing self-issued equity instruments are deductedfrom shareholders’ equity.

When the Company repurchases its own shares, those shares are treated as treasury shares. All expenditure relating to therepurchase is recorded in the cost of the treasury shares, with the transaction recording in the share register. Treasury sharesare excluded from profit distributions and are presented as a deduction under shareholders’ equity in the balance sheet.

When treasury shares are cancelled, the share capital should be reduced to the extent of the total par value of the treasuryshares cancelled. Where the cost of the treasury shares cancelled exceeds the total par value, the excess is deducted fromcapital reserve (share premium), surplus reserve and retained earnings sequentially. If the cost of treasury shares cancelled isless than the total par value, the difference is credited to the capital reserve (share premium).

When treasury shares are disposed of, any excess of proceeds above cost is recognized in capital reserve (share premium);otherwise, the shortfall is deducted against capital reserve (share premium), surplus reserve and retained earningssequentially.

(6) Convertible instruments

- Convertible instruments containing an equity component

Convertible instruments issued by the Group that can be converted to equity shares, where the number of shares to beissued and the value of consideration to be received at that time do not vary, are accounted for as compound financialinstruments containing both liability and equity components.

Page 29

The initial carrying amount of a compound financial instrument is allocated to its equity and liability components. Theamount recognized in the equity is the difference between the fair value of the instrument as a whole and the separatelydetermined fair value of the liability component (including the fair value of any embedded derivatives other than theequity component). Transaction costs that relate to the issuance of a compound financial instrument are allocated to theliability and equity components in proportion to the allocation of proceeds.

Subsequent to initial recognition, the liability component is measured at amortized cost using the effective interestmethod, unless it is designated upon recognition at fair value through profit or loss. The equity component is notre-measured.

If the convertible instrument is converted, the liability component, together with the equity component, is transferred toequity. If the convertible instrument is redeemed, the consideration paid for the redemption, together with the transactioncosts that relate to the redemption, are allocated to the liability and equity components. The method used to allocate theconsideration and transaction costs is the same as that used for issuance. After allocating the consideration andtransaction costs, the difference between the allocated and carrying amounts is charged to profit and loss if it relates to theliability component or is directly recognized in equity if it relates to the equity component.

- Other convertible instruments not containing an equity component

For other convertible instruments issued by the Group which do not contain an equity component, at initial recognition,the derivative component is measured at fair value, and any excess of proceeds over the derivative component isrecognized as the liability component.

The derivative component is subsequently measured at fair value, and gains or losses from the changes in the fair valueare recognized in profit or loss. The liability component is subsequently carried at amortized cost using the effectiveinterest method.

On conversion, the carrying amounts of the derivative and liability components are transferred to equity. If the instrumentis redeemed, any difference between the redemption amount paid and the carrying amounts of both components isrecognized in profit or loss.

Page 30

10 Impairment of receivables

Receivables are assessed for impairment both on an individual basis and on a collective group basis.

Where impairment is assessed on an individual basis, an impairment loss in respect of a receivable is calculated as the excessof its carrying amount over the present value of the estimated future cash flows (excluding future credit losses that have notbeen incurred) discounted at the original effective interest rate. Impairment losses are recognized in profit or loss. The Grouprecognized receivables individually greater than RMB 50,000,000 as significant and perform impairment test on anindividual basis. Those receivables individually insignificant but with specific natures, i.e. legal issue or customer creditissue, are also reviewed and tested on an individual basis.

The assessment is made collectively where receivables share similar credit risk characteristics (including those not havingbeen individually assessed as impaired), based on their historical loss experiences, and adjusted by the observable factorsreflecting present economic conditions.

If, after an impairment loss has been recognized on receivables, there is a recovery in the value of the financial asset whichcan be related objectively to an event occurring after the impairment was recognized, the previously recognized impairmentloss is reversed through profit or loss. A reversal of an impairment loss will not result in the asset’s carrying amountexceeding what the amortized cost would have been had no impairment loss been recognized in prior years.

11 Inventories

(1) Classification and cost

Inventories include raw materials, work in progress, finished goods and reusable materials. Reusable materials includelow-value consumables, packaging materials and other materials, which can be used repeatedly but do not meet the definitionof fixed assets.

Inventories are initially measured at cost. Cost of inventories comprises all costs of purchase, costs of conversion and otherexpenditure incurred in bringing the inventories to their present location and condition. In addition to the purchase cost ofraw materials, work in progress and finished goods include direct labour costs and an appropriate allocation of productionoverheads.

(2) Mesurement method of cost of inventories

Cost of inventories is calculated using the weighted average method.

Consumables including low-value consumables and packaging materials are amortized when they are used. The amortisationcharge is included in the cost of the related assets or recognized in profit or loss for the current period.

Page 31

(3) Basis for determining the net realisable value and method for provision for obsolete inventories

At the balance sheet date, inventories are carried at the lower of cost and net realisable value.

Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion andthe estimated costs necessary to make the sale and relevant taxes. The net realisable value of materials held for use in theproduction is measured based on the net realisable value of the finished goods in which they will be incorporated. The netrealisable value of the quantity of inventory held to satisfy sales or service contracts is measured based on the contract price.If the quantities held by the Group are more than the quantities of inventories specified in sales contracts, the net realisablevalue of the excess portion of inventories is measured based on general selling prices.

Any excess of the cost over the net realisable value of each category of inventories is recognized as a provision for obsoleteinventories, and is recognized in profit or loss.

(4) Inventory count system

The Group maintains a perpetual inventory system.

12 Long-term equity investments

(1) Investment cost of long-term equity investments

(a) Long-term equity investments acquired through a business combination

- The initial cost of a long-term equity investment acquired through a business combination involving entities under

common control is the Company’s share of the carrying amount of the subsidiary’s equity in the consolidatedfinancial statements of the ultimate controlling party at the combination date. The difference between the initialinvestment cost and the carrying amounts of the consideration given is adjusted to the share premium in thecapital reserve, with any excess adjusted to retained earnings. For a long-term equity investment in a subsidiaryacquired through a business combination achieved in stages which do not form a bundled transaction andinvolving entities under common control, the Company determines the initial cost of the investment inaccordance with the above policies. The difference between this initial cost and the sum of the carrying amountof previously-held investment and the consideration paid for the shares newly acquired is adjusted to sharepremium in the capital reserve, with any excess adjusted to retained earnings.

- For a long-term equity investment obtained through a business combination not involving entities under common

control, the initial cost comprises the aggregate of the fair value of assets transferred, liabilities incurred orassumed, and equity securities issued by the Company, in exchange for control of the acquiree. For a long-termequity investment obtained through a business combination not involving entities under common control andachieved through multiple transactions in stages which do not form a bundled transaction, the initial costcomprises the carrying amount of the previously-held equity investment in the acquiree immediately before theacquisition date, and the additional investment cost at the acquisition date.

Page 32

(b) Long-term equity investments acquired other than through a business combination

- A long-term equity investment acquired other than through a business combination is initially recognized at the

amount of cash paid if the Group acquires the investment by cash, or at the fair value of the equity securitiesissued if an investment is acquired by issuing equity securities.

(2) Subsequent measurement of long-term equity investment

(a) Investments in subsidiaries

In the Company’s separate financial statements, long-term equity investments in subsidiaries are accounted for usingthe cost method for subsequent measurement, unless the investment is classified as held for sale (see Note III.28).Except for cash dividends or profit distributions declared but not yet distributed that have been included in the priceor consideration paid in obtaining the investments, the Company recognizes its share of the cash dividends or profitdistributions declared by the investee as investment income for the current period.

The investments in subsidiaries are stated in the balance sheet at cost less accumulated impairment losses.

For the impairment of the investments in subsidiaries, refer to Note III.20.

In the Group’s consolidated financial statements, investments in subsidiaries are accounted for in accordance with thepolicies described in Note III.6.

(b) Investment in joint ventures and associates

A joint venture is an arrangement whereby the Group and other parties have joint control (see Note III.12(3)) andrights to the net assets of the arrangement.

An associate is an entity over which the Group has significant influence (see Note III.12(3)).

A long-term equity investment in a joint venture or an associate is accounted for using the equity method forsubsequent measurement, unless the investment is classified as held for sale (see Note III.28).

The accounting treatments under the equity method adopted by the Group are as follows:

- Where the initial cost of a long-term equity investment exceeds the Group’s interest in the fair value of the

investee’s identifiable net assets at the date of acquisition, the investment is initially recognized at cost. Where theinitial investment cost is less than the Group’s interest in the fair value of the investee’s identifiable net assets atthe date of acquisition, the investment is initially recognized at the investor’s share of the fair value of theinvestee’s identifiable net assets, and the difference is recognized in profit or loss.

Page 33

- After the acquisition of the investment, the Group recognizes its share of the investee’s profit or loss and other

comprehensive income as investment income or losses and other comprehensive income respectively, and adjuststhe carrying amount of the investment accordingly. Once the investee declares any cash dividends or profitdistributions, the carrying amount of the investment is reduced by the amount attributable to the Group. Changesin the Group’s share of the investee’s shareholders’ equity, other than those arising from the investee’s net profitor loss, other comprehensive income or profit distribution (“other changes in owners’ equity”), is recognizeddirectly in the Group’s equity, and the carrying amount of the investment is adjusted accordingly.

- In calculating its share of the investee’s net profits or losses, other comprehensive income and other changes in

owners’ equity, the Group recognizes investment income and other comprehensive income after makingappropriate adjustments to align the accounting policies or accounting periods with those of the Group based onthe fair value of the investee’s identifiable net assets at the date of acquisition. Unrealised profits and lossesresulting from transactions between the Group and its associates or joint ventures are eliminated to the extent ofthe Group’s interest in the associates or joint ventures. Unrealised losses resulting from transactions betweenthe Group and its associates or joint ventures are eliminated in the same way as unrealised gains but only to theextent that there is no impairment.

- The Group discontinues recognising its share of further losses of the investee after the carrying amount of the

long-term equity investment and any long-term interest that in substance forms part of the Group’s net investmentin the joint venture or associate is reduced to zero, except to the extent that the Group has an obligation to assumeadditional losses. If the joint venture or associate subsequently reports net profits, the Group resumesrecognising its share of those profits only after its share of the profits has fully covered the share of losses notrecognized. For the Group’s impairment of the investments in joint ventures and associates, refer to Note III.20.

(3) Criteria for determining the existence of joint control or significant influence over an investee

Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about therelevant activities (activities with significant impact on the returns of the arrangement) require the unanimous consent of theparties sharing control.

The following factors are usually considered when assessing whether the Group can exercise joint control over an investee:

Whether no single participant party is in a position to control the investee’s related activities unilaterally;Whether strategic decisions relating to the investee’s related activities require the unanimous consent of all participant partiesthat sharing of control.

Significant influence is the power to participate in the financial and operating policy decisions of an investee but does nothave control or joint control over those policies.

Page 34

13 Investment properties

Investment properties are properties held either to earn rental income or for capital appreciation or for both. Investmentproperties are accounted for using the cost model and stated in the balance sheet at cost less accumulated depreciation,amortisation and impairment losses. The cost of investment property, less its estimated residual value and accumulatedimpairment losses, is depreciated or amortized using the straight-line over its estimated useful life, unless the investmentproperty is classified as held for sale (see Note III.28). For the impairment of the investment properties, refer to Note III.20.

The estimated useful lives, residual value rates and depreciation rates of each class of investment properties are as follows:

?Estimated useful life (years)?Residual value rate (%)?Depreciation rate (%)
??????
Land use rights32 to 50 years?0.0%?2.0% - 3.1%
Buildings25 to 40 years?3.0% - 10.0%?2.3% - 3.9%

14 Fixed assets

(1) Recognition of fixed assets

Fixed assets represent the tangible assets held by the Group for use in production of goods, supply of services, for rental orfor administrative purposes with useful lives over one accounting year.

The cost of a purchased fixed asset comprises the purchase price, related taxes, and any directly attributable expenditure forbringing the asset to working condition for its intended use. The cost of self-constructed assets is measured in accordancewith the policy set out in Note III.15.

Where the parts of an item of fixed assets have different useful lives or provide benefits to the Group in a different pattern,thus necessitating use of different depreciation rates or methods, each part is recognized as a separate fixed asset.

Any subsequent costs including the cost of replacing part of an item of fixed assets are recognized as assets when it isprobable that the economic benefits associated with the costs will flow to the Group, and the carrying amount of the replacedpart is derecognized. The costs of the day-to-day maintenance of fixed assets are recognized in profit or loss as incurred.

Fixed assets are stated in the balance sheet at cost less accumulated depreciation and impairment losses.

(2) Depreciation of fixed assets

The cost of a fixed asset, less its estimated residual value and accumulated impairment losses, is depreciated using thestraight-line method over its estimated useful life, unless the fixed asset is classified as held for sale (see Note III.28).

Page 35

The estimated useful lives, residual value rates and depreciation rates of each class of fixed assets are as follows:

ClassEstimated useful life (years)?Residual value rate (%)?Depreciation rate (%)
Plant and buildings10 to 50 years?3% - 10%?1.8% - 9.7%
Equipment2 to 25 years?0 - 10%?3.6% - 50%
Others2 to 10 years?0 - 10%?9.0% - 50%

Useful lives, residual values and depreciation methods are reviewed at least at each year-end.

(3) For the impairment of the fixed assets, refer to Note III.20.

(4) For the recognition, measurement and depreciation of fixed assets acquired under finance leases, refer to Note III.27.

(5) Disposal of fixed assets

The carrying amount of a fixed asset is derecognized:

when the fixed asset is holding for disposal; orwhen no future economic benefit is expected to be generated from its use or disposal.

Gains or losses arising from the retirement or disposal of an item of fixed asset are determined as the difference between thenet disposal proceeds and the carrying amount of the item, and are recognized in profit or loss on the date of retirement ordisposal.

15 Construction in progress

The cost of self-constructed assets includes the cost of materials, direct labour, capitalised borrowing costs (see Note III.16),and any other costs directly attributable to bringing the asset to working condition for its intended use.

A self-constructed asset is classified as construction in progress and transferred to fixed asset when it is ready for its intendeduse. No depreciation is provided against construction in progress.

Construction in progress is stated in the balance sheet at cost less accumulated impairment losses (see Note III.20).

16 Borrowing costs

Borrowing costs incurred directly attributable to the acquisition and construction of a qualifying asset are capitalised as partof the cost of the asset. Other borrowing costs are recognized as financial expenses when incurred.

Page 36

During the capitalisation period, the amount of interest (including amortisation of any discount or premium on borrowing) tobe capitalised in each accounting period is determined as follows:

- Where funds are borrowed specifically for the acquisition and construction of a qualifying asset, the amount of interest to

be capitalised is the interest expense calculated using effective interest rates during the period less any interest incomeearned from depositing the borrowed funds or any investment income on the temporary investment of those funds beforebeing used on the asset.

- To the extent that the Group borrows funds generally and uses them for the acquisition, construction of a qualifying asset,

the amount of borrowing costs eligible for capitalisation is determined by applying a capitalisation rate to the weightedaverage of the excess amounts of cumulative expenditures on the asset over the above amounts of specific borrowings.The capitalisation rate is the weighted average of the interest rates applicable to the general-purpose borrowings.

The effective interest rate is determined as the rate that exactly discounts estimated future cash flow through the expected lifeof the borrowing or, when appropriate, a shorter period to the initially recognized amount of the borrowings.

During the capitalisation period, exchange differences related to the principal and interest on a specific-purpose borrowingdenominated in foreign currency are capitalised as part of the cost of the qualifying asset. The exchange differences related tothe principal and interest on foreign currency borrowings other than a specific-purpose borrowing are recognized as afinancial expense when incurred.

The capitalisation period is the period from the date of commencement of capitalisation of borrowing costs to the date ofcessation of capitalisation, excluding any period over which capitalisation is suspended. Capitalisation of borrowing costscommences when expenditure for the asset is being incurred, borrowing costs are being incurred and activities of acquisition,construction that are necessary to prepare the asset for its intended use are in progress, and ceases when the assets becomeready for their intended use. When the parts of the qualifying assets acquired or constructed that are eligible for capitalisationare completed separately, and each part is available for use in other parts of the construction process or can be sold externally,and for the purpose of making the parts of the assets ready for use or necessary for the sales status, the acquisition orconstruction activities have been substantially completed, the Group ceases the capitalization of the borrowing costs relatedto the parts of the assets. Capitalisation of borrowing costs is suspended when the acquisition, construction activities areinterrupted abnormally for a period of more than three months.

17 Intangible assets

Intangible assets are stated in the balance sheet at cost less accumulated amortization (where the estimated useful life isfinite) and impairment losses (see Note III.20). For an intangible asset with finite useful life, its cost estimated less residualvalue and accumulated impairment losses is amortized on the straight-line method over its estimated useful life, unless theintangible asset is classified as held for sale (see Note III.28).

Page 37

The respective amortisation periods for intangible assets are as follows:

ItemAmortisation period (years)
??
Land use rights40 to 50 years
Patent and technology rights5 to 20 years
Computer software3 to 10 years
Others5 to 20 years

An intangible asset is regarded as having an indefinite useful life and is not amortized when there is no foreseeable limit tothe period over which the asset is expected to generate economic benefits for the Group. At the balance sheet date, the Groupdoes not have any intangible assets with indefinite useful lives.

Expenditure on an internal research and development project is classified into expenditure during the research phase andexpenditure during the development phase.

Expenditure during the research phase is expensed when incurred. Expenditure during the development phase is capitalised ifdevelopment costs can be measured reliably, the product or process is technically and commercially feasible, and the Grouphas sufficient resources and the intention to complete development. Capitalised development costs are stated in the balancesheet at cost less impairment losses (see Note III.20). Other development expenditure is recognized as an expense in theperiod in which it is incurred.

18 Goodwill

The initial cost of goodwill represents the excess of cost of acquisition over the acquirer’s interest in the fair value of theidentifiable net assets of the acquiree under a business combination not involving enterprises under common control.

Goodwill is not amortized and is stated in the balance sheet at cost less accumulated impairment losses (see Note III.20). Ondisposal of an asset group or a set of asset groups, any attributable goodwill is written off and included in the calculation ofthe profit or loss on disposal.

19 Long-term deferred expenses

Long-term deferred expenses are amortized using a straight-line method within the benefit period. The respectiveamortisation periods for such expenses are as follows:

?

Item

ItemAmortisation period (years)
??
Prepayment for public facilities construction and use10 to 15 years
Cost of operating lease assets improvement2 to 10 years
Others2 to 10 years

Page 38

20 Impairment of assets other than inventories and financial assets

The carrying amounts of the following assets are reviewed at each balance sheet date based on internal and external sourcesof information to determine whether there is any indication of impairment:

- Fixed assets- Construction in progress- Intangible assets- Investment properties measured using a cost model- Long-term equity investments- Goodwill- Long-term deferred expenses, etc.

If any indication exists, the recoverable amount of the asset is estimated. In addition, the Group estimates the recoverableamounts of goodwill at each year-end, irrespective of whether there is any indication of impairment. Goodwill is allocated toeach asset group or set of asset groups, which is expected to benefit from the synergies of the combination for the purpose ofimpairment testing.

The recoverable amount of an asset (or asset group, set of asset groups, the same below) is the higher of its fair value (seeNote III.21) less costs to sell and its present value of expected future cash flows.

An asset group is composed of assets directly related to cash-generation and is the smallest identifiable group of assets thatgenerates cash inflows that are largely independent of the cash inflows from other assets or asset groups.

The present value of expected future cash flows of an asset is determined by discounting the future cash flows, estimated tobe derived from continuing use of the asset and from its ultimate disposal, to their present value using an appropriate pre-taxdiscount rate.

An impairment loss is recognized in profit or loss when the recoverable amount of an asset is less than its carrying amount. Aprovision for impairment of the asset is recognized accordingly. Impairment losses related to an asset group or a set of assetgroups are allocated first to reduce the carrying amount of any goodwill allocated to the asset group or set of asset groups,and then to reduce the carrying amount of the other assets in the asset group or set of asset groups on a pro rata basis.However, such allocation would not reduce the carrying amount of an asset below the highest of its fair value less costs tosell (if measurable), its present value of expected future cash flows (if determinable) and zero.

Once an impairment loss is recognized, it is not reversed in a subsequent period.

Page 39

21 Fair value measurement

Unless otherwise specified, the Group measures fair value as follows:

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction betweenmarket participants at the measurement date.

When measuring fair value, the Group takes into account the characteristics of the particular asset or liability (including thecondition and location of the asset and restrictions, if any, on the sale or use of the asset) that market participants wouldconsider when pricing the asset or liability at the measurement date, and uses valuation techniques that are appropriate in thecircumstances and for which sufficient data and other information are available to measure fair value. Valuation techniquesmainly include the market approach, the income approach and the cost approach.

22 Provisions

A provision is recognized for an obligation related to a contingency if the Group has a present obligation that can beestimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation.

A provision is initially measured at the best estimate of the expenditure required to settle the related present obligation.Where the effect of the time value of money is material, provisions are determined by discounting the expected future cashflows. Factors pertaining to a contingency such as the risks, uncertainties and time value of money are taken into account as awhole in reaching the best estimate. Where there is a continuous range of possible outcomes for the expenditure required, andeach possible outcome in that range is as likely as any other, the best estimate is the mid-point of that range. In other cases,the best estimate is determined according to the following circumstances:

Where the contingency involves a single item, the best estimate is the most likely outcome.

Where the contingency involves a large population of items, the best estimate is determined by weighting all possibleoutcomes by their associated probabilities.

The Group reviews the carrying amount of a provision at the balance sheet date and adjusts the carrying amount to thecurrent best estimate.

23 Revenue recognition

Revenue is the gross inflow of economic benefits arising in the course of the Group’s ordinary activities when the inflowsresult in increase in shareholders’ equity, other than increase relating to contributions from shareholders. Revenue isrecognized in profit or loss when it is probable that the economic benefits will flow to the Group, the revenue and costs canbe measured reliably and the following conditions are met:

Page 40

(1) Sale of goods

Revenue is recognized when the general conditions stated above and the following conditions are satisfied:

- Significant risks and rewards of ownership of goods have been transferred to the buyer;

- The Group retains neither continuing managerial involvement to the degree usually associated with ownership nor

effective control over the goods sold.

Revenue from the sale of goods is measured at the fair value of the consideration received or receivable under the salescontract or agreement.

The sales contracts/orders signed between the Company and its customers (mainly electronic equipment manufacturers)contain various trading terms. The Company judges the transfer timing of major risks and rewards according to the tradingterms, and recognizes revenue accordingly. Depending on the trading terms, the income is usually recognized when the goodsare delivered and received, or when they are received by the carrier.

(2) Rendering of services

Revenue is measured at the fair value of the consideration received or receivable under the contract or agreement.

Where the outcome of a transaction involving the rendering of services can be estimated reliably, revenue is recognized byreference to the stage of completion based on the progress of work performed.

Where the outcome cannot be estimated reliably, revenues are recognized to the extent of the costs incurred that are expectedto be recoverable, and an equivalent amount is charged to profit or loss as service cost; otherwise, the costs incurred arerecognized in profit or loss and no service revenue is recognized.

(3) Revenue from construction contracts

Where the outcome of a construction contract can be estimated reliably, contract revenue and contract expenses associatedwith the construction contract are recognized using the percentage of completion method.

The stage of completion of a contract is determined based on the proportion of contract costs incurred for work performed todate to the estimated total contract costs.

When the outcome of a construction contract cannot be estimated reliably:

- If the contract costs can be recovered, revenue is recognized to the extent of contract costs incurred that can be recovered,

and the contract costs are recognized as contract expenses when incurred;

- Otherwise, the contract costs are recognized as contract expenses immediately when incurred, and no contract revenue is

recognized.

Page 41

(4) Interest income

Interest income is recognized on a time proportion basis with reference to the principal outstanding and the applicableeffective interest rate.

(5) Royalties from intangible assets

Royalty income from intangible assets is determined according to the period and fee calculation method as stipulated in therelevant contracts or agreements.

24 Employee benefits

(1) Short-term employee benefits

Employee wages or salaries, bonuses, social security contributions such as medical insurance, work injury insurance,maternity insurance and housing fund, measured at the amount incurred or accrued at the applicable benchmarks and rates,are recognized as a liability as the employee provides services, with a corresponding charge to profit or loss or included in thecost of assets where appropriate.

(2) Post-employment benefits - defined contribution plans

Pursuant to the relevant laws and regulations of the People’s Republic of China, the Group participated in a definedcontribution basic pension insurance plan and unemployment insurance plan in the social insurance system established andmanaged by government organisations, and annuity plan established by the Group in compliance with the national policy ofthe corporation annuity. The Group makes contributions to basic pension and unemployment insurance plans based on theapplicable benchmarks and rates stipulated by the government. Annuity is accrued based on the gross salaries of theemployees. Basic pension insurance contributions are recognized as part of the cost of assets or charged to profit or loss asthe related services are rendered by the employees.

(3) Post-employment benefits - defined benefit plans

During the reporting period, the Group did not have defined benefit plans.

(4) Termination benefits

When the Group terminates the employment with employees before the employment contracts expire, or providescompensation under an offer to encourage employees to accept voluntary redundancy, a provision is recognized with acorresponding expense in profit or loss at the earlier of the following dates:

- When the Group cannot unilaterally withdraw the offer of termination benefits because of an employee termination plan

or a curtailment proposal;

- When the Group has a formal detailed restructuring plan involving the payment of termination benefits and has raised a

valid expectation in those affected that it will carry out the restructuring by starting to implement that plan or announcingits main features to those affected by it.

Page 42

25 Government grants

Government grants are non-reciprocal transfers of monetary or non-monetary assets from the government to the Groupexcept for capital contributions from the government in the capacity as an investor in the Group.

A government grant is recognized when there is reasonable assurance that the grant will be received and that the Group willcomply with the conditions attaching to the grant.

If a government grant is in the form of a transfer of a monetary asset, it is measured at the amount received or receivable. If agovernment grant is in the form of a transfer of a non-monetary asset, it is measured at fair value.

Government grants related to assets are grants whose primary condition is that the Group qualifying for them shouldpurchase, construct or otherwise acquire long-term assets. Government grants related to income are grants other than thoserelated to assets.

Those related to daily activities of the Company are included in other income or used to write off related cost based on thenature of economic businesses, or included in non-operating income and expense in respect of those not related to dailyactivities of the Company.

With respect to the government grants related to assets, if the Group first obtains government grants related to assets and thenrecognizes the long-term assets purchased and constructed, deferred income is included in profit and loss based on areasonable and systematic approach by stages when related assets are initially depreciated or amortized; or the deferredincome is written off against the carrying amount of the asset when the asset becomes ready for its intended status or intendeduse. If the Group obtains government grants related to the assets after relevant long-term assets are put into use, deferredincome is included in profit and loss based on a reasonable and systematic approach by stages within the remaining usefullife of relevant assets, or the deferred income is written off against the carrying amount of relevant asset when the grants areobtained; the assets shall be depreciated or amortized based on the carrying amount after being offset and the remaininguseful life of relevant assets.

For the government grants related to income which are used to compensate for related costs or losses of the Group in thefuture period, it shall be recognized as deferred income, and included in profit and loss or used to offset related costs;otherwise it shall be directly included in profit and loss or used to offset related costs.

In respect of the policy-based preferential loan interest subsidy obtained by the Group, if the interest subsidy is appropriatedto the lending bank which shall provide loans to the Group at the policy-based preferential interest rate, the actual loanamount is used as the entry value and relevant borrowing costs are calculated on the basis of the loan principal and thepreferential interest rate. If the interest subsidy is directly appropriated to the Group, relevant borrowing costs shall be offsetby corresponding interest subsidy. If borrowing costs are capitalized as part of the cost of the asset (see Note III. 16), theinterest subsidy shall be used to offset relevant asset costs.

Page 43

26 Income tax

Current tax and deferred tax are recognized in profit or loss except to the extent that they relate to a business combination oritems recognized directly in equity (including other comprehensive income).

Current tax is the expected tax payable calculated at the applicable tax rate on taxable income for the year, plus anyadjustment to tax payable in respect of previous years.

At the balance sheet date, current tax assets and liabilities are offset only if the Group has a legally enforceable right to setthem off and also intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

Deferred income tax assets and deferred income tax liabilities are determined based on deductible temporary differences andtaxable temporary differences respectively. The temporary differences are the differences between the carrying amounts ofassets and liabilities for financial reporting purposes and their tax bases, which include the deductible tax losses and taxcredits carried forward to subsequent periods. Deferred tax assets are recognized to the extent that it is probable that futuretaxable profits will be available against which deductible temporary differences can be utilised.

Deferred tax is not recognized for the temporary differences arising from the initial recognition of assets or liabilities in atransaction that is not a business combination and that affects neither accounting profit nor taxable profit (or deductible loss).Deferred tax is not recognized for taxable temporary differences arising from the initial recognition of goodwill.

At the balance sheet date, deferred tax is measured based on the tax consequences that would follow from the expectedmanner of recovery or settlement of the carrying amount of the assets and liabilities, using tax rates enacted at the reportingdate that are expected to be applied in the period when the asset is recovered or the liability is settled.

The carrying amount of a deferred tax asset is reviewed at each balance sheet date, and is reduced to the extent that it is nolonger probable that the related tax benefits will be utilised. Such reduction is reversed to the extent that it becomes probablethat sufficient taxable profits will be available.

At the balance sheet date, deferred tax assets and liabilities are offset if all of the following conditions are met:

- The taxable entity has a legally enforceable right to offset current tax liabilities and assets, and

- They relate to income taxes levied by the same tax authority on either: the same taxable entity; or different taxable entities

which intend either to settle the current tax liabilities and current tax assets on a net basis, or to realise the assets andsettle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities ordeferred tax assets are expected to be settled or recovered.

Page 44

27 Operating leases and finance leases

A lease is classified as either a finance lease or an operating lease. A finance lease is a lease that transfers substantially all therisks and rewards incidental to ownership of a leased asset to the lessee, irrespective of whether the legal title to the asset iseventually transferred. An operating lease is a lease other than a finance lease.

(1) Operating lease charges

Rental payments under operating leases are recognized as part of the cost of another related asset or as expenses on astraight-line basis over the lease term.

(2) Assets leased out under operating leases

Fixed assets leased out under operating leases, except for investment properties (see Note III.13), are depreciated inaccordance with the Group’s depreciation policies described in Note III.14(2). Impairment losses are recognized inaccordance with the accounting policy described in Note III.20. Income derived from operating leases is recognized in profitor loss using the straight-line method over the lease term. If initial direct costs incurred in respect of the assets leased out arematerial, the costs are initially capitalised and subsequently amortized in profit or loss over the lease term on the same basisas the lease income. Otherwise, the costs are charged to profit or loss immediately.

(3) Assets acquired under finance leases

At the commencement of the lease term, the minimum lease payments are recorded as long-term payables. The differencebetween the carrying amount of the leased assets and the minimum lease payments is accounted for as unrecognized financecharges. Initial direct costs attributable to a finance lease that are incurred by the Group are added to the carrying amount ofthe leased asset. Depreciation and impairment losses are accounted for in accordance with the accounting policies describedin Notes III.14 (2) and III.20, respectively.

If there is reasonable certainty that the Group will obtain ownership of a leased asset at the end of the lease term, the leasedasset is depreciated over its estimated useful life. Otherwise, the leased asset is depreciated over the shorter of the lease termand its estimated useful life.

Unrecognized finance charges arising from a finance lease are recognized using an effective interest method over the leaseterm. The amortisation is accounted for in accordance with the principles of borrowing costs (see Note III.16).

At the balance sheet date, the long-term payables arising from finance leases, net of the unrecognized finance charges, areanalysed and separately presented as long-term payables or non-current liabilities due within one year.

Page 45

28 Assets held for sale and discontinued operations

(1) Assets held for sale

The Group classified a non-current asset or disposal group as held for sale when the carrying amount of a non-current asset ordisposal group will be recovered through a sale transaction rather than through continuing use.

A disposal group refers to a group of assets to be disposed of, by sale or otherwise, together as a whole in a single transactionand liabilities directly associated with those assets that will be transferred in the transaction.

A non-current asset or disposal group is accounted for as held for sale when all the following criteria are met:

- According to the customary practices of selling such asset or disposal group in similar transactions, the non-current asset or

disposal group must be available for immediate sale in their present condition subject to terms that are usual andcustomary for sales of such assets or disposal groups;- Its sale is highly probable, that is, the Group has made a resolution on a sale plan and has obtained a firm purchase

commitment. The sale is to be completed within one year.

Non-current assets or disposal groups held for sale are stated at the lower of carrying amount and fair value (see Note III.21)less costs to sell (except financial assets (see Note III.9) and deferred tax assets (see Note III.26)) initially and subsequently.Any excess of the carrying amount over the fair value (see Note III.21) less costs to sell is recognized as an impairment lossin profit or loss.

(2) Discontinued operations

The Group classifies a component that is separately identifiable, and the component either has been disposed of or isclassified as held for sale, and satisfies one of the following conditions as a discontinued operation:

- It represents a separate major line of business or separate geographical area of operations;- It is part of a single co-ordinated plan to dispose of a separate major line of business or separate geographical area of

operations;- It is a subsidiary acquired exclusively with a view to resale.

For the Group's discontinued operations during the current period, the profit and loss from continuing operations and theprofit and loss from discontinued operations are respectively presented in the income statement, and the informationpreviously presented as the profit and loss from continuing operations is reclassified as the profit and loss from discontinuedoperations in the comparable accounting period in the income statement of the comparative period.

29 Profit distributions

Dividends or profit distributions proposed in the profit appropriation plan, which will be approved after the balance sheetdate, are not recognized as a liability at the balance sheet date but are disclosed in the notes separately.

30 Related parties

If a party has the power to control, jointly control or exercise significant influence over another party, or vice versa, or wheretwo or more parties are subject to common control or joint control from another party, they are considered to be relatedparties. Related parties may be individuals or enterprises. Enterprises with which the Company is under common control onlyfrom the State and that have no other related party relationships are not regarded as related parties.

In addition to the related parties stated above, the Company determines related parties based on the disclosure requirementsof Administrative Procedures on the Information Disclosures of Listed Companies issued by the CSRC.

31 Segment reporting

Operating segments are determined based on the structure of the Group’s internal organisation, management requirementsand internal reporting system. Two or more operating segments may be aggregated into a single operating segment if the

Page 46

segments have similar economic characteristics, and are same or similar in respect of the nature of each product and service;the nature of production processes; the type or class of customers for the products and services; the methods used to distributethe products or provide the services; the nature of the regulatory environment. Reportable segments are identified based onoperating segments taking into account of materiality principle.

Inter-segment revenues are measured on the basis of actual transaction price for such transactions for segment reporting.Segment accounting policies are consistent with those for the consolidated financial statements.

32 Significant accounting estimates and judgements

The preparation of financial statements requires management to make estimates and assumptions that affect the application ofaccounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from theseestimates. Estimates as well as underlying assumptions and uncertainties involved are reviewed on an ongoing basis.Revisions to accounting estimates are recognized in the period in which the estimate is revised and in any future periodsaffected.

Expect for accounting estimates related to depreciation and amortisation of assets such as fixed assets and intangible assets(see Note III. 14 and 17) and provision for impairment of various types of assets (see Note V. 2, 4, 5, 7, 8, 10, 11, 12, and 13,and Note XIV. 2 and 3). Other significant accounting estimates are as follows:

(i) Note V. 15 – Recognition of deferred tax asset;(ii) Note V. 24 – Assurance of product quality;(iii) Note IX. – Fair value measurements of financial instruments.

Significant judgements made by the Group in the application of accounting policies are as follows:

(i) Note V. 30 – Convertible debt and equity investment with redemption provisions terms are categorised as financial

liabilities; and

(ii) Note VII. 1(1) –Disclosure of significant judgements and assumptions of control and exercising

significant influence over other entities.

Page 47

33 Changes in accounting policies

Changes in accounting policies and their reasons

The MOF issued the following interpretations and amendments of the Accounting Standards for Business Enterprises during2017 and 2018:

- <Accounting Standards for Business Enterprise, Interpretation No. 9 —— Accounting Treatment of Net Loss of Investmentunder Equity Method>- <Accounting Standards for Business Enterprise, Interpretation No. 10 —— Depreciation Method Based on IncomeGenerated by Fixed Assets>- <Accounting Standards for Business Enterprise, Interpretation No. 11 —— Amortization Method Based on IncomeGenerated by Intangible Assets>- <Accounting Standards for Business Enterprise, interpretation No. 12 —— On the Case of Providing Key ManagementPersonnel, whether the Provider and Client are Related Parties.

(Collectively referred to “Interpretation No. 9 - 12”)- <Notice on Revision of the Illustrative Financial Statements for 2018> (Cai Kuai [2018] No. 15) and relevant

interpretations.

The Group has implemented the above-mentioned interpretations and amendments of accounting standard since January 1,2018, and adjusted the relevant contents of accounting policies.

Impacts of the adoption of the above accounting standards and regulations are as follows:

(a) Interpretation No. 9 - 12

The Group's accounting policies are based on the accounting treatment of the net loss of investment under the equitymethod in Interpretation No.9 - 12, and the depreciation and amortization method of fixed assets and intangibleassets, and the related party recognition and disclosure requirements of key management personnel services areadjusted.

The adoption of Interpretation No. 9 -12 has no material impact on the financial position and the financial result ofthe Group.

(b) Presentation of financial statement

The Group has prepared financial statements for the year ended 31 December 2018 in accordance with Caikuai[2018] No.15. Comparative figures have been adjusted retrospectively.

Page 48

Impacts of related presentation adjustment are as follows:

Items affected in consolidated balance sheet and company balance sheet on 31December 2018:

??The Group
??Before adjustmentAdjusted amountAfter adjustment
???????
Bills receivable?833,268,127?(833,268,127)?-
Accounts receivable?15,513,763,252?(15,513,763,252)?-
Bills receivable and accounts receivable?-?16,347,031,379?16,347,031,379
Interest receivable?89,628,559?(89,628,559)?-
Other receivables?728,395,573?89,628,559?818,024,132
Bills payable?543,798,835?(543,798,835)?-
Accounts payable?16,205,788,698?(16,205,788,698)?-
Bills payable and accounts payable?-?16,749,587,533?16,749,587,533
Interest payable?847,955,186?(847,955,186)?-
Dividends payable?9,651,170?(9,651,170)?-
Other payables?15,264,806,774?857,606,356?16,122,413,130
???????
Total??-?

?

?

??The Company
??Before adjustmentAdjusted amountAfter adjustment
???????
Accounts receivable?39,897,385?(39,897,385)?-
Bills receivable and accounts receivable?-?39,897,385?39,897,385
Dividends receivable?10,404,147?(10,404,147)?-
Other receivables?1,824,727,573?10,404,147?1,835,131,720
Accounts payable?50,152,503?(50,152,503)?-
Bills payable and accounts payable?-?50,152,503?50,152,503
Interest payable?312,029,252?(312,029,252)?-
Dividends payable?6,451,170?(6,451,170)?-
Other payables?9,713,912,548?318,480,422?10,032,392,970
???????
Total??-?

Page 49

Items affected in consolidated income statement and company income statement in2017:

The Group
Before adjustmentAdjusted amountAfter adjustment
Administrative expenses7,246,543,340?(3,177,767,395)?4,068,775,945
Research and development costs-?3,177,767,395?3,177,767,395
Total?-?

?

The Company
Before adjustmentAdjusted amountAfter adjustment
Administrative expenses1,719,668,597?(1,027,250,122)?692,418,475
Research and development costs-?1,027,250,122?1,027,250,122
Total-

Items affected in consolidated cash flow statement in 2017:

?

The Group
Before adjustmentAdjusted amountAfter adjustment
Cash inflows from operating activities111,934,693,142?459,943,640?112,394,636,782
Cash inflows from investing activities33,347,868,918?(459,943,640)?32,887,925,278
??????
Total?-?

??

According to the relevant interpretation of Caikuai [2018] No. 15, the Group will adjustthe government subsidies received related to assets from “cash inflows from investingactivities” to “cash inflows from operating activities” and present.

Page 50

IV. Taxation

1 Main types of taxes and corresponding tax rates

Tax Name?Tax basis?Tax rate
?????
Value-added tax (VAT)?Output VAT is calculated on product sales and taxable services revenue. The basis for VAT payable is to deduct input VAT from the output VAT for the period?6%,10%,11% 16%,17%
City maintenance and construction tax?Based on business tax and VAT paid, and VAT exemption and offset for the period?7%,5%
Education surcharges and local education surcharges?Based on business tax and VAT paid, and VAT exemption and offset for the period?3%,2%
Corporate income tax?Based on taxable profits?15% - 25%

2 Corporate income tax

The income tax rate applicable to the Company for the year is 15% (2017: 15%).

Pursuant to the Corporate Income Tax Law of the People’s Republic of China treatment No.28, corporate income tax for keyadvanced and high-tech enterprises supported by the State is applicable to a preferential tax rate of 15%.

On 25 October 2017, the Company renewed the High-tech Enterprise Certificate No. GR201711002584, which was entitledjointly by Beijing Municipal Science and Technology Commission, Beijing Municipal Financial Bureau, Beijing MunicipalState Administration of Taxation and Beijing Municipal Local Administration of Taxation. The Company is subject tocorporate income tax rate of 15% since the date of certification with the valid period of three years.

The income tax rate applicable to other subsidiaries of the Group is 25% other than the following subsidiaries and theoverseas subsidiaries which subject to the local income tax rate.

Page 51

The subsidiaries that are entitled to preferential tax treatments are as follows:

Company namePreferential rate?Reason
????
Beijing BOE Optoelectronics Technology Co., Ltd. (BOE OT)15%?High-tech Enterprise
Chengdu BOE Optoelectronics Technology Co., Ltd (Chengdu Optoelectronics )15%?High-tech Enterprise
Hefei BOE Optoelectronics Technology Co., Ltd.(Hefei BOE)15%?High-tech Enterprise
Beijing BOE Display Technology Co., Ltd. (BOE Display)15%?High-tech Enterprise
Hefei Xinsheng Optoelectronics Technology Co., Ltd. (Hefei Xinsheng)15%?High-tech Enterprise
Ordos Yuansheng Optoelectronics Co., Ltd. (Yuansheng Optoelectronics)15%?Encouraged enterprise in Western Regions
Chongqing BOE Optoelectronics Co., Ltd. (Chongqing BOE)15%?Encouraged enterprise in Western Regions
BOE (Hebei) Mobile Technology Co., Ltd. (BOE Hebei)15%?High-tech Enterprise
BOE Optical Science and technology Co., Ltd (Optical Technology)15%?High-tech Enterprise
Beijing BOE CHATANI ElectronicsCo.,Ltd. (Beijing CHATANI)15%?High-tech Enterprise
Hefei BOE Display Lighting Co.,Ltd. (Hefei Display Lighting)15%?High-tech Enterprise
Chongqing BOE Display Lighting Co.,Ltd. (Chongqing Display Lighting)15%?High-tech Enterprise
BOE Semi-conductor Co., Ltd. (BOE Semiconductor)15%?High-tech Enterprise
Hefei BOE Semiconductor Co.,Ltd. (Hefei Semiconductor)15%?High-tech Enterprise
Beijing BOE Special Display Technology Co., Ltd. (Special Display)15%?High-tech Enterprise
Beijing BOE Vacuum Electronics Co., Ltd. (Vacuum Electronics)15%?High-tech Enterprise
Beijing Asahi Electronic Materials Co.,Ltd. (Asahi Materials)15%?High-tech Enterprise
Beijing BOE Vacuum Technology Co., Ltd. (Vacuum Technology)15%?High-tech Enterprise
Beijing BOE Energy Technology Co., Ltd. (BOE Energy)15%?High-tech Enterprise
Beijing BOE multimedia Technology Co., Ltd. (BOE multimedia)15%?High-tech Enterprise
Fuzhou BOE Optoelectronics Technology Co., Ltd. (Fuzhou BOE)15%?High-tech Enterprise
Hefei BOE Vision-Electronic Technology Co., Ltd. (Hefei Vision-Electronic Technology)15%?High-tech Enterprise
Mianyang BOE Optoelectronics Technology Co., Ltd. (Mianyang BOE)15%?Encouraged enterprise in Western Regions
BOE Intelligent Technology Co., Ltd. (Intelligent Technology)15%High-tech Enterprise

Page 52

V. Notes to the consolidated financial statements

1. Cash at bank and on hand

?2018?2017
?Amount in original currency?Exchange rate?RMB / RMB equivalents?Amount in original currency?Exchange rate?RMB / RMB equivalents
????????????
Cash on hand:???????????
RMB????285,407?????444,343
USD1,364?6.8632?9,361?891?6.5342?5,822
HKD56,603?0.8762?49,596?53,705?0.8359?44,892
JPY1,668,876?0.0619?103,303?55,419?0.0579?3,209
KRW490,686?0.0061?2,993?513,831?0.0061?3,134
Other foreign currencies????87,145?????25,364
????????????
Sub-total????537,805?????526,764
????????????
Bank Deposits:???????????
RMB????19,526,770,243?????24,172,930,297
USD3,215,270,076?6.8632?22,067,041,586?3,151,375,970?6.5342?20,591,720,863
HKD36,614,201?0.8762?32,081,363?55,249,266?0.8359?46,182,862
JPY15,077,127,145?0.0619?933,274,170?21,118,693,041?0.0579?1,222,772,327
KRW1,274,695,127?0.0061?7,775,640?1,058,266,098?0.0061?6,455,423
EUR94,362,955?7.8473?740,494,417?236,210,492?7.8023?1,842,985,129
Other foreign currencies????32,708,963?????29,713,710
????????????
Sub-total????43,340,146,382?????47,912,760,611
????????????
Other monetary funds:???????????
RMB????4,883,082,015?????7,497,341,876
USD473,193,118?6.8632?3,247,619,007?262,928,917?6.5342?1,718,030,129
HKD11,423,973?0.8762?10,009,685?232?0.8359?194
JPY2,339,530?0.0619?144,817?29?0.0579?2
????????????
Sub-total????8,140,855,524?????9,215,372,201
????????????
Total????51,481,539,711?????57,128,659,576

Including: Total overseas deposits were equivalent to RMB 5,012,219,357 (2017: RMB 3,341,984,398).

As at 31 December 2018, other monetary funds were pledged by the Group amounting to USD 305,000,000 for short-termloans, RMB142,547,192 and and USD 18,500,000 were pledged for long-term loans. The rest of other restricted monetaryfunds, amounting to RMB 5,768,050,799, were the deposits in commercial banks as security.

As at 31 December 2017, other monetary funds were pledged by the Group amounting to RMB1,164,000,000 and USD60,159,875 for short-term loans, and RMB 1,207,705,322 and USD 63,000,000 were pledged for long-term loans. The rest ofother restricted monetary funds, amounting to RMB 6,038,915,416, were the deposits in commercial banks as security.

Page 53

2 Bills receivable and accounts receivable

?Note2018?2017
?????
Bills receivable(1)656,781,577?833,268,127
Accounts receivable(2)19,880,680,518?15,513,763,252
?????
Total?20,537,462,095?16,347,031,379

(1) Bills receivable

(a) Classification of bills receivable

?

Item

Item?2018?2017
?????
Bank acceptance bills?655,081,577?824,873,475
Commercial acceptance bills?1,700,000?8,394,652
?????
Total?656,781,577?833,268,127

All of the above bills are due within one year.

(b) Bills receivable pledged at the end of the year

As at 31 December 2018, the pledged bills of the Group amounted to RMB 6,605,869 (2017: RMB 123,826,995).

(c) Outstanding endorsed or discounted bills that have not matured at the end of the year

?

Item

Item?Amount derecognized at year end?Amount not-derecognized at year end
?????
Bank acceptance bills?32,868,462?200,669,545
Commercial acceptance bills?-?1,049,000
?????
Total?32,868,462?201,718,545

For the year ended 31 December 2018, there was no amount transferred to accounts receivable from bills receivabledue to non-performance of the issuers of the Group (2017: nil).

Page 54

(2) Accounts receivable

(a) The Group’s accounts receivable by customer type:

Item?2018?2017
?????
Amounts due from related parties?52,246?9,600,724
Amounts due from other customers?20,199,950,102?15,808,849,645
?????
Sub-total?20,200,002,348?15,818,450,369
?????
Less: Provision for bad and doubtful debts?319,321,830?304,687,117
?????
Total?19,880,680,518?15,513,763,252

(b) The Group’s accounts receivable by currency type:

??

?2018?2017
?Amount in original currency?Exchange rate?RMB / RMB equivalents?Amount in original currency?Exchange rate?RMB / RMB equivalents
????????????
RMB????7,253,239,876?????4,764,755,351
USD1,800,476,186?6.8632?12,357,028,161?1,684,267,507?6.5342?11,005,340,743
JPY36,523,949?0.0619?2,260,467?17,602,919?0.0579?1,019,209
Other foreign currencies????587,473,844?????47,335,066
????????????
Sub-total????20,200,002,348?????15,818,450,369
????????????
Less: Provision for bad and doubtful debts????319,321,830?????304,687,117
????????????
Total????19,880,680,518?????15,513,763,252

Page 55

(c) The ageing analysis of accounts receivable is as follows:

??2018?2017
?????
Within 1 year (inclusive)?19,748,808,258?15,482,151,261
1 to 2 years (inclusive)?136,291,482?293,213,891
2 to 3 years (inclusive)?279,756,940?13,346,163
Over 3 years?35,145,668?29,739,054
?????
Sub-total?20,200,002,348?15,818,450,369
?????
Less: Provision for bad and doubtful debts?319,321,830?304,687,117
?????
Total?19,880,680,518?15,513,763,252

The ageing is counted starting from the date when accounts receivable are recognized.

Page 56

(d) Accounts receivable by category

2018?2017
Book value?Provision for bad and doubtful debtsBook balance?Provision for bad and doubtful debts
CategoryAmount?Percentage (%)?Amount?Percentage (%)?Carrying amountsAmount?Percentage (%)?Amount?Percentage (%)Carrying amounts
????????????????????
Accounts receivables that are collectively assessed for impairment based on credit risk characteristics*20,149,872,554?100%?275,864,448?1%?19,874,008,106?15,767,136,659?100%?262,640,383?2%?15,504,496,276
????????????????????
Individually insignificant but assessed for impairment individually50,129,794?0%?43,457,382?87%?6,672,412?51,313,710?0%?42,046,734?82%?9,266,976
????????????????????
Total20,200,002,348?100%?319,321,830?2%?19,880,680,518?15,818,450,369?100%?304,687,117?2%?15,513,763,252

Note*: This category includes accounts receivable having been individually assessed but not impaired.

The Group has no individually significant accounts receivable and individually for impairment this year (2017: nil).

Page 57

(e) Additions and recoveries of provision for bad and doubtful debts during the year:

??2018?2017
?????
Balance at the beginning of the year?304,687,117?31,371,811
Charge during the year?5,005,871?284,705,046
Recoveries during the year?1,779,710?2,609,674
Write-offs during the year2,475,273?2,236,524
Translation differences?13,883,825?(6,543,542)
?????
Closing balance?319,321,830?304,687,117

For the year ended 31 December 2018, the Group had no individually significant write-off or recovery of doubtfuldebts which had been fully or substantially made in prior years (2017: nil).

(f) Five largest accounts receivable by debtor at the end of the year

The total of five largest accounts receivable of the Group at the end of the year was RMB 8,942,759,895, representing44% of the total accounts receivable, and no provision was made for bad and doubtful debts after assessment.

3 Prepayments

(1) The Group’s prepayments by category:

?

?

??2018?2017
?????
Prepayment for inventory?252,434,159?122,885,896
Others?518,199,289?464,240,855
?????
Total?770,633,448?587,126,751

Page 58

(2) The ageing analysis of prepayments is as follows:

?2018?2017
AgeingAmount?Percentage (%)?Amount?Percentage (%)
????????
Within 1 year (inclusive)721,657,321?94%?568,849,167?97%
1 to 2 years (inclusive)46,363,026?6%?17,188,654?3%
2 to 3 years (inclusive)2,035,569?-?606,393?-
Over 3 years577,532?-?482,537?-
????????
Total770,633,448?100%?587,126,751?100%

The ageing is counted starting from the date when prepayments are recognized.

As at 31 December 2018, the total of five largest prepayments of the Group is RMB 432,558,675, representing 56% of thetotal prepayments.

4 Other receivables

?

?

?Note2018?2017
?????
Interest receivable?140,597,317?89,628,559
Dividends receivable?3,711,768?-
Others(1)2,309,865,886?728,395,573
?????
Total?2,454,174,971?818,024,132

(1) Others

(a) The Group’s other receivable by customer type:

?

Customer type

Customer type?2018?2017
?????
Amounts due from related parties?12,148?27,591,317
Amounts due from other customers?2,310,194,250?701,313,513
?????
Sub-total?2,310,206,398?728,904,830
?????
Less: Provision for bad and doubtful debts?340,512?509,257
?????
Total?2,309,865,886?728,395,573

Page 59

(b) The Group’s other receivable by currency type:

?2018?2017
?Amount in original currency?Exchange rate?RMB / RMB equivalents?Amount in original currency?Exchange rate?RMB / RMB equivalents
????????????
RMB????2,278,359,260?????699,117,519
USD1,511,739?6.8632?10,375,364?2,742,109?6.5342?17,917,490
JPY35,383,000?0.0619?2,189,854?66,206,715?0.0579?3,833,367
Other foreign currencies????19,281,920?????8,036,454
????????????
Sub-total????2,310,206,398?????728,904,830
????????????
Less: Provision for bad and doubtful debts????340,512?????509,257
????????????
Total????2,309,865,886?????728,395,573

(c) The ageing analysis of the Group’s other receivables is as follows:

?

?

??2018?2017
?????
Within 1 year (inclusive)?2,015,309,595?454,457,340
1 to 2 years (inclusive)?29,027,513?37,230,582
2 to 3 years (inclusive)?28,652,382?2,335,586
Over 3 years?237,216,908?234,881,322
?????
Sub-total?2,310,206,398?728,904,830
?????
Less: Provision for bad and doubtful debts?340,512?509,257
?????
Total?2,309,865,886?728,395,573

The ageing is counted starting from the date when other receivable are recognized.

Page 60

(d) The Group’s other receivables by category

2018?2017
Book value?Provision for bad and doubtful debtsBook balance?Provision for bad and doubtful debts
CategoryAmount?Percentage (%)?Amount?Percentage (%)?Carrying amounts?Amount?Percentage (%)?Amount?Percentage (%)?Carrying amounts
????????????????????
Accounts receivables that are collectively assessed for impairment based on credit risk characteristics*2,309,865,886?100%?-?-?2,309,865,886?728,395,573?100%?-?-?728,395,573
????????????????????
Individually insignificant but assessed for impairment individually340,512?0%?340,512?100%?-?509,257?0%?509,257?100%?-
????????????????????
Total2,310,206,398?100%?340,512?0%?2,309,865,886?728,904,830?100%?509,257?0%?728,395,573

Note*: This category includes other receivables having been individually assessed but not impaired.

The Group has no individually significant other receivable and individually for impairment this year. As at 31 December 2018, the Group collectively assessed other receivable havingbeen individually assessed but not impaired for impairment and did not recognize impairment loss against this amount of other receivable (2017: nil).

Page 61

(e) Additions and recoveries of provision for bad and doubtful debts during the year

??2018?2017
?????
Balance at the beginning of the year?509,257?653,341
Charge during the year?1,273,563?111,166
Recoveries during the year?-?6,350
Write-offs during the year1,442,308?248,900
?????
Closing balance?340,512?509,257

(f) The Group’s other receivables categorised by nature

?

Nature of other receivables

Nature of other receivables?2018?2017
?????
VAT refunds?415,687,566?179,152,619
Amount due from equity transfer?200,000,000?200,000,000
Deposits?148,893,918?154,724,906
Wealth management receivables?1,408,094,816?-
Others?137,530,098?195,027,305
?????
Sub-total?2,310,206,398?728,904,830
?????
Less: Provision for bad and doubtful debts?340,512?509,257
?????
Total?2,309,865,886?728,395,573

Wealth management receivables included in other receivables, with principal and interest amounted to RMB1,408,094,816, was expired on 31 December 2018, and recovered on 2 January 2019.

(g) Five largest other receivables by debtor at the end of the year

The total of five largest other receivables of the Group at the end of the year was RMB 1,886,065,008, most of whichare export tax rebate receivables and receivables due from wealth management. No provision is made for bad anddoubtful debts after assessment.

Page 62

5 Inventories

(1) The Group’s inventories by category:

2018?2017
?Book value?Provision for impairment of inventories?Carrying amount?Book value?Provision for impairment of inventories?Carrying amount
????????????
Raw materials4,350,466,710?293,435,033?4,057,031,677?3,663,568,064?312,167,170?3,351,400,894
Work in progress1,442,498,808?150,867,947?1,291,630,861?1,442,250,856?130,466,876?1,311,783,980
Finished goods7,770,574,684?1,244,503,744?6,526,070,940?5,742,195,757?1,546,545,280?4,195,650,477
Consumables113,493,354?2,828,660?110,664,694?99,620,537?736,507?98,884,030
????????????
Total13,677,033,556?1,691,635,384?11,985,398,172?10,947,635,214?1,989,915,833?8,957,719,381

As at 31 December 2018, there was no amount of capitalised borrowing cost in the Group’s closing balance of inventories

(2017: nil).

As at 31 December 2018, the Group had no inventory used as collateral (2017: nil).

(2) Provision for impairment of inventories of the Group is analyzed as follows:

?

Reductions during the year
Balance at the beginning of the year?Charge during the year?Move Back?Transferred out?Balance at the end of the year
?????????
Raw materials312,167,170?307,794,313?95,981,437?230,545,013?293,435,033
Work in progress130,466,876?89,465,770?59,402,305?9,662,394?150,867,947
Finished goods1,546,545,280?1,621,997,256?664,032,716?1,260,006,076?1,244,503,744
Consumables736,507?2,760,542?642,836?25,553?2,828,660
????????
Total1,989,915,833?2,022,017,881?820,059,294?1,500,239,036?1,691,635,384

6 Other current assets

?

?

??2018?2017
?????
VAT on tax credits?4,841,165,133?4,847,422,522
Input tax to be verified or deducted?1,773,794,503?1,198,408,412
Income taxes prepaid?132,824,503?5,763,179
Wealth management product?5,534,413,566?9,791,137,808
Others?180,876,074?81,702,057
?????
Total?12,463,073,779?15,924,433,978

As at 31 December 2018, all of the wealth management products owned by the Group are due within one year.

Page 63

7 Available-for-sale financial assets

(1) Available-for-sale financial assets

2018?2017
ItemBook value?Provision for impairment?Carrying amount?Book value?Provision for impairment?Carrying amount
????????????
Available-for-sale debt instruments12,866,432?-?12,866,432?14,912,146?-?14,912,146
Available-for-sale equity instruments???????????
- Measured at fair value528,735,772?150,099,655?378,636,117?662,938,045?150,099,655?512,838,390
- Measured at cost377,015,762?34,495,952?342,519,810?332,328,820?180,000?332,148,820
????????????
Total918,617,966?184,595,607?734,022,359?1,010,179,011?150,279,655?859,899,356

(2) Available-for-sale financial assets at fair value at the end of the year:

?

Available-for-sale equity instruments?Available-for-sale debt instruments?Total
Cost of equity instruments / amortized cost of debt instruments555,793,175?12,565,172?568,358,347
Fair Values378,636,117?12,866,432?391,502,549
Accumulated fair value movements in other comprehensive income(27,057,403)?301,260?(26,756,143)
Provision for impairment(150,099,655)?-?(150,099,655)

Page 64

(3) Available-for-sale financial assets at cost at the end of the year

Book valueProvision for impairment
InvesteeBalance at the beginning of the year?Increase during the year?Reductions during the year?Translation differences?Balance at the end of the year?Balance at the beginning of the year?Increase during the yearTranslation differencesBalance at the end of the yearPercentage of shareholding in investees (%)
??????????????
Teralane Semiconductor Inc11,868,000?-?-?-?11,868,000?-?---7.29%
Zhejiang BOE Display Technology Co., Ltd.321,256?-?-?-?321,256?-?---7.03%
Zhejiang Qiusheng Photoelectric Technology Co., Ltd.248,776?-?-?-?248,776?-?---5.09%
National Engineering Laboratory of Digital Television (Beijing) Co., Ltd.6,250,000?-?-?-?6,250,000?-?---12.50%
Meta Company32,670,951?-?-?1,645,001?34,315,952?-?33,130,4521,185,50034,315,9525.66%
Danhua Capital, L. P.24,503,250?-?-?1,233,750?25,737,000?-?---5.48%
Danhua Capital II, L.P.34,304,550?26,419,000?-?2,761,050?63,484,600?-?---3.29%
Kateeva Inc.78,051,019?-?-?3,929,905?81,980,924?-?---3.00%
DEPICT INC.13,068,400?-?-?658,000?13,726,400?-?---22.20%
MOOV INC.26,244,971?-?-?1,321,446?27,566,417?-?---7.69%
ZGLUE INC.9,801,289?-?-?493,499?10,294,788?-?---6.00%
Fabord Ltd.910?-?910?-?-?-?----
Hefei Xin Jing Yuan Electronic Materials Co., Ltd.3,000,000?-?3,000,000?-?-?-?----
Nanosys INC49,006,500?-?-?2,467,500?51,474,000?-?---3.14%
Ceribell INC8,494,453?-?-?427,699?8,922,152?-?---2.05%
Baebies INC28,709,230?-?-?1,445,523?30,154,753?-?---9.05%
Illumina Fund I,L.P.5,605,265?4,433,785?-?451,694?10,490,744?-?---2.14%
Others180,000?-?-?-?180,000?180,000?--180,000
??????????????
Total332,328,820?30,852,785?3,000,910?16,835,067?377,015,762?180,000?33,130,4521,185,50034,495,952?

Page 65

8 Long-term equity investments

(1) The Group’s long-term equity investments by category:

??2018?2017
?????
Investments in joint ventures?-?2,793,732,185
Investments in associates?2,926,303,858?4,672,259,202
?????
Sub-total?2,926,303,858?7,465,991,387
?????
Less: Provision for impairment?537,136,972?537,136,972
- Associates?537,136,972?537,136,972
?????
Total?2,389,166,886?6,928,854,415

Page 66

(2) Movements of long-term equity investments during the year are as follows:

InvesteeBalance at the beginning of the year?Newly added investments during the year?Investment income recognized under equity method?Other comprehensive income?Other changes in equity?Translation differences of foreign currency financial statements?Cash dividends or profit declared?Acquired as subsidiaries during the year?Balance at the end of the year
??????????????????
Joint ventures?????????????????
Wuhan BOE Optoelectronics Technology Co., Ltd.91,590,309?1,140,000,000?(729,793)?-?-?-?-?(1,230,860,516)?-
Mianyang BOE Optoelectronics Technology Co., Ltd.2,698,378,093?2,400,000,000?(1,398,010)?-?-?-?-?(5,096,980,083)?-
Beijing BOE Yiyun Science &Technology Co., Ltd.3,763,783?-?(3,763,783)?-?-?-?-?-?-
??????????????????
Sub-total2,793,732,185?3,540,000,000?(5,891,586)?-?-?-?-?(6,327,840,599)?-
??????????????????
Associates?????????????????
Beijing Nissin Electronics Precision Component Co., Ltd.-?-?(1,886,109)?-?2,424,598?-?-?-?538,489
Beijing Nittan Electronic Co., Ltd.53,786,835?-?10,946,250?-?-?-?(3,000,000)?-?61,733,085
Erdos BOE Energy Investment Co., Ltd.907,458,312?-?-?-?-?-?-?-?907,458,312
Beijing Infi-Hailin Venture Investment Co., Ltd.373,361?-?62,467?-?-?-?-?-?435,828
Beijing Infi-Hailin Venture Investment (Limited Partnership)137,448,451?-?22,591,316?(47,702,834)?-?-?(30,000,000)?-?82,336,933
TPV Display Technology (China) Limited27,190,533?-?(4,189,174)?-?-?-?-?-?23,001,359
Beijing Xindongneng Investment Fund (Limited Partnership)1,472,249,231?150,000,000?(11,778,573)?(155,295,781)?-?-?-?-?1,455,174,877
Beijing Xindongneng Investment Management Co., Ltd.4,861,735?-?2,327,127?-?-?-?(2,000,000)?-?5,188,862
Shenzhen Yunyinggu Technology Co., Ltd.35,483,897?-?(20,002,391)?-?-?-?-?-?15,481,506
Beijing Xloong Technologies Co.,Ltd.23,981,997?-?(1,372,786)?-?-?-?-?-?22,609,211
New on Technology Co.Ltd.3,708,174?-?(512,473)?-?-?(10,207)?-?-?3,185,494
Chongqing BOE Display Technology Co., Ltd.3,846,000?192,300,000?(2,808,246)?219,616?-?-?-?(193,557,370)?-
Beijing Zhonglianhe Ultra HD Collaborative Technology Center Co., Ltd.-?3,000,000?-?-?-?-?-?-?3,000,000
SES Imagotag SA Co.Ltd.1,675,160,676?11,715,900?(1,411,455)?-?-?255,418?-?(1,685,720,539)?-
Cnoga Medical Co.Ltd.326,710,000?-?-?-?-?16,450,000?-?-?343,160,000
Hefei Xin Jing Yuan Electronic Materials Co., Ltd.-?3,000,000?(98)?-?-?-?-?-?2,999,902
??????????????????
Sub-total4,672,259,202?360,015,900?(8,034,145)?(202,778,999)?2,424,598?16,695,211?(35,000,000)?(1,879,277,909)?2,926,303,858
?
??????????????????
Total7,465,991,387?3,900,015,900?(13,925,731)?(202,778,999)?2,424,598?16,695,211?(35,000,000)?(8,207,118,508)?2,926,303,858
??????????????????
Less: Provision for impairment537,136,972???????????????537,136,972
??????????????????
Total6,928,854,415???????????????2,389,166,886

Page 67

9 Investment properties

??Land use rights?Buildings?Total
???????
Cost??????
Balance at the beginning of the year?675,597,667?991,566,471?1,667,164,138
Additions during the year?11,837,010?20,592,374?32,429,384
???????
Closing balance?687,434,677?1,012,158,845?1,699,593,522
???????
Less: Accumulated depreciation or amortization??????
Balance at the beginning of the year?112,407,496?258,094,437?370,501,933
Additions during the year?14,742,206?30,481,732?45,223,938
???????
Closing balance?127,149,702?288,576,169?415,725,871
?
???????
Carrying amounts?
At the end of the year?560,284,975?723,582,676?1,283,867,651
???????
At the beginning of the year?563,190,171?733,472,034?1,296,662,205

Page 68

10 Fixed assets

(1) Analysis of the Group’s fixed assets are as follows:

ItemPlant & buildings?Equipment?Others?Total
Cost???????
Balance at the beginning of the year26,638,824,007?111,488,454,005?2,106,778,047?140,234,056,059
Additions during the year???????
- Additions due to business combinations involving entities not under common control8,369,526?554,286,212?11,779,221?574,434,959
- Purchases22,048,907?490,646,142?620,686,368?1,133,381,417
- Transfer from construction in progress10,080,982,077?47,301,257,740?613,774,548?57,996,014,365
Disposals or written-offs during the year(663,844)?(377,332,712)?(102,605,476)?(480,602,032)
Other decreases-?(6,520,201,883)?-?(6,520,201,883)
Translation differences133,616?22,051,939?3,112,610?25,298,165
????????
Closing balance36,749,694,289?152,959,161,443?3,253,525,318?192,962,381,050
????????
Less: Accumulated depreciation???????
Balance at the beginning of the year3,366,248,795?46,632,776,416?936,024,333?50,935,049,544
Charge during the year921,469,231?11,998,277,652?620,991,543?13,540,738,426
Disposals or written-offs during the year(559,484)?(242,112,475)?(98,034,828)?(340,706,787)
Translation differences43,483?13,925,120?2,737,927?16,706,530
????????
Closing balance4,287,202,025?58,402,866,713?1,461,718,975?64,151,787,713
????????
Less: Provision for impairment???????
Balance at the beginning of the year1,085,094?663,639,306?8,985,354?673,709,754
Disposals or written-offs during the year-?(19,001,242)?(1,846,170)?(20,847,412)
????????
Balance at the end of the year1,085,094?644,638,064?7,139,184?652,862,342
????????
????????
Carrying amounts???????
At the end of the year32,461,407,170?93,911,656,666?1,784,667,159?128,157,730,995
????????
At the beginning of the year23,271,490,118?64,192,038,283?1,161,768,360?88,625,296,761

On January 16, 2018, the Company signed a debt examption agreement with Fuzhou Municipal People's Government,Fuzhou Chengtou BOE Investment Co., Ltd. and Fuzhou Construction & Investment Group Co., Ltd. for the investmentframework agreement of Fuzhou 8.5th new semiconductor display device production line project. The loan exempted for theconstruction of Fuzhou's 8.5th generation new semiconductor display device production line project totaled RMB 6.3 billion.In accordance with the accounting policies set out in note III 25, the group has simultaneously reduced the total book value oflong-term loans and related fixed assets by RMB 6.3 billion in the consolidated financial statements.

Page 69

(2) Fixed assets acquired under finance leases

?2018?2017
ItemOriginal book value?Accumulated depreciationProvision for impairment?Carrying amount?Original book valueAccumulated depreciation?Provision for impairment?Carrying amount
??????????????
Plant & buildings11,291,665?4,357,005-?6,934,660?11,291,6654,103,316?-?7,188,349
Equipment111,358,1454,815,787-?106,542,358----
Total122,649,8109,172,792-113,477,01811,291,6654,103,316-7,188,349

The Group’s fixed assets under finance leases represented a youth apartment under finance lease for the Company, which isused for the purposes of the staff dormitory and machinery and equipment under finance leases.

(3) Fixed assets pending certificates of ownership

On 31 December 2018, fixed assets pending certificates of ownership totalled RMB 12,554,907,996 and certificates ofownership is still being processed.

11 Construction in progress

(1) Construction in progress

(a) Analysis of the Group’s construction in progress is as follows:

?

?

?2018?2017
ItemBook value?Provision for impairment?Carrying amount?Book value?Provision for impairment?Carrying amount
????????????
The 6th generation AMOLED project23,065,639,272?-?23,065,639,272?-?-?-
The 6th generation LTPS / AMOLED project15,759,483,392?-?15,759,483,392?19,099,729,823?-?19,099,729,823
The 10.5th generation TFT-LCD project5,599,769,733?-?5,599,769,733?19,778,218,499?-?19,778,218,499
Others11,998,462,490?-?11,998,462,490?11,883,302,104?-?11,883,302,104
????????????
Total56,423,354,887?-?56,423,354,887?50,761,250,426?-?50,761,250,426

Page 70

(b) Movements of major construction in progress during the year

ItemBudget?Balance at the beginning of the year?Additions due to business combinations involving entities not under common controlIncrease during the yearTransfer to fixed assets during the year?Transfer to Intangible assets during the year?Balance at the end of the year?Percentage of actual cost to budget (%)?Accumulated capitalized interest at the end of the year?Interest capitalized in 2018?Percentage of interest capitalized in 2018 (%)?Sources of funding
The 6th generation AMOLED project44,500,000,000?-?2,389,530,479?21,094,477,912(418,369,119)?-?23,065,639,272?57.08%?56,276,871?56,276,871?3.88%??Self-raised funds and borrowings
The 6th generation LTPS / AMOLED project44,800,000,000?19,099,729,823?-?12,724,032,041(16,059,831,316)?(4,447,156)?15,759,483,392?71.53%?382,974,096?582,748,988?4.68%??Self-raised funds and borrowings
The 10.5th generation TFT-LCD project42,937,000,000?19,778,218,499?-?15,109,135,590(29,283,568,179)?(4,016,177)?5,599,769,733?82.86%?-?424,792,676?5.06%??Self-raised funds and borrowings

Page 71

12 Intangible assets

(1) Intangible assets

Land use rights?Patent and proprietary technology?Computer software?Others?Total
Original book value?????????
Balance at the beginning of the year1,822,280,424?1,744,517,311776,387,468343,837,1594,687,022,362
Additions during the year
- Additions due to business combinations involving entities not under common control589,657,038?1,347,085,49728,569840,703,0622,777,474,166
- Minority shareholder's rights-200,000,000--200,000,000
- Purchases236,594,905?-68,627,73742,184,921347,407,563
- Transfer from construction in progress37,170,534?-60,291,004-97,461,538
Interest subsidies from policy-related preferential loans-?(973,500)--(973,500)
Disposals during the year-?-(2,963,479)(96,525)(3,060,004)
???
Balance at the end of the year2,685,702,901?3,290,629,308902,371,2991,226,628,6178,105,332,125
?
Less: Accumulated amortisation??
Balance at the beginning of the year178,337,1191,024,064,866443,322,42958,633,6401,704,358,054
Charge during the year50,136,183261,569,80693,961,09859,406,685465,073,772
Disposals during the year--(1,729,224)(49,871)(1,779,095)
Balance at the end of the year228,473,3021,285,634,672535,554,303117,990,4542,167,652,731
Carrying amounts
At the end of the year2,457,229,5992,004,994,636366,816,9961,108,638,1635,937,679,394
?
At the beginning of the year1,643,943,305720,452,445333,065,039285,203,5192,982,664,308

(2) Land use rights pending certificates of ownership

As at 31 December 2018, the company has land use rights pending certificates of ownership RMB 121,648,077 in total,which have been obtained on February 26 2019.

Page 72

13 Goodwill

(1) Changes in goodwill

Name of investeeNoteBalance at the beginning of the year?Additions during the year?Balance at the end of the year
??????
Original book value?????
Beijing Yinghe Century Co., Ltd.42,940,434?-?42,940,434
K-Tronics (Suzhou) technology Co., Ltd.8,562,464?-?8,562,464
Beijing BOE Optoelectronics Technology Co., Ltd.4,423,876?-?4,423,876
BOE Healthcare Investment & Management Co., Ltd.146,460,790?-?146,460,790
SES Imagotag SA Co.Ltd.(a)-?706,406,821?706,406,821
??????
Sub-total202,387,564?706,406,821?908,794,385
??????
Provision for impairment4,423,876?-?4,423,876
??????
Carrying amounts197,963,688?706,406,821?904,370,509

(a) As at 6 February 2018, the Group achieving actual control of SES Imagotag SA Co. Ltd (SES). The excess of

the combination cost over the Group’s interest in the fair value of SES’s identifiable assets and liabilities,amounting to RMB 706,406,821, was recognized as goodwill attributable to SES.(2) Provision for impairment of goodwill

The recoverable amount of Yinghe Century, Suzhou K-Tronics, Health Investment and SES is determined based on thepresent value of expected future cash flows. The present value of expected future cash flows was projected based on the mostrecent approved five-year financial budgets of the management and a pre-tax discount rate of 8.44%、6.62%、6.80% and23.01% respectively. The cash flows beyond the five-year budget period were assumed to keep stable. The key assumptionsadopted in the forecasting may change. If management consider the key assumption will have negative changes, the bookvalue of the relevant asset group will exceed the recoverable amount.

14 Long-term deferred expenses

??

?Balance at the beginning of the year?Additions during the year?Reductions during the year?Balance at the end of the year
????????
Payment for public facilities construction and use113,443,013?-?(15,370,224)?98,072,789
Cost of operating lease assets improvement18,931,332?13,630,236?(12,210,115)?20,351,453
Others247,455,085?109,089,264?(114,327,738)?242,216,611
????????
Total379,829,430?122,719,500?(141,908,077)?360,640,853

Page 73

15 Deferred tax assets / deferred tax liabilities

(1) Deferred tax assets and liabilities

?2018?2017
ItemDeductible/ (taxable) temporary differences?Deferred tax assets / (liabilities)?Deductible/ (taxable) temporary differences?Deferred tax assets / (liabilities)
????????
Deferred tax assets:???????
Provisions for impairment losses of assets391,727,136?69,662,802?404,563,258?72,783,228
Depreciation of fixed assets125,811,735?22,699,045?79,460,328?11,970,733
Assessed value added by investing real estate ini subsidiaries142,110,808?35,527,702?147,664,660?36,916,165
Accumulated losses230,110,593?67,447,589?48,749,683?8,043,698
Advances from customers290,000,00043,500,000--
Others219,548,492?42,572,983?34,900,387?8,725,096
????????
Sub-total1,399,308,764?281,410,121?715,338,316?138,438,920
????????
Amount offset??(29,036,499)???(32,183,263)
????????
Balance after offset??252,373,622???106,255,657
????????
Deferred tax liabilities:???????
Revaluation due to business combinations involving entities not under common control(2,777,250,385)?(835,036,150)?(1,099,980,193)?(272,308,392)
Depreciation of fixed assets(3,248,856,623)?(517,769,740)?(1,246,406,521)?(213,674,259)
Changes in fair value of available-for-sale financial assets(53,218,430)(8,058,902)(145,163,930)(25,783,777)
Long-term equity investments(360,863,027)?(54,129,454)?(360,863,027)?(54,129,454)
Bond interest(71,525,943)?(10,728,891)?(71,532,514)?(10,729,877)
Others(223,118,577)?(22,686,907)?(204,034,820)?(18,860,414)
????????
Sub-total(6,734,832,985)?(1,448,410,044)?(3,127,981,005)?(595,486,173)
Amount offset??29,036,499???32,183,263
Balance after offset??(1,419,373,545)???(563,302,910)

Page 74

(2) Details of unrecognized deferred tax assets

??2018?2017
?????
Deductible temporary differences?9,073,884,112?7,974,238,271
Deductible losses?6,752,930,780?1,888,693,158
?????
Total?15,826,814,892?9,862,931,429

As at 31 December 2018, the deductible temporary differences are mainly provisions for the subsidiaries’ impairment ofassets. Due to the uncertainty that there will be sufficient taxable income to cover these deductible differences in futureperiods, the deferred income tax assets were not recognized in consideration of prudence.

(3) Expiration of deductible tax losses for unrecognized deferred tax assets:

?

Year

YearNote?2018?2017
?????
2018?-?45,598,745
2019?38,076,038?47,515,768
2020?59,149,932?130,498,173
2021?52,190,671?73,876,573
2022?528,642,251?524,338,212
2023669,677,50667,648,332
2024125,649,689125,649,689
2025512,243,532512,977,493
2026233,283,462233,283,463
2027133,672,001127,306,710
2028?4,296,683,816?-
?Others(a)?103,661,882?-
Total?6,752,930,780?1,888,693,158

According to the Notice of the Ministry of Finance and the State Administration of Taxation on Extending the LossCarry-over Period of High-Tech Enterprises and High-Tech SMEs (Cai Shui [2018] No. 76), qualified enterprises in 2018,regardless of whether they are qualified from 2013 to 2017, the losses that have not been remedied from 2013 to 2017 are allallowed to be repaid after the carry-over, and the longest carry-over period is 10 years. In order to facilitate the correspondingcomparison, comparative figures in 2017 are restated.

(a) According to the applicable local tax laws, Loss of some overseas subsidiaries of the

Group has indefinite carry-over period to deduct the future taxable income.

Page 75

16 Other non-current assets

??2018?2017
?????
Deferred VAT for imported equipment?3,187,164,914?1,401,435,788
Prepayment for fixed assets?2,896,176,554?2,062,240,060
VAT on tax credits?1,488,605,413?321,022,343
Prepayment for projects?155,970,966?289,231,537
Others?165,084,206?115,837,526
?????
Total?7,893,002,053?4,189,767,254

17 Short-term loans

??

?2018
?????RMB /?Credited /collateralised
?Amount in original currency?Exchange rate?RMB equivalents?guaranteed /pledged
????????
Bank loans???????
- RMB????110,033,961?Pledged
- RMB????1,399,800,000?Credited
????????
Sub-total????1,509,833,961??
????????
Foreign currency bank loans???????
- USD314,573,510?6.8632?2,158,980,914?Pledged
- USD47,369,984?6.8632?325,109,671?Collateralised
- USD139,129,343?6.8632?954,872,507?Credited
- JPY313,000,000?0.0619?19,370,631?Collateralised
- JPY7,784,950,000?0.0619?481,787,201?Credited?
????????
Sub-total???3,940,120,924??
?
????????
Total???5,449,954,885??

Page 76

?2017
?????RMB /?Credited /collateralised
?Amount in original currency?Exchange rate?RMB equivalents?guaranteed /pledged
????????
Bank loans???????
- RMB????350,578,748?Pledged
- RMB????418,499,999?Credited
????????
Sub-total????769,078,747??
????????
Foreign currency bank loans???????
- USD161,181,026?6.5342?1,053,189,061?Pledged
- USD53,679,291?6.5342?350,751,222?Credited
- EUR138,000,000?7.8023?1,076,717,400?Pledged
????????
Sub-total????2,480,657,683??
?
????????
Total????3,249,736,430??

The interest rate of short-term loans for the Group ranged from 1.28% to 4.95% in 2018 (2017: 0.35% to 5.20%).

As at 31 December 2018, no short-term loan was past due (2017: nil).

18 Bills payable and accounts payable

??

?Note2018?2017
?????
Bills payable(1)591,109,272?543,798,835
Accounts payable(2)22,213,956,616?16,205,788,698
?????
Total?22,805,065,888?16,749,587,533

(1) Bills payable

?

?

??2018?2017
?????
Bank acceptance bills?326,575,254?481,852,311
Commercial acceptance bills?264,534,018?61,946,524
?????
Total?591,109,272?543,798,835

There is no due but unpaid bill payable at the end of the year. The above bills are all due within one year.

(2) Accounts payable

(a) The Group’s accounts payable by category are as follows:

Page 77

??2018?2017
?????
Payables to related parties?30,361,810?14,532,494
Payables to third parties?22,183,594,806?16,191,256,204
?????
Total?22,213,956,616?16,205,788,698

(b) The Group’s accounts payable by currency are as follows:

??

?2018?2017
?Amount in original currency?Exchange rate?RMB / RMB equivalents?Amount in original currency?Exchange rate?RMB / RMB equivalents
????????????
- RMB????14,305,998,594?????11,174,717,229
- USD959,572,576?6.8632?6,585,738,505?658,301,225?6.5342?4,301,456,276
- JPY13,279,275,766?0.0619?821,987,170?11,718,379,068?0.0579?678,364,509
- Other foreign currencies????500,232,347?????51,250,684
????????????
Total????22,213,956,616?????16,205,788,698

As at 31 December 2018, the Group had no individually significant accounts payable ageing more than one year.

Page 78

19 Advances from customers

Item?2018?2017
?????
Advances from related parties?1,111?141,921
Advances from third parties?1,218,933,632?781,182,601
?????
Total?1,218,934,743?781,324,522

As at 31 December 2018, the Group had no individually significant advances from customers ageing more than one year.20 Employee benefits payable

(1) Employee benefits payable:

??

?NoteBalance as of January 1 2018?Increase during the year?Reductions during the year?Balance as of December 31 2018
?????????
Short-term employee benefits(2)2,167,235,414?10,681,611,152?10,673,038,901?2,175,807,665
Post-employment benefits????????
- defined contribution plans(3)34,854,644?860,558,928?861,059,727?34,353,845
Termination benefits?14,976,886?6,091,402?6,298,627?14,769,661
?????????
Total?2,217,066,944?11,548,261,482?11,540,397,255?2,224,931,171

??

?NoteBalance as of January 1 2017?Increase during the year?Reductions during the year?Balance as of December 31 2017
?????????
Short-term employee benefits(2)1,497,068,752?9,211,333,761?8,541,167,099?2,167,235,414
Post-employment benefits????????
- defined contribution plans(3)30,746,554?707,946,622?703,838,532?34,854,644
Termination benefits?15,036,960?5,497,883?5,557,957?14,976,886
?????????
Total?1,542,852,266?9,924,778,266?9,250,563,588?2,217,066,944

(2) Short-term employee benefits

??

?Balance as of January 1 2018?Increase during the year?Reductions during the year?Balance as of December 31 2018
????????
Salaries, bonuses and allowances1,840,923,550?8,737,680,189?8,760,657,228?1,817,946,511
Staff welfare-?776,550,030?776,550,030?-
Social insurance33,561,796?436,106,436?438,357,908?31,310,324
Medical insurance30,110,821?384,231,011?387,191,648?27,150,184
Work-related injury insurance1,419,661?31,115,109?30,485,856?2,048,914
Maternity insurance2,031,314?20,760,316?20,680,404?2,111,226
Housing fund17,201,305?430,417,142?425,536,787?22,081,660
Labour union fee, staff and workers’ education fee246,372,990?242,263,166?214,158,506?274,477,650
Staff bonus and welfare fund7,282,591?-?-?7,282,591
Other short-term employee benefits21,893,182?58,594,189?57,778,442?22,708,929
????????
Total2,167,235,414?10,681,611,152?10,673,038,901?2,175,807,665

Page 79

?
?Balance as of January 1 2017?Increase during the year?Reductions during the year?Balance as of December 31 2017
????????
Salaries, bonuses and allowances1,178,080,434?7,500,609,836?6,837,766,720?1,840,923,550
Staff welfare-?742,718,924?742,718,924?-
Social insurance66,779,153?357,701,317?390,918,674?33,561,796
Medical insurance63,337,669?310,634,444?343,861,292?30,110,821
Work-related injury insurance1,631,421?26,846,859?27,058,619?1,419,661
Maternity insurance1,810,063?20,220,014?19,998,763?2,031,314
Housing fund20,607,756?339,557,027?342,963,478?17,201,305
Labour union fee, staff and workers’ education fee214,936,641?186,435,492?154,999,143?246,372,990
Staff bonus and welfare fund7,282,591?-?-?7,282,591
Other short-term employee benefits9,382,177?84,311,165?71,800,160?21,893,182
????????
Total1,497,068,752?9,211,333,761?8,541,167,099?2,167,235,414

(3) Post-employment benefits - defined contribution plans

??

?Balance as of January 1 2018?Increase during the year?Reductions during the year?Balance as of December 31 2018
????????
Basic pension insurance28,831,475?815,071,236?814,696,438?29,206,273
Unemployment insurance1,155,250?25,252,494?25,442,851?964,893
Annuity4,867,919?20,235,198?20,920,438?4,182,679
????????
Total34,854,644?860,558,928?861,059,727?34,353,845
?
?Balance as of January 1 2017?Increase during the year?Reductions during the year?Balance as of December 31 2017
????????
Basic pension insurance24,629,016?664,045,399?659,842,940?28,831,475
Unemployment insurance1,219,162?26,548,521?26,612,433?1,155,250
Annuity4,898,376?17,352,702?17,383,159?4,867,919
????????
Total30,746,554?707,946,622?703,838,532?34,854,644

21 Taxes payable

?

?

??2018?2017
?????
Value-added tax?112,292,699?7,384,437
Corporate income tax?387,053,187?501,685,626
Individual income tax?39,659,862?41,968,486
City construction tax?205,222,860?84,932,308
Education surcharges and local education surcharges?148,544,558?61,375,167
Others?77,335,132?78,275,122
?????
Total?970,108,298?775,621,146

Page 80

22 Other payables

?

?

?Note2018?2017
?????
Interest payable?1,016,761,921?847,955,186
Dividends payable(1)23,648,778?9,651,170
Others(2)21,916,569,129?15,264,806,774
?????
Total?22,956,979,828?16,122,413,130

(1) Dividends payable

Dividends not paid this year were mainly due to dividends not yet available to non-tradable shareholders and cash dividendsof non-controlling shareholders who have not paid individual subsidiaries.

(2) Others

(a) The Group’s other payables by category are as follows:

?

?

??2018?2017
?????
Projects and equipment?18,042,357,713?12,772,388,210
Deferred VAT for imported equipment?1,400,000,000?675,815,849
Accrued water and electricity charges and freight?606,071,394?430,803,905
Deposits?440,792,988?380,789,096
External agency fee?53,393,714?34,108,132
Others?1,373,953,320?970,901,582
?????
Total?21,916,569,129?15,264,806,774

The Group’s significant other payables aged over one year are payables of projects and equipment.

(b) The Group’s other payables by currency are as follows:

??

?2018?2017
?Amount in original currency?Exchange rate?RMB / RMB equivalents?Amount in original currency?Exchange rate?RMB / RMB equivalents
????????????
RMB????15,064,792,480?????10,281,873,020
USD724,117,103?6.8632?4,969,760,500?574,115,354?6.5342?3,751,384,540
JPY29,183,294,045?0.0619?1,806,445,901?20,695,199,824?0.0579?1,198,039,317
Other foreign currencies????75,570,248?????33,509,897
????????????
Total????21,916,569,129?????15,264,806,774

Page 81

23 Non-current liabilities due within one year

As at 31 December, the non-current liabilities due within one year for the Group were long-term loans and long-termpayables due within one year.

??

?2018
?????RMB /?Credited /collateralised
?Amount in original currency?Exchange rate?RMB equivalents?guaranteed /pledged
Bank loans???????
- RMB????37,743,750?Pledged
- RMB????1,702,180,000?Collateralised
- RMB????990,000,000?Credited
- USD378,624,409?6.8632?2,598,575,044?Collateralised
- EUR3,694,2627.847328,989,985?Credited
- EUR3,950,000?7.8473?30,996,836Pledged
Long-term payables???209,077,589?Collateralised?
????????
Total????5,597,563,204??

??

?2017
?????RMB /?Credited /collateralised
?Amount in original currency?Exchange rate?RMB equivalents?guaranteed /pledged
Bank loans???????
- RMB????2,725,000,000?Credited
- RMB????915,745,064?Collateralised
- RMB????1,000,000?Pledged
- USD200,000,000?6.5342?1,306,840,000?Credited
- USD609,380,700?6.5342?3,981,815,370?Collateralised
Long-term payables????179,308,077?Collateralised
????????
Total????9,109,708,511??

The interest rate of RMB long-term loans due within one year for the Group ranged from 0% to 5.88% in 2018 (2017: from0% to 5.64%).

24 Other current liabilities

The other current liabilities of the Group were warranty provision. The warranty provision mainly relates to the expectedafter-sales repair warranty to the customers. The provision is estimated by the Management, based on historical claimexperience and current actual sales outcomes.

Page 82

25 Long-term loans

?2018
?????RMB /?Credited /collateralised
?Amount in original currency?Exchange rate?RMB equivalents?guaranteed /pledged
Bank loans???????
- RMB????640,180,000?Pledged
- RMB????32,190,024,533?Collateralised
- RMB????660,000,000?Guaranteed
- RMB????27,697,000,000?Credited
- USD5,422,274,409?6.8632?37,214,153,724?Collateralised
- EUR7,172,652?7.8473?56,285,953?Credited
- EUR218,025,000?7.8473?1,710,919,269?Pledged
Less: Long-term loans due within one year????5,388,485,615??
????????
Total???94,780,077,864??

??

?2017
?????RMB /?Credited /collateralised
?Amount in original currency?Exchange rate?RMB equivalents?guaranteed /pledged
Bank loans???????
- RMB????26,676,070,000?Credited
- RMB????18,725,264,133?Collateralised
- RMB????508,585,000?Pledged
- USD308,062,697?6.5342?2,012,943,277?Credited
- USD5,950,391,285?6.5342?38,881,046,734?Collateralised
- EUR141,000,000?7.8023?1,100,124,300?Pledged
Less: Long-term loans due within one year????8,930,400,434??
????????
Total????78,973,633,010??

The interest rate of RMB long-term loans for the Group ranged from 0% to 5.88% in 2018 (2017: from 0% to 6.60%).

26 Bonds payable

(1) Bonds payable

?

Item

Item2018?2017
????
Debentures payable10,288,666,233?9,966,467,496
Less: Bonds payable due within one year-?-
????
Total10,288,666,233?9,966,467,496

Page 83

(2) Increase and decrease of bonds payable:

From 21 March 2016 to 22 March 2016, with the Approval document No. 469 [2016] of CSRC, the Group successfully issued a corporate bond of RMB 10 billion to qualified investors viaShenzhen Stock Exchange. The full name of the bond was Corporate Bond Issued Publicly by BOE Technology Group Co., Ltd. to Qualified Investors in 2016 (the First Phase), whichreferred to as 16BOE01.

The total amount of the bond in the current period is RMB 10 billion issued at a par value of RMB 100, with a maturity of 5 years from 21 March 2016 to 21 March 2021. Interest starts toaccrue on 21 March 2016 and the interest payments are made annually. The company will pay out the last interest payment with the principle amount of the bond when it becomes mature.The coupon rate is 3.15% which is fixed in the first 3 years, after which the company has a right to raise the rate and so are the investors to sell back the bond to the company. On 30 January2019, the company has decided that the coupon rate remains unchanged and the investors may exercise the put option considering the market environment at the time. A number of96,705,976